Mar 1, 2022
Operator
Welcome everyone to Global Cord Blood Corporation Earnings Conference Call for the Fiscal 2022 Third Quarter. All participant lines will be placed on mute during the presentation, after which there will be a question-and-answer session.
[Operator Instructions]. Now I would like to introduce you Ms.
Cathy Bai, VP of Corporate Finance, to begin the presentation.
Cathy Bai
Good morning, everyone. Welcome to our fiscal 2022 third quarter earnings conference call.
A press release discussing our financial results has already been published and a copy is available on our company's website. During the call, our management team will summarize corporate developments and financial highlights for the quarter.
A question-and-answer session will follow. Before we begin, please note that today's discussion will contain forward-looking statements that are subject to certain risks and uncertainties and actual results could be materially different from these forward-looking statements.
Kindly refer to our SEC filings for detailed discussions of potential risks. In the interest of time, I will begin with our CEO's remarks, followed by a report of our fiscal 2022 third quarter financials given by our CFO, Mr.
Albert Chen. Our management will be available to answer questions during the Q&A session.
We understand investors and shareholders have various questions to ask. To give everyone a chance to ask questions, we'd appreciate if you could ask 1 question at a time.
Today on behalf of our CEO, Tina, I will read her prepared remarks. Let's begin our presentation.
Good morning, everyone. And welcome to our third quarter fiscal 2022 earnings conference call.
As COVID-19 outbreaks re-emerged in winter seasons in the northern hemisphere during the reporting quarter, the group's operating regions continue to adopt a zero COVID strategy by implementing strict measures such as localized lockdowns and tightened access in hospitals, which continued to obstruct the group's client access and client conversion efficiencies compared to the pre COVID-19 era. Despite such difficulties, the group managed to recruit 18,985 new subscribers, up 6.6% year-over-year and down 0.4% quarter-over-quarter, in line with management expectations.
At the end of December 2021, our accumulated subscriber base surpassed 555,000. In regards to industry regulation, the biggest regulatory uncertainties remain as the National Health Commission has yet to release any updates on the licensing regime for China's cord blood banking industry.
By the end of the reporting period, the National Development and Reform Commission and Ministry of Commerce of the People's Republic of China published an updated version of the 2021 special administrative measures for access of foreign investment, also known as the negative list, where there was no substantial change in the relevant regulations involving the group's business. Meanwhile, as the overall number of women of childbearing age and new birth continue to decline, the academic community and general public in China began vibrant discussions on how to stimulate population growth.
In face of such a dynamic regulatory and business environment, the management team continues to closely monitor any potential development of industry regulations and policies and carry on efforts to operate existing lines of business, while digging deeper into business development opportunities related to cord blood stem cells with a goal to diversify business risks and cultivate new ways of growth. Looking ahead, Year of Tiger is generally considered a favorable year to have children in parts of China, which thereby may have a positive impact on birth rates.
At the same time, we must cautiously address the negative impact of the long-term decline in birth rates and from the recurrence of COVID-19 outbreaks in China. With this in mind, the management team expects new subscriber numbers in fiscal 2022 to be around the higher end of our previous guidance at 75,000.
This concludes my remarks regarding our fiscal 2022 third quarter results. Thank you for your ongoing support of Global Cord Blood Corporation.
Now, I will turn the call over to our CFO, Mr. Albert Chen, to discuss our third fiscal quarter financial performance.
Mr. Chen, please go ahead.
Albert Chen
Good morning, everyone. Thank you for joining our call today.
In the third quarter, revenues increased by 9% year-over-year to approximately RMB 317 million as a result of the increase in revenues from processing fees and storage fees. The group recruited 18,985 new subscribers during the third quarter, which represents an increase of approximately 7% year-over-year, despite challenges from COVID-19 and the downward newborn trend.
As a result, revenues generated from processing fees and other services increased by approximately 10% year-over-year to RMB 181 million, which accounted for 57% of total revenues, similar to last year. By the end of December 2021, our accumulated subscriber base expanded to over 955,000.
Storage fee revenues for the third quarter increased by 8% year-over-year to RMB 136 million. Gross profit in the reporting quarter increased by 10% to approximately RMB 270 million due to economies of scale, but partially offset by higher labor costs.
Gross margin remained at 85%, similar to last year. As a result of top line growth, combined with cost control measures, operating income increased by approximately 21% year-over-year to approximately RMB 150 million in the third quarter.
As a result, operating margin improved to 47% from 43% of last year. Depreciation and amortization expenses for the reporting quarter were approximately RMB 12 million, again, similar to last-year period.
Non-GAAP operating income increased by approximately 19% year-over-year to RMB 162 million. And non-GAAP operating margin improved to 51% from 47% of last year.
Taking into account labor costs savings, sales and marketing expenses in the third quarter decreased by approximately 5% year-over-year to RMB 66 million. Sales and marketing expenses as a percentage of revenue was 21% compared to 24% of last year.
General and administrative expenses increased by 8% year-over-year to approximately RMB 47 million as the increase in professional fees was partially offset by lower staff costs and provisions. General and administrative expenses as a percentage of revenue remained at 15%, similar to last year.
In the third quarter, the company recognized an increase of approximately RMB 0.6 million in fair value of equity securities or more commonly known as mark-to-market gains. And this is significantly less than the RMB 6 million mark-to-market gains, which we recorded last year.
In the third quarter, income before income tax increased by 14% year-over-year to RMB 159 million. Income tax expense was approximately RMB 24 million.
Net income attributable to the company's shareholders increased by 15% year-over-year to RMB 134 million. Net margin improved to 42% from 40% of last year.
Basic and diluted earnings per ordinary share was RMB 1.11. These are the highlights of our third quarter results.
We are now happy to turn to the floor for any questions.
Operator
[Operator Instructions]. Our first question comes from Jeff Oliver with Lone Star Funds.
Jeff Oliver
Can you comment on the geographical breakdown of new subscribers for the quarter? Also, what was the payment option breakdown as well?
Albert Chen
In terms of geographical breakdown, new subscriber who signed up during the third quarter of our current fiscal year, approximately 11% of the new subscribers derived from our Beijing market. Approximately 67% of new subscribers came from the Guangdong market and the remaining balance came from the Zhejiang market, which is approximately 22%.
In terms of payment option breakdown, [indiscernible] payment option accounted for approximately 30% in terms of our new subscriber numbers. New subscriber electing upfront payment during the third quarter is approximately 38%.
And approximately 32% of our new subscribers recorded in the third quarter elect installment payment option.
Operator
[Operator Instructions]. At this point, there appears to be no further questions.
I will now turn back to Ms. Cathy Bai.
Please go ahead.
Cathy Bai
Thank you, Simone. This concludes our earnings conference call for the fiscal 2022 third quarter.
Thank you all for your participation and ongoing support. Have a great day.