4Q 2010 Net Revenues Increased 43.6% Year-Over-Year
4Q 2010 Non-GAAP Net Income Increased 36.8% Year-Over-Year
FY10 Net Revenues Increased 40.4% Year-Over-Year
FY10 Non-GAAP Net Income Increased 20.7% Year-Over-Year
Global Education & Technology Group Ltd. (Nasdaq:GEDU) ("Global
Education" or the "Company"), the largest test preparation provider
for the International English Language Testing System ("IELTS") and
a leading provider of educational courses and related services in
China, today announced unaudited financial results for the fourth
quarter and fiscal year of 2010.
Fourth Quarter 2010 Financial Summary
- Total net revenues increased 43.6% year-over-year to RMB85.0
million ($12.9 million1) from RMB59.2 million in the fourth quarter
of 2009.
- Non-GAAP operating income, excluding share-based compensation
of RMB4.6 million ($0.7 million), increased 10.2% year-over-year to
RMB9.7 million ($1.5 million) from RMB8.8 million in the fourth
quarter of 2009. GAAP operating income (including share-based
compensation) decreased 38.6% year-over-year to RMB5.1 million
($0.8 million) from RMB8.3 million in the fourth quarter of
2009.
- Non-GAAP net income, excluding share-based compensation and
fair value change in contingent consideration payable attributable
to Global Education, increased 36.8% year-over-year to RMB11.9
million ($1.8 million) from RMB8.7 million in the fourth quarter of
2009. GAAP net income, including share-based compensation and
fair value change in contingent consideration payable attributable
to Global Education, decreased 9.8% year-over-year to RMB7.4
million ($1.1 million) from RMB8.2 million in the fourth quarter of
2009.
- Total course enrollments increased 40.2% year-over-year to
133,129.
- Total number of learning centers increased to 351, covering 119
cities as of December 31, 2010, up from 317 as of September 30,
2010.
- Total number of directly-owned-and-operated learning centers
increased by five to 82 as of December 31, 2010 from September 30,
2010.
Fiscal Year 2010 Financial Summary
- Total net revenues increased 40.4% year-over-year to RMB345.6
million ($52.4 million) from RMB246.2 million in fiscal year
2009.
- Non-GAAP operating income, excluding share-based compensation,
increased 31.7% year-over-year to RMB68.6 million ($10.4 million)
from RMB52.1 million in fiscal year 2009. Operating income
increased 18.9% year-over-year to RMB60.3 million ($9.1 million)
from RMB50.7 million in fiscal year 2009.
- Non-GAAP net income, excluding share-based compensation and
fair value change in contingent consideration payable attributable
to Global Education, increased 20.7% year-over-year to RMB68.8
million ($10.4 million) from RMB57.0 million in the fiscal year
2009. GAAP net income increased 1.8% year-over-year to
RMB56.6 million ($8.6 million) from RMB55.6 million in fiscal year
2009.
- Total course enrollments for the year of 2010 were 770,669,
representing a 20.4% increase compared to 640,243 for the year of
2009.
- Total number of learning centers increased to 351, covering 119
cities as of December 31, 2010, up from 241 as of December 31,
2009.
Mr. David Yongqi Zhang, Founder and Chief Executive Officer of
Global Education, commented, "In the fourth quarter of 2010, we
achieved rapid revenue growth, continued with our nationwide
construction of new learning centers, and broadened our pre-school
education offerings. More and more students and parents rank
studying abroad as their highest aspiration, and boosted by the
appreciation of the RMB, there was a substantial increase in the
number of applicants to study in the UK and US. The year 2011 opens
a new decade for Global Education, as we march towards "1,000
Learning Centers in 10 Years", with a focus on early education,
after-school tutoring, primary and secondary schools training, test
preparation related training and vocational education, for all ages
between four and forty."
Ms. Hannah Lee, Vice President & Chief Financial Officer of
Global Education, stated, "We are pleased with the strong 43.6%
year-over-year revenue growth in the fourth quarter, which exceeded
our previously stated guidance. During the quarter, we
continued to add new learning centers in kids science and
after-school tutoring in both Beijing and Shanghai. In 2011,
we will continue to execute our multi-pronged expansion plan by
further penetrating the test preparation segment and by rapidly
expanding in the kids-related training segment. "
Fourth Quarter 2010 Financial Performance
Fourth quarter 2010 net revenues increased
43.6% year-over-year to RMB85.0 million ($12.9 million) from
RMB59.2 million in the same period of 2009. The increase was
primarily due to the following:
- Net revenues from educational programs and
services increased by 39.6% to RMB76.8 million ($11.6
million) in the fourth quarter of 2010 compared to RMB55.0 million
in the fourth quarter of 2009, driven primarily by 16.2% increase
in test preparation course enrollments.
- Net revenues from franchise fees, study abroad
consulting services and sales of books and course
materials increased by 95.2% to RMB8.2 million ($1.2
million) in the fourth quarter of 2010, compared to RMB4.2 million
in the prior year period, driven primarily by increased fees and
commissions earned in relation to our study abroad consulting
services.
Cost of revenues, which primarily consisted of
salaries and benefits, rent payments, and books and course material
printing costs, increased 47.4% to RMB37.3 million ($5.7 million)
in the fourth quarter of 2010 compared to RMB25.3 million in the
same period of 2009, primarily due to larger teaching faculty and
increased costs related to the expansion of the Company's network
of directly operated learning centers. As a result, cost of
revenues represented 43.9% of net revenues in the fourth quarter of
2010, up from 42.7% of net revenues in the same period of 2009.
Selling and marketing expenses increased 55.4%
to RMB27.5 million ($4.2 million) in the fourth quarter of 2010
compared to RMB17.7 million in the same period in 2009, reflecting
an increase in expenses relating to salaries and benefits
(including share-based compensation of RMB1.4 million) of sales and
marketing personnel and commission to sales agents. Selling and
marketing expenses represented 32.4% of net revenues, an increase
from 29.9% in the same period of 2009, mainly due to increased
sales and marketing related headcount and higher share-based
compensation expenses relating to performance-based options.
General and administrative expenses increased
88.8% to RMB15.1 million ($2.3 million) in the fourth quarter of
2010 compared to RMB8.0 million in the same period of 2009 mainly
due to significantly higher share-based compensation expenses of
RMB3.0 million mainly related to performance-based options linked
to the Company's IPO in the quarter and operational performance in
2010, increased professional fees, and performance-based incentive
payments. General and administrative expense increased as a
percentage of net revenues from 13.5% in the fourth quarter of 2009
to 17.8% in the fourth quarter of 2010, as a result of the
significant increase of non-cash share-based compensation expenses
as described above.
Operating income decreased 38.6% to RMB5.1
million ($0.8 million) in the fourth quarter of 2010, from RMB8.3
million in the same period of 2009, mainly due to higher non-cash
share-based compensation expenses of RMB4.6 million ($0.7 million)
in the fourth quarter of 2010 compared to RMB0.5 million in the
same quarter in the previous year. Operating
margin for the fourth quarter of 2010 was 6.0%, compared
to 14.0% in the same period of last year. The decrease in the
Company's operating margin was again mainly due to increased
share-based compensation expenses and higher professional fees.
Income tax expense in the fourth quarter of
2010 was RMB0.4 million ($0.06 million), representing an effective
tax rate of 5.5%, as compared to income tax expenses of RMB1.6
million and an effective tax rate of 16.0% in the same period of
2009. The decrease in effective tax rate was mainly due to
permanent difference due to the fact that IPO related expenses
which were deductible for tax purposes were presented as a
reduction of paid-in-capital that did not reduce net income for
accounting purposes in accordance with US GAAP.
Net income decreased 9.8% to RMB7.4 million
($1.1 million) in the fourth quarter of 2010, compared to RMB8.2
million in the same quarter of 2009. Diluted earnings
per ADS were RMB0.28 ($0.04) in the fourth quarter of
2010. The number of weighted average ADSs used to calculate basic
and diluted earnings per ADS were 24.3 million and 25.1 million,
respectively. Each ADS represents four ordinary shares.
The Company had approximately 103.7 million ordinary shares,
representing 25.9 million ADS, outstanding as of December 31,
2010.
Non-GAAP net income, excluding share-based
compensation expenses and fair value change in contingent
consideration payable attributable to Global Education, was RMB11.9
million ($1.8 million) in the fourth quarter of 2010, representing
a 36.8% increase from the same period of 2009. Basic
and diluted non-GAAP net income per ADS for the fourth
quarter of 2010 were both RMB0.48 ($0.07).
Fiscal Year 2010 Financial Performance
Full year 2010 net revenues increased 40.4%
year-over-year to RMB345.6 million ($52.4 million) from RMB246.2
million in the full year of 2009. The increase was primarily
due to the following:
- Net revenues from educational programs and
services increased by 40.2% to RMB321.8 million ($48.8
million) in the full year of 2010 compared to RMB229.5 million in
the prior year, driven primarily by 20.5% increase in test
preparation course enrollments.
- Net revenues from franchise fees, study abroad
consulting services and sales of books and course
materials increased by 41.9% to RMB23.7 million ($3.6
million) in the full year of 2010, compared to RMB16.7 million in
the prior year period, driven primarily by increased fees and
commissions earned in relation to our study abroad consulting
services and increased franchise fees.
Cost of revenues, which primarily consisted of
salaries and benefits, rent payments, and books and course material
printing costs, increased 49.6% to RMB152.6 million ($23.1 million)
in the full year 2010 compared to RMB102.0 million in the full year
2009, primarily due to larger teaching faculty and increased rental
expenses related to the expansion of the Company's network of
directly operated learning centers, and costs associated with
summer camps. As a result, cost of revenues represented 44.2%
of net revenues in the full year 2010, up from 41.4% of net
revenues in the full year 2009.
Selling and marketing expenses increased 42.7%
to RMB92.2 million ($14.0 million) in the full year 2010 compared
to RMB64.6 million in the prior year, primarily due to increased
expenses relating to salaries and benefits (including share-based
compensation of RMB2.6 million ($0.4 million)) of sales and
marketing personnel, commissions to sales agents, and related
rental expenses. Selling and marketing expenses represented
26.7% of net revenues, a slight increase from 26.2% in the full
year of 2009.
General and administrative expenses in the full
year 2010 increased 39.3% to RMB40.4 million ($6.1 million),
compared to RMB29.0 million in the full year 2009, mainly due to
significantly higher share-based compensation expenses of RMB 5.0
million ($0.8 million), increased professional fees, and
performance-based incentive payments. As a percentage of the
net revenues, general and administrative expenses remained at a
stable level at 11.7 % in the full year 2010 compared to 11.8% in
the full year 2009.
Operating income increased 18.9% to RMB60.3
million ($9.1 million) for the full year of 2010, from RMB50.7
million for the full year of 2009, due to combination of the above
aforementioned factors. Operating margin for
the full year of 2010 was 17.4%, compared to 20.6% for the full
year 2009. This operating margin decrease was mainly due to
the increased cost of revenues, non-cash share-based compensation
expenses, and higher professional fees.
Income tax expenses for the full year 2010 were
RMB7.8 million ($1.2 million), representing an effective tax rate
of 12.1%, as compared to income tax expenses of RMB4.8 million and
an effective tax rate of 7.9% in the year of 2009. The
increase in the effective tax rate primarily related to expiration
of tax-exemption status in 2009 where a wholly-owned subsidiary in
China starts to subject to 7.5% income tax rate from 2010 to
2012.
Net income in the full year of 2010 increased
1.8% to RMB56.6 million ($8.6 million), compared to RMB55.6 million
in the prior year. Diluted earnings per ADS
were RMB2.80 ($0.42) for the full year of 2010. The Company
had approximately 20.3 million weighted average diluted ADSs
outstanding during the full year 2010.
Non-GAAP net income, excluding share-based
compensation expenses and fair value change in contingent
consideration payable attributable to Global Education, was RMB68.8
million ($10.4 million) in the full year 2010, representing a 20.7%
increase from full year 2009. Basic and diluted
non-GAAP net income per ADS were RMB3.48 ($0.53) and
RMB3.40 ($0.52), respectively.
As of December 31, 2010, the Company had cash and cash
equivalents of RMB807.6 million ($122.4 million), compared
to RMB103.8 million as of December 31, 2009.
Cash flows provided by operating activities for
the full year 2010 were approximately RMB99.5 million ($15.1
million) compared to RMB 84.2 million for the full year 2009. The
increase was due to the continued strength of the Company's
operating results.
Deferred revenues increased to RMB88.7 million
($13.4 million) as of December 31, 2010, from RMB65.8 million as at
December 31, 2009. This increase was mainly due to continued
business growth.
Financial Outlook for First Quarter of 2011
The Company estimates that its net revenues for the first
quarter of 2011 will be in the range of RMB71.0 million ($10.8
million) to RMB76.0 million ($11.5 million), an increase of
approximately 14.5% to 22.5% over the same quarter in the previous
year.
This forecast reflects the Company's current and preliminary
view, which is subject to change.
"As we look at our overall performance in 2011, our focus on
further penetrating the test preparation segment remains a high
priority. We are also focused on rolling out new learning centers
in kids science and after-school tutoring at an accelerated rate,
particularly in the first half of the year. While this effort
will likely result in higher operating expenses compared to our
historic average in the coming quarters, we believe these areas of
learning will be strong contributors to overall revenue and profit
growth in the ensuing years to come," concluded Mr. Zhang, founder
and Chief Executive Officer.
Conference Call
The Company will hold a conference call at 8:00 pm ET on Monday,
March 7, 2011, to discuss its unaudited fourth quarter and fiscal
year 2010 financial results. Listeners may access the call by
dialing:
US Toll Free: +1-800-860-2442
International: +1-412-858-4600
Access code: Global Education & Technology
A replay of the call will be available through March 15,
2011. Listeners may access the replay by dialing:
US Toll Free: +1-877-344-7529
International: +1-412-317-0088
Access code: 449026
A webcast will also be available through the Company's website
at http://ir.globaleducation.cn.
About Global Education
Global Education & Technology Group Ltd. (Nasdaq:GEDU) is
the largest test preparation provider for IELTS and a leading
provider of educational courses and related services in China.
Under its "Global" brand, the Company also offers diversified
services that span a student's educational life cycle, including
after-school courses, overseas study consulting, and professional
certification test preparation. As of December 31, 2010, the
Company's network comprised 82 directly operated and 269 franchised
learning centers across China, as well as an online course delivery
platform with more than one million registered members. For
more information, please visit www.gedu.org.
The Global Education & Technology Group Ltd. logo is
available at
http://www.globenewswire.com/newsroom/prs/?pkgid=8354
Forward-looking Statements
This announcement contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
and as defined in the Private Securities Litigation Reform Act of
1995.
These forward-looking statements can be identified by terms such
as "anticipate," "believe," "could," "estimate," "expect,"
"forecast," "future," "intend," "look forward to," "outlook,"
"plan," "should," "will," and similar terms and include, among
other things, the Company's guidance relating to anticipated
financial and operating results for the first quarter of 2011 and
the growth prospects of the Company's business and industry. The
factors that could cause the Company's actual financial and
operating results to differ from what the Company currently
anticipates can include its ability to meet challenges associated
with its rapid expansion, its ability to anticipate and meet market
demand, the growth of China's economy and education market,
uncertainties with respect to the China's legal and regulatory
environments, and other factors, including those stated in the
Company's filings with the U.S. Securities and Exchange Commission
(the "SEC"). The financial information contained in this release
should be read in conjunction with the consolidated financial
statements and related notes included in the Company's prospectus
dated October 7, 2010 which was filed with the SEC and is available
on the SEC's website at www.sec.gov.
The forward-looking statements in this release involve known and
unknown risks and uncertainties and are based on current
expectations, assumptions, estimates, and projections about Global
Education and the markets in which it operates. The Company
undertakes no obligation to update forward-looking statements,
which speak only of the Company's views as of the date of this
release, to reflect subsequent events or circumstances, or to
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, the Company cannot
assure you that its expectations and assumptions will turn out to
be correct, and investors are cautioned that actual results may
differ materially from the anticipated results.
About Non-GAAP Measures
To supplement Global Education's unaudited consolidated
financial results presented in accordance with United States
Generally Accepted Accounting Principles (GAAP), the Company uses
the following measures defined as non-GAAP financial measures: net
income attributable to Global Education excluding share-based
compensation expenses and fair value change in contingent
consideration, operating income excluding share-based compensation
expenses, operating costs and expenses excluding share-based
compensation expenses, general and administrative expenses
excluding share-based compensation expenses, operating margin
excluding share-based compensation expenses, and basic and diluted
net income per ADS attributable to the Company excluding
share-based compensation expenses and fair value change in
contingent consideration payable.
Global Education believes that these non-GAAP financial measures
are useful for its management and investors to assess and analyze
the Company's core operating results as share-based compensation
expense and fair value change in contingent consideration payable
is not directly attributable to the underlying performance of the
Company's business operations and may not be indicative of its
operating performance from a cash perspective. These non-GAAP
financial measures also facilitate management's internal
comparisons to its historical performance and liquidity. A
limitation of using these non-GAAP financial measures is that these
non-GAAP measures exclude the share-based compensation charge and
fair value change in contingent consideration payable that have
been and will continue to be for the foreseeable future a
significant recurring expense in Global Education's business.
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
GAAP. The Company is only providing these non-GAAP performance
measures in the press release, and will not incorporate into GAAP
financial statements. For more information on these non-GAAP
financial measures, please see the tables captioned "Reconciliation
of Unaudited non-GAAP measures to the Most comparable GAAP
measures" set forth at the end of this press release.
GLOBAL EDUCATION &
TECHNOLOGY GROUP LIMITED |
Unaudited Condensed
Consolidated Balance Sheets |
(In
thousands) |
|
|
|
|
|
As of December
31, |
|
|
|
2010 |
2009 |
2010 |
|
RMB |
RMB |
USD |
Current assets: |
|
|
|
Cash and cash equivalents |
807,589 |
103,777 |
122,362 |
Restricted cash |
-- |
3,600 |
-- |
Term deposits |
5,271 |
241,500 |
799 |
Accounts receivable, net of allowance of nil
for 2009 and 2010 |
2,690 |
1,888 |
408 |
Prepaid expenses and other current
assets |
18,785 |
15,303 |
2,845 |
Deferred tax assets, current |
5,721 |
3,097 |
867 |
Amounts due from a related party |
-- |
10,184 |
-- |
Total current assets |
840,056 |
379,349 |
127,281 |
|
|
|
|
Property and equipment, net |
85,406 |
82,401 |
12,940 |
Acquired intangible assets, net |
5,609 |
1,144 |
850 |
Goodwill |
35,906 |
6,678 |
5,440 |
Other non-current assets |
6,463 |
8,174 |
980 |
Total Assets |
973,440 |
477,746 |
147,491 |
|
|
|
|
LIABILITIES, REDEEMABLE CONVERTIBLE
PREFERRED SHARES AND SHAREHOLDERS' EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
20,412 |
4,859 |
3,093 |
Deferred revenue |
88,704 |
65,814 |
13,440 |
Accrued expenses and other current
liabilities |
37,945 |
30,188 |
5,749 |
Deferred tax liabilities, current |
354 |
2,163 |
54 |
Tax payable |
7,190 |
9,576 |
1,089 |
Total current
liabilities |
154,605 |
112,600 |
23,425 |
|
|
|
|
Contingent consideration payable |
23,103 |
-- |
3,500 |
Deferred tax liabilities, non-current |
2,065 |
711 |
313 |
Other non-current liabilities |
1,275 |
2,354 |
194 |
Total Liabilities |
181,048 |
115,665 |
27,432 |
|
|
|
|
Redeemable convertible preferred
shares |
-- |
238,029 |
-- |
|
GLOBAL EDUCATION &
TECHNOLOGY GROUP LIMITED |
Unaudited Condensed
Consolidated Balance Sheets |
(In
thousands) |
|
|
|
|
|
As of December
31, |
|
2010 |
2009 |
2010 |
|
RMB |
RMB |
USD |
Shareholders' Equity |
|
|
|
Ordinary shares |
75 |
39 |
11 |
Additional paid-in capital |
705,927 |
52,126 |
106,959 |
Statutory reserves |
25,605 |
16,847 |
3,880 |
Retain earnings |
63,481 |
55,040 |
9,618 |
Accumulated other comprehensive income |
(2,696) |
-- |
(409) |
Total Shareholders'
Equity |
792,392 |
124,052 |
120,059 |
|
|
|
|
Total Liabilities, Redeemable
Convertible Preferred Shares and Shareholders' Equity |
973,440 |
477,746 |
147,491 |
GLOBAL EDUCATION &
TECHNOLOGY GROUP LIMITED |
Unaudited Interim
Condensed Consolidated Statements of Operations |
(in thousands, except
ADS and per ADS data) |
|
|
|
|
|
For the three
months ended December 31, |
|
2010 |
2009 |
2010 |
|
RMB |
RMB |
USD |
Revenues |
|
|
|
Educational programs and services |
76,756 |
55,025 |
11,630 |
Franchise fees, study abroad consulting
services and sales of books and course materials |
8,232 |
4,211 |
1,247 |
Total revenues |
84,988 |
59,236 |
12,877 |
|
|
|
|
Operating costs and
expenses |
|
|
|
Cost of revenues |
(37,319) |
(25,255) |
(5,654) |
Selling and marketing expenses |
(27,491) |
(17,655) |
(4,165) |
General and administrative expenses |
(15,073) |
(8,048) |
(2,284) |
Total operating costs and
expenses |
(79,883) |
(50,958) |
(12,103) |
Operating income |
5,105 |
8,278 |
774 |
|
|
|
|
Interest income |
1,973 |
1,630 |
299 |
Foreign exchange losses, net |
169 |
(2) |
26 |
Consideration payable fair value change |
122 |
-- |
18 |
Other income/(expense), net |
455 |
(152) |
68 |
Income before income
taxes |
7,824 |
9,754 |
1,185 |
|
|
|
|
Income tax expense |
(432) |
(1,558) |
(65) |
Net income |
7,392 |
8,196 |
1,120 |
|
|
|
|
Accretion of convertible redeemable preferred
shares |
499 |
(5,758) |
75 |
Income allocated to participating preferred
shareholder |
(148) |
(2,822) |
(22) |
|
|
|
|
Net income/(loss) attributable to
ordinary shareholders |
7,743 |
(384) |
1,173 |
|
|
|
|
Net income per share: |
|
|
|
Basic |
0.08 |
(0.01) |
0.01 |
Diluted |
0.07 |
(0.01) |
0.01 |
|
|
|
|
Weighted average number of shares
outstanding: |
|
|
|
Basic |
97,395,953 |
49,030,191 |
97,395,953 |
Diluted |
100,230,106 |
49,030,191 |
100,230,106 |
|
|
|
For the three
months ended December 31, |
|
2010 |
2009 |
2010 |
Share-based compensation expense included
in: |
RMB |
RMB |
USD |
Cost of revenues |
194 |
58 |
29 |
Selling and marketing expenses |
1,417 |
346 |
215 |
General and administrative expenses |
2,995 |
137 |
454 |
Total |
4,606 |
541 |
698 |
|
GLOBAL EDUCATION &
TECHNOLOGY GROUP LIMITED |
Reconciliation of
Unaudited Non-GAAP Measures to the Most Comparable GAAP
Measures |
|
|
|
For the three
months ended December 31, |
|
2010 |
2009 |
2010 |
|
RMB |
RMB |
USD |
|
|
|
|
General and administrative expenses |
15,073 |
8,048 |
2,284 |
Share-based compensation expense in general
and administrative expenses |
2,995 |
137 |
454 |
Non-GAAP general and administrative
expenses |
12,078 |
7,911 |
1,830 |
|
|
|
|
Total operating costs and expenses |
79,883 |
50,958 |
12,103 |
Share-based compensation expenses |
4,606 |
541 |
698 |
Non-GAAP operating costs and expenses |
75,277 |
50,417 |
11,405 |
|
|
|
|
Operating income |
5,105 |
8,278 |
774 |
Share-based compensation expenses |
4,606 |
541 |
698 |
Non-GAAP operating income |
9,711 |
8,819 |
1,472 |
|
|
|
|
Operating margin |
6.0% |
14.0% |
6.0% |
Non-GAAP operating margin |
11.4% |
14.9% |
11.4% |
|
|
|
|
Net income attributable to Global
Education |
7,392 |
8,196 |
1,120 |
Share-based compensation expenses |
4,606 |
541 |
698 |
Fair value change in contingent consideration
payable |
(122) |
-- |
(18) |
Non-GAAP net income attributable to Global
Education |
11,876 |
8,737 |
1,800 |
|
|
|
|
Net income per ADS attributable to Global
Education -- Basic (Note 1) |
0.32 |
(0.04) |
0.05 |
Net income per ADS attributable to Global
Education -- Diluted (Note 1) |
0.28 |
(0.04) |
0.04 |
|
|
|
|
Non-GAAP Net income per ADS attributable to
Global Education - Basic (Note 1) |
0.48 |
0.00 |
0.07 |
Non-GAAP Net income per ADS attributable to
Global Education - Diluted (Note 1) |
0.48 |
0.00 |
0.07 |
|
|
|
|
Weighted average shares used in calculating
basic net income per ADS (Note 1) |
97,395,953 |
49,030,191 |
97,395,953 |
Weighted average shares used in calculating
diluted net income per ADS (Note 1) |
100,230,106 |
49,030,191 |
100,230,106 |
|
|
|
|
Note 1: Each ADS represents four common
shares |
|
|
|
GLOBAL EDUCATION &
TECHNOLOGY GROUP LIMITED |
Unaudited Condensed
Consolidated Statements of Operations |
|
For the year
ended December 31, |
|
2010 |
2009 |
2010 |
|
RMB |
RMB |
USD |
Revenues |
|
|
|
Educational programs and services |
321,848 |
229,491 |
48,765 |
Franchise fees, study abroad consulting
services and sales of books and course materials |
3,727 |
16,739 |
3,595 |
Total revenues |
345,575 |
246,230 |
52,360 |
|
|
|
|
Operating costs and
expenses |
|
|
|
Cost of revenues |
(152,612) |
(101,976) |
(23,123) |
Selling and marketing expenses |
(92,204) |
(64,590) |
(13,970) |
General and administrative expenses |
(40,431) |
(28,968) |
(6,126) |
|
|
|
|
Total operating costs and
expenses |
(285,247) |
(195,534) |
(43,219) |
Operating income |
60,328 |
50,696 |
9,141 |
|
|
|
|
Interest income |
7,507 |
5,510 |
1,137 |
Investment income |
-- |
3,833 |
-- |
Foreign exchange losses, net |
(64) |
(119) |
(10) |
Consideration payable fair value change |
(3,887) |
-- |
(589) |
Other income, net |
561 |
461 |
85 |
|
|
|
|
Income before income
taxes |
64,445 |
60,381 |
9,764 |
|
|
|
|
Income tax expense |
(7,801) |
(4,778) |
(1,182) |
|
|
|
|
Net income |
56,644 |
55,603 |
8,582 |
|
|
|
|
Accretion of convertible redeemable preferred
shares |
2,038 |
(22,083) |
309 |
Income allocated to participating preferred
shareholder |
(14,441) |
(18,699) |
(2,188) |
|
|
|
|
Net income attributable to ordinary
shareholders |
44,241 |
14,821 |
6,703 |
|
|
|
|
Net income per share: |
|
|
|
Basic |
0.72 |
0.30 |
0.11 |
Diluted |
0.70 |
0.30 |
0.11 |
|
|
|
|
Weighted average number of shares
outstanding: |
|
|
|
Basic |
61,629,049 |
49,030,191 |
61,629,049 |
Diluted |
81,222,352 |
49,030,191 |
81,222,352 |
|
For
the year ended
December 31, |
|
2010 |
2009 |
2010 |
Share-based compensation expense included
in: |
RMB |
RMB |
USD |
Cost of revenues |
636 |
232 |
96 |
Selling and marketing expenses |
2,557 |
636 |
387 |
General and administrative expenses |
5,043 |
562 |
765 |
Total |
8,236 |
1,430 |
1,248 |
GLOBAL EDUCATION &
TECHNOLOGY GROUP LIMITED |
Reconciliation of
Unaudited Non-GAAP Measures to the Most Comparable GAAP
Measures |
(In thousands,
except ADS and per ADS
data) |
|
|
|
|
|
For the year
ended December 31, |
|
2010 |
2009 |
2010 |
|
RMB |
RMB |
USD |
|
|
|
|
General and administrative expenses |
40,431 |
28,968 |
6,126 |
Share-based compensation expense in general
and administrative expenses |
5,043 |
562 |
764 |
Non-GAAP general and administrative
expenses |
35,388 |
28,406 |
5,362 |
|
|
|
|
Total operating costs and expenses |
285,247 |
195,534 |
43,219 |
Share-based compensation expenses |
8,236 |
1,430 |
1,248 |
Non-GAAP operating costs and expenses |
277,011 |
194,104 |
41,971 |
|
|
|
|
Operating income |
60,328 |
50,696 |
9,141 |
Share-based compensation expenses |
8,236 |
1,430 |
1,248 |
Non-GAAP operating income |
68,564 |
52,126 |
10,389 |
|
|
|
|
Operating margin |
17.4% |
20.6% |
17.5% |
Non-GAAP operating margin |
19.8% |
21.2% |
19.8% |
|
|
|
|
Net income attributable to Global
Education |
56,644 |
55,603 |
8,582 |
Share-based compensation expenses |
8,236 |
1,430 |
1,248 |
Fair value change in contingent consideration
payable |
3,887 |
-- |
589 |
Non-GAAP net income attributable to Global
Education |
68,767 |
57,033 |
10,419 |
|
|
|
|
Net income per ADS attributable to Global
Education -- Basic (Note 1) |
2.88 |
1.20 |
0.44 |
Net income per ADS attributable to Global
Education - Diluted (Note 1) |
2.80 |
1.20 |
0.42 |
|
|
|
|
Non-GAAP Net income per ADS attributable to
Global Education -- Basic (Note 1) |
3.48 |
1.28 |
0.53 |
Non-GAAP Net income per ADS attributable to
Global Education - Diluted (Note 1) |
3.40 |
1.28 |
0.52 |
|
|
|
|
Weighted average shares used in calculating
basic net income per ADS (Note 1) |
61,629,049 |
49,030,191 |
61,629,049 |
Weighted average shares used in calculating
diluted net income per ADS (Note 1) |
81,222,352 |
49,030,191 |
81,222,352 |
|
|
|
|
Note 1: Each ADS represents four common
shares |
|
|
|
CONTACT: Global Education & Technology Group Ltd.
Jessica Wang
IR Senior Officer
Phone: +86 10 6212 5800 ext 302
E-mail: ir@globaleducation.cn
jessicawang@globaleducation.cn
ICR LLC.
Michael Tieu
Phone: +86-10-6583-7509
or +1-646-328-2550
E-mail: michael.tieu@icrinc.com
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