BEIJING, Aug. 27, 2018 /PRNewswire/ -- RYB Education,
Inc. ("RYB" or the "Company") (NYSE: RYB), a leading early
childhood education service provider in China, today announced its unaudited financial
results for the second quarter ended June
30, 2018.
Second Quarter 2018 Operational and Financial Summary
- Number of students enrolled at RYB directly operated
kindergartens was 23,526 as of June 30,
2018, a 15.0% increase from 20,463 as of June 30, 2017.
- Number of franchise play-and-learn centers and kindergartens in
operation were 1,029 and 216, respectively, as of June 30, 2018.
- Net revenues increased by 25.6% to $47.5
million, compared with $37.8
million for the second quarter of 2017.
- Gross profit was $15.9 million,
compared with $9.4 million for the
second quarter of 2017.
- Net income attributable to ordinary shareholders of RYB for the
second quarter of 2018 was $4.7
million, compared with $4.3
million for the second quarter of 2017. Adjusted net income
attributable to ordinary shareholders[1] of RYB for the
second quarter of 2018 was $6.9
million, compared with $4.5
million for the second quarter of 2017.
- Net cash outflows from operating activities were $10.6 million in the second quarter of 2018.
First Six Months of 2018 Financial Highlights
- Net revenues were $76.2 million,
compared with $64.3 million for the
first six months of 2017.
- Gross profit was $16.5 million,
compared with $13.0 million for the
first six months of 2017.
- Net income attributable to ordinary shareholders of RYB for the
first six months of 2018 was $2.0
million, compared with $5.3
million for the same period last year. Adjusted net income
attributable to ordinary shareholders of RYB for the first six
months of 2018 was $6.0 million,
compared with $5.5 million for the
first six months of 2017.
- Net cash outflows from operating activities were $5.3 million for the six months of 2018, compared
with $20.7 million of net cash
inflows for the first six months of 2017.
"We ended the second quarter of 2018 with net revenues exceeding
the high end of our guidance range," said Ms. Yanlai Shi,
Co-founder, Director and Chief Executive Officer of RYB. "Our
results were driven by steady enrollment growth in our directly
operated kindergartens and increased franchise fee revenue. Thanks
to the parents who reacted positively to our enhanced security and
safety standards and educational services quality, as of
June 30, 2018, the total student
enrollment at our 90 directly operated kindergartens grew to 23,526
and our total number of franchise play-and-learn centers in
operation grew to over 1,000.
"During the quarter, we continued to focus on improving teaching
quality with more stringent teacher recruitment requirements and
training standards. In addition, at RYB, security and safety at our
facilities continue to be paramount. This quarter, we appointed a
Chief Security and Safety Officer, set up a security and safety
oversight committee with key senior management members and set up a
central surveillance control room at our head office. Furthermore, we also
conducted extensive security and safety training throughout our
network. Finally, toward the end of the second quarter, we started
to accept new franchise applications for our play-and-learn centers
after introducing enhanced franchise service standards, more
stringent franchisee screening and acceptance criteria as well as a
new revenue-sharing model. We believe our
strategy of selective growth, while maintaining high standards for
quality and safety, positions us well to meet the strong demand for
premium kindergarten and early-childhood education services in
China. Through our dedication to
educational and services quality and the safety and security of our
students, we are committed to sustaining healthy, long-term growth
going forward," Ms. Shi concluded.
Ms. Ping Wei, Chief Financial
Officer of RYB added, "During the second quarter, we delivered a
25.6% year-over-year increase in net revenues. Our steady growth in
enrollment at our directly operated kindergartens was a key
contributor. In addition, we adopted Topic 606 "Revenue from
Contracts with Customers" (ACS 606) applying the modified
retrospective method to franchise contracts not completed as of
January 1, 2018, which requires the recognition of initial franchise
fee revenue over the service period while the prior recognition
standard was upon the official start of a franchisee's operation.
This resulted in higher initial franchise fee revenue generated in
the quarter, which was partially offset by lower revenue from
existing franchisees as a one-off fee reduction and free or
discounted products and services offered to them at the beginning
of this year continued."
Second Quarter 2018 Financial Results
Net Revenues
Net revenues for the second quarter of 2018 increased by 25.6%
to $47.5 million, from $37.8 million for the same quarter of 2017.
Service revenues for the second quarter of 2018 increased by
35.2% to $43.6 million, from
$32.3 million for the same quarter of
2017. The increase was partially
due to an increase in the number of students enrolled at the
Company's directly operated kindergartens as enrollment at existing
facilities continued to grow and newly acquired kindergartens also
contributed to the increase. Franchise services revenue also
increased significantly in the quarter due to the recognition of
initial franchise fee revenue over the service period as the
Company adopted Topic 606 "Revenue from Contracts with Customers"
(ACS 606) applying the modified retrospective method to franchise
contracts not completed as of January 1,
2018. The increase was partially
offset by lower revenue from existing franchisees as a one-off fee
reduction and free or discounted products and services offered to
them at the beginning of this year continued.
Product revenues for the second quarter of 2018 decreased by
30.2% to $3.9 million, from
$5.6 million for the same quarter of
2017. The decrease was primarily due to a decrease in the amount of
merchandise sold through the Company's franchise network as the
Company continued to pause the expansion of its franchise operation
for most of the quarter.
Cost of Revenues
Cost of revenues for the second quarter of 2018 was $31.6 million, an 11.0% increase from
$28.5 million for the same quarter of
2017. Cost of revenues for services for the second quarter of 2018
was $29.4 million, compared with
$25.6 million for the same quarter of
2017. The increase was primarily due to an increase in staff
compensation at the Company's directly operated kindergartens and
higher operating cost as the Company continued to expand its
kindergarten facilities network. Cost of revenues for products for
the second quarter of 2018 was $2.2
million, compared with $2.9
million for the same quarter of 2017, the reduction was in
line with the decrease in revenue.
Gross Profit and Gross Margin
Gross profit for the second quarter of 2018 increased by 69.9%
to $15.9 million, compared with
$9.4 million for the same quarter of
2017.
Gross margin for the second quarter of 2018 was 33.5%, compared
with 24.7% for the same quarter last year. The increase in gross margin was primarily due to
the increased franchise fee revenue partially offset by the
increase in staff compensation and operating costs at the directly
operated kindergarten facilities.
Operating Expenses
Total operating expenses for the second quarter of 2018 were
$8.4 million, a 139.3% increase from
$3.5 million for the same quarter of
2017. Excluding share-based compensation expenses, operating
expenses were $6.2 million, an
increase of 85.0% from the second quarter of 2017.
Selling expenses for the second quarter of 2018 remained flat at
$0.4 million, compared with
$0.4 million for the same quarter of
2017.
General and administrative ("G&A") expenses for the second
quarter of 2018 were $8.0 million, a
156.2% increase from $3.1 million for
the same quarter of 2017. Excluding share-based compensation
expenses, G&A expenses were $5.8
million for the second quarter of 2018, a 96.4% increase
from $3.0 million for the same
quarter of 2017. The increase in G&A expenses excluding
share-based compensation expenses was primarily due to higher
payroll expenses and additional expenses incurred in professional
service fees. The share-based compensation expenses included in
G&A expenses were $2.2 million
for the quarter.
Operating Income
Operating income for the second quarter of 2018 was $7.5 million, compared with $5.8 million for the same quarter
last year. Adjusted operating income[2] was $9.7 million for the second quarter of 2018,
compared with of $6.0 million for the
same quarter of 2017.
Net Income
Net income attributable to ordinary shareholders of RYB for the
second quarter of 2018 was $4.7
million, compared with $4.3
million for the same quarter of 2017. Adjusted net income
attributable to ordinary shareholders of RYB, which excludes the
impact of $2.2 million of share-based
compensation expense for the second quarter of 2018, was
$6.9 million, compared with
$4.5 million for the same quarter of
2017.
Basic and diluted net income per American depositary share
("ADS") attributable to ordinary shareholders of RYB for the second
quarter of 2018 were $0.16 and
$0.15, respectively, compared with
$0.18 and $0.17, respectively, for the same quarter of
2017. Each ADS represents one Class A ordinary share.
Adjusted basic and diluted net income per ADS attributable to
ordinary shareholders[3] of RYB for the second quarter
of 2018 were $0.24 and $0.22, respectively
compared with $0.19 and
$0.18, respectively, for the same
quarter of 2017.
EBITDA[4] for the second quarter of 2018 was
$10.1 million, compared with
$7.3 million for the same period of
2017. Adjusted EBITDA[5] for the second quarter of 2018
was $12.3 million, compared with
$7.4 million for the same quarter of
2017.
Balance Sheet
As of June 30, 2018, the Company
had total cash, cash equivalents and term deposits of $143.0 million, compared with $158.7 million as of December 31, 2017. The decrease in cash balance
was primarily driven by operational cash outflow, capital
expenditures of $2.4 million and
acquisition payments of $2.3 million
in the quarter.
Operating Cash Flow
Net cash outflows from operating activities were $10.6 million during the second quarter of 2018,
compared with $4.9 million net cash
inflows from operating activities during the second quarter of
2017. The cash outflow in the quarter was
primarily driven by a decrease in prepayment from customers as the
Company continued to pause the addition of new franchisees for most
of the quarter and the decrease in deferred revenue due to the
timing of tuition fee payments at the directly operated
kindergarten facilities. The decrease was partially offset by the
operating profits generated in the quarter.
First Six Months of 2018 Financial Results
Net Revenues
Net revenues for the first six months of 2018 were $76.2 million, compared with $64.3 million for the first six months of
2017.
Services revenues for the first six months of 2018 were
$69.6 million, compared with
$56.2 million for the same period
last year. The increase was partially due to an increase in the
number of students enrolled at the Company's directly operated
kindergartens. Franchise services
revenue also contributed to the increase due to the recognition of
initial franchise fee revenue over the service period as the
Company adopted Topic 606 "Revenue from Contracts with Customers"
(ACS 606) applying the modified retrospective method to franchise
contracts not completed as of January 1,
2018. This impact was partially offset by lower revenue
generated from franchise operations, as a one-off fee reduction and
free or discounted products and services offered to existing
franchisees at the beginning of this year continued.
Products revenues for the first six months of 2018 were
$6.6 million, compared with
$8.1 million for the same period in
2017. The decrease was primarily due to a decrease in the amount of
merchandise sold through the Company's franchise network as we paused the expansion of our franchise
operation for most of the period.
Cost of Revenues
Cost of revenues for the first six months of 2018 was
$59.7 million, compared with
$51.3 million for the first six
months of 2017. Cost of services revenues for the first six months
of 2018 was $56.1 million, compared
with $47.0 million for the same
period in 2017. The increase was primarily due to an increase in
staff compensation at the Company's directly operated kindergartens
and higher operating cost as the Company continued to expand its
kindergarten facilities network. Cost of products revenues for the
first six months of 2018 was $3.6
million, compared with $4.3
million for the same period last year, the reduction was in
line with the decrease in revenue.
Gross Profit and Gross Margin
Gross profit for the first six months of 2018 was $16.5 million, compared with $13.0 million for the first six months of
2017.
Gross margin for the first six months of 2018 was 21.7%,
compared with 20.3% for the same period last year.
Operating Expenses
Total operating expenses for the first six months of 2018 were
$14.2 million, compared with
$6.3 million for the same period last
year. Excluding share-based compensation expenses operating
expenses were $10.2 million.
Selling expenses remained flat for the first six months of 2018
at $0.7 million, compared with
$0.7 million for the same period last
year.
G&A expenses for the first six months of 2018 were
$13.5 million, compared with
$5.6 million for the same period last
year. Excluding share-based compensation expenses, G&A expenses
were $9.6 million for the first six
months of 2018, a 77.2% increase from $5.4
million for the same quarter of 2017. The increase in
G&A expenses excluding share-based compensation expenses was
primarily due to higher payroll expenses and additional expenses
incurred in professional service fees.
Operating Income
Operating income for the first six months of 2018 was
$2.4 million, compared with
$6.7 million for the same period last
year. Adjusted operating income for the first six months of 2018
was $6.3 million, compared with
$6.9 million for the same period last
year.
Net Income
Net income attributable to ordinary shareholders of RYB for the
first six months of 2018 was $2.0
million, compared with $5.3
million for the same period last year. Adjusted net income
attributable to ordinary shareholders of RYB, which excludes the
impact of share-based compensation expense, for the first six
months of 2018 was $6.0 million,
compared with $5.5 million for the
same period last year.
Basic and diluted net income per ADS attributable to ordinary
shareholders of RYB for the first six months of 2018 were
$0.07 and $0.06, respectively, compared with basic and
diluted net income per ADS attributable to ordinary shareholders of
RYB of $0.23 and $0.21, respectively for the same period last
year. Each ADS represents one Class A ordinary share.
Adjusted basic and diluted net income per ADS attributable to
ordinary shareholders of RYB for the first six months of 2018 were
$0.20 and $0.19, respectively, compared with adjusted basic
and diluted net income per ADS attributable to ordinary
shareholders of RYB of $0.24 and
$0.22, respectively for the same
period last year.
EBITDA for the first six months of 2018 was $7.3 million, compared with $9.6 million for the same period last year.
Adjusted EBITDA for the first six months of 2018 was $11.2 million, compared with $9.8 million for the same period last year.
Recent Developments
In June, 2018, the Company entered into
a definitive agreement to acquire 80% equity interest of an
early-childhood education services provider in Shanghai with two facilities offering
international training curriculum for children two to six years
old.
Subsequent to the quarter-end, the Company entered into a
definitive agreement to acquire 90% equity interest of an education
services group in Beijing with a
portfolio of educational assets which includes international
kindergartens.
Total consideration for the two acquisitions was approximately
$23.0 million.
Outlook
For the third quarter of 2018, the Company's management
currently expects:
- Net revenues to be between $37
million and $40 million,
representing a year-over-year increase of approximately 0% to
10%.
For the full year of 2018, the Company's management updates its outlook and currently
expects:
- Net revenues to be between
$160.0 million and $170.0 million, compared to the Company's
previous guidance given on May 15,
2018 of $154.9 million and
$166.1 million.
The above outlook is based on the current market conditions and
reflects the Company management's current and preliminary estimates
of market and operating conditions and customer demand, which are
all subject to change.
Conference Call
The Company's management will host an earnings conference call
at 8:30 AM U.S. Eastern Time on
August 28, 2018 (8:30 PM Beijing/Hong
Kong time on August 28,
2018).
Dial-in details for the earnings conference call are as
follows:
United States (toll
free):
|
1-888-317-6003
|
International:
|
1-412-317-6061
|
China (toll
free):
|
400-120-6115
|
Hong Kong (toll
free):
|
800-963-976
|
Participants Elite
Entry Number:
|
3870779
|
Participants should dial-in at least 5 minutes before the
scheduled start time and ask to be connected to the call for "RYB
Education."
Additionally, a live and archived webcast of the conference call
will be available on the Company's investor relations website at
http://ir.rybbaby.com.
A replay of the conference call will be accessible until
September 4, 2018, by dialing the
following telephone numbers:
United States (toll
free):
|
1-877-344-7529
|
International:
|
1-412-317-0088
|
Replay Access
Code:
|
10123089
|
About RYB Education, Inc.
Founded on the core values of ''Care'' and ''Responsibility'',
"Inspire" and "Innovate," RYB Education, Inc. is a leading early
childhood education service provider in China. Since opening
its first play-and-learn center in 1998, the Company has grown and
flourished with the mission to provide high-quality, individualized
and age-appropriate care and education to nurture and inspire each
child for his or her betterment in life. During its nearly
two decades of operating history, the Company has built "RYB" into
a well-recognized education brand and helped bring about many new
educational practices in China's
early childhood education industry. RYB's comprehensive early
childhood education solutions meet the needs of children from
infancy to 6 years old through structured courses at kindergartens
and play-and-learn centers, as well as at-home educational products
and services.
For more information, please visit http://ir.rybbaby.com
Use of Non-GAAP Financial Measures
We use EBITDA, adjusted EBITDA, adjusted operating income,
adjusted net income, and adjusted basic and diluted net income per
ADS, each a non-GAAP financial measure, in evaluating our operating
results and for financial and operational decision-making
purposes.
EBITDA is defined as net income excluding depreciation,
amortization, interest expenses, and income tax expenses; adjusted
EBITDA is defined as net income excluding depreciation,
amortization, interest expenses, income tax expenses, and
share-based compensation expenses; adjusted operating income is
defined as operating income excluding share-based compensation
expenses; adjusted net income attributable to ordinary shareholders
is defined as net income attributable to ordinary
shareholders excluding share-based compensation expenses; and
adjusted basic and diluted net income per ADS attributable to
ordinary shareholders are defined as basic and diluted net income
per ADS attributable to ordinary shareholders excluding share-based
compensation expenses.
We believe that EBITDA, adjusted EBITDA, adjusted operating
income, adjusted net income, and adjusted basic and diluted net
income per ADS, help identify underlying trends in our business
that could otherwise be distorted by the effect of certain expenses
that we include in income from operations and net income. We
believe that EBITDA, adjusted EBITDA, adjusted operating income,
adjusted net income, and adjusted basic and diluted net income per
ADS, provide useful information about our operating results,
enhance the overall understanding of our past performance and
future prospects and allow for greater visibility with respect to
key metrics used by our management in its financial and operational
decision-making.
EBITDA, adjusted EBITDA, adjusted operating income, adjusted net
income, and adjusted basic and diluted net income per ADS, should
not be considered in isolation or construed as an alternative to
net income or any other measure of performance or as an indicator
of our operating performance. Investors are encouraged to review
the historical Adjusted financial measures to the most directly
comparable GAAP measures. EBITDA, adjusted EBITDA, adjusted
operating income, adjusted net income, and adjusted basic and
diluted net income per ADS, presented here may not be comparable to
similarly titled measures presented by other companies. Other
companies may calculate similarly titled measures differently,
limiting their usefulness as comparative measures to our data. We
encourage investors and others to review our financial information
in its entirety and not rely on a single financial measure.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "confident" and similar statements.
Statements that are not historical facts, including statements
about the Company's beliefs and expectations, are forward-looking
statements. Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement, including but not limited to the following: the
Company's brand recognition and market reputation; student
enrollment in the Company's teaching facilities; the Company's
growth strategies; its future business development, results of
operations and financial condition; trends and competition in
China's early childhood education
market; changes in its revenues and certain cost or expense items;
the expected growth of the Chinese early education market; Chinese
governmental policies relating to the Company's industry and
general economic conditions in China. Further information regarding these and
other risks is included in the Company's filings with the SEC. All
information provided in this press release and in the attachments
is as of the date of this press release, and the Company undertakes
no obligation to update any forward-looking statement, except as
required under applicable law.
For investor and media inquiries, please contact:
In China:
RYB
Education, Inc.
Investor Relations
Tel: 86-10-8767-5752
E-mail: ir@rybbaby.com
The Piacente Group, Inc.
Ross Warner
Tel: +86 (10) 5730-6200
E-mail: ryb@tpg-ir.com
In the United
States:
The Piacente Group, Inc.
Brandi Piacente
Tel: +1-212-481-2050
E-mail: ryb@tpg-ir.com
[1]
|
Adjusted net income
attributable to ordinary shareholders is a non-GAAP financial
measure, which is defined as net income attributable to ordinary
shareholders excluding share-based compensation expenses. See "Use
of Non-GAAP Financial Measures" and "Reconciliations of GAAP and
non-GAAP results" included elsewhere in this earnings
release.
|
[2]
|
Adjusted operating
income is a non-GAAP financial measure, which is defined as
operating income excluding share-based compensation expenses. See
"Use of Non-GAAP Financial Measures" and "Reconciliations of GAAP
and non-GAAP results" elsewhere in this earnings
release.
|
[3]
|
Adjusted basic and
diluted net income per ADS attributable to ordinary shareholders is
a non-GAAP financial measure, which is defined as basic and diluted
net income per ADS attributable to ordinary shareholders excluding
share-based compensation expenses. See "Use of Non-GAAP Financial
Measures" and "Reconciliations of GAAP and non-GAAP results"
elsewhere in this earnings release.
|
[4]
|
EBITDA is defined as
net income excluding depreciation, amortization and income tax
expenses. See "Use of Non-GAAP Financial Measures" and
"Reconciliations of GAAP and non-GAAP results" included elsewhere
in this earnings release.
|
[5]
|
Adjusted EBITDA is a
non-GAAP financial measure, which is defined as net income
excluding depreciation, amortization, interest expenses, income tax
expenses, and share-based compensation expenses. See "Use of
Non-GAAP Financial Measures" and "Reconciliations of GAAP and
non-GAAP results" included elsewhere in this earnings
release.
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS BALANCE SHEETS (in
thousands of U.S. dollars)
|
|
As
of
|
|
June 30,
2018
|
December 31,
2017
|
|
|
|
Current
assets
|
|
|
Cash and cash
equivalents
|
142,566
|
158,691
|
Term
deposits
|
454
|
-
|
Accounts receivable,
net
|
748
|
901
|
Inventories
|
4,546
|
3,549
|
Prepaid expenses and
other current assets
|
14,295
|
9,541
|
Amounts due from
related parties
|
148
|
126
|
Loan receivable -
current
|
453
|
-
|
Total current
assets
|
163,210
|
172,808
|
|
|
|
Non-current
assets
|
|
|
Restricted
Cash
|
547
|
543
|
Property and
equipment, net
|
41,232
|
40,163
|
Intangible
assets
|
1,007
|
-
|
Goodwill
|
8,486
|
428
|
Long-term
investment
|
197
|
256
|
Deferred tax
assets
|
13,375
|
12,430
|
Other non-current
assets
|
4,272
|
3,110
|
Loan receivable -
non-current
|
604
|
-
|
Total non-current
assets
|
69,720
|
56,930
|
|
|
|
Total
assets
|
232,930
|
229,738
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
Current
liabilities
|
|
|
Prepayments from
customers, current portion(including prepayments from customers of
the consolidated VIE without recourse to the Group of $ 6,822 and $
11,962 as of June 30, 2018 and December 31, 2017,
respectively)
|
6,834
|
11,968
|
Accrued expenses and
other current liabilities(including accrued expenses and other
current liabilities of the consolidated VIE without recourse to the
Group of $ 51,994 and $ 48,123 as of June 30, 2018 and
December 31, 2017, respectively)
|
55,452
|
51,854
|
Income taxes
payable(including income taxes payable of the consolidated VIE
without recourse to the Group of $ 9,854 and $ 10,125 as of June
30, 2018 and December 31, 2017, respectively)
|
10,497
|
10,534
|
Deferred revenue,
current portion(including deferred revenue of the consolidated VIE
without recourse to the Group of $ 24,975 and $ 22,327 as of
June 30, 2018 and December 31, 2017, respectively)
|
25,150
|
22,666
|
|
|
|
Total current
liabilities
|
97,933
|
97,022
|
|
|
|
Non-current
liabilities
|
|
|
Prepayments from
customers, non-current portion (including prepayments from
customers of the consolidated VIE without recourse to the Group of
$ 3,955 and $ 8,542 as of June 30, 2018 and December 31, 2017,
respectively)
|
3,955
|
8,542
|
Deferred revenue,
non-current portion (including deferred revenue of the consolidated
VIE without recourse to the Group of $ 8,294 and $ 8,505 as of June
30, 2018 and December 31, 2017, respectively)
|
9,760
|
10,396
|
Deferred income taxes
liabilities(including deferred income taxes liabilities of the
consolidated VIE without recourse to the Group of $252 and nil as
of June 30, 2018 and December 31, 2017, respectively)
|
252
|
-
|
Other non-current
liabilities (including other non-current liabilities of the
consolidated VIE without recourse to the Group of $ 8,271 and $
8,484 as of June 30, 2018 and December 31, 2017,
respectively)
|
8,271
|
8,484
|
Total non-current
liabilities
|
22,238
|
27,422
|
|
|
|
Total
liabilities
|
120,171
|
124,444
|
|
|
|
Shareholders'
equity:
|
|
|
Ordinary
shares
|
29
|
29
|
Additional paid-in
capital
|
132,871
|
129,134
|
Statutory
reserve
|
2,678
|
2,678
|
Accumulated other
comprehensive income
|
384
|
783
|
Accumulated
deficits
|
(25,955)
|
(28,879)
|
Total RYB
Education, Inc. shareholders' equity
|
110,007
|
103,745
|
|
|
|
Non-controlling
interests
|
2,752
|
1,549
|
|
|
|
Total
equity
|
112,759
|
105,294
|
|
|
|
Total liabilities
and shareholders' equity
|
232,930
|
229,738
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in
thousands of U.S. dollars, except share, ADS, per share and per ADS
data)
|
|
|
|
Three Months
Ended June
30,
|
Six
Months Ended June
30,
|
|
2018
|
2017
|
2018
|
2017
|
Net
revenues:
|
|
|
|
|
Services
|
43,602
|
32,252
|
69,602
|
56,249
|
Products
|
3,882
|
5,558
|
6,635
|
8,089
|
Total net
revenues
|
47,484
|
37,810
|
76,237
|
64,338
|
Cost of
revenues:
|
|
|
|
|
Services
|
29,418
|
25,591
|
56,106
|
46,973
|
Products
|
2,176
|
2,867
|
3,618
|
4,324
|
Total cost of
revenues
|
31,594
|
28,458
|
59,724
|
51,297
|
Gross
profit
|
15,890
|
9,352
|
16,513
|
13,041
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
Selling
Expenses
|
415
|
393
|
693
|
725
|
General and
administrative
|
7,970
|
3,111
|
13,462
|
5,569
|
Total operating
expenses
|
8,385
|
3,504
|
14,155
|
6,294
|
|
|
|
|
|
Operating
income
|
7,505
|
5,848
|
2,358
|
6,747
|
Interest
income
|
503
|
49
|
1038
|
77
|
Government subsidy
income
|
201
|
82
|
290
|
181
|
Loss on disposal of
subsidiaries
|
-
|
(168)
|
1
|
(168)
|
|
|
|
|
|
Income before
income taxes
|
8,209
|
5,811
|
3,687
|
6,837
|
Less: Income tax
expense
|
2,874
|
1,540
|
1,395
|
1,797
|
|
|
|
|
|
Income before loss
in equity method investments
|
5,335
|
4,271
|
2,292
|
5,040
|
Loss from equity
method investment
|
(35)
|
(41)
|
(90)
|
(92)
|
|
|
|
|
|
Net
income
|
5,300
|
4,230
|
2,202
|
4,948
|
Less: Net loss
attributable to noncontrolling interest
|
583
|
(54)
|
205
|
(379)
|
|
|
|
|
|
Net income
attributable to ordinary shareholders of RYB
|
4,717
|
4,284
|
1,997
|
5,327
|
|
|
|
|
|
|
|
|
|
|
Net income per share
attributable to ordinary shareholders of RYB Education,
Inc.
|
|
|
|
|
Basic
|
0.16
|
0.18
|
0.07
|
0.23
|
Diluted
|
0.15
|
0.17
|
0.06
|
0.21
|
Net income per ADS
attributable to ordinary shareholders of RYB Education, Inc. (Note
1)
|
|
|
|
|
Basic
|
0.16
|
0.18
|
0.07
|
0.23
|
Diluted
|
0.15
|
0.17
|
0.06
|
0.21
|
|
|
|
|
|
Weighted average
shares used in calculating net income per ordinary share
|
Basic
|
29,349,537
|
23,163,801
|
29,282,044
|
23,163,801
|
Diluted
|
31,344,409
|
25,185,111
|
31,298,700
|
25,125,947
|
|
|
|
|
|
|
Net income
|
|
5,300
|
4,230
|
2,202
|
4,948
|
Other comprehensive
income (loss), net of tax of nil:
|
|
|
|
|
|
Change in cumulative
foreign currency translation adjustments
|
|
(1,320)
|
670
|
(661)
|
167
|
Total
comprehensive income
|
|
3,980
|
4,900
|
1,541
|
5,115
|
Less: Comprehensive
loss attributable to non-controlling interest
|
|
267
|
(38)
|
(57)
|
(360)
|
Comprehensive
income attributable to RYB Education, Inc.
|
|
3,713
|
4,938
|
1,598
|
5,475
|
|
Note 1: Each ADS
represents one Class A ordinary share.
|
RECONCILIATION
OF GAAP and non-GAAP results (in thousands of U.S. dollars,
except share, ADS, per share and per ADS data)
|
|
|
|
Three Months
Ended June
30,
|
Six Months
Ended June
30,
|
|
2018
|
2017
|
2018
|
2017
|
|
|
|
|
|
Operating
income
|
7,505
|
5,848
|
2,358
|
6,747
|
Share-based
compensation expenses
|
2,212
|
167
|
3,974
|
167
|
Adjusted operating
income
|
9,717
|
6,015
|
6,332
|
6,914
|
|
|
|
|
|
Net income
attributable to RYB
|
4,717
|
4,284
|
1,997
|
5,327
|
Share-based
compensation expenses
|
2,212
|
167
|
3,974
|
167
|
Adjusted net income
attributable to RYB
|
6,929
|
4,451
|
5,971
|
5,494
|
|
|
|
|
|
Net income
|
5,300
|
4,230
|
2,202
|
4,948
|
Add: Income tax
expense
|
2,874
|
1,540
|
1,395
|
1,797
|
Depreciation of property, plant and equipment, and amortization of
intangible assets
|
1,896
|
1,497
|
3,666
|
2,904
|
EBITDA
|
10,070
|
7,267
|
7,263
|
9,649
|
Share-based
compensation expenses
|
2,212
|
167
|
3974
|
167
|
Adjusted
EBITDA
|
12,282
|
7,434
|
11,237
|
9,816
|
|
|
|
|
|
Net income per ADS
attributable to RYB- Basic (Note1)
|
0.16
|
0.18
|
0.07
|
0.23
|
Net income per ADS
attributable to RYB- Diluted (Note1)
|
0.15
|
0.17
|
0.06
|
0.21
|
|
|
|
|
|
Adjusted net income
per ADS attributable to RYB- Basic (Note1)
|
0.24
|
0.19
|
0.20
|
0.24
|
Adjusted Net income
per ADS attributable to RYB- Diluted (Note1)
|
0.22
|
0.18
|
0.19
|
0.22
|
|
|
|
|
|
Weighted average
shares used in calculating basic net income per
ADS(Note1)
|
29,349,537
|
23,163,801
|
29,282,044
|
23,163,801
|
Weighted average
shares used in calculating diluted net income per
ADS(Note1)
|
31,344,409
|
25,185,111
|
31,298,700
|
25,125,947
|
|
|
|
|
|
Adjusted net income
per share- Basic
|
0.24
|
0.19
|
0.20
|
0.24
|
Adjusted net income
per share- Diluted
|
0.22
|
0.18
|
0.19
|
0.22
|
|
Note 1: Each ADS
represents one Class A ordinary share.
|
View original
content:http://www.prnewswire.com/news-releases/ryb-education-inc-reports-second-quarter-2018-financial-results-300702973.html
SOURCE RYB Education, Inc.