Burning Rock Reports Fourth Quarter and Full Year 2022 Financial Results

GUANGZHOU, China, March 28, 2023 (GLOBE NEWSWIRE) -- Burning Rock Biotech Limited (NASDAQ:BNR, the "Company" or "Burning Rock"))), a company focused on the application of next generation sequencing (NGS) technology in the field of precision oncology, today reported financial results for the three months and the year ended December 31, 2022.

2022 Business Overview and Recent Updates

• Corporate
  • Listed on the Main Market of the London Stock Exchange (the "LSE") by way of a direct listing on November 1, 2022, offering an alternative listing venue in addition to the Nasdaq Global Market.
  • Completed profitability-driven organizational optimization.
• Early Detection  
  • OverC^TM Multi-Cancer Detection Blood Test (MCDBT) obtained Breakthrough Device Designation of the U.S. Food and Drug Administration (FDA) in January 2023, the third of its kind globally.
  • THUNDER study for 6-cancer test released on Annals of Oncology in March, 2023, achieving a comparably high sensitivity of 69.1% and a specificity of 98.9% in detecting six cancers, and showing an impressive performance of ELSA-seq using cfDNA in cancer detection and origin prediction.
  • Completed PROMISE study (2,035 participants, 9-cancer test development) in June 2022, continued to carry out PREDICT and PRESCIENT studies (17,000 participants, 22-cancer test development), launched PREVENT study (12,500 subjects, validation) in the second quarter of 2022.
• Therapy Selection and Minimal Residual Disease (MRD)
  • Gained NMPA approval for a 9-gene panel, the Company's second NMPA-approved product.
  • Presented additional MRD datasets on colorectal and pancreatic cancers at the ASCO Gastrointestinal Cancers Symposium (ASCO GI) in January 2023. "Patient-specific tumor-informed circulating tumor DNA (ctDNA) analysis for molecular residual disease (MRD) detection in surgical patients with stages I-IV colorectal cancer (CRC)" and "Patient-specific tumor-informed circulating tumor DNA (ctDNA) assay predicts cancer recurrence in patients with resected pancreatic cancer".
• Pharma Services
  • Total value of new contracts entered into during 2022 amounted to RMB250 million, representing a 36% increase from 2021.

Fourth Quarter 2022 Financial Results

Revenues were RMB142.2 million (US$20.6 million) for the three months ended December 31, 2022, representing a 3.5% decrease from RMB147.3 million for the same period in 2021.

• Revenue generated from central laboratory business was RMB72.0 million (US$10.4 million) for the three months ended December 31, 2022, representing a 16.3% decrease from RMB86.0 million for the same period in 2021, primarily attributable to the resurgence of COVID-19 pandemic that resulted in a sharp drop in the number of tests performed.
• Revenue generated from in-hospital business was RMB42.5 million (US$6.2 million) for the three months ended December 31, 2022, representing a 18.1% decrease from RMB51.9 million for the same period in 2021, driven by a decrease of sales volume as affected by the resurgence of COVID-19.
• Revenue generated from pharma research and development services was RMB27.7 million (US$4.0 million) for the three months ended December 31, 2022, representing a 193.2% increase from RMB9.5 million for the same period in 2021, primarily attributable to a further increased testing volume performed for our pharma customers.
  
  

Cost of revenues was RMB41.0 million (US$5.9 million) for the three months ended December 31, 2022, remaining relatively stable compared to RMB42.0 million for the same period in 2021.

Gross profit was RMB101.3 million (US$14.7 million) for the three months ended December 31, 2022, representing a 3.9% decrease from RMB105.4 million for the same period in 2021. Gross margin was 71.2% for the three months ended December 31, 2022, compared to 71.5% of the same period in 2021. By channel, gross margin of central laboratory business was 75.7% for the three months ended December 31, 2022, compared to 76.7% during the same period in 2021; gross margin of in-hospital business was 63.5% for the three months ended December 31, 2022, compared to 65.9% during the same period in 2021; gross margin of pharma research and development services was 71.2% for the three months ended December 31, 2022, compared to 55.0% during the same period of 2021, primarily due to an increase in test volume of higher margin projects.

Non-GAAP gross profit, which excludes depreciation and amortization expenses, was RMB110.4 million (US$16.0 million) for the three months ended December 31, 2022, representing a 2.8% increase from RMB107.4 million for the same period in 2021. Non-GAAP gross margin was 77.6% for the three months ended December 31, 2022, compared to 72.9% for the same period in 2021.

Operating expenses were RMB318.7 million (US$46.2 million) for the three months ended December 31, 2022, representing a 10.9% decrease from RMB357.5 million for the same period in 2021. The decrease was primarily driven by budget control measures and headcount reduction to improve the Company's operating efficiency.

• Research and development expenses were RMB100.8 million (US$14.6 million) for the three months ended December 31, 2022, representing a 10.6% decrease from RMB112.7 million for the same period in 2021, primarily due to (i) a decrease in the expenditure for early cancer detection research, and (ii) a decrease in research and development personnel's staff cost, partially offset by an increase in amortized expense on share-based compensation to constantly motivate staff.
• Selling and marketing expenses were RMB85.2 million (US$12.3 million) for the three months ended December 31, 2022, representing a 17.5% decrease from RMB103.2 million for the same period in 2021, primarily due to (i) a decrease in staff cost resulted from the reorganization of the selling department and improvement in operating efficiency; (ii) a decrease in amortized expense on share-based compensation; and (iii) a decrease in advertising and marketing fee.
• General and administrative expenses were RMB132.7 million (US$19.2 million) for the three months ended December 31, 2022, representing a 6.3% decrease from RMB141.6 million for the same period in 2021, primarily due to (i) a decrease in general and administrative personnel's staff cost; (ii) a decrease in allowance for credit loss in relation to accounts receivables; and (iii) an increase in depreciation expenses for new buildings.
  
  

Net loss was RMB216.2 million (US$31.4 million) for the three months ended December 31, 2022, compared to RMB251.1 million for the same period in 2021.

Cash, cash equivalents, restricted cash and short-term investments were RMB925.3 million (US$134.2 million) as of December 31, 2022.

Full Year 2022 Financial Results

Revenues were RMB563.2 million (US$81.7 million) for 2022, representing a 10.9% increase from RMB507.9 million for 2021.

• Revenue generated from central laboratory business was RMB314.8 million (US$45.6 million) for 2022, remaining relatively stable compared to RMB319.4 million for 2021.
• Revenue generated from in-hospital business was RMB175.3 million (US$25.4 million) for 2022, representing a 6.2% increase from RMB165.1 million for 2021, primarily due to (i) increased demand from existing hospitals and (ii) demand from eight new contracted partner hospitals added to the Company's in-hospital channel in 2022.
• Revenue generated from pharma research and development services was RMB73.2 million (US$10.6 million) for 2022, representing a 212.8% increase from RMB23.4 million for 2021, primarily attributable to increased development and testing services performed for our pharma customers.
  
  

Cost of revenues was RMB183.2 million (US$26.6 million) for 2022, representing a 27.5% increase from RMB143.7 million for 2021, primarily due to an increase in cost of revenues for our in-hospital business and pharma research and development services.

Gross profit was RMB380.0 million (US$55.1 million) for 2022, representing a 4.4% increase from RMB364.1 million for 2021. Gross margin decreased to 67.5% for 2022 from 71.7% for 2021.

Non-GAAP gross profit, which excludes depreciation and amortization expenses, was RMB411.0 million (US$59.6 million) for 2022, representing a 11.6% increase from RMB368.2 million for 2021. Non-GAAP gross margin was 73.0% for 2022, compared to 72.5% for 2021.

Operating expenses were RMB1,360.4 million (US$197.2 million) for 2022, representing a 17.2% increase from RMB1,161.2 million for 2021.

• Research and development expenses were RMB421.9 million (US$61.2 million) for 2022, representing a 14.7% increase from RMB367.9 million for 2021, primarily due to (i) an increase in expenditure for early cancer detection research, (ii) an increase in depreciation expenses for new buildings; and (iii) an increase in amortized expense on share-based compensation.
• Selling and marketing expenses were RMB370.3 million (US$53.7 million) for 2022, representing a 22.2% increase from RMB303.1 million for 2021, primarily due to (i) an increase in staff cost of sales and marketing personnel in anticipation of the commercialization of our early detection products and pharma research and development services; (ii) an increase in conference fee and marketing fees; and (iii) an increase in amortized expense on share-based compensation.
• General and administrative expenses were RMB568.3 million (US$82.4 million) for 2022, representing a 15.9% increase from RMB490.3 million for 2021, primarily due to (i) an increase in depreciation expenses for new buildings, and (ii) an increase in allowance for credit loss in relation to accounts receivables; and (iii) an increase in amortized expense on share-based compensation.
  
  

Net loss was RMB971.2 million (US$140.8 million) for 2022, compared to RMB796.7 million for 2021.

2023 Financial Guidance

We currently expect our full year 2023 revenues to grow approximately 20% over 2022.

Silicon Valley Bank Event

The Company promptly transferred its cash deposits at Silicon Valley Bank to its accounts with other major financial institutions as a result of the Company's regular risk assessment process. No loss was incurred to such deposits. We maintain bank accounts with a diversified set of financial institutions.

Conference Call Information

Burning Rock will host a conference call to discuss the fourth quarter and full year 2022 financial results at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Hong Kong time) on March 28, 2023.

Please register in advance of the conference using the link provided below and dial in 15 minutes prior to the call, using participant dial-in numbers and unique registrant ID which would be provided upon registering.

PRE-REGISTER LINK: https://register.vevent.com/register/BI1cc3eb383ecf42c6969319f9e9cdd02c.

Additionally, a live and archived webcast of the conference call will also be available on the company's investor relations website at http://ir.brbiotech.com or through link https://edge.media-server.com/mmc/p/tx2a7ju9.

A replay of the webcast will be available for 12 months via the same link above.

About Burning Rock

Burning Rock Biotech Limited (NASDAQ:BNR), whose mission is to guard life via science, focuses on the application of next generation sequencing (NGS) technology in the field of precision oncology. Its business consists of i) NGS-based therapy selection testing for late-stage cancer patients, and ii) cancer early detection, which has moved beyond proof-of-concept R&D into the clinical validation stage.

For more information about Burning Rock, please visit: ir.brbiotech.com.

Safe Harbor Statement

This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "target," "confident" and similar statements. Burning Rock may also make written or oral forward-looking statements in its periodic reports to the SEC, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Burning Rock's beliefs and expectations, are forward-looking statements. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond Burning Rock's control. Forward-looking statements involve risks, uncertainties and other factors that could cause actual results to differ materially from those contained in any such statements. All information provided in this press release is as of the date of this press release, and Burning Rock does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

Non-GAAP Measures

In evaluating the business, the company considers and uses non-GAAP measures, such as non-GAAP gross profit and non-GAAP gross margin, as supplemental measures to review and assess operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The company defines non-GAAP gross profit as gross profit excluding depreciation and amortization. The company defines non-GAAP gross margin as gross margin excluding depreciation and amortization.

The company presents these non-GAAP financial measures because they are used by management to evaluate operating performance and formulate business plans. The company believe non-GAAP gross profit and non-GAAP gross margin excluding non-cash impact of depreciation and amortization reflect the company's ongoing business operations in a manner that allows more meaningful period-to-period comparisons.

Contact: [email protected]





Selected Operating Data

			For the three months ended
	March 31, 2021		June 30, 2021		September 30, 2021		December 31, 2021		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022
Central Laboratory Channel:
Number of patients tested	7,716		8,155		7,808		8,235		7,743		8,060		7,989		6,419
Number of ordering physicians(1)	1,082		1,013		920		917		994		767		897		797
Number of ordering hospitals(2)	303		300		287		306		318		264		257		238

<sup>(1) Represents physicians who on average order at least one test from us every month during a relevant period in the central laboratory channel.

(2) Represents hospitals whose residing physicians who on average order at least one test from us every month during a relevant period in the central laboratory channel.</sup>

			As of
	March 31, 2021		June 30, 2021		September 30, 2021		December 31, 2021		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022
In-hospital Channel:
Pipeline partner hospitals(1)	22		22		24		23		24		25		22		28
Contracted partner hospitals(2)	32		34		34		41		41		43		47		49
Total number of partner hospitals	54		56		58		64		65		68		69		77

<sup>(1) Refers to hospitals that are in the process of establishing in-hospital laboratories, laboratory equipment procurement or installation, staff training or pilot testing using the Company's products.

(2) Refers to hospitals that have entered into contracts to purchase the Company's products for use on a recurring basis in their respective in-hospital laboratories the Company helped them establish. Kit revenue is generated from contracted hospitals.</sup>

Selected Financial Data

	For the three months ended
Revenues	March 31, 2021		June 30, 2021		September 30, 2021		December 31, 2021		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022
	(RMB in thousands)
Central laboratory channel	74,561		79,999		78,817		85,976		74,211		78,597		89,992		71,970
In-hospital channel	28,994		40,502		43,714		51,906		48,957		34,177		49,636		42,526
Pharma research and development channel	3,068		6,778		4,084		9,463		12,356		18,072		15,003		27,741
Total revenues	106,623		127,279		126,615		147,345		135,524		130,846		154,631		142,237

			For the three months ended
Gross profit	March 31, 2021		June 30, 2021		September 30, 2021		December 31, 2021		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022
	(RMB in thousands)
Central laboratory channel	55,212		58,681		58,387		65,985		50,574		57,575		69,991		54,507
In-hospital channel	20,070		29,426		31,111		34,194		33,396		20,012		31,593		26,999
Pharma research and development channel	1,658		2,124		2,098		5,200		3,610		5,015		7,010		19,757
Total gross profit	76,940		90,231		91,596		105,379		87,580		82,602		108,594		101,263

			For the three months ended
Share-based compensation expenses	March 31, 2021		June 30, 2021		September 30, 2021			December 31, 2021			March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022
	(RMB in thousands)
Cost of revenues	339		406		267			492			365		441		481		496
Research and development expenses	22,404		20,825		(9,559	)		(4,033	)		12,299		11,923		13,978		14,673
Selling and marketing expenses	2,633		2,809		2,044			2,126			1,774		2,158		2,346		2,247
General and administrative expenses	59,382		59,369		60,803			62,126			65,715		62,615		61,041		74,232
Total share-based compensation expenses	84,758		83,409		53,555			60,711			80,153		77,137		77,846		91,648

Burning Rock Biotech Limited

Unaudited Condensed Statements of Comprehensive Loss

(in thousands, except for number of shares and per share data)

	For the three months ended
	March 31, 2021			June 30, 2021			September 30, 2021			December 31, 2021			March 31, 2022			June 30, 2022			September 30, 2022			December 31, 2022			December 31, 2022
	RMB			RMB			RMB			RMB			RMB			RMB			RMB			RMB			US$
Revenues	106,623			127,279			126,615			147,345			135,524			130,846			154,631			142,237			20,622
Cost of revenues	(29,683	)		(37,048	)		(35,019	)		(41,966	)		(47,944	)		(48,244	)		(46,037	)		(40,974	)		(5,940	)
Gross profit	76,940			90,231			91,596			105,379			87,580			82,602			108,594			101,263			14,682
Operating expenses:
Research and development expenses	(77,414	)		(108,071	)		(69,649	)		(112,724	)		(119,496	)		(92,112	)		(109,433	)		(100,827	)		(14,619	)
Selling and marketing expenses	(55,130	)		(68,058	)		(76,687	)		(103,221	)		(89,211	)		(105,634	)		(90,275	)		(85,174	)		(12,349	)
General and administrative expenses	(116,259	)		(116,130	)		(116,304	)		(141,563	)		(141,733	)		(150,316	)		(143,530	)		(132,705	)		(19,240	)
Total operating expenses	(248,803	)		(292,259	)		(262,640	)		(357,508	)		(350,440	)		(348,062	)		(343,238	)		(318,706	)		(46,208	)
Loss from operations	(171,863	)		(202,028	)		(171,044	)		(252,129	)		(262,860	)		(265,460	)		(234,644	)		(217,443	)		(31,526	)
Interest income	787			681			958			1,031			1,832			2,685			2,001			2,838			411
Interest expenses	(510	)		(565	)		(367	)		(94	)		119			(29	)		12			-			-
Other income (expense), net	118			433			20			(372	)		298			127			(189	)		(84	)		(12	)
Foreign exchange gain (loss), net	57			(560	)		380			(731	)		(777	)		624			1,337			365			53
Loss before income tax	(171,411	)		(202,039	)		(170,053	)		(252,295	)		(261,388	)		(262,053	)		(231,483	)		(214,324	)		(31,074	)
Income tax (expenses) benefits	-			(1,626	)		(424	)		1,151			-			(84	)		-			(1,901	)		(276	)
Net loss	(171,411	)		(203,665	)		(170,477	)		(251,144	)		(261,388	)		(262,137	)		(231,483	)		(216,225	)		(31,350	)
Net loss attributable to Burning Rock Biotech Limited's shareholders	(171,411	)		(203,665	)		(170,477	)		(251,144	)		(261,388	)		(262,137	)		(231,483	)		(216,225	)		(31,350	)
Net loss attributable to ordinary shareholders	(171,411	)		(203,665	)		(170,477	)		(251,144	)		(261,388	)		(262,137	)		(231,483	)		(216,225	)		(31,350	)
Loss per share for class A and class B ordinary shares:
Class A ordinary shares - basic and diluted	(1.65	)		(1.96	)		(1.64	)		(2.40	)		(2.50	)		(2.50	)		(2.23	)		（2.11	）		（0.31	）
Class B ordinary shares - basic and diluted	(1.65	)		(1.96	)		(1.64	)		(2.40	)		(2.50	)		(2.50	)		(2.23	)		（2.11	）		（0.31	）
Weighted average shares outstanding used in loss per share computation:
Class A ordinary shares - basic and diluted	86,721,263			86,764,260			86,908,975			87,128,297			87,179,752			87,532,539			86,585,322			85,051,882			85,051,882
Class B ordinary shares - basic and diluted	17,324,848			17,324,848			17,324,848			17,324,848			17,324,848			17,324,848			17,324,848			17,324,848			17,324,848
Other comprehensive income (loss), net of tax of nil:
Foreign currency translation adjustments	14,080			(34,980	)		6,146			(24,726	)		(3,065	)		29,715			20,646			(5,950	)		(863	)
Total comprehensive loss	(157,331	)		(238,645	)		(164,331	)		(275,870	)		(264,453	)		(232,422	)		(210,837	)		(222,175	)		(32,213	)
Total comprehensive loss attributable to Burning Rock Biotech Limited's shareholders	(157,331	)		(238,645	)		(164,331	)		(275,870	)		(264,453	)		(232,422	)		(210,837	)		(222,175	)		(32,213	)

Burning Rock Biotech Limited

Unaudited Condensed Statements of Comprehensive Loss

(in thousands, except for number of shares and per share data)

	For the year ended
	December 31, 2021			December 31, 2022			December 31, 2022
	RMB			RMB			US$
Revenues	507,862			563,238			81,662
Cost of revenues	(143,716	)		(183,199	)		(26,561	)
Gross profit	364,146			380,039			55,101
Operating expenses:
Research and development expenses	(367,858	)		(421,868	)		(61,165	)
Selling and marketing expenses	(303,096	)		(370,294	)		(53,688	)
General and administrative expenses	(490,256	)		(568,284	)		(82,393	)
Total operating expenses	(1,161,210	)		(1,360,446	)		(197,246	)
Loss from operations	(797,064	)		(980,407	)		(142,145	)
Interest income	3,457			9,356			1,356
Interest expenses	(1,536	)		102			15
Other income, net	199			152			22
Foreign exchange loss, net	(854	)		1,549			225
Loss before income tax	(795,798	)		(969,248	)		(140,527	)
Income tax expenses	(899	)		(1,985	)		(288	)
Net loss	(796,697	)		(971,233	)		(140,815	)
Net loss attributable to Burning Rock Biotech Limited's shareholders	(796,697	)		(971,233	)		(140,815	)
Net loss attributable to ordinary shareholders	(796,697	)		(971,233	)		(140,815	)
Loss per share for class A and class B ordinary shares:
Class A ordinary shares - basic and diluted	(7.65	)		(9.35	)		(1.36	)
Class B ordinary shares - basic and diluted	(7.65	)		(9.35	)		(1.36	)
Weighted average shares outstanding used in loss per share computation:
Class A ordinary shares - basic and diluted	86,883,011			86,584,100			86,584,100
Class B ordinary shares - basic and diluted	17,324,848			17,324,848			17,324,848
Other comprehensive income (loss), net of tax of nil:
Foreign currency translation adjustments	(39,480	)		41,346			5,995
Total comprehensive loss	(836,177	)		(929,887	)		(134,820	)
Total comprehensive loss attributable to Burning Rock Biotech Limited's shareholders	(836,177	)		(929,887	)		(134,820	)

Burning Rock Biotech Limited

Unaudited Condensed Consolidated Balance Sheets

(In thousands)

	As of
	December 31, 2021		December 31, 2022		December 31, 2022
	RMB		RMB		US$
ASSETS
Current assets:
Cash and cash equivalents	1,431,317		905,451		131,278
Restricted cash	7,795		19,817		2,873
Short-term investments	63,757		-		-
Accounts receivable, net	92,197		109,954		15,942
Contract assets, net	42,391		41,757		6,054
Inventories, net	123,210		130,321		18,895
Prepayments and other current assets, net	60,279		51,462		7,462
Total current assets	1,820,946		1,258,762		182,504
Non-current assets:
Equity method investment	910		690		100
Convertible note receivable	-		5,105		740
Property and equipment, net	325,438		251,829		36,512
Operating right-of-use assets	81,007		48,205		6,989
Intangible assets, net	5,150		1,986		288
Other non-current assets	45,136		20,890		3,029
Total non-current assets	457,641		328,705		47,658
TOTAL ASSETS	2,278,587		1,587,467		230,162

Burning Rock Biotech Limited

Unaudited Condensed Consolidated Balance Sheets (Continued)

(in thousands)

	As of
	December 31, 2021			December 31, 2022			December 31, 2022
	RMB			RMB			US$
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	63,080			50,947			7,387
Deferred revenue	142,871			147,633			21,405
Accrued liabilities and other current liabilities	127,892			173,832			25,203
Customer deposits	972			1,803			261
Short-term borrowing	2,370			-			-
Current portion of operating lease liabilities	34,999			37,236			5,399
Total current liabilities	372,184			411,451			59,655
Non-current liabilities:
Non-current portion of operating lease liabilities	49,316			13,551			1,965
Other non-current liabilities	11,776			4,124			598
Total non-current liabilities	61,092			17,675			2,563
TOTAL LIABILITIES	433,276			429,126			62,218
Shareholders' equity:
Class A ordinary shares	116			117			17
Class B ordinary shares	21			21			3
Additional paid-in capital	4,280,956			4,582,790			664,442
Treasury stock	-			(58,919	)		(8,542	)
Accumulated deficits	(2,228,713	)		(3,199,946	)		(463,949	)
Accumulated other comprehensive loss	(207,069	)		(165,722	)		(24,027	)
Total shareholders' equity	1,845,311			1,158,341			167,944
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	2,278,587			1,587,467			230,162

Burning Rock Biotech Limited

Unaudited Condensed Statements of Cash Flows

(in thousands)

	For the three months ended
	December 31, 2021			December 31, 2022			December 31, 2022
	RMB			RMB			US$
Net cash used in operating activities	(112,349	)		(67,707	)		(9,817	)
Net cash used in investing activities	(66,970	)		(5,033	)		(730	)
Net cash used in financing activities	(6,781	)		(10,074	)		(1,461	)
Effect of exchange rate on cash, cash equivalents and restricted cash	(24,498	)		(5,924	)		(859	)
Net decrease in cash, cash equivalents and restricted cash	(210,598	)		(88,738	)		(12,867	)
Cash, cash equivalents and restricted cash at the beginning of period	1,649,710			1,014,006			147,018
Cash, cash equivalents and restricted cash at the end of period	1,439,112			925,268			134,151

	For the year ended
	December 31, 2021			December 31, 2022			December 31, 2022
	RMB			RMB			US$
Net cash used in operating activities	(477,886	)		(456,808	)		(66,231	)
Net cash generated from (used in) investing activities	81,697			(7,463	)		(1,082	)
Net cash used in financing activities	(52,899	)		(86,238	)		(12,503	)
Effect of exchange rate on cash, cash equivalents and restricted cash	(37,006	)		36,665			5,316
Net decrease in cash, cash equivalents and restricted cash	(486,094	)		(513,844	)		(74,500	)
Cash, cash equivalents and restricted cash at the beginning of period	1,925,206			1,439,112			208,651
Cash, cash equivalents and restricted cash at the end of period	1,439,112			925,268			134,151

Burning Rock Biotech Limited

Reconciliations of GAAP and Non-GAAP Results

			For the three months ended
	March 31, 2021		June 30, 2021		September 30, 2021		December 31, 2021		March 31, 2022		June 30, 2022		September 30, 2022		December 31, 2022
			(RMB in thousands)
Gross profit:
Central laboratory channel	55,212		58,681		58,387		65,985		50,574		57,575		69,991		54,507
In-hospital channel	20,070		29,426		31,111		34,194		33,396		20,012		31,593		26,999
Pharma research and development channel	1,658		2,124		2,098		5,200		3,610		5,015		7,010		19,757
Total gross profit	76,940		90,231		91,596		105,379		87,580		82,602		108,594		101,263
Add: depreciation and amortization:
Central laboratory channel	117		284		1,254		995		2,553		2,545		3,138		3,609
In-hospital channel	79		113		109		130		93		1,428		2,479		2,449
Pharma research and development channel	10		40		19		856		2,493		4,327		2,805		3,065
Total depreciation and amortization included in cost of revenues	206		437		1,382		1,981		5,139		8,300		8,422		9,123
Non-GAAP gross profit：
Central laboratory channel	55,329		58,965		59,641		66,980		53,127		60,120		73,129		58,116
In-hospital channel	20,149		29,539		31,220		34,324		33,489		21,440		34,072		29,448
Pharma research and development channel	1,668		2,164		2,117		6,056		6,103		9,342		9,815		22,822
Total non-GAAP gross profit	77,146		90,668		92,978		107,360		92,719		90,902		117,016		110,386
Non-GAAP gross margin：
Central laboratory channel	74.2%		73.7%		75.7%		77.9%		71.6%		76.5%		81.3%		80.8%
In-hospital channel	69.5%		72.9%		71.4%		66.1%		68.4%		62.7%		68.6%		69.2%
Pharma research and development channel	54.4%		31.9%		51.8%		64.0%		49.4%		51.7%		65.4%		82.3%
Total non-GAAP gross margin	72.4%		71.2%		73.4%		72.9%		68.4%		69.5%		75.7%		77.6%

Burning Rock Biotech Limited

Reconciliations of GAAP and Non-GAAP Results

	For the year ended
	December 31, 2021	December 31, 2022
	(RMB in thousands) RMB
Gross profit:
Central laboratory channel	238,265	232,647
In-hospital channel	114,801	112,000
Pharma research and development channel	11,080	35,392
Total gross profit	364,146	380,039
Add: depreciation and amortization:
Central laboratory channel	2,650	11,845
In-hospital channel	431	6,449
Pharma research and development channel	925	12,690
Total depreciation and amortization included in cost of revenues	4,006	30,984
Non-GAAP gross profit：
Central laboratory channel	240,915	244,492
In-hospital channel	115,232	118,449
Pharma research and development channel	12,005	48,082
Total non-GAAP gross profit	368,152	411,023
Non-GAAP gross margin：
Central laboratory channel	75.4%	77.7%
In-hospital channel	69.8%	67.6%
Pharma research and development channel	51.3%	65.7%
Total non-GAAP gross margin	72.5%	73.0%