-Quarterly Net Revenues up by 68.1% Year-Over-Year
-Quarterly Income from Operations Increased by 32.6%
Year-Over-Year
-Quarterly Non-GAAP Income from Operations Increased by 33.7%
Year-Over-Year
-Quarterly Total Student Enrollments up by 100.6%
Year-Over-Year
BEIJING, Oct. 26, 2017 /PRNewswire/ -- TAL Education Group
(NYSE: TAL) ("TAL" or the "Company"), a leading K-12 after-school
tutoring services provider in China, today announced its unaudited financial
results for the second quarter of fiscal year 2018 ended
August 31, 2017.
Highlights for the Second Quarter of Fiscal Year 2018
- Net revenues increased by 68.1% year-over-year to US$455.7 million from US$271.1 million in the same period of the prior
year.
- Income from operations increased by 32.6% to US$68.3 million from US$51.5 million in the same period of the prior
year.
- Non-GAAP income from operations increased by 33.7% to
US$79.9 million from US$59.8 million in the same period of the prior
year.
- Net income attributable to TAL increased by 6.7% year-over-year
to US$59.5 million, from US$55.7 million in the same period of the prior
year.
- Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 11.0% to
US$71.1 million from US$64.0 million in the same period of the prior
year.
- Basic and diluted net income per American Depositary Share
("ADS") 1 were US$0.11 and
US$0.10, respectively. Non-GAAP basic
and diluted net income per ADS, which excluded share-based
compensation expenses, were US$0.14
and US$0.12, respectively. Three ADSs
represent one Class A common share.
- Cash, cash equivalents and short-term investments totaled
US$946.1 million as of August 31, 2017, compared to US$699.7 million as of February 28, 2017.
- Total student enrollments increased by 100.6% year-over-year to
approximately 2,242,380 from approximately 1,117,650 in the same
period of the prior year.
1
Effective on August 16, 2017, the Company adjusted the ratio of its
American depositary shares ("ADSs") to Class A common shares
("Shares") from one (1) ADS representing two (2) Shares to three
(3) ADSs representing one (1) Share. All earnings per ADS figures
in this announcement give effect to the foregoing ADS to share
ratio change.
|
Highlights for the Six Months Ended August 31, 2017
- Net revenues increased by 66.8% year-over-year to US$777.7 million from US$466.2 million in the same period of the prior
year.
- Income from operations increased by 40.6% to US$97.1 million from US$69.1 million in the same period of fiscal year
2017.
- Non-GAAP income from operations increased by 39.2% to
US$119.4 million from US$85.8 million in the same period of the prior
year.
- Net income attributable to TAL increased by 27.9%
year-over-year to US$88.2 million,
from US$69.0 million in the same
period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 29.1% to
US$110.5 million from US$85.7 million in the same period of the prior
year.
- Basic and diluted net income per ADS were US$0.17 and US$0.16, respectively. Non-GAAP basic and diluted
net income per ADS, excluding share-based compensation expenses,
were US$0.22 and US$0.19, respectively.
- Total student enrollments during the first six months of fiscal
year 2018 increased by 86.5% year-over-year to approximately
3,290,140 from approximately 1,763,700.
- Total physical network increased from 507 learning centers in
30 cities as of February 28, 2017 to
575 learning centers in 36 cities as of August 31, 2017.
Financial and
Operating Data -- Second Quarter and First Six Months of Fiscal
Year 2018
|
(In US$ thousands,
except per ADS data, student enrollments and
percentages)
|
|
Three Months
Ended
|
|
August
31,
|
|
2016
|
2017
|
Pct. Change
|
Net
revenues
|
271,121
|
455,750
|
68.1%
|
Net income
attributable to TAL
|
55,740
|
59,451
|
6.7%
|
Non-GAAP net income
attributable to
TAL
|
64,023
|
71,070
|
11.0%
|
Operating
income
|
51,526
|
68,326
|
32.6%
|
Non-GAAP operating
income
|
59,808
|
79,945
|
33.7%
|
Net income per ADS
attributable to
TAL - basic
|
0.11
|
0.11
|
0.3%
|
Net income per ADS
attributable to
TAL – diluted
|
0.10
|
0.10
|
1.0%
|
Non-GAAP net income
per ADS
attributable to TAL – basic
|
0.13
|
0.14
|
4.4%
|
Non-GAAP net income
per ADS
attributable to TAL – diluted
|
0.12
|
0.12
|
5.5%
|
Total student
enrollments in small
class, one-on-one, and online courses
|
1,117,650
|
2,242,380
|
100.6%
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
August
31,
|
|
2016
|
2017
|
Pct. Change
|
Net
revenues
|
466,216
|
777,653
|
66.8%
|
Net income
attributable to TAL
|
68,976
|
88,239
|
27.9%
|
Non-GAAP net income
attributable to
TAL
|
85,651
|
110,543
|
29.1%
|
Operating
income
|
69,095
|
97,131
|
40.6%
|
Non-GAAP operating
income
|
85,770
|
119,434
|
39.2%
|
Net income per ADS
attributable to
TAL – basic
|
0.14
|
0.17
|
22.1%
|
Net income per ADS
attributable to
TAL – diluted
|
0.13
|
0.16
|
20.2%
|
Non-GAAP net income
per ADS
attributable to TAL – basic
|
0.18
|
0.22
|
23.2%
|
Non-GAAP net income
per ADS
attributable to TAL – diluted
|
0.16
|
0.19
|
21.9%
|
Total student
enrollments in small
class, one-on-one, and online courses
|
1,763,700
|
3,290,140
|
86.5%
|
|
|
|
|
"I'm pleased to see that our capacity expansion continued to
drive our top-line growth in the second quarter. All our business
segments performed well during the second quarter, and our revenues
increased 70% year-over-year in RMB terms, backed by 101%
enrollment growth year-on-year," said Mr. Rong Luo, TAL's Chief
Financial Officer. "During the quarter, we continued to offer more
classes with the classrooms and teachers that we have added
year-to-date. We expect to see normalized utilization gradually in
the second half of the year. As we further scale our business, we
intend to explore new opportunities to strengthen the foundation
for our future growth."
Mr. Luo continued, "We continue to explore new technologies in
our online and offline products and promote education progress
through smart intelligence. We are confident that our investments
enable us to offer students the most innovative technology-based
tutoring, and that positive student outcomes will reinforce, as
they always have done, our distinctive word-of-mouth based business
and brand."
Financial Results for the Second Quarter of Fiscal Year
2018
Net Revenues
In the second quarter of fiscal
year 2018, TAL reported net revenues of US$455.7 million, representing a 68.1% increase
from US$271.1 million in the second
quarter of fiscal year 2017. The increase was mainly driven by the
growth in total student enrollments, which rose by 100.6% to
approximately 2,242,380 from approximately 1,117,650 in the same
period of the prior year. The increase in total student enrollments
was driven primarily by summer promotions in small classes and
online courses.
Operating Costs and Expenses
In the second
quarter of fiscal year 2018, operating costs and expenses were
US$390.7 million, a 76.1% increase
from US$221.8 million in the second
quarter of fiscal year 2017. Non-GAAP operating costs and expenses,
which excluded share-based compensation expenses, were US$379.1 million, a 77.5% increase from
US$213.6 million in the second
quarter of fiscal year 2017.
Cost of revenues grew by 85.7% to US$244.9 million from US$131.9 million in the second quarter of fiscal
year 2017. The increase in cost of revenues was mainly due to an
increase in teacher compensation and rental costs, as well as the
acquisition of Beijing Shunshun Bida Information Consulting Co.,
Ltd ("Shunshun Bida"). Non-GAAP cost of revenues, which excluded
share-based compensation expenses, increased by 85.7% to
US$244.8 million, from US$131.9 million in the second quarter of fiscal
year 2017.
Selling and marketing expenses increased by 104.4% to
US$58.5 million from US$28.6 million in the second quarter of fiscal
year 2017. Non-GAAP selling and marketing expenses, which excluded
share-based compensation expenses, increased by 105.4% to
US$57.2 million from US$27.9 million in the second quarter of fiscal
year 2017. The increase of selling and marketing expenses in the
second quarter of fiscal year 2018 was primarily a result of a rise
in the compensation to sales and marketing staff to support a
greater number of programs and service offerings compared to the
year-ago period, as well as more marketing promotion activities
both in brand enhancement and consumer experience.
General and administrative expenses increased by 42.3% to
US$87.3 million from US$61.3 million in the second quarter of fiscal
year 2017. The increase in general and administrative expenses was
mainly due to an increase of the number of our general and
administrative personnel compared to the year-ago period and a rise
in compensation to our general and administrative personnel, as
well as an increase in rental cost. Non-GAAP general and
administrative expenses, which excluded share-based compensation
expenses, increased by 43.1% to US$77.1
million, from US$53.8 million
in the second quarter of fiscal year 2017.
Total share-based compensation expenses allocated to the related
operating costs and expenses increased by 40.3% to US$11.6 million in the second quarter of fiscal
year 2018 from US$8.3 million in the
same period of fiscal year 2017.
Gross
Profit
Gross profit grew by 51.4% to US$210.8
million from US$139.2 million
in the second quarter of fiscal year 2017.
Income from Operations
Income from operations
increased by 32.6% to US$68.3 million
from US$51.5 million in the second
quarter of fiscal year 2017. Non-GAAP income from operations, which
excluded share-based compensation expenses, increased by 33.7% to
US$79.9 million from US$59.8 million in the second quarter of fiscal
year 2017.
Other Income
Other income was US$2.0 million for the second quarter of fiscal
year 2018, compared to other income of US$23.8 million in the second quarter of fiscal
year 2017. Other income in the second quarter of fiscal year 2017
was mainly due to a gain from remeasuring the fair value of the
previously held equity interests in an acquiree at its acquisition
date fair value during a business combination achieved in
stages.
Impairment loss on long-term
investments
Impairment loss on long-term investments was
nil in this quarter, compared to impairment loss on long-term
investments of US$2.2 million in the
second quarter of fiscal year 2017. Impairment loss on long-term
investments was due to the other-than-temporary declines in the
value of long-term investments in several investees.
Income Tax Expense
Income tax expense was
US$16.2 million in the second quarter
of fiscal year 2018, compared to US$17.6
million in the second quarter of fiscal year 2017.
Net Income Attributable to TAL Education
Group
Net income attributable to TAL increased by 6.7%
to US$59.5 million from US$55.7 million in the second quarter of fiscal
year 2017. Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 11.0% to
US$71.1 million from US$64.0 million in the second quarter of fiscal
year 2017.
Basic and Diluted Net Income per ADS
Basic and
diluted net income per ADS were US$0.11 and US$0.10
respectively in the second quarter of fiscal year 2018. Non-GAAP
basic and Non-GAAP diluted net income per ADS, which excluded
share-based compensation expenses, were US$0.14 and US$0.12, respectively.
Capital Expenditures
Capital expenditures for
the second quarter of fiscal year 2018 were US$37.6 million, representing an increase of
US$18.7 million from US$18.9 million in the second quarter of fiscal
year 2017. The increase was mainly due to leasehold improvements
and the purchase of servers, computers, software systems and other
hardware for the Company's teaching facilities and mobile network
research and development.
Cash, Cash Equivalents, and Short-Term
Investments
As of August 31,
2017, the Company had US$431.4
million of cash and cash equivalents and US$514.7 million of short-term investments,
compared to US$470.2 million of cash
and cash equivalents and US$229.5
million of short-term investments as of February 28, 2017.
Deferred Revenue
As of August 31, 2017, the Company's deferred revenue
balance was US$728.8 million,
compared to US$463.4 million as of
August 31, 2016, representing an
increase of 57.3%. Deferred revenue primarily consisted of the
tuition collected in advance for the fall semester of Xueersi
Peiyou small classes, as well as the deferred revenue related to
the acquired businesses.
Financial Results for the First Six Months of Fiscal Year
2018
Net Revenues
For the first six months of fiscal
year 2018, TAL reported net revenues of US$777.7 million, representing a 66.8% increase
from US$466.2 million in the first
six months of fiscal year 2017. The increase was mainly driven by a
growth in total student enrollments, which increased by 86.5% to
approximately 3,290,140 from approximately 1,763,700 in the same
period of the prior year. The increase in total student enrollments
was driven primarily by the growth of enrollments in the small
class offerings and online courses.
Operating Costs and Expenses
In the first six
months of fiscal year 2018, operating costs and expenses were
US$684.4 million, a 71.2% increase
from US$399.9 million in the first
six months of fiscal year 2017. Non-GAAP operating costs and
expenses, which excluded share-based compensation expenses, were
US$662.1 million, a 72.8% increase
from US$383.2 million in the first
six months of fiscal year 2017.
Cost of revenues grew by 78.4% to US$414.5 million from US$232.4 million in the first six months of
fiscal year 2017. The increase in cost of revenues was mainly due
to an increase in teacher compensation and rental costs, as well as
the acquisition of Shunshun Bida. Non-GAAP cost of revenues, which
excluded share-based compensation expenses, increased by 78.4% to
US$414.4 million from US$232.3 million in the first six months of
fiscal year 2017.
Selling and marketing expenses increased by 93.3% to
US$102.0 million from US$52.7 million in the first six months of fiscal
year 2017. Non-GAAP selling and marketing expenses, which excluded
share-based compensation expenses, increased by 94.5% to
US$99.6 million from US$51.2 million in the first six months of fiscal
year 2017. The increase of selling and marketing expenses in the
first six months of fiscal year 2018 was primarily a result of a
rise in the compensation to sales and marketing staff to support a
greater number of programs and service offerings compared to the
year-ago period, as well as more marketing promotion activities
both in brand enhancement and consumer experience.
General and administrative expenses increased by 46.3% to
US$167.9 million from US$114.8 million in the first six months of
fiscal year 2017. The increase in general and administrative
expenses was mainly due to an increase of the number of our general
and administrative personnel compared to the year-ago period and a
rise in compensation to our general and administrative personnel,
as well as an increase in rental cost. Non-GAAP general and
administrative expenses, which excluded share-based compensation
expenses, increased by 48.7% to US$148.2
million from US$99.7 million
in the first six months of fiscal year 2017.
Total share-based compensation expenses allocated to the related
operating costs and expenses increased by 33.8% to US$22.3 million in the first six months of fiscal
year 2018 from US$16.7 million in the
same period of fiscal year 2017.
Gross Profit
Gross profit grew by 55.3% to
US$363.1 million from US$233.9 million in the first six months of
fiscal year 2017.
Income from Operations
Income from operations
increased by 40.6% to US$97.1 million
from US$69.1 million in the first six
months of fiscal year 2017. Non-GAAP income from operations, which
excluded share-based compensation expenses, increased by 39.2% to
US$119.4 million from US$85.8 million in the first six months of fiscal
year 2017.
Other Income
Other income was US$8.8 million for the first six months of fiscal
year 2018, compared to other income of US$23.8 million in the first six months of fiscal
year 2017. Other income for the first six months of fiscal year
2018 was mainly due to a gain from fair value change of an
investment. Other income for the first six months of fiscal year
2017 was mainly due to a gain from remeasuring the fair value of
the previously held equity interests in an acquiree at its
acquisition date fair value during a business combination achieved
in stages.
Income Tax Expense
Income tax expense was
US$24.6 million in the first six
months of fiscal year 2018, compared to US$22.1 million in the first six months of fiscal
year 2017.
Net Income Attributable to TAL Education
Group
Net income attributable to TAL increased by 27.9%
to US$88.2 million from US$69.0 million in the first six months of fiscal
year 2017. Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 29.1% to
US$110.5 million from US$85.7 million in the first six months of fiscal
year 2017.
Basic and Diluted Net Income per ADS
Basic and
diluted net income per ADS were US$0.17 and US$0.16, respectively, in the first six months of
fiscal year 2018. Non-GAAP basic and Non-GAAP diluted net income
per ADS, which excluded share-based compensation expenses, were
US$0.22 and US$0.19, respectively.
Capital Expenditures
Capital expenditures for
the first six months of fiscal year 2018 were US$67.2 million, an increase of US$35.6 million from US$31.6 million in the first six months of fiscal
year 2017. The increase was mainly due to leasehold improvements
and the purchase of servers, computers, software systems and other
hardware for the Company's teaching facilities and mobile network
research and development.
Business Outlook
Based on the Company's current
estimates, total net revenues for the third quarter of fiscal year
2018 are expected to be between US$411.7
million and US$416.9 million, representing an increase of
58% to 60% on a year-over-year basis, assuming no material change
in exchange rates.
These estimates reflect the Company's current expectation, which
is subject to change.
Conference Call
The Company will host a conference call and live webcast to
discuss its financial results for the second fiscal quarter of
fiscal year 2018 ended August 31,
2017 at 8:00 a.m. Eastern Time
on October 26, 2017 (8:00 p.m. Beijing time on October
26, 2017).
The dial-in details for the live conference call are as
follows:
U.S. toll
free:
|
+1-866-519-4004
|
Hong Kong toll
free:
|
800-906-601
|
International
toll:
|
+65-6713-5090
|
Conference
ID:
|
87036636
|
A live and archived webcast of the conference call will be
available on the Investor Relations section of TAL's website at
en.100tal.com.
A telephone replay of the conference call will be available
through 8:59 a.m. U.S. Eastern time,
November 3, 2017 (8:59 p.m. Beijing time, November
3, 2017).
The dial-in details for the replay are as follows:
U.S. toll
free:
|
+1-855-452-5696
|
Hong Kong toll
free:
|
800-963-117
|
International
toll:
|
+61-2-8199-0299
|
Conference
ID:
|
87036636
|
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 2018, quotations
from management in this announcement, as well as TAL Education
Group's strategic and operational plans, contain forward-looking
statements. The Company may also make written or oral
forward-looking statements in its reports filed with, 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 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 ability to continue to
attract students to enroll in its courses; the Company's ability to
continue to recruit, train and retain qualified teachers; the
Company's ability to improve the content of its existing course
offerings and to develop new courses; the Company's ability to
maintain and enhance its brand; the Company's ability to maintain
and continue to improve its teaching results; and the Company's
ability to compete effectively against its competitors. Further
information regarding these and other risks is included in the
Company's reports filed with, or furnished to the U.S. Securities
and Exchange Commission. All information provided in this press
release and in the attachments is as of the date of this press
release, and TAL Education Group undertakes no duty to update such
information or any forward-looking statement, except as required
under applicable law.
About TAL Education Group
TAL Education Group is a leading K-12 after-school tutoring
services provider in China. The
acronym "TAL" stands for "Tomorrow Advancing Life," which reflects
our vision to promote top learning opportunities for Chinese
students through both high-quality teaching and content, as well as
leading edge application of technology in the education experience.
TAL Education Group offers comprehensive tutoring services to
students from pre-school to the twelfth grade through three
flexible class formats: small classes, personalized premium
services, and online courses. Our tutoring services cover the core
academic subjects in China's
school curriculum including mathematics, English, Chinese, physics,
chemistry, and biology. The Company's learning center network
includes 575 physical learning centers as of August 31, 2017, located in 36 key cities in
China: Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Wuhan, Xi'an,
Chengdu, Nanjing, Hangzhou, Taiyuan, Zhengzhou, Chongqing, Suzhou, Shenyang, Jinan, Shijiazhuang, Qingdao, Changsha, Luoyang, Nanchang, Ningbo, Wuxi, Fuzhou , Hefei, Xiamen, Lanzhou, Dalian, Changchun, Guiyang, Dongguan, Changzhou, Xuzhou, Nantong, Foshan and
Zhenjiang. We also operate www.jzb.com, a leading online education
platform in China. Our ADSs trade
on the New York Stock Exchange under the symbol "TAL."
About Non-GAAP Financial Measures
In evaluating its business, TAL considers and uses the following
measures defined as non-GAAP financial measures by the U.S.
Securities and Exchange Commission as supplemental metrics to
review and assess its operating performance: non-GAAP operating
costs and expenses, non-GAAP cost of revenues, non-GAAP selling and
marketing expenses, non-GAAP general and administrative expenses,
non-GAAP income from operations, non-GAAP net income attributable
to TAL, non-GAAP basic and non-GAAP diluted net income per ADS. To
present each of these non-GAAP measures, the Company excludes
share-based compensation expenses. The presentation of these
non-GAAP financial measures is not intended to be considered in
isolation from 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
table captioned "Reconciliations of non-GAAP measures to the most
comparable GAAP measures" set forth at the end of this release.
TAL believes that these non-GAAP financial measures provide
meaningful supplemental information regarding its performance and
liquidity by excluding share-based expenses that may not be
indicative of its operating performance from a cash perspective.
TAL believes that both management and investors benefit from 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 TAL's
historical performance and liquidity. TAL computes its non-GAAP
financial measures using the same consistent method from quarter to
quarter and from period to period. TAL 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 non-GAAP measures is that these non-GAAP
measures exclude share-based compensation charges that have been
and will continue to be for the foreseeable future a significant
recurring expense in the Company's 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.
For further information, please contact:
Mei Li
Investor Relations
TAL Education Group
Tel: +86 10 5292 6658
Email: ir@100tal.com
Caroline Straathof
IR Inside
Tel: +31 6 5462 4301
Email: info@irinside.com
TAL EDUCATION
GROUP
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In U.S.
dollars)
|
|
|
|
As
of
February 28,
2017
|
|
As
of
August 31,
2017
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
470,217,004
|
|
$
431,397,021
|
Restricted
cash-current
|
2,732,559
|
|
1,684,933
|
Short-term
investments
|
229,456,397
|
|
514,673,149
|
Inventory
|
2,823,039
|
|
5,444,085
|
Amounts due
from related parties-current
|
3,424,285
|
|
3,462,788
|
Income tax
receivables
|
2,244,898
|
|
6,921,943
|
Prepaid
expenses and other current assets
|
160,222,823
|
|
150,018,132
|
Total current
assets
|
871,121,005
|
|
1,113,602,051
|
Restricted
cash-non-current
|
5,660,713
|
|
8,367,682
|
Property and
equipment, net
|
154,306,718
|
|
216,265,791
|
Deferred tax
assets-non-current
|
16,188,301
|
|
20,570,237
|
Rental
deposits
|
32,659,360
|
|
42,813,425
|
Intangible
assets, net
|
37,966,808
|
|
41,661,385
|
Goodwill
|
267,162,685
|
|
286,450,694
|
Long-term
investments
|
347,732,444
|
|
375,237,956
|
Long-term
prepayments and other non-current assets
|
96,107,917
|
|
109,672,343
|
Total
assets
|
$
1,828,905,951
|
|
$
2,214,641,564
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
Accounts payable
(including accounts payable of the consolidated VIEs without recourse to
TAL Education Group of
20,905,226 and 46,398,744 as
of February 28, 2017, and August 31,
2017, respectively)
|
$
22,637,199
|
|
$
48,943,530
|
Deferred
revenue-current (including deferred revenue-
current of the consolidated VIEs without recourse to
TAL Education Group of 465,944,822 and
682,785,276 as of February 28, 2017, and August
31, 2017, respectively)
|
504,147,032
|
|
720,182,698
|
Amounts due to
related parties-current (including amounts due to related parties-current of
the
consolidated VIEs without recourse to TAL
Education Group of 192,785 and 3,006,711 as of
February 28, 2017, and August 31, 2017,
respectively)
|
3,042,785
|
|
5,856,711
|
Accrued expenses and
other current liabilities (including accrued expenses and other
current liabilities of
the consolidated VIEs without recourse to TAL Education Group of 90,834,954
and
145,038,484 as of February 28, 2017, and August
31, 2017, respectively)
|
116,830,290
|
|
172,623,012
|
Income tax payable
(including income tax payable of the consolidated VIEs without recourse to
TAL
Education Group of 15,204,900 and 17,947,819 as
of February 28, 2017, and August 31, 2017,
respectively)
|
20,483,037
|
|
27,573,585
|
Total current
liabilities
|
667,140,343
|
|
975,179,536
|
Deferred
revenue-non-current (including deferred
revenue-non-current of the consolidated VIEs
without recourse to TAL Education Group of
14,726,473 and 8,648,404 as of February 28, 2017,
and August 31, 2017, respectively)
|
14,726,473
|
|
8,648,404
|
Amounts due to
related parties-non-current (including
amounts due to related parties-non-current of the
consolidated VIEs without recourse to TAL
Education Group of nil and nil as of February 28,
2017, and August 31, 2017, respectively)
|
2,840,000
|
|
2,840,000
|
Deferred tax
liabilities-non-current (including deferred
tax liabilities-non-current of the consolidated VIEs
without recourse to TAL Education Group of
13,063,488 and 16,277,272 as of February 28, 2017,
and August 31, 2017, respectively)
|
13,185,886
|
|
16,480,428
|
Bond payable
(including bond payable of the
consolidated VIEs without recourse to TAL
Education Group of nil and nil as of February 28,
2017, and August 31,2017, respectively)
|
225,148,918
|
|
72,008,000
|
Long-term debt
(including long-term debt of the
consolidated VIEs without recourse to TAL
Education Group of nil and nil as of February 28,
2017, and August 31, 2017, respectively)
|
225,000,000
|
|
225,000,000
|
Total
liabilities
|
1,148,041,620
|
|
1,300,156,368
|
|
|
|
|
TAL Education
Group Shareholders' Equity
|
|
|
|
|
|
|
|
Class A common
shares
|
93,131
|
|
106,588
|
Class B common
shares
|
71,456
|
|
70,556
|
Additional paid-in
capital
|
141,968,264
|
|
298,062,275
|
Statutory
reserve
|
28,407,421
|
|
28,407,421
|
Retained
earnings
|
417,835,502
|
|
464,909,105
|
Accumulated other
comprehensive income
|
55,869,132
|
|
87,168,364
|
Total TAL
Education Group's equity
|
644,244,906
|
|
878,724,309
|
Non-controlling
interest
|
36,619,425
|
|
35,760,887
|
Total
equity
|
680,864,331
|
|
914,485,196
|
Total liabilities
and equity
|
$
1,828,905,951
|
|
$
2,214,641,564
|
TAL EDUCATION
GROUP
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In U.S. dollars,
except share, ADS, per share and per ADS data)
|
|
|
|
|
|
For the Three
Months
Ended August
31,
|
|
For the Six Months
Ended August
31,
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
Net
revenues
|
$
271,121,287
|
|
$
455,749,893
|
|
$
466,216,375
|
|
$
777,653,115
|
Cost of
revenues
|
131,879,033
|
|
244,929,963
|
|
232,366,242
|
|
414,534,386
|
Gross
profit
|
139,242,254
|
|
210,819,930
|
|
233,850,133
|
|
363,118,729
|
Operating expenses
(note 1)
|
|
|
|
|
|
|
|
Selling and
marketing
|
28,620,113
|
|
58,490,896
|
|
52,743,743
|
|
101,952,975
|
General and
administrative
|
61,343,393
|
|
87,311,774
|
|
114,773,223
|
|
167,943,064
|
Total operating
expenses
|
89,963,506
|
|
145,802,670
|
|
167,516,966
|
|
269,896,039
|
Government
subsidies
|
2,246,800
|
|
3,309,031
|
|
2,761,607
|
|
3,907,997
|
Income from
operations
|
51,525,548
|
|
68,326,291
|
|
69,094,774
|
|
97,130,687
|
Interest
income
|
4,449,108
|
|
10,534,422
|
|
7,837,460
|
|
18,235,679
|
Interest
expense
|
(2,667,238)
|
|
(3,869,794)
|
|
(4,555,211)
|
|
(9,094,878)
|
Other
income
|
23,802,211
|
|
2,017,878
|
|
23,787,119
|
|
8,806,037
|
Impairment loss on
long-term
investments
|
(2,211,642)
|
|
-
|
|
(2,211,642)
|
|
(699,748)
|
Income before
provision for
income tax and loss from
equity method investments
|
74,897,987
|
|
77,008,797
|
|
93,952,500
|
|
114,377,777
|
Provision for income
tax
|
(17,597,079)
|
|
(16,158,324)
|
|
(22,075,286)
|
|
(24,553,778)
|
Loss from equity
method
investments
|
(2,168,346)
|
|
(1,964,530)
|
|
(3,840,133)
|
|
(3,247,334)
|
Net
income
|
55,132,562
|
|
58,885,943
|
|
68,037,081
|
|
86,576,665
|
Add: Net loss
attributable to
noncontrolling interest
|
607,705
|
|
565,061
|
|
939,332
|
|
1,662,772
|
Total net income
attributable
to TAL Education
Group
|
$
55,740,267
|
|
$ 59,451,004
|
|
$
68,976,413
|
|
$
88,239,437
|
Net income per
common share
|
|
|
|
|
|
|
|
Basic
|
$ 0.34
|
|
$ 0.34
|
|
$ 0.43
|
|
$ 0.52
|
Diluted
|
0.31
|
|
0.31
|
|
0.39
|
|
0.47
|
Net income per ADS
(note 2)
|
|
|
|
|
|
|
|
Basic
|
$ 0.11
|
|
$ 0.11
|
|
$ 0.14
|
|
$ 0.17
|
Diluted
|
0.10
|
|
0.10
|
|
0.13
|
|
0.16
|
Weighted average
shares used in
calculating net income per
common share
|
|
|
|
|
|
|
|
Basic
|
162,158,462
|
|
172,388,942
|
|
161,961,997
|
|
169,669,402
|
Diluted
|
188,197,500
|
|
193,131,866
|
|
187,541,900
|
|
193,585,695
|
Note1: Share-based compensation expenses are included in the
operating costs and expenses as follows:
|
For the Three
Months
|
|
For the Six
Months
|
|
Ended August
31,
|
|
Ended August
31,
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
Cost of
revenues
|
$ 15,598
|
|
$ 108,633
|
|
$ 23,338
|
|
$ 141,537
|
Selling and
marketing
|
762,661
|
|
1,257,967
|
|
1,538,626
|
|
2,375,599
|
General and
administrative
|
7,504,515
|
|
10,252,433
|
|
15,113,099
|
|
19,786,118
|
Total
|
$
8,282,774
|
|
$
11,619,033
|
|
$
16,675,063
|
|
$
22,303,254
|
Note 2: Three ADSs represent one Class A common Share.
TAL EDUCATION
GROUP
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
(In U.S.
dollars)
|
|
|
|
|
|
For the Three
Months Ended
August
31,
|
|
For the Six Months
Ended
August
31,
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
|
|
|
|
|
|
|
Net
income
|
$
55,132,562
|
|
$
58,885,943
|
|
$
68,037,081
|
|
$
86,576,665
|
Other
comprehensive
(loss)/income, net of tax
|
(30,496,590)
|
|
24,005,053
|
|
64,347,466
|
|
31,299,232
|
Comprehensive
income
|
24,635,972
|
|
82,890,996
|
|
132,384,547
|
|
117,875,897
|
Add: Comprehensive
loss
attributable to noncontrolling
interest
|
659,981
|
|
565,061
|
|
1,004,756
|
|
1,662,772
|
Comprehensive
income
attributable to TAL
Education Group
|
$
25,295,953
|
|
$
83,456,057
|
|
$
133,389,303
|
|
$
119,538,669
|
TAL EDUCATION
GROUP
|
Reconciliation of
Non-GAAP Measures to the Most Comparable GAAP
Measures
|
(In U.S. dollars,
except share, ADS, per share and per ADS data)
|
|
|
|
|
|
For the Three
Months
Ended August
31,
|
|
For the Six
Months
Ended August 31,
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
$
131,879,033
|
|
$
244,929,963
|
|
$
232,366,242
|
|
$
414,534,386
|
Share-based
compensation expense
in cost of revenues
|
15,598
|
|
108,633
|
|
23,338
|
|
141,537
|
Non-GAAP cost of
revenues
|
131,863,435
|
|
244,821,330
|
|
232,342,904
|
|
414,392,849
|
|
|
|
|
|
|
|
|
Selling and
marketing expenses
|
28,620,113
|
|
58,490,896
|
|
52,743,743
|
|
101,952,975
|
Share-based
compensation expense
in selling and marketing expenses
|
762,661
|
|
1,257,967
|
|
1,538,626
|
|
2,375,599
|
Non-GAAP selling
and marketing
expenses
|
27,857,452
|
|
57,232,929
|
|
51,205,117
|
|
99,577,376
|
General and
administrative expenses
|
61,343,393
|
|
87,311,774
|
|
114,773,223
|
|
167,943,064
|
Share-based
compensation expense
in general and administrative
expenses
|
7,504,515
|
|
10,252,433
|
|
15,113,099
|
|
19,786,118
|
Non-GAAP general
and administrative
expenses
|
53,838,878
|
|
77,059,341
|
|
99,660,124
|
|
148,156,946
|
|
|
|
|
|
|
|
|
Operating costs
and expenses
|
221,842,539
|
|
390,732,633
|
|
399,883,208
|
|
684,430,425
|
Share-based
compensation expense
in operating costs and expenses
|
8,282,774
|
|
11,619,033
|
|
16,675,063
|
|
22,303,254
|
Non-GAAP operating
costs and
expenses
|
213,559,765
|
|
379,113,600
|
|
383,208,145
|
|
662,127,171
|
|
|
|
|
|
|
|
|
Income from
operations
|
51,525,548
|
|
68,326,291
|
|
69,094,774
|
|
97,130,687
|
Share based
compensation expenses
|
8,282,774
|
|
11,619,033
|
|
16,675,063
|
|
22,303,254
|
Non-GAAP income
from
operations
|
59,808,322
|
|
79,945,324
|
|
85,769,837
|
|
119,433,941
|
|
|
|
|
|
|
|
|
Net income
attributable to TAL
Education Group
|
55,740,267
|
|
59,451,005
|
|
68,976,413
|
|
88,239,438
|
Share based
compensation expenses
|
8,282,774
|
|
11,619,033
|
|
16,675,063
|
|
22,303,254
|
Non-GAAP net
income
attributable to TAL Education
Group
|
$
64,023,041
|
|
$
71,070,038
|
|
$
85,651,476
|
|
$
110,542,692
|
Net income per
ADS
|
|
Basic
|
$ 0.11
|
|
$ 0.11
|
|
$ 0.14
|
|
$ 0.17
|
Diluted
|
0.10
|
|
0.10
|
|
0.13
|
|
0.16
|
Non-GAAP Net
income per ADS
(note 3)
|
|
|
|
|
|
|
|
Basic
|
$ 0.13
|
|
$ 0.14
|
|
$ 0.18
|
|
$ 0.22
|
Diluted
|
0.12
|
|
0.12
|
|
0.16
|
|
0.19
|
ADSs used in
calculating net
income per ADS
|
|
|
|
|
|
|
|
Basic
|
486,475,386
|
|
517,166,827
|
|
485,885,991
|
|
509,008,205
|
Diluted
|
564,592,500
|
|
579,395,597
|
|
562,625,701
|
|
580,757,085
|
Note 3: The Non-GAAP adjusted net income per ADS is computed
using Non-GAAP adjusted net income and the same number of ADSs used
in GAAP basic and diluted EPS calculation.
View original
content:http://www.prnewswire.com/news-releases/tal-education-group-announces-unaudited-financial-results-for-the-second-fiscal-quarter-ended-august-31-2017-300543755.html
SOURCE TAL Education Group