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Mindray Medical International Limited (



Q4 2011 Earnings Call

February 28, 2012 8:00 AM ET


Cathy Gao – Manager, IR

Jie Liu – COO

Alex Lung – CFO

David Gibson – President, Mindray DS USA Inc.


Jin Song Du – Credit Suisse

Ingrid Yin – Oppenheimer

Sean Wu – JP Morgan

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Good morning, everyone. Thank you for standing by, and welcome to Mindray’s Fourth Quarter 2011 Earnings Conference Call. At this time, all participants are in a listen-only mode. After management’s prepared remarks, we will conduct a question-and-answer session. Today’s conference is being recorded for relay purposes. If you have any objections, you may disconnect at this time.

I would now like to turn the call over to your host for today’s conference, Ms. Cathy Gao, Mindray’s Manager of Investor Relations. Please proceed, Ms. Gao.

Cathy Gao

Thank you. Hello, everyone. Welcome to Mindray’s 2011 fourth quarter and full year earnings call. We released our financial results last night and they are now available on the company’s website on Newswire services. There will also be an archived webcast of this conference call on our Investor Relations website.

Joining today’s call are Mr. Xu Hang, our Chairman and Co-CEO; Mr. Li Xiting, our President and Co-CEO; Mr. Alex Lung, our Chief Financial Officer; Mr. Jie Liu, our Chief Operating Officer; Mr. Minghe Cheng, our Chief Strategic Officer; Mr. David Gibson, our President of North America Operations; and Ms. May Li, our Deputy Chief Financial Officer.

In a moment, Mr. Jie Liu will provide an update of the company’s operational performance. Mr. Alex Lung will review the detailed financial results as well as the company’s outlook for 2012. Mr. David Gibson will discuss Mindray’s operations in the North America region. After that, they will be happy to take your questions.

Before we continue, please note that this call will contain forward-looking statements made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. Statements made and the views expressed here, which are not historical facts are forward-looking statements. You should be cautioned that forward-looking statements are only predictions and may involve inherent risks and uncertainties.

As such our actual results may be materially different from the statements made and views expressed here today due to a variety of factors. A number of such risks and uncertainties and factors are outlined in our public filings with the SEC.

In particular, please refer to risk factors beginning on page four of our Annual Report on Form 20-F. Any projections made here today are based only on limited information currently available to us and are subject to change.

Mindray does not undertake any obligations to update any forward-looking statements except as required under applicable law.

I will now turn the call over to Mindray’s COO, Mr. Jie Liu.

Jie Liu

Thank you, Cathy. Good morning and good evening, ladies and gentlemen. Thank you for joining us today. In 2011, we celebrated the company’s 20th Anniversary with great achievements evolved from overall we achieved strong year-over-year revenue growth of 25% yen at US$880.7 million, by exceeding the sales target of at less 16% and we set out as of end of the year. Last year China and the emerging market remained the key growth drivers for our company with each achieving over 25% year-over-year growth. We also delivered high teens year-over-year growth in developed markets both in West Europe and in North American market.

Operationally, we focused on bringing sales and the service coverage to the next level. In domestic China, we continued our strategic sales reinforcement program to strength our distribution network on the developed or strategic countries. We’ve also invested in adding drug servicing care count to bid on relationships with the key hospital clients and also customer loyalty.

Based on highly demanded survey conducted by four independent third party on 2011 service quality performance succession among all medical device players in China also with quality satisfaction was ranked number one in general. In addition, the emerging markets we continued to build up the service and sales in the service platform in key countries. We also expanded to the key accounting and increased our presence in public sector. In developed markets, we gained wider market acceptance in the US with a few for our new product introductions and continued to gain market shares in West Europe.

We also put in place a new CRM system to improve sales service efficiency in key regions including China and the emerging markets. On the R&D and the product development front, we accelerated our product upgrades and the portfolio expansion. As a result, we exceeded our product development target and launched 13 new products into the market. We also made four acquisitions in China last year, which further strengths our company technology and the product offering including acquired products monitored to the number of marketed products have now exceeded 100.

I’ll now turn the call to Alex for financial details as well as some fourth quarter and the full year highlights.

Alex Lung

Thanks, Jie. In the fourth quarter, we have achieved a 25.2% year-over-year increase on the top line for a total of $264.1 million, leading our growth was China revenues, which increased 30.9% year0-over-year, primarily driven by our strong record of sales that made up more than 90% of China sales in the fourth quarter.

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