SHANGHAI, Nov. 22,
2023 /PRNewswire/ -- Four Seasons Education (Cayman)
Inc. ("Four Seasons Education" or the "Company") (NYSE: FEDU), a
tourism and education-related service provider in China, today announced its unaudited financial
results for the first half of fiscal year 2024, ended August 31, 2023.
Financial and Operational Highlights for the First Half of
Fiscal Year 2024
- Revenue increased by 347.5% to RMB61.8
million (US$8.5 million),
compared to RMB13.8 million in the
same period of last year.
- Gross profit increased by 650.1% to RMB26.7 million (US$3.7
million) from RMB3.6 million
in the same period of last year.
- Operating income was RMB0.9
million (US$0.1 million),
compared to an operating loss of RMB25.3
million in the same period of last year.
- Adjusted operating income(1) (non-GAAP) was
RMB2.7 million (US$0.4 million), as compared to an adjusted
operating loss of RMB23.3 million in
the same period of last year.
- Net income was RMB5.7 million
(US$0.8 million), compared to a net
loss of RMB23.9 million in the same
period of last year.
- Adjusted net income(2) (non-GAAP) was RMB6.2 million (US$0.9
million), as compared to an adjusted net loss of
RMB18.4 million in the same period of
last year.
- Basic and diluted net income per American Depositary Share
("ADS") attributable to ordinary shareholders were both
RMB2.70 (US$0.37), as compared to a net loss of
RMB11.23 in the same period of last
year. Each ADS represents ten ordinary shares.
- Adjusted basic and diluted net income per ADS attributable to
ordinary shareholders(3) (non-GAAP) were both
RMB2.93 (US$0.41), compared to a net loss of RMB8.65 in the same period of last year.
|
(1) Adjusted
operating income/loss is defined as operating income/loss excluding
share-based compensation expenses.
|
|
(2) Adjusted
net income/loss is defined as net income/loss excluding share-based
compensation expenses and fair value change of
investments.
|
|
(3) Adjusted
basic/diluted net income/loss per ADS attributable to ordinary
shareholders is defined as basic/diluted net income/loss per ADS
attributable to ordinary shareholders excluding share-based
compensation expenses per ADS attributable to ordinary shareholders
and fair value change of investments per ADS attributable to
ordinary shareholders.
|
|
For more information on
these adjusted financial measures, please see the section captioned
under "About Non-GAAP Financial Measures" and the tables captioned
"Reconciliation of GAAP and non-GAAP Results" set forth at the end
of this release.
|
Ms. Yi (Joanne) Zuo, Chief
Executive Officer and Director of Four Seasons Education said, "We
experienced a strong recovery in the six months ended August 31, 2023, evidenced by a triple-digit
percentage growth in total revenues which drove our gross margin to
approximately 43%. The substantial revenue increase was primarily
attributable to the robust growth of our tourism business, as well
as the increase of the non-academic tutoring business.
Additionally, our bottom line turned positive in the period as a
result of the improved operating leverage and prudent cost
management.
"Excitingly, we experienced rapid growth in both our domestic
and outbound tourism business for all ages. Furthermore, beyond the
regular travel agency business, we capitalized on our abundant
study resources and keen industry sense to roll out a broad array
of themed enrichment learning trip programs for students. We are
also actively developing and providing tourism programs tailored
for senior adults. Meanwhile, operations and construction at our
proprietary study camps are progressing well. We have been steadily
expanding the service offerings of our study camps in operation and
construction at our new camp in Jiangxi province is on course with partial
facilities set to open next year.
"Furthermore, we witnessed encouraging progress in advancing our
non-academic tutoring programs as we maintained our strategic focus
on enriching and diversifying our non-academic offerings to meet
learning needs across broader age groups. Moreover, we further
expanded our footprint in school-based tutoring product solutions
and training programs for teachers. Leveraging our in-depth
expertise and experience in the education sector, we have recently
embarked on our overseas learning preparation and consulting
businesses, with the goal of providing our customer groups and
communities with more comprehensive services.
"Moving forward, we plan to further explore new business
opportunities that align with relevant rules and regulations in the
tourism and education-related services sectors. As we navigate
market dynamics and cycles, we remain committed to advancing our
strategy to develop our business and increase shareholder value by
further enriching our service offerings, diversifying our customer
base and investing in our core capabilities," Ms. Zuo
concluded.
First Half Fiscal Year 2024 Financial Results
Revenue increased by 347.5% to RMB61.8 million (US$8.5
million) in the first half of fiscal year 2024, from
RMB13.8 million in the same period of
last year, mainly driven by the rapid growth in the Company's
tourism and non-academic tutoring businesses.
Cost of revenue increased by 242.6% to RMB35.1 million (US$4.8
million) in the first half of fiscal year 2024 from
RMB10.3 million in the same period of
last year,mainly due to the increase in cost related to the
Company's tourism business and the staff cost of the Company's
non-academic tutoring business, which is in line with the revenue
growth.
Gross profit increased by 650.1% to RMB26.7 million (US$3.7
million) in the first half of fiscal year 2024 from
RMB3.6 million in the same period of
last year.
General and administrative expenses decreased by 10.6% to
RMB23.5 million (US$3.2 million) in the first half of fiscal year
2024 from RMB26.3 million in the same
period of last year, mainly attributable to the one-time expenses
associated with the stock reserve split-up incurred last year.
Sales and marketing expenses decreased by 11.2% to
RMB2.2 million (US$0.3 million) in the first half of fiscal year
2024 from RMB2.5 million in the same
period of last year, mainly resulting from the Company's cost
control initiatives.
Operating income was RMB0.9
million (US$0.1 million) in
the first half of fiscal year 2024, compared with an operating loss
of RMB25.3 million in the same period
of last year. Adjusted operating income(1)
(non-GAAP), which is calculated as operating income (loss)
excluding share-based compensation expenses, was RMB2.7 million (US$0.4
million) in the first half of fiscal year 2024, compared
with an adjusted operating loss of RMB23.3
million in the same period of last year.
Other income, net was RMB2.7
million (US$0.4 million) in
the first half of fiscal year 2024, compared with other expenses of
RMB0.8 million in the same period of
last year.
Income tax expense was RMB0.2
million (US$0.02 million) in
the first half of fiscal year 2024, compared with income tax
benefit of RMB0.6 million in the same
period of last year.
Net income was RMB5.7
million (US$0.8 million)
during the first half of fiscal year 2024, compared with a net loss
of RMB23.9 million in the same period
of last year. Adjusted net income(2) (non-GAAP),
which is calculated as net income (loss) excluding share-based
compensation expenses and fair value change of the Company's
investments, was RMB6.2 million
(US$0.9 million), compared with an
adjusted net loss of RMB18.4 million
in the same period of last year.
Basic and diluted net income
per ADS attributable to ordinary shareholders in the first half
of fiscal year 2024 were both RMB2.70
(US$0.37), compared with a net loss
of RMB11.23 in the same period of
last year. Adjusted basic and diluted net income per ADS
attributable to ordinary
shareholders(3) (non-GAAP) in the first half of
fiscal year 2024 were both RMB2.93
(US$0.41), compared with an adjusted
net loss of RMB8.65, for the same
period of last year.
Cash and cash equivalents. As of August 31, 2023, the Company had cash and cash
equivalents of RMB221.2 million
(US$30.5 million), compared with
RMB175.7 million as of February 28, 2023.
About Four Seasons Education (Cayman) Inc.
Four Seasons Education (Cayman) Inc. is a service provider of
both tourism and education-related services in China. The Company's program, service and
product offerings mainly consist of non-academic tutoring programs,
school-based tutoring product solutions and training programs for
teachers, study camps and learning trips for students, and travel
agency services for all age groups. For more information, please
visit https://ir.sijiedu.com.
About Non-GAAP Financial Measures
In evaluating the Company's business, the Company considers and
uses certain non-GAAP measures, including primarily adjusted
operating income/loss, adjusted net income/loss and adjusted basic
and diluted net income/loss per ADS attributable to ordinary
shareholders, as supplemental measures to review and assess the
Company's operating performance. Adjusted operating income/loss is
defined as operating income/loss excluding share-based compensation
expenses. Adjusted net income/loss is defined as net income/loss
excluding share-based compensation expenses and fair value change
of investments (net of tax effect). Adjusted basic/ diluted net
income/loss per ADS attributable to ordinary shareholders is
defined as basic/diluted net income/loss per ADS attributable to
ordinary shareholders excluding share-based compensation expenses
per ADS attributable to ordinary shareholders and fair value change
of investments measured at fair value per ADS attributable to
ordinary shareholders. 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 U.S. GAAP.
The Company believes that these non-GAAP financial measures
provide meaningful supplemental information regarding its
performance and liquidity by excluding share-based expenses, fair
value change of investments measured at fair value and impairment
loss on intangible assets and goodwill (where applicable) that may
not be indicative of the Company's operating performance from a
cash perspective. The Company believes that both management and
investors benefit from these non-GAAP financial measures in
assessing its performance and when planning and forecasting future
periods. These non-GAAP financial measures also facilitate
management's internal comparisons to the Company's historical
performance and liquidity. The Company also believes these non-GAAP
financial measures are useful to investors in allowing for greater
transparency with respect to supplemental information used by
management in the Company's financial and operational decision
making. A limitation of using non-GAAP measures is that these
non-GAAP measures exclude share-based compensation charges and fair
value change of investments measured at fair value (where
applicable) that have been and will continue to be for the
foreseeable future a significant recurring expense in the Company's
business. The Company compensates for these limitations by
providing specific information regarding the GAAP amounts excluded
from each non-GAAP measure. The accompanying tables have more
details on the reconciliations between GAAP financial measures that
are most directly comparable to non-GAAP financial measures.
Exchange Rate Information
This announcement contains translations of certain RMB amounts
into U.S. dollars at a specified rate solely for the convenience of
the reader. Unless otherwise noted, all translations from RMB to
U.S. dollars are made at a rate of RMB7.2582 to US$1.00, the rate set forth in the H.10
statistical release of the U.S. Federal Reserve Board on
August 31, 2023.
Safe Harbor Statement
This press release contains statements of a forward-looking
nature. These statements, including the statements relating to the
Company's future financial and operating results, 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. Among other things, management's quotations and
the Business Outlook section contain forward-looking statements.
These forward-looking statements involve known and unknown risks
and uncertainties and are based on current expectations,
assumptions, estimates and projections about the Company and the
industry. Potential risks and uncertainties include, but are not
limited to, those relating to its ability to attract new students
and retain existing students, its ability to deliver a satisfactory
learning experience and improving their academic performance, PRC
regulations and policies relating to the education industry in
China, general economic conditions
in China, and the Company's
ability to meet the standards necessary to maintain listing of its
ADSs on the NYSE or other stock exchange, including its ability to
cure any non-compliance with the NYSE's continued listing criteria.
All information provided in this press release is as of the date
hereof, and the Company 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 the Company 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. Further
information regarding risks and uncertainties faced by the Company
is included in the Company's filings with the U.S. Securities and
Exchange Commission, including its annual reports on Form 20-F.
For investor and media inquiries, please contact:
In China:
Four Seasons Education (Cayman) Inc.
Olivia Li
Tel: +86 (21) 6317-6177
E-mail: IR@fsesa.com
The Piacente Group, Inc.
Jenny Cai
Tel: +86-10-6508-0677
E-mail: fourseasons@tpg-ir.com
In the United States:
The Piacente Group, Inc.
Brandi Piacente
Tel: +1-212-481-2050
E-mail: fourseasons@tpg-ir.com
|
FOUR SEASONS
EDUCATION (CAYMAN) INC.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(in thousands,
except share data and per share data)
|
|
|
|
As of
|
|
|
February
28,
|
|
August
31,
|
|
August
31,
|
|
|
2023
|
|
2023
|
|
2023
|
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
Current
assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
175,696
|
|
221,191
|
|
30,475
|
|
Accounts receivable
and contract assets
|
|
887
|
|
6,217
|
|
857
|
|
Other receivables,
deposits and other assets
|
|
7,306
|
|
8,571
|
|
1,181
|
|
Amounts due from
related parties, net
|
|
11,127
|
|
10,412
|
|
1,435
|
|
Short-term
investments
|
|
24,332
|
|
-
|
|
-
|
|
Short-term investments
under fair value
|
|
156,639
|
|
136,645
|
|
18,826
|
|
Long-term investments
under fair value – current
|
|
135,201
|
|
139,773
|
|
19,257
|
|
Total current
assets
|
|
511,188
|
|
522,809
|
|
72,031
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
Restricted
cash
|
|
1,362
|
|
1,652
|
|
228
|
|
Property and
equipment, net
|
|
13,979
|
|
25,357
|
|
3,494
|
|
Operating lease
right-of-use assets
|
|
29,379
|
|
28,468
|
|
3,922
|
|
Intangible assets,
net
|
|
2,476
|
|
2,087
|
|
288
|
|
Goodwill
|
|
-
|
|
1,125
|
|
155
|
|
Deferred tax
assets
|
|
601
|
|
881
|
|
121
|
|
Long-term
investment
|
|
27,500
|
|
36,500
|
|
5,029
|
|
Long-term investment
under fair value – non-current
|
|
13,583
|
|
14,124
|
|
1,946
|
|
Other non-current
assets
|
|
972
|
|
956
|
|
132
|
|
Total non-current
assets
|
|
89,852
|
|
111,150
|
|
15,315
|
|
TOTAL
ASSETS
|
|
601,040
|
|
633,959
|
|
87,346
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
Amounts due to related
parties
|
|
867
|
|
2,124
|
|
293
|
|
Accrued expenses and
other current liabilities
|
|
59,542
|
|
65,587
|
|
9,036
|
|
Operating lease
liabilities – current
|
|
2,531
|
|
1,768
|
|
244
|
|
Income tax
payable
|
|
17,171
|
|
17,549
|
|
2,418
|
|
Deferred
revenue
|
|
7,269
|
|
12,893
|
|
1,776
|
|
Total current
liabilities
|
|
87,380
|
|
99,921
|
|
13,767
|
|
FOUR SEASONS
EDUCATION (CAYMAN) INC.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(in thousands,
except share data and per share data)
|
|
|
|
As of
|
|
|
February
28,
|
|
August
31,
|
|
August
31,
|
|
|
2023
|
|
2023
|
|
2023
|
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
Deferred tax
liabilities
|
|
575
|
|
575
|
|
79
|
|
Operating lease
liabilities – non-current
|
|
1,195
|
|
1,502
|
|
207
|
|
Total non-current
liabilities
|
|
1,770
|
|
2,077
|
|
286
|
|
TOTAL
LIABILITIES
|
|
89,150
|
|
101,998
|
|
14,053
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
Total
equity
|
|
511,890
|
|
531,961
|
|
73,293
|
|
TOTAL LIABILITIES
AND EQUITY
|
|
601,040
|
|
633,959
|
|
87,346
|
|
FOUR SEASONS
EDUCATION (CAYMAN) INC.
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(in thousands,
except share data and per share data)
|
|
|
|
Six Months Ended
August 31,
|
|
|
2022
|
|
2023
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
Revenue
|
|
|
|
|
|
|
|
-- Revenue from
third parties
|
|
9,899
|
|
60,718
|
|
8,365
|
|
-- Revenue from
related parties
|
|
3,917
|
|
1,113
|
|
153
|
|
Total
revenue
|
|
13,816
|
|
61,831
|
|
8,518
|
|
Cost of
revenue
|
|
(10,258)
|
|
(35,143)
|
|
(4,842)
|
|
Gross
profit
|
|
3,558
|
|
26,688
|
|
3,676
|
|
|
|
|
|
|
|
|
General and
administrative expenses
|
|
(26,343)
|
|
(23,549)
|
|
(3,244)
|
|
Sales and marketing
expenses
|
|
(2,526)
|
|
(2,244)
|
|
(309)
|
|
Operating income
(loss)
|
|
(25,311)
|
|
895
|
|
123
|
|
|
|
|
|
|
|
|
Subsidy
income
|
|
1,238
|
|
49
|
|
7
|
|
Interest income,
net
|
|
377
|
|
2,224
|
|
306
|
|
Other income/
(expenses), net
|
|
(799)
|
|
2,698
|
|
372
|
|
Income (loss) before income
taxes
|
|
(24,495)
|
|
5,866
|
|
808
|
|
|
|
|
|
|
|
|
Income tax benefit/
(expense)
|
|
642
|
|
(154)
|
|
(21)
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
(23,853)
|
|
5,712
|
|
787
|
|
Net income (loss)
attributable to non-controlling interest
|
|
(1,940)
|
|
664
|
|
91
|
|
Net income (loss)
attributable to Four Seasons Education (Cayman) Inc.
|
|
(21,913)
|
|
5,048
|
|
696
|
|
|
|
|
|
|
|
|
Net income (loss)
per ordinary share:
|
|
|
|
|
|
|
|
Basic
|
|
(1.03)
|
|
0.24
|
|
0.03
|
|
Diluted
|
|
(1.03)
|
|
0.24
|
|
0.03
|
|
|
|
|
|
|
|
|
Weighted average
shares used in calculating net income (loss) per ordinary
share:
|
|
|
|
|
|
|
|
Basic
|
|
21,238,806
|
|
21,189,215
|
|
21,189,215
|
|
Diluted
|
|
21,238,806
|
|
21,189,215
|
|
21,189,215
|
|
FOUR SEASONS
EDUCATION (CAYMAN) INC.
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(LOSS)
|
|
(in thousands,
except share data and per share data)
|
|
|
|
Six Months Ended
August 31,
|
|
|
2022
|
|
2023
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
Net income
(loss)
|
|
(23,853)
|
|
5,712
|
|
787
|
|
Other comprehensive
income, net of tax of nil
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
34,317
|
|
1,641
|
|
226
|
|
Comprehensive
income
|
|
10,464
|
|
7,353
|
|
1,013
|
|
Less: Comprehensive
income (loss) attributable to non-controlling interest
|
|
(1,940)
|
|
664
|
|
91
|
|
Comprehensive income
attributable to Four Seasons Education (Cayman) Inc.
|
|
12,404
|
|
6,689
|
|
922
|
|
FOUR SEASONS
EDUCATION (CAYMAN) INC.
|
|
RECONCILIATION OF
GAAP AND NON-GAAP RESULTS
|
|
(in thousands,
except share data and per share data)
|
|
|
|
Six Months Ended
August 31,
|
|
|
2022
|
|
2023
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
Operating income
(loss)
|
|
(25,311)
|
|
895
|
|
123
|
|
Add: share-based
compensation expenses
|
|
2,012
|
|
1,800
|
|
248
|
|
Adjusted operating
income (loss) (non-GAAP)
|
|
(23,299)
|
|
2,695
|
|
371
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
(23,853)
|
|
5,712
|
|
787
|
|
Add: share-based
compensation expenses (net of tax effect of nil)
|
|
2,012
|
|
1,800
|
|
248
|
|
Add: fair value change
of investments, excluding foreign currency
translation adjustment (net of tax effect of nil)
|
|
3,471
|
|
(1,304)
|
|
(180)
|
|
Adjusted net income
(loss) (non-GAAP)
|
|
(18,370)
|
|
6,208
|
|
855
|
|
|
|
|
|
|
|
|
Basic net income
(loss) per ADS attributable to ordinary shareholders
|
|
(11.23)
|
|
2.70
|
|
0.37
|
|
Add: share-based
compensation expenses per ADS attributable to
ordinary shareholders
|
|
0.95
|
|
0.85
|
|
0.12
|
|
Add: fair value change
of investments per ADS attributable to
ordinary shareholders
|
|
1.63
|
|
(0.62)
|
|
(0.08)
|
|
Adjusted basic net
income (loss) per ADS attributable to
ordinary shareholders (non-GAAP)
|
|
(8.65)
|
|
2.93
|
|
0.41
|
|
Diluted net income
(loss) per ADS attributable to
ordinary shareholders
|
|
(11.23)
|
|
2.70
|
|
0.37
|
|
Add: share-based
compensation expenses per ADS attributable to
ordinary shareholders
|
|
0.95
|
|
0.85
|
|
0.12
|
|
Add: fair value change
of investments per ADS attributable to
ordinary shareholders
|
|
1.63
|
|
(0.62)
|
|
(0.08)
|
|
Adjusted diluted net
income (loss) per ADS attributable to
ordinary shareholders (non-GAAP)
|
|
(8.65)
|
|
2.93
|
|
0.41
|
|
Weighted average ADSs
used in calculating earnings per ADS
|
|
|
|
|
|
|
|
Basic
|
|
2,123,881
|
|
2,118,922
|
|
2,118,922
|
|
Diluted
|
|
2,123,881
|
|
2,118,922
|
|
2,118,922
|
View original
content:https://www.prnewswire.com/news-releases/four-seasons-education-reports-first-half-of-fiscal-year-2024-unaudited-financial-results-301995805.html
SOURCE Four Seasons Education Inc.