New Oriental Announces Results for the Second Fiscal Quarter Ended November 30, 2018
Quarterly Net Revenues Increased by 27.8% Year-Over-Year
Quarterly Student Enrollments Increased by 23.6% Year-Over-Year
BEIJING, Jan. 22, 2019 /PRNewswire/ -- New Oriental Education & Technology Group Inc. (the "Company" or "New Oriental") (NYSE: EDU), the largest provider of private educational services in China, today announced its unaudited financial results for the second fiscal quarter ended November 30, 2018, which is the second quarter of New Oriental's fiscal year 2019.
Financial Highlights for the Second Fiscal Quarter Ended November 30, 2018
- Total net revenues increased by 27.8% year-over-year to US$597.1 million for the second fiscal quarter of 2019.
- Operating loss increased by 118.5% year-over-year to US$28.6 million for the second fiscal quarter of 2019.
- Non-GAAP operating loss, which excludes share-based compensation expenses, was US$14.9 million, an increase of 295.7% year-over-year compared to US$3.8 million in the same period of the prior fiscal year.
- Net loss attributable to New Oriental was US$25.8 million for the second fiscal quarter of 2019, compared to an income of US$4.3 million in the same period of the prior fiscal year.
- Non-GAAP net income attributable to New Oriental, which excludes share-based compensation expenses and loss from fair value change of long-term investments, was US$23.0 million, an increase of 69.2% year-over-year compared to US$13.6 million in the same period of the prior fiscal year.
Key Financial Results
(in thousands US$, except per ADS(1) data) | 2Q FY2019 | 2Q FY2018 | % of change |
Net revenues | 597,072 | 467,183 | 27.8% |
Operating loss | 28,553 | 13,070 | 118.5% |
Non-GAAP operating loss (2)(3) | 14,866 | 3,757 | 295.7% |
Net (loss) / income attributable to New Oriental | (25,826) | 4,279 | - |
Non-GAAP net income attributable to New Oriental (2)(3) | 22,996 | 13,592 | 69.2% |
Net (loss) / income per ADS attributable to New Oriental - | (0.16) | 0.03 | - |
Net (loss) / income per ADS attributable to New Oriental - | (0.16) | 0.03 | - |
Non-GAAP net income per ADS attributable to New Oriental - | 0.14 | 0.09 | 68.6% |
Non-GAAP net income per ADS attributable to New Oriental - | 0.14 | 0.09 | 68.4% |
(in thousands US$, except per ADS(1) data) | 1H FY2019 | 1H FY2018 | % of change |
Net revenues | 1,456,918 | 1,128,348 | 29.1% |
Operating income | 132,782 | 148,007 | -10.3% |
Non-GAAP operating income(2)(3) | 160,389 | 160,446 | 0.0% |
Net income attributable to New Oriental | 97,406 | 162,672 | -40.1% |
Non-GAAP net income attributable to New Oriental(2)(3) | 207,132 | 175,111 | 18.3% |
Net income per ADS attributable to New Oriental - basic | 0.61 | 1.03 | -40.3% |
Net income per ADS attributable to New Oriental - diluted | 0.61 | 1.03 | -40.4% |
Non-GAAP net income per ADS attributable to New Oriental - | 1.31 | 1.11 | 17.9% |
Non-GAAP net income per ADS attributable to New Oriental - | 1.30 | 1.11 | 17.7% |
(1) | Each ADS represents one common share. |
(2) | GAAP represents Generally Accepted Accounting Principles in the United States of America. |
(3) | New Oriental provides net (loss) / income attributable to New Oriental, operating (loss) / income and net (loss) / income per ADS attributable to New Oriental on a non-GAAP basis that excludes share-based compensation expenses and loss from fair value change of long-term investments to provide supplemental information regarding its operating performance. For more information on these non-GAAP financial measures, please see the section captioned "About Non-GAAP Financial Measures" and the tables captioned "Reconciliations of Non-GAAP Measures to the Most Comparable GAAP Measures" set forth at the end of this release. |
(4) | The Non-GAAP net income per ADS is computed using Non-GAAP net income and the same number of shares and ADSs used in GAAP basic and diluted EPS calculation. |
Operating Highlights for the Second Fiscal Quarter Ended November 30, 2018
- Total student enrollments in academic subjects tutoring and test preparation courses increased by 23.6% year-over-year to approximately 2,320,800 for the second fiscal quarter of 2019.
- The total number of schools and learning centers was 1,125 as of November 30, 2018, an increase of 185 compared to 940 as of November 30, 2017, and an increase of 25 compared to 1,100 as of August 31, 2018. The total number of schools was 89 as of November 30, 2018.
Michael Minhong Yu, New Oriental's Executive Chairman, commented, "We are pleased to see our overall business continue its strong momentum in the second quarter of fiscal year 2019 and achieve a top line growth of 27.8%, or 33.6% if computed in Renminbi. This was driven largely by our key business unit, K-12 all-subjects after-school tutoring, which recorded a remarkable year-over-year revenue growth of approximately 38%, or 44% if computed in Renminbi, reflecting a combination of a solid high-quality product portfolio and a sustained market demand. Furthermore, our U-Can middle and high school all-subjects after-school tutoring business grew by approximately 39%, or 46% if computed in Renminbi, and the POP Kids program achieved a growth of approximately 35%, or 41% if computed in Renminbi."
Chenggang Zhou, New Oriental's Chief Executive Officer, added, "As we execute our well-proven 'Optimize the Market' strategy', we continued to progress our capacity expansion plan in this quarter. We added a net of 24 learning centers in existing cities, and opened a new training school in the city of Jinhua. Altogether, this increased the total square meters of classroom area by approximately 30% year-over-year and 5% quarter-over-quarter by the end of this quarter. At the same time, we continued to refine and leverage our online and offline integrated standardized teaching system for the K-12 business across the nation, and particularly in some of the larger cities for our overseas test preparation business. Starting from the fiscal year 2019, we initiated a pilot program to standardize teaching content and methodology in the U-Can middle and high school tutoring business, which has started to bear fruit as we achieved a remarkable increase of customer retention. As we develop best practices gradually, we will begin to roll out the pilot program in our online and offline K-12 tutoring business to further improve teaching quality. We believe this will in turn boost our competitive advantages as we offer the best learning experience to our students. Moreover, we continued to make strategic investments in our dual-teacher model classes and new initiatives for K-12 tutoring on our pure online education platform, Koolearn.com, which is expected to see increasing demand in cities of lower tiers and in remote areas."
Stephen Zhihui Yang, New Oriental's Chief Financial Officer, commented, "In this quarter we continued to see a healthy ramping up of the new facilities we built in the previous fiscal year, which is highly encouraging. Our Non-GAAP operating margin and the utilization rate in the offline language training and test preparation business remained flattish year-over-year in the second quarter. Going forward, we will remain focused on improving our operational efficiency and ensuring consistently-high quality of education across all business lines, through a standardized, modular and systematic approach. We believe that, altogether, these will enable us to leverage our existing capability to capture growth opportunities and generate sustainable long-term value for our customers and shareholders."
Recent Development
In December 2018, New Oriental entered into a 3-year US$200 million term and revolving facilities agreement with a group of arrangers led by Credit Suisse AG, Singapore Branch. The facilities consist of a US$100 million 3-year bullet maturity term loan and a US$100 million 3-year revolving facility. The use of proceeds of the facilities is for the Company's existing share repurchase program and other general corporate purposes.
Financial Results for the Second Fiscal Quarter Ended November 30, 2018
Net Revenues
For the second fiscal quarter of 2019, New Oriental reported net revenues of US$597.1 million, representing a 27.8% increase year-over-year. Net revenues from educational programs and services for the second fiscal quarter were US$543.6 million, representing a 28.6% increase year-over-year. The growth was mainly driven by increases in student enrollments in K-12 after-school tutoring courses.
Total student enrollments in academic subjects tutoring and test preparation courses in the second fiscal quarter of 2019 increased by 23.6% year-over-year to approximately 2,320,800.
Operating Cost and Expenses
Operating cost and expenses for the quarter were US$627.3 million, representing a 30.6% increase year-over-year. Non-GAAP operating cost and expenses for the quarter, which exclude share-based compensation expenses, were US$613.7 million, representing a 30.3% increase year-over-year.
- Cost of revenues increased by 32.1% year-over-year to US$300.1 million, primarily due to increases in teachers' compensation for more teaching hours and rental cost for increased number of schools and learning centers in operation.
- Selling and marketing expenses increased by 27.1% year-over-year to US$91.6 million, primarily due to increases in brand promotion expenses and selling and marketing staff's compensation.
- General and administrative expenses for the quarter increased by 30.3% year-over-year to US$235.6 million. Non-GAAP general and administrative expenses, which exclude share-based compensation expenses, were US$222.0 million, representing a 29.4% increase year-over-year. The increase was primarily due to increased headcount as the Company expanded its network of schools and learning centers, as well as increases in R&D expenses and human resources expenses related to the development of the Company's online and offline integrated education ecosystem.
Total share-based compensation expenses, which were allocated to related operating cost and expenses, increased by 47.0% to US$13.7 million in the second fiscal quarter of 2019.
Operating Loss and Operating Margin
Operating loss for the quarter was US$28.6 million, representing a 118.5% increase year-over-year. Non-GAAP loss operating loss for the quarter was US$14.9 million, representing a 295.7% increase year-over-year.
Operating margin for the quarter was negative 4.8%, compared to negative 2.8% in the same period of the prior fiscal year. Non-GAAP operating margin, which excludes share-based compensation expenses, for the quarter was negative 2.5%, compared to negative 0.8% in the same period of the prior fiscal year.
Loss from Fair Value Change of Long-Term Investments
Loss from fair value change of long term investments for the quarter was US$35.1 million.
Net (Loss) / Income and EPS
Net loss attributable to New Oriental for the quarter was US$25.8 million, compared to an income of US$4.3 million. Basic and diluted loss per ADS attributable to New Oriental were US$0.16 and US$0.16, respectively.
Non-GAAP Net Income and Non-GAAP EPS
Non-GAAP net income attributable to New Oriental, which excludes share-based compensation expenses and loss from fair value change of long-term investments, for the quarter was US$23.0 million, representing a 69.2% increase from the same period of the prior fiscal year. Non-GAAP basic and diluted earnings per ADS attributable to New Oriental were US$0.14 and US$0.14, respectively.
Cash Flow
Net operating cash flow for the second fiscal quarter of 2019 was approximately US$125.3 million. Capital expenditures for the quarter were US$43.1 million, which were primarily attributable to the opening of 48 facilities and renovations at existing learning centers.
Balance Sheet
As of November 30, 2018, New Oriental had cash and cash equivalents of US$842.9 million, compared to US$983.3 million as of May 31, 2018. In addition, the Company had US$94.6 million in term deposits, US$1,700.7 million in short-term investments.
New Oriental's deferred revenue balance, which is cash collected from registered students for courses and recognized proportionally as revenue as the instructions are delivered, at the end of the second quarter of fiscal year 2019 was US$1,250.3 million, an increase of 9.9% from US$1,137.3 million at the end of the second quarter of fiscal year 2018. The lower than usual increase is due to the change of tuition fees collection schedule for K-12 after-school tutoring courses.
Financial Results for the Six Months Ended November 30, 2018
For the first six months of fiscal year 2019, New Oriental reported net revenues of US$1,456.9 million, representing a 29.1% increase year-over-year.
Total student enrollments in academic subjects tutoring and test preparation courses in the first six months of fiscal year 2019 increased by 18.9% to approximately 4,056,100.
Income from operations for the first six months of fiscal year 2019 was US$132.8 million, representing a 10.3% decrease year-over-year. Non-GAAP income from operations for the first six months of fiscal year 2019 was US$160.4 million, representing a 0.04% decrease year-over-year.
Operating margin for the first six months of fiscal year 2019 was 9.1%, compared to 13.1% for the same period of the prior fiscal year. Non-GAAP operating margin, which excludes share-based compensation expenses for the first six months of fiscal year 2019, was 11.0%, compared to 14.2% for the same period of the prior fiscal year.
Net income attributable to New Oriental for the first six months of fiscal year 2019 was US$97.4 million, representing a 40.1% decrease year-over-year. Basic and diluted net income per ADS attributable to New Oriental for the first six months of fiscal year 2019 amounted to US$0.61 and US$0.61, respectively.
Non-GAAP net income attributable to New Oriental for the first six months of fiscal year 2019 was US$207.1 million, representing an 18.3% increase year-over-year. Non-GAAP basic and diluted net income per ADS attributable to New Oriental for the first six months of fiscal year 2019 amounted to US$1.31 and US$1.30, respectively.
Outlook for Third Quarter of Fiscal Year 2019
New Oriental expects total net revenues in the third quarter of fiscal year 2019 (December 1, 2018 to February 28, 2019) to be in the range of US$769.9 million to US$793.2 million, representing year-over-year growth in the range of 25% to 28%.
The projected growth rate of revenue in Renminbi is expected to be in the range of 32% to 36% for the third quarter of fiscal year 2019.
This forecast reflects New Oriental's current and preliminary view, which is subject to change.
Conference Call Information
New Oriental's management will host an earnings conference call at 8 AM on January 22, 2019, U.S. Eastern Time (9 PM on January 22, 2019, Beijing/Hong Kong Time).
Dial-in details for the earnings conference call are as follows:
US: | +1-845-675-0437 |
Hong Kong: | +852-3018-6771 |
UK: | +44-20-3621-4779 |
Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is "3990216".
A replay of the conference call may be accessed by phone at the following number until January 31, 2019:
International: | +61-2-8199-0299 |
Passcode: | 3990216 |
Additionally, a live and archived webcast of the conference call will be available at http://investor.neworiental.org.
About New Oriental
New Oriental is the largest provider of private educational services in China based on the number of program offerings, total student enrollments and geographic presence. New Oriental offers a wide range of educational programs, services and products consisting primarily of language training and test preparation, primary and secondary school education, online education, content development and distribution, overseas study consulting services, pre-school education and study tour. New Oriental's ADSs, each of which represents one common share, currently trade on the New York Stock Exchange under the symbol "EDU."
For more information about New Oriental, please visit http://www.neworiental.org/english/.
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" and similar statements. Among other things, the outlook for the third quarter of fiscal year 2019, quotations from management in this announcement, as well as New Oriental's strategic and operational plans, contain forward-looking statements. New Oriental may also make written or oral forward-looking statements in its reports filed or furnished to the U.S. Securities and Exchange Commission, in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about New Oriental'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: our ability to attract students without a significant decrease in course fees; our ability to continue to hire, train and retain qualified teachers; our ability to maintain and enhance our "New Oriental" brand; our ability to effectively and efficiently manage the expansion of our school network and successfully execute our growth strategy; the outcome of ongoing, or any future, litigation or arbitration, including those relating to copyright and other intellectual property rights; competition in the private education sector in China; changes in our revenues and certain cost or expense items as a percentage of our revenues; the expected growth of the Chinese private education market; Chinese governmental policies relating to private educational services and providers of such services; health epidemics and other outbreaks in China; and general economic conditions in China. Further information regarding these and other risks is included in our annual report on Form 20-F and other documents filed with the Securities and Exchange Commission. New Oriental does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release and in the attachments is as of the date of this press release, and New Oriental undertakes no duty to update such information, except as required under applicable law.
About Non-GAAP Financial Measures
To supplement New Oriental's consolidated financial results presented in accordance with GAAP, New Oriental uses the following measures defined as non-GAAP financial measures by the SEC: net (loss) / income excluding share-based compensation expenses and loss from fair value change of long-term investments, operating income excluding share-based compensation expenses, operating cost 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 and per share excluding share-based compensation expenses and loss from fair value change of long-term investments. 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. For more information on these non-GAAP financial measures, please see the tables captioned "Reconciliations of non-GAAP measures to the most comparable GAAP measures" set forth at the end of this release.
New Oriental believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based compensation expenses and loss from fair value of long-term investments that may not be indicative of its operating performance from a cash perspective. New Oriental believes that both management and investors benefit from referring to 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 New Oriental's historical performance and liquidity. New Oriental believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using these non-GAAP measures is that they exclude share-based compensation charge and loss from fair value change of long-term investments that has been and will continue to be for the foreseeable future a significant recurring expense in our business. Management 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.
Contacts
For investor and media inquiries, please contact:
Ms. Joyce Wu
FTI Consulting
Tel: +852-3768-4548
Email: [email protected]
Ms. Sisi Zhao
New Oriental Education and Technology Group Inc.
Tel: +86-10-6260-5568
Email: [email protected]
NEW ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(In thousands) | |||
As of November 30 | As of May 31 | ||
2018 | 2018 | ||
(Unaudited) | (Audited) | ||
USD | USD | ||
ASSETS: | |||
Current assets: | |||
Cash and cash equivalents | 842,860 | 983,319 | |
Restricted cash | 43 | 47 | |
Term deposits | 94,569 | 107,741 | |
Short-term investments | 1,700,650 | 1,623,763 | |
Accounts receivable, net | 5,351 | 3,179 | |
Inventory, net | 35,141 | 40,175 | |
Prepaid expenses and other current assets, net | 207,768 | 182,095 | |
Amounts due from related parties, current | 20,261 | 1,595 | |
Total current assets | 2,906,643 | 2,941,914 | |
Restricted cash, non-current | 3,683 | 3,399 | |
Property and equipment, net | 488,941 | 449,592 | |
Land use rights, net | 12,941 | 3,785 | |
Amounts due from related parties, non-current | 2,006 | 2,226 | |
Long-term deposits | 44,431 | 40,099 | |
Long-term prepaid rents | 535 | 191 | |
Intangible assets, net | 12,921 | 8,544 | |
Goodwill, net | 66,365 | 31,729 | |
Long-term investments, net | 391,334 | 433,333 | |
Deferred tax assets, non-current, net | 47,175 | 43,323 | |
Other non-current assets | 25,668 | 19,577 | |
Total assets | 4,002,643 | 3,977,712 | |
LIABILITIES, MEZZANINE EQUITY AND EQUITY | |||
Current liabilities: | |||
Accounts payable (including accounts payable of the | 36,126 | 39,889 | |
Accrued expenses and other current liabilities (including accrued | 456,406 | 373,537 | |
Income taxes payable (including income tax payable of the | 66,610 | 67,233 | |
Amounts due to related parties (including amounts due to related | 393 | 30 | |
Deferred revenue (including deferred revenue of the | 1,250,262 | 1,270,195 | |
Total current liabilities | 1,809,797 | 1,750,884 | |
Deferred tax liabilities, non-current (including deferred tax | 18,170 | 12,133 | |
Total liabilities | 1,827,967 | 1,763,017 | |
Mezzanine equity | |||
Redeemable non-controlling interests | 206,624 | 206,624 | |
Equity | |||
New Oriental Education & Technology Group Inc. shareholders' | 1,951,653 | 1,991,589 | |
Non-controlling interests | 16,399 | 16,482 | |
Total equity | 1,968,052 | 2,008,071 | |
Total liabilities, mezzanine equity and equity | 4,002,643 | 3,977,712 | |
NEW ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. | |||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||
(In thousands except for per share and per ADS amounts) | |||
For the Three Months Ended November 30 | |||
2018 | 2017 | ||
(Unaudited) | (Unaudited) | ||
USD | USD | ||
Net revenues | 597,072 | 467,183 | |
Operating cost and expenses (note 1) | |||
Cost of revenues | 300,105 | 227,258 | |
Selling and marketing | 91,597 | 72,091 | |
General and administrative | 235,647 | 180,904 | |
Total operating cost and expenses | 627,349 | 480,253 | |
Gain on disposal of a subsidiary | 1,724 | - | |
Operating loss | (28,553) | (13,070) | |
Loss from fair value change of long-term investments | (35,135) | - | |
Other income, net | 35,783 | 23,578 | |
Provision for income taxes | (11) | (2,973) | |
Income from equity method investments | 1,575 | 224 | |
Net (loss) income | (26,341) | 7,759 | |
Add: Net loss (income) attributable to non-controlling interests | 515 | (3,480) | |
Net (loss) income attributable to New Oriental | (25,826) | 4,279 | |
Net (loss) income per common share | |||
- Basic | (0.16) | 0.03 | |
- Diluted | (0.16) | 0.03 | |
Net (loss) income per ADS (note 2) | |||
- Basic | (0.16) | 0.03 | |
- Diluted | (0.16) | 0.03 | |
NEW ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. | |||
RECONCILIATION OF NON-GAAP MEASURES TO THE MOST COMPARABLE GAAP MEASURES | |||
(In thousands except for per share and per ADS amounts) | |||
For the Three Months Ended November 30 | |||
2018 | 2017 | ||
(Unaudited) | (Unaudited) | ||
USD | USD | ||
General and administrative expenses | 235,647 | 180,904 | |
Less: Share-based compensation expenses in | 13,687 | 9,313 | |
Non-GAAP general and administrative | 221,960 | 171,591 | |
Total operating cost and expenses | 627,349 | 480,253 | |
Less: Share-based compensation expenses | 13,687 | 9,313 | |
Non-GAAP operating cost and expenses | 613,662 | 470,940 | |
Operating loss | (28,553) | (13,070) | |
Add: Share-based compensation expenses | 13,687 | 9,313 | |
Non-GAAP operating loss | (14,866) | (3,757) | |
Operating margin | -4.8% | -2.8% | |
Non-GAAP operating margin | -2.5% | -0.8% | |
Net (loss) income attributable to New Oriental | (25,826) | 4,279 | |
Add: Share-based compensation expenses | 13,687 | 9,313 | |
Add: Loss from fair value change of long- | 35,135 | - | |
Non-GAAP net income attributable to New | 22,996 | 13,592 | |
Net (loss) income per ADS attributable to | (0.16) | 0.03 | |
Net (loss) income per ADS attributable to | (0.16) | 0.03 | |
Non-GAAP net income per ADS | 0.14 | 0.09 | |
Non-GAAP net income per ADS | 0.14 | 0.09 | |
Weighted average shares used in calculating | 158,690,714 | 158,119,910 | |
Weighted average shares used in calculating | 159,030,698 | 158,322,404 | |
Non-GAAP income per share - basic | 0.14 | 0.09 | |
Non-GAAP income per share - diluted | 0.14 | 0.09 | |
Notes: | |||||
Note 1: Share-based compensation expenses (in thousands) are included in the operating cost | |||||
For the Three Months Ended November 30 | |||||
2018 | 2017 | ||||
(Unaudited) | (Unaudited) | ||||
USD | USD | ||||
General and administrative expenses | 13,687 | 9,313 | |||
Total | 13,687 | 9,313 | |||
Note 2: Each ADS represents one common share. | |||||
NEW ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. | |||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||
(In thousands except for per share and per ADS amounts) | |||
For the Six Months Ended November 30 | |||
2018 | 2017 | ||
(Unaudited) | (Unaudited) | ||
USD | USD | ||
Net Revenues: | 1,456,918 | 1,128,348 | |
Operating cost and expenses (note 1): | |||
Cost of revenues | 667,504 | 497,452 | |
Selling and marketing | 190,898 | 145,994 | |
General and administrative | 469,309 | 336,895 | |
Total operating cost and expenses | 1,327,711 | 980,341 | |
Gain on disposal of a subsidiary | 3,575 | - | |
Operating income | 132,782 | 148,007 | |
Loss from fair value change of long-term investments | (82,119) | - | |
Other income, net | 69,292 | 48,511 | |
Provision for income taxes | (25,695) | (29,851) | |
Income from equity method investments | 522 | 249 | |
Net income | 94,782 | 166,916 | |
Add: Net loss (income) attributable to non-controlling interests | 2,624 | (4,244) | |
Net income attributable to New Oriental Education & | 97,406 | 162,672 | |
Net income per share attributable to New Oriental - | 0.61 | 1.03 | |
Net income per share attributable to New Oriental - | 0.61 | 1.03 | |
Net income per ADS attributable to New Oriental - | 0.61 | 1.03 | |
Net income per ADS attributable to New Oriental - | 0.61 | 1.03 | |
NEW ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. | |||
RECONCILIATION OF NON-GAAP MEASURES TO THE MOST COMPARABLE GAAP MEASURES | |||
(In thousands except for per share and per ADS amounts) | |||
For the Six Months Ended November 30 | |||
2018 | 2017 | ||
USD | USD | ||
General and administrative expenses | 469,309 | 336,895 | |
Share-based compensation expense in | 27,607 | 12,439 | |
Non-GAAP general and administrative | 441,702 | 324,456 | |
Total operating cost and expenses | 1,327,711 | 980,341 | |
Share-based compensation expenses | 27,607 | 12,439 | |
Non-GAAP operating cost and | 1,300,104 | 967,902 | |
Operating income | 132,782 | 148,007 | |
Share-based compensation expenses | 27,607 | 12,439 | |
Non-GAAP operating income | 160,389 | 160,446 | |
Operating margin | 9.1% | 13.1% | |
Non-GAAP operating margin | 11.0% | 14.2% | |
Net income attributable to New Oriental | 97,406 | 162,672 | |
Share-based compensation expenses | 27,607 | 12,439 | |
Add: Loss from fair value change of | 82,119 | - | |
Non-GAAP net income to New Oriental | 207,132 | 175,111 | |
Net income per ADS attributable to | 0.61 | 1.03 | |
Net income per ADS attributable to | 0.61 | 1.03 | |
Non-GAAP net income per ADS | 1.31 | 1.11 | |
Non-GAAP net income per ADS | 1.30 | 1.11 | |
Weighted average shares used in | 158,631,953 | 158,051,290 | |
Weighted average shares used in | 159,111,883 | 158,277,981 | |
Non-GAAP income per share - basic | 1.31 | 1.11 | |
Non-GAAP income per share - diluted | 1.30 | 1.11 | |
Notes: | |||
Note 1: Share-based compensation expenses (in thousands) are included in the operating | |||
For the Six Months Ended November 30 | |||
2018 | 2017 | ||
(Unaudited) | (Unaudited) | ||
USD | USD | ||
General and administrative expense | 27,607 | 12,439 | |
Total | 27,607 | 12,439 | |
Note 2: Each ADS represents one common share. | |||
SOURCE New Oriental Education and Technology Group Inc.
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