CUPERTINO, Calif., Nov. 28,
2023 /PRNewswire/ -- Ambow Education
Holding Ltd. ("Ambow" or the "Company") (NYSE American: AMBO),
a technology-driven educational company with primary operations in
the United States, today announced
its unaudited financial and operating results for the three-month
and six-month periods ended June 30, 2023.
"We are at the forefront of emerging trends in education,
indicating a shift towards an integrated, AI-driven hybrid model
encompassing both education and workforce training," said Dr.
Jin Huang, President, Chief
Executive Officer, and acting Chief Financial Officer of Ambow.
"Over the last six months, we have closed underperforming business
units and redirected our focus toward the development and
deployment of our HybriU AI solution. As a result, in the first
half of 2023, we witnessed a substantial improvement in profit
margins, successfully narrowing our operating loss by an impressive
50%. Since its official launch in July, the HybriU AI digital
education solution has been successfully deployed in classrooms
throughout NewSchool Architecture & Design in San Diego, Calif., facilitating a seamless,
cutting-edge AI hybrid learning model. Looking ahead, we are
actively expanding our HybriU initiatives with partnerships in
various institutions, leading colleges, universities, and
corporations to drive the next stage of Ambow's growth. We are
optimistic about our prospects for the next year. Our turnaround
efforts are yielding results as the HybriU AI solution continues to
gain traction, and we expect to achieve operating profitability in
2024."
Second Quarter 2023 Financial Highlights
- Net revenues for the second quarter of 2023 decreased by
46.0% to $2.7 million from
$5.0 million for the same period of
2022. The decrease was primarily due to the permanent closure of
Bay State College at the end of the
2022-2023 academic year.
- Gross profit for the second quarter of 2023 decreased by
20.0% to $1.2 million from
$1.5 million for the same period of
2022. Gross profit margin was 44.4%, compared with 30.0% for the
second quarter of 2022.
- Operating expenses for the second quarter of 2023
decreased by 47.4% to $2.0 million
from $3.8 million for the same period
of 2022. The decrease was primarily due to the Company's issuance
of 5.2 million shares of fully vested restricted stock units to
senior management and key employees as compensation during the
second quarter of 2022, and stringent expense controls to improve
operating efficiency.
- Operating loss for the second quarter of 2023 was
$0.8 million, compared to an
operating loss of $2.3 million for
the same period of 2022.
- Net loss attributable to ordinary shareholders from
continuing operations for the second quarter of 2023 was
$1.0 million, or $0.02 per basic and diluted share, compared with
a net loss from continuing operations of $2.5 million, or $0.05 per basic and diluted share, for the same
period of 2022.
- As of June 30, 2023, Ambow
maintained strong cash resources of $12.4
million, comprising cash and cash equivalents of
$6.9 million and restricted cash of
$5.5 million.
First Six Months 2023 Financial Highlights
- Net revenues for the first six months of 2023 decreased
by 37.1% to $6.1 million from
$9.7 million for the same period of
2022. The decrease was primarily due to the permanent closure of
Bay State College at the end of the
2022-2023 academic year.
- Gross profit for the first six months of 2023 decreased
by 16.7% to $2.0 million from
$2.4 million for the same period of
2022. Gross profit margin was 32.8%, compared with 24.7% for the
same period of 2022.
- Operating expenses for the first six months of 2023
decreased by 40.0% to $3.9 million
from $6.5 million for the same period
of 2022. The decrease was primarily due to the Company's issuance
of 5.2 million shares of fully vested restricted stock units to
senior management and key employees as compensation during the
three months ended June 30, 2022, and
stringent expense controls to improve operating efficiency. Also,
the permanent closure of Bay State
College at the end of the 2022-2023 academic year has led to
lower expenses.
- Operating loss for the first six months of 2023 was
$1.9 million, compared to an
operating loss of $4.1 million for
the same period of 2022.
- Net loss attributable to ordinary shareholders from
continuing operations for the first six months of 2023 was
$2.2 million, or $0.04 per basic and diluted share, compared with
a net loss from continuing operations of $4.4 million, or $0.10 per basic and diluted share, for the same
period of 2022.
The Company's financial and operating results for the second
quarter and first half of 2023 can also be found on its Report of
Foreign Private Issuer on Form 6–K, to be furnished with the
U.S. Securities and Exchange Commission at www.sec.gov.
Exchange Rate Information
Historically, Ambow presented its financial results in
Renminbi. Starting on January 1, 2023, Ambow changed its
reporting currency from Renminbi to U.S. dollars, as the majority
of Ambow's revenues and expenses are now denominated in U.S.
dollars. Ambow believes the alignment of the reporting currency
with its underlying operations better illustrates its operational
results for each period. Ambow has applied the change of reporting
currency retrospectively to its historical results of operations
and financial statements included in this press release.
Bay State College Closure
On January 19, 2023, the New
England Commission of Higher Education ("NECHE") informed
Bay State College ("BSC") of its
intention to withdraw BSC's accreditation as of August 31, 2023. Following the rejection of
Ambow's appeal, on April 11, 2023,
the Board of Trustees voted to permanently close Bay State College at the end of the 2022-2023
academic year. Accordingly, this permanent closer has been
completed. The College provided academic support and transitional
services to students through August 31,
2023, and signed agreements with several area universities
to provide program completion pathways to Bay
State students, often with enhanced transfer and other
opportunities.
Subsequent Events
Ambow received a continued listing deficiency notice (the
"Notice") from the NYSE American LLC (the "NYSE American") dated
September 21, 2023, stating that the Company's securities had
been selling for a low price per share for a substantial period of
time and the Company is not in compliance with the continued
listing standards as set forth in Section 1003(f)(v) of
the NYSE American Company Guide ("Company Guide"). NYSE American
staff determined that Ambow's continued listing is predicated on it
effecting a reverse stock split of its common stock or otherwise
demonstrating sustained price improvement no later than
March 21, 2024. The Company intends to complete a reverse
stock split in order to regain compliance with the NYSE American's
continued listing standards set forth in the Company Guide in a
timely manner.
About Ambow
Ambow Education Holding Ltd. is an AI technology-driven
educational company with primary operations in the United States. Through the operation of
its for-profit colleges and dynamic patented open platform
technology, Ambow offers high-quality, individualized, and dynamic
career education services and products. For more information, visit
Ambow's website at https://www.ambow.com/.
Follow us on Twitter:@Ambow_Education
Safe Harbor Statement
This press release contains statements of a forward-looking
nature. These statements are made under the "safe harbor"
provisions of the U.S. Private Securities Litigation Reform Act of
1995. You can identify these forward-looking statements by
terminology such as "will," "expects," "believes," "anticipates,"
"intends," "estimates" and similar statements. These
forward-looking statements involve known and unknown risks and
uncertainties and are based on current expectations, assumptions,
estimates and projections about Ambow and the industry. All
information provided in this press release is as of the date
hereof, and Ambow undertakes no obligation to update any
forward-looking statements to reflect subsequent occurring events
or circumstances, or changes in its expectations, except as may be
required by law. Although Ambow believes that the expectations
expressed in these forward-looking statements are reasonable, it
cannot assure you that its expectations will turn out to be
correct, and investors are cautioned that actual results may differ
materially from the anticipated results.
For more information, please contact:
Ambow Education Holding Ltd.
E-mail: ir@ambow.com
or
Piacente Financial Communications
Tel: +1–212–481–2050
E-mail: ambow@tpg-ir.com
|
AMBOW EDUCATION
HOLDING LTD.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(All amounts in
thousands, except for share and per share data)
|
|
|
|
|
|
|
|
|
As of December 31,
|
|
As of June 30,
|
|
|
2022
|
|
2023
|
|
|
$
|
|
$
|
|
|
|
|
Unaudited
|
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
3,276
|
|
6,913
|
|
Restricted
cash
|
|
4,320
|
|
5,490
|
|
Accounts receivable,
net
|
|
1,958
|
|
3,690
|
|
Prepaid and other
current assets
|
|
6,119
|
|
4,230
|
|
Total current
assets
|
|
15,673
|
|
20,323
|
|
Non-current
assets:
|
|
|
|
|
|
Property and equipment,
net
|
|
274
|
|
19
|
|
Intangible assets,
net
|
|
532
|
|
527
|
|
Operating lease
right-of-use asset
|
|
6,842
|
|
5,946
|
|
Other non-current
assets
|
|
1,951
|
|
1,944
|
|
Total non-current
assets
|
|
9,599
|
|
8,436
|
|
|
|
|
|
|
Total
assets
|
|
25,272
|
|
28,759
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Short-term
borrowings
|
|
3,000
|
|
5,439
|
|
Accounts
payable
|
|
2,409
|
|
1,957
|
|
Accrued and other
liabilities
|
|
3,702
|
|
6,080
|
|
Income taxes
payable
|
|
523
|
|
510
|
|
Operating lease
liability, current
|
|
2,197
|
|
2,451
|
|
Total current
liabilities
|
|
11,831
|
|
16,437
|
|
Non-current
liabilities:
|
|
|
|
|
|
Operating lease
liability, non-current
|
|
5,688
|
|
4,900
|
|
Total non-current
liabilities
|
|
5,688
|
|
4,900
|
|
|
|
|
|
|
Total
liabilities
|
|
17,519
|
|
21,337
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
Preferred
shares
|
|
|
|
|
|
($0.003 par
value;1,666,667 shares authorized, nil issued and outstanding as of
December
31, 2022 and June 30, 2023)
|
|
—
|
|
—
|
|
Class A Ordinary
shares
|
|
|
|
|
|
($0.003 par value;
66,666,667 and 66,666,667 shares authorized, 47,419,109 and
52,419,109 shares issued and outstanding as of December 31, 2022
and June 30, 2023,
respectively)
|
|
131
|
|
146
|
|
Class C Ordinary
shares
|
|
|
|
|
|
($0.003 par value;
8,333,333 and 8,333,333 shares authorized, 4,708,415 and
4,708,415
shares issued and outstanding as of December 31, 2022 and June 30,
2023, respectively)
|
|
13
|
|
13
|
|
Additional paid-in
capital
|
|
515,182
|
|
517,031
|
|
Accumulated
deficit
|
|
(507,573)
|
|
(509,768)
|
|
Accumulated other
comprehensive income
|
|
—
|
|
—
|
|
Total
equity
|
|
7,753
|
|
7,422
|
|
|
|
|
|
|
Total liabilities
and equity
|
|
25,272
|
|
28,759
|
|
AMBOW EDUCATION
HOLDING LTD.
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS
|
|
(All amounts in
thousands, except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
For the six months ended
|
|
For the three months ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2022
|
|
2023
|
|
2022
|
|
2023
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
NET
REVENUES
|
|
|
|
|
|
|
|
|
|
Educational programs
and services
|
|
9,724
|
|
6,097
|
|
4,955
|
|
2,728
|
|
COST OF
REVENUES
|
|
|
|
|
|
|
|
|
|
Educational programs
and services
|
|
(7,364)
|
|
(4,082)
|
|
(3,449)
|
|
(1,508)
|
|
|
|
|
|
|
|
|
|
|
GROSS
PROFIT
|
|
2,360
|
|
2,015
|
|
1,506
|
|
1,220
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Selling and
marketing
|
|
(1,170)
|
|
(425)
|
|
(486)
|
|
(148)
|
|
General and
administrative
|
|
(5,288)
|
|
(3,449)
|
|
(3,273)
|
|
(1,829)
|
|
Total operating
expenses
|
|
(6,458)
|
|
(3,874)
|
|
(3,759)
|
|
(1,977)
|
|
|
|
|
|
|
|
|
|
|
OPERATING
LOSS
|
|
(4,098)
|
|
(1,859)
|
|
(2,253)
|
|
(757)
|
|
|
|
|
|
|
|
|
|
|
OTHER
EXPENSES
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
(72)
|
|
(33)
|
|
(33)
|
|
(26)
|
|
Foreign exchange loss,
net
|
|
—
|
|
(9)
|
|
—
|
|
(9)
|
|
Other expense,
net
|
|
(134)
|
|
(281)
|
|
(87)
|
|
(196)
|
|
Loss on disposal of
subsidiaries
|
|
(173)
|
|
—
|
|
(173)
|
|
—
|
|
Total other
expense
|
|
(379)
|
|
(323)
|
|
(293)
|
|
(231)
|
|
|
|
|
|
|
|
|
|
|
LOSS BEFORE INCOME
TAX AND NON-CONTROLLING
INTEREST
|
|
(4,477)
|
|
(2,182)
|
|
(2,546)
|
|
(988)
|
|
Income tax benefit
(expense)
|
|
34
|
|
(13)
|
|
34
|
|
(13)
|
|
|
|
|
|
|
|
|
|
|
LOSS FROM CONTINUING
OPERATIONS
|
|
(4,443)
|
|
(2,195)
|
|
(2,512)
|
|
(1,001)
|
|
Loss from discontinued
operations, net of income tax
|
|
(9,467)
|
|
—
|
|
(8,642)
|
|
—
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS
|
|
(13,910)
|
|
(2,195)
|
|
(11,154)
|
|
(1,001)
|
|
-Less: Net loss
attributable to non-controlling interests from
continuing operations
|
|
—
|
|
—
|
|
—
|
|
—
|
|
-Less: Net loss
attributable to non-controlling interests from
discontinued operations
|
|
(180)
|
|
—
|
|
(134)
|
|
—
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
ATTRIBUTABLE TO ORDINARY SHAREHOLDERS
FROM CONTINUING OPERATIONS
|
|
(4,443)
|
|
(2,195)
|
|
(2,512)
|
|
(1,001)
|
|
NET LOSS
ATTRIBUTABLE TO ORDINARY SHAREHOLDERS
FROM DISCONTINUED OPERATIONS
|
|
(9,287)
|
|
—
|
|
(8,508)
|
|
—
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
ATTRIBUTABLE TO ORDINARY SHAREHOLDERS
|
|
(13,730)
|
|
(2,195)
|
|
(11,020)
|
|
(1,001)
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE
LOSS, NET OF TAX
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
(166)
|
|
—
|
|
(90)
|
|
—
|
|
Other comprehensive
loss
|
|
(166)
|
|
—
|
|
(90)
|
|
—
|
|
|
|
|
|
|
|
|
|
|
TOTAL COMPREHENSIVE
LOSS
|
|
(14,076)
|
|
(2,195)
|
|
(11,244)
|
|
(1,001)
|
|
|
|
|
|
|
|
|
|
|
Net loss from
continuing operations per share – basic and diluted
|
|
(0.10)
|
|
(0.04)
|
|
(0.05)
|
|
(0.02)
|
|
Net loss from
discontinued operations per share – basic and diluted
|
|
(0.20)
|
|
—
|
|
(0.18)
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
used in calculating basic and diluted net loss per share
|
|
46,756,368
|
|
55,525,314
|
|
46,825,968
|
|
57,127,524
|
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SOURCE Ambow Education Holding Ltd.
