Hailiang Releases 2015 Chairman Letter
ZHUJI, China, Jan. 25, 2016 /PRNewswire/ --
Dear Shareholders,
2015 was a momentous year for Hailiang Education. We completed our Initial Public Offering (IPO) and listed our American depositary shares on the NASDAQ Global Market in July 2015 under the symbol "HLG." I had the honor of ringing the bell at NASDAQ on July 9. This was a significant milestone for Hailiang Education.
Our goal is to educate future leaders who have the mindset of a global citizen, together with a foundation in the humanities that will inspire them to make a difference to the world. To do that, we need to first and foremost invest in the hiring and training of teachers. We see such investment as an important part of our strategy which will enable parents to see us as the go-to private K-12 school not only in Zhejiang, but for the entire country. As we grow our student base, particularly in our highly valued international programs, we expect to take advantage of our access to overseas school programs to make our schools even better, so that we can become a pace-setter in private education both nationally and internationally.
As a publicly listed company, Hailiang Education has to meet SEC and NASDAQ disclosure and reporting standards, which means that our business is more transparent and accessible than prior to the IPO. This, of course, is good for our shareholders. It has other benefits as well, such as reinforcing the recognition of our international brand. For one thing, we have strict standards in hiring teachers. Our strong brand makes it possible to attract more highly-qualified foreign teachers, who are essential to raising the bar of our international programs. As of December 31, 2015, we had 49 foreign teachers, more than at the time of our IPO in July, and about 300 teachers with experience in international education programs. We take pride in our ability to provide our students with access to numerous activities, clubs and interesting courses that allow them to further explore their interests outside of the standard learning subjects. We are focused on enriching our students' personal development as we prepare them for universities they will attend around the world. We also hired a vice head for our international program from the United States to reinforce our international educational philosophy and management principles, and we have at least one faculty member with a Ph.D. from an Ivy League university in the US. Given the importance teachers play in a student's life, we have increased our teacher and educational staff to student ratio in our international program from 1:8.26 as of June 30, 2015 to 1:6.56 in the new school year. The higher ratio will increase the individual attention each student gets from his or her teachers.
Parents have noticed the exciting changes in our schools. The headcount in our international programs increased from 1,371 students as of June 30, 2015 to more than 1,700 as of December 31, 2015, representing a 24.0% increase, including students from around 20 countries. They appreciate our track record of graduate acceptances to some of the world's highest quality universities. We have graduates in the acclaimed University of California, Berkeley, and at a couple of other University of California campuses such as San Diego and Irvine, as well as the University of Michigan. One graduate recently interviewed at Cambridge University, and others have been accepted by London School of Economics, Imperial College London, University of London, University of Warwick, University of Bath, and University of Manchester. In addition to our English-immersion program, we also have immersion programs in Korean and Japanese, and have students accepted by top universities in countries other than the US and UK, including the University of Sydney and Korea University. We have achieved outstanding academic results from our basic educational programs with strong performances in both the high school and college entrance examinations from our students. Among the top ten high school entrance exam scores in Zhuji in 2015, seven were graduates of Hailiang Education, including the top two scores of the exam. Over the past four years, approximately 300 of our students have been recipients of provincial and national level academic awards.
Our IPO was not the only event we celebrated in 2015. In September, we welcomed the first students to our exciting new campus, the Hailiang Educational Park, with a capacity for 12,000 students and 2,000 teachers over a generous site area of 850,000 square meters. We relocated our Zhuji Hailiang Foreign Language School to the new campus along with selected programs from our other two schools, Tianma Experimental School and Zhuji Private High School. Over 11,000 students and 900 teachers began classes on September 7. The state of the art facilities at the new K-12 campus include sports facilities with an indoor swimming pool and track fields, as well as a school hospital, hotel, student and staff dormitories, and dining halls. The new campus serves as our flagship and provides a physical statement of our ambitions – with the highest standards in terms of learning facilities to educate and train student's bodies and minds, in line with the world's premier private boarding schools. Our international program was designed in cooperation with Cambridge English, and the campus has been authorized as a Cambridge Test Center. All of the courses, classes, textbooks, and teacher selection have been based on the tests students will need to pass to be admitted to universities in the United States and Commonwealth countries, as well as passing the TOEFL and IELTS examinations required in English-speaking countries.
I would also like to mention our financial strength. On October 28, 2015, we released our first fiscal year results following the IPO. We saw impressive performance across major financial indicators. Revenue and gross profit grew by 11.2% and 10.5%, to RMB514.8 million (US$83.0 million) and RMB180.3 million (US$29.1 million), respectively. We had higher administrative costs due to the IPO, and as a result, net profit of RMB141.0 million (US$22.7 million) and gross margin of 35.2%, similar to the previous fiscal year.
Operationally, we have experienced strong organic growth. The number of students enrolled in our international program at the end of the 2015 fiscal year was 1,371, an increase of 16.2% from that at the end of the 2014 fiscal year. More importantly, the share of revenues from our international program is growing fast, from 10.8% in 2013 fiscal year to 15.9% in 2015 fiscal year. Meanwhile, enrollment in the basic educational program grew by 2.8% in the 2015 fiscal year compared to the 2014 fiscal year, to 16,135 students from 15,695 students, respectively. As noted previously, the headcount in our international program has grown since the end of the 2015 fiscal year, with the beginning of the new school year in September, and of course our general education enrollment has increased as well with the opening of the new campus.
Finally, the proceeds from the IPO are driving a dedicated search for expansion through mergers and acquisitions. At present, we are concentrated operationally in just one city, but we believe we can leverage our advantage in capital resources, brand recognition and asset-light strategy to take our business model to other parts of Zhejiang Province and beyond. We are actively searching for the best partners in strategic locations, and targeting cities that attach high importance to education, including eastern coastal cities, provincial capitals and those around the Yangtze River Economic Zone.
Let me share the heartiest New Year's greetings with our shareholders and their families. At Hailiang Education, we have greatest appreciation for your support.
Sincere regards,
Ming Wang
Chairman and Chief Executive Officer
Hailiang Education Group Inc.
Zhuji, Zhejiang Province
About Hailiang Education
Founded in 1995, Hailiang Education now operates three centrally managed schools through its PRC affiliated entities under the "Hailiang" brand in Zhuji city, Zhejiang province: Zhuji Hailiang Foreign Language School, Zhuji Private High School, and Tianma Experimental School. Its schools offer a basic educational program, an international program at the kindergarten, primary school, middle school, and high school levels, as well as courses designed for university-bound students studying for A-levels courses in the United Kingdom or the SAT courses in the United States.
For more information, please visit http://ir.hailiangedu.com.
Contact:
Mr. Bo Lyu
T: +86 575 8706-9788
[email protected]
Mr. Christian Arnell
T: +86 10 5900-1548 in Beijing
[email protected]
Mrs. Linda Bergkamp
T: +1 480-614-3004
[email protected]
SOURCE Hailiang Education Group Inc.
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