China Health Labs & Diagnostics Ltd. provides update on rural lab installations

    




 TSX-V: CHO OTCQX: CHLBF 

 www.chinahealthlabs.com 

 TORONTO, March 15, 2012 /CNW/ - China Health Labs & Diagnostics Ltd.  ("China Health" or the "Company") , is pleased  to announce that it now has 906 BK Clinlabs installed or contracted for  installation in eight provinces of China.  In addition, it has  delivered 63 Rural Mobile Labs to the Health Care Bureau in Xinjiang  Uygur Autonomous Region. As previously announced, China Health  increased its installed base of BK Clinlabs to 833 in five provinces of  China at the end of 2011, compared to 210 labs in three provinces at  the start of 2011 (see press release dated February 21, 2012).  The  additional 73 BK Clinlabs and 63 Rural Mobile Labs are expected to be  delivered in the first and second quarters of 2012. 

 The Rural Mobile Labs are a new product developed to serve sparsely  populated remote rural areas that do not have local hospitals.  China  Health worked with the customer, the Health Care Bureau in Xinjiang  Uygur Autonomous Region, to develop a solution that integrates its lab  diagnostic equipment, point of care technology and lab management  system (LMS) into a vehicle equipped with an extensible treatment  space.  The Company expects to generate approximately RMB 11.8 million  ($1.9 million) from the sale.  The vehicles were provided by a separate  supplier. 

 Included in the 906 BK Clinlabs are 44 that are being installed in  Chongqing, China, 16 of which were installed in the fourth quarter of  2011.  The Chongqing labs are being installed under a new business  model, whereby the Company will install the labs in return for a  five-year contract to provide testing reagents and maintenance services  that is expected to generate revenues of RMB 17.7 million ($2.8  million). 

 Also included in the 906 BK Clinlabs are a total of 45 labs for  customers in Hebei Province, Qinghai Province and Xinjiang Uygur  Autonomous Region, with installations expected to be completed before  the end of the second quarter of fiscal year 2012. 

 The Company is also pleased to report that Biosino Bio-Technology and  Science Inc. has been allocated five provinces in China (Sichuan,  Jiangxi, Anhui, Shanxi and Shandong) to lead marketing of the BK  Clinlab rural hospital total diagnostic lab solution, pursuant to the  agreement signed in 2011.  (See press release dated November 7, 2011.) 

 "Our track record of delivering a total diagnostic solution to rural  hospitals in China has been the key to expanding our installed base to  over 900 locations in eight provinces of China, compared to 86  locations in two provinces when we listed on the TSXV in October of  2010," said Wilson Yao, CEO of China Health.  "Our diagnostic  laboratory equipment, lab design and installation, proprietary LMS,  training and ongoing service is providing rural hospitals with the  ability to diagnose and treat patients and helping the Chinese  government achieve its goal of providing improved health care to the  rural population.  Our team did a great job using our technology and  knowledge of customer needs to develop the Rural Mobile Labs, a great  solution for remote areas without access to hospitals.  We plan to  expand our installed base in the eight provinces where we have  locations, and add new provinces in 2012." 

 About China Health Labs & Diagnostics Ltd. 

 China Health, operating in China as the Biochem Group, is a leading  diagnostic lab solution provider for the public healthcare industry in  China. The Company develops and sells Biochem Group branded and  third-party medical diagnostic products and services to diagnostic  facilities in China. Customers include large urban hospitals, rural  hospitals, Chinese military and rescue operations, the Beijing  government and third-party distributors. 

 In 2010, China Health had revenues of approximately $33.7 million, and  intends to expand its business by focusing its efforts on expanding its  sales network in three areas where it provides proprietary solutions,  has limited competition and that are supported by Chinese government  policy and budgets: BK Clinlab total lab solutions for rural hospitals  and clinics, POCT solutions for military and emergency rescue services,  and food safety solutions for large cities in China. 

 Neither TSX Venture Exchange nor its Regulation Services Provider (as  that term is defined in the policies of the TSX Venture Exchange)  accepts responsibility for the adequacy or accuracy of this release. 

 FORWARD LOOKING INFORMATION AND NON-GAAP MEASURES 

 This press release contains forward-looking statements and information  that are based on the beliefs of management and reflect China Health's  current expectations.  When used in this press release, the words  "estimate", "project", "belief", "anticipate", "intend", "expect",  "plan", "predict", "may" or "should" and the negative of these words or  such variations thereon or comparable terminology are intended to  identify forward-looking statements and information.  The  forward-looking statements and information in this press release  includes information relating to the installations to be delivered and  revenues to be generated from the installations, reagents and  maintenance services, the completion of the installations by the second  quarter of fiscal year 2012, the expansion of the Company's installed  base in the eight provinces and expansion to new provinces in 2012 and  the growth of the Company's business through its sales network in areas  where it has proprietary products, limited competition and strong  government support.  The forward-looking information is based on  certain assumptions, which could change materially in the future,  including the assumption that the Company will be able to deliver the  new installations, that the new installations will be completed by the  second quarter of fiscal year 2012, that payment for the installations,  reagents and maintenance services will be made and revenue recognized,  that the Company will have the resources and ability to expand its  installed base and expand to new provinces and that the Company will be  able to grow its sales network and business.  Such statements and  information reflect the current view of China Health with respect to  risks and uncertainties that may cause actual results to differ  materially from those contemplated in those forward-looking statements  and information.  By their nature, forward-looking statements involve  known and unknown risks, uncertainties and other factors which may  cause our actual results, performance or achievements, or other future  events, to be materially different from any future results, performance  or achievements expressed or implied by such forward-looking  statements. Such factors include, among others, the risk that the  Company may not be able to deliver the outstanding installations as  scheduled or at all, the Company may not be able to generate the  expected revenue from its installations, reagents and maintenance  services as expected, the customers may not make payment on a timely  basis or at all upon installation, the Company may not have the ability  or resources to expand its installed base in the eight provinces and to  new provinces, and the Company may not be able to grow its business as  expected through its sales network in any of the areas in which it has  proprietary products, limited competition and strong government  support.  China Health cautions that the foregoing list of material  factors is not exhaustive.  When relying on China Health's  forward-looking statements and information to make decisions, investors  and others should carefully consider the foregoing factors and other  uncertainties and potential events.  China Health has assumed a certain  progression, which may not be realized.  It has also assumed that the  material factors referred to above will not cause such forward-looking  statements and information to differ materially from actual results or  events.  However, the list of these factors is not exhaustive and is  subject to change and there can be no assurance that such assumptions  will reflect the actual outcome of such items or factors. 

 China Health has also included in this press release figures based on  sales orders, which is a non-GAAP measure.  Readers are cautioned that  such a measure is not recognized under Canadian GAAP and should not be  construed to be an indicator of performance or liquidity or cash  flows.  China Health's method of calculating this measure may differ  from the method used by other entities and accordingly China Health's  measure may not be comparable to the measure used by other entities. 

 THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS PRESS RELEASE  REPRESENTS THE EXPECTATIONS OF CHINA HEALTH AS OF THE DATE OF THIS  PRESS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE.   READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING  INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER  DATE.  WHILE CHINA HEALTH MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE  THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN  ACCORDANCE WITH APPLICABLE LAWS. 



CHINA HEALTH LABS & DIAGNOSTICS


CONTACT:  Judyanna ChenChief Financial OfficerChina Health Labs & Diagnostics Ltd.T: [phone]Email: [e-mail] PedramInvestor RelationsTMX Equicom GroupT: [phone] ext. 264Email: [e-mail] 


    

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