EQS-News / 27/08/2019 / 15:37 UTC+8
*For immediate release 26 August 2019*
_(Stock code:2001.HK)_
*Core Revenue increased by 101.4% to RMB 501 mn*
*Net profit increased by 50.5% to RMB 226 mn
Completion of consolidation of Henan School, Northeast School, Guangxi
Schools and Central China School*
(26 August 2019, Hong Kong) China New Higher Education Group Limited ("New
Higher Education Group", together with its subsidiaries, the "Group"; stock
code: 2001.HK) is pleased to announce the interim results for the six months
ended 30 June 2019.
*Financial Overview *
Total revenue amounted to RMB565.0 million, up 73.1% yoy
Core revenue amounted to RMB501.0 million, up 101.4% yoy
Gross Profit amounted to RMB268.6 million, up 92.0% yoy
EBITDA amounted to RMB341.8 million, up 58.5% yoy
Net profit amounted to RMB225.7 million, up 50.5% yoy
Net profit attributable to the parent amounted to 201 million, up 34.0% yoy
Proposed interim dividend of RMB0.036 per share, up 33.3% yoy.
*Operation Overview*
Completion of consolidation of Henan School, Northeast School, Guangxi
Schools and Central China School
Industry-leading organic growth, for the 4 schools self-built and invested
by the Group at the time of listing, total student enrollment at these 4
schools increased by 15.0% yoy
"Since our listing in 2017, we seized the opportunity to acquire 5 schools
at very affordable costs based on our internal investment screening
criteria, which has enabled us to build an extensive presence across 7
provinces in China and allowed the newly acquired schools under our
management to achieve substantial improvements." Founder and Chairman of the
Board Mr. Li Xiaoxuan said.
"Meanwhile, we place great importance to the strengthening our
post-investment management standards. The construction speed of our Gansu
College is the fastest among the education space in the province. From
2015-2018, our total student enrollment grew at a CAGR of 50%. The current
student enrollment has exceeded 100,000 students.
Looking forward, the policy for the development of private education will be
more specific and there will be a larger room for the growth of the sector
as well. We will capitalize on these opportunities and continue to improve
ourselves in hope of creating stable returns for our shareholders."
*Financial Analysis *
Looking back, the Group's core revenue increased 101.4% to RMB 501 mn.
Tuition fee income increased 97.7% to RMB455 million, boarding fee increased
146.6% to RMB46 million, The significant increase in revenue was mainly due
to the new completions of acquisitions of Henan School, Northeast School and
Guangxi Schools, and the increase of student enrollment and tuition fees in
the existing schools facilitated by collectivized school operation
advantages.
Gross profit increased by 92.0% to RMB269 million. The increase is
attributable to the increase in student enrollment of the schools owned by
the Group and the impacts of the newly invested schools (Henan School,
Northeast School and Guangxi Schools). The gross profit margin decreased to
53.6% from 56.2%, primarily due to new completions of acquisitions of Henan
School and Guangxi Schools, whose gross profit margin are relatively lower
than other existing schools of the Group.
Net profit increased 50.5% to RMB226 million, net profit attributable to the
parent amounted to 201 million, up 34.0% yoy.
*Cash and Cash equivalents *
As of 30 June 2019, the Cash and Cash equivalents of the Group amounted to
RMB475 million.
*Capital Expenditures *
For the six months ended 30 June 2019, the Group's capital expenditures were
RMB195.2 million. The Group's capital expenditures were primarily related to
the construction of buildings and school facilities at the campus and the
prepaid rental for the land lease and purchase of equipment and software.
*Business Review *
For the six months ended 30 June 2019, the Group operated and invested 7
higher education institutes in 7 in mainland China with nationwide student
enrollment coverage. Total student no. reached 101,766 (including the
unconsolidated Gansu College). Furthermore, the Group has completed the
construction of the new campus of Gansu College with the fastest
construction speed in the local region?Besides, the change of promoter and
consolidation of Central China School were completed today. Consolidation of
Henan School, Northeast School, Guangxi Schools and Central China School
were all completed.
*Integration of Industry and Education, Cooperation between Schools and
Enterprises *
For the schools under the Group, they established a profound
school-corporate cooperation with many well-known companies including
Microsoft, Huawei, Alibaba, Lenovo, Jingdong, Midea, Gree, Geely, 360, Tedu,
iFlytek, China Union, Chinasoft International, Newland Group and Travelsky
Group. They jointly carry out talents training through many cooperative
models such as teaching resources sharing, course resources sharing,
joint-construction of experimental training bases, common construction of
majors as well as college joint-construction.
*Future Prospect *
*"Endogenous Growth + Value Investment" Growth Strategy*
Benefiting from the country's favorable policies of continuous improvement
in the gross enrollment rate of higher education and the large-scale
enrollment expansion of higher education sector, and the solid operation
capability of China New Higher Education Group, the number of student
enrollment of the schools which were self-built and invested by the Group
was over 15% year-on-year. According to the market forecast conducted by
China Insights Consultancy, the average tuition fee for private colleges and
universities in 2018 is RMB13,836, while the average tuition fee for the
Group's universities in 2018/19 is only RMB9,947, indicating that the future
tuition has very big growth potential.
Due to the large gap between the income and quality of the newly invested
schools
and the flagship schools, the Group will leverage its advantages in
collectivized school operation to achieve resource sharing among and
coordinated development of schools and to elevate the education quality and
management efficiency. In 2019, the employment rate of the students of our
schools remains at a high level and the average salary of our students is
the highest among the sector. In particular, the average employment salary
of the 2019 Excellence Class graduates exceeds RMB80,000. Our efforts in the
education development are widely recognized by students, parents and
enterprises.
The Group will continue to maintain the rapid growth of our flagship
universities and leverage our advantages in school operation to close the
distance between the schools acquired and our flagship universities, in
order to realize fast-paced growth.
*Endogenous Growth*
*Investment Strategy *
As a pioneer of collectivized school operation, the Group has 15 years of
experience in acquisitions and self-construction of higher education
academic schools. We always focus on higher education, as well as the key
regions with a large number of college-aged population, low gross enrollment
rate penetration, scarcity of quality education resources and large room for
revenue growth and quality improvement.
In recent years, the Group has seized the opportunity to acquire 5 schools
at affordable costs according to the internal investment screening criteria.
Building an extensive presence across 7 provinces in China, it is a Hong
Kong-listed education company with the largest provincial presence and
broadest regional coverage. Meanwhile, we attach great importance to the
post-investment management standards. The speed of construction of our Gansu
College is the fastest among the Gansu education space. Thanks to the right
investment strategy we have adopted and the scientific post-investment
management, the Group has been able to achieve rapid growth. From 2015-2018,
the total student enrollment grew at a CAGR of more than 50%. The current
student enrollment has exceeded 100,000 students (including Gansu College).
-End-
*About China New Higher Education Group Limited *
China New Higher Education is a leading private formal higher education
group in China with nearly 20 years of education industry experience,
specializing in providing higher education which focuses on applied
sciences. The Group endeavors to help each student maximize his or her
potential and live his or her life to the fullest. The Group's fundamental
educational philosophy is mainly composed of two integral parts: (i) to
nurture the growth of students, and provide education tailored to each
student's individual needs and circumstances; and (ii) to equip students
with practical and readily applicable skills that meet market demand. The
Group currently operates and invests in six schools across six provinces in
mainland China with nationwide student enrollment coverage. Furthermore, the
Group has applied to be a joint school sponsor of Gansu College and is
expected to complete its new campus relocation in September 2019.
The Group provides high quality higher education in a wide selection of
fields in applied sciences. Its courses are designed to equip students with
practical and readily applicable skills, helping to prepare them for job
market. It achieved industry-leading graduate employment rates, with over
98% of its graduates from 2013 to 2015 by the end of their year of
graduation, according to Frost & Sullivan. The Group has been included as a
constituent stock of the Hang Seng Composite Small Cap Index and the Hang
Seng Consumer Goods & Services Index in the Hang Seng Composite Index Series
in August 2017, and has been included as a constituent stock of the MSCI
China Small Cap Index in November 2017 and included as a constituent stock
of Shenzhen and Hong Kong Stock Connect in March 2018.
The press release is distributed by Wonderful Sky Financial Group Limited on
behalf of China New Higher Education Group Limited.
For further information, please contact:
Wonderful Sky Financial Group Limited
Anson Wong
Tel: (852) 3970 2236
Email: georginazhaoxy@wsfg.hk
Document: http://n.eqs.com/c/fncls.ssp?u=MANDIBSJQS [1]
Document title: China New Higher Education Group Core Revenue increased by
101.4% to RMB 501 mn Net profit increased by 50.5% to RMB 226 mn Completion
of consolidation of Henan School, Northeast School, Guangxi Schools and
Central China School
27/08/2019 Dissemination of a Marketing Press Release, transmitted by EQS
Group.
The issuer is solely responsible for the content of this announcement.
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(END) Dow Jones Newswires
August 27, 2019 03:37 ET (07:37 GMT)
