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Showing Marked Improvement Over Prior Periods

BETHESDA, MARYLAND – March 31, 1999 - Chindex International, Inc. (NASDAQ: CHDX) (U.S.-China Industrial Exchange, Inc.), the leading independent American company providing Western healthcare products distribution and medical services in the People’s Republic of China, today announced results for its fourth quarter and year ended December 31, 1998, showing significant improvement in performance compared to the prior periods.

Revenue for the fourth quarter of 1998 was $9.8 million with a net profit of $776,000, or earnings per share of $0.98. This compares to revenue of $8.0 million with a net loss of $3.6 million which included a one-time charge of $1.5 million for restructuring of operations, or a loss per share of $4.55 for the same period in 1997.

Revenue for the year 1998 was $21.6 million with a net loss of $2.0 million or a loss per share of $2.58. This compares to revenue of $24.4 million with a net loss of $4.6 million, including the one-time charge of $1.5 million for restructuring of operations, or a loss per share of $5.88 for the year 1997.

The Company’s balance sheet as of December 31, 1998 showed cash and equivalents of $4.7 million, total assets of $28.6 million, a current ratio of 1.45:1 and shareholders equity of $12.2 million.

Chindex Chairperson, President and CEO, Roberta Lipson, speaking from Beijing, commented on the results and the factors currently impacting Chindex business:

"In spite of a difficult year in China due to the Asian financial crisis, our fourth quarter results for 1998 were profitable and showed a dramatic improvement over the same period a year earlier. In addition our full year results for 1998 showed a significant turn-around over 1997."

"We began to deliver our $14 million loan program guaranteed by the U.S. Export-Import Bank at the end of the year and will complete shipments under that program in 1999. We have already begun to put together the next loan program to be guaranteed by the Export-Import Bank which will be for the export of up to $30 million of U.S. medical equipment."

"Our repeatable, ongoing financing programs for capital equipment purchases by our Chinese customers are now in their third year. They are based on active support and cooperation by both Chinese and American government organizations. Chinese Foreign Trade Minister Wu Yi and American Secretary of Commerce William Daley presided over the signing of our formal Letter of Intent with China National Instruments Import and Export Corporation for this program in the Great Hall of the People earlier this week. We hope to begin delivery of equipment under this new program late in 1999."

"Our strategy of revenue diversification is progressing nicely as well. Healthcare Services revenue from our private hospital Beijing United showed a very aggressive growth rate, accounting for 9 percent of our total revenue in 1998. We expect Beijing United revenues to continue to expand rapidly in 1999, its second year of operation. The hospital has already begun to broaden its financial base, announcing the opening of its first satellite clinic earlier this year. Our healthcare products distribution business is also growing rapidly into the hospital, retail pharmacy and third party logistics markets. We are pleased to see that in spite of the adverse market conditions we have been facing over the past two years we have been able to maintain the momentum of our development strategy for the Company. At the same time we are continuing our aggressive cost containment programs which yielded an actual decrease in total selling expenses in 1998 over the prior year."

Chindex is a leading American company in healthcare in the Greater Chinese marketplace including Hong Kong and Macau. It provides representative and distribution services to a number of multinational companies including Acuson, Johnson & Johnson, and Kendall Healthcare Products. It also operates a private hospital corporation in China. With nearly eighteen years experience, 285 employees, and operations in the United States, China and Hong Kong, the Chindex strategy is to expand its cross-cultural reach by providing leading edge technologies, quality products and services to Greater China’s professional communities. Chindex is listed on NASDAQ under the ticker symbol CHDX. More information is available at the Company’s website:


The statements in this press release that relate to future plans, events or performance are forward-looking statements that involve risks and uncertainties, including risks associated with uncertainties pertaining to customer orders, demand for products and services, receipt of financing and guarantee commitments, development of markets for the Company’s products and services and other risks identified in the Company’s SEC filings. Actual results, events and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

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