BEIJING and HONG KONG, July 18,
2011 /PRNewswire-Asia/ -- New Oriental Education and
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 fourth quarter and fiscal year
ended May 31, 2011. The Company also
announced that it will change the ratio of its American depositary
shares ("ADSs") to Common Shares from one (1) ADS representing four
(4) Common Shares to one (1) ADS representing one (1) Common Share,
effective on August 18, 2011.
Highlights for the Fourth Fiscal Quarter Ended May 31,
2011
- Total net revenues increased by 58.7% year-over-year to
US$137.4 million, from US$86.6 million in the same period of the prior
fiscal year.
- Net income attributable to New Oriental increased by 147.8%
year-over-year to US$14.3 million,
from US$5.8 million in the same
period of the prior fiscal year; excluding the approximately
US$1.54 million loss from the
disposal of two subsidiaries, Mingshitang School and Tomorrow
Oriental (described below) in the quarter ("Disposal Loss"), net
income attributable to New Oriental would have increased by 174.4%
year-over-year to US$15.8 million,
from US$5.8 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 Disposal Loss,
increased by 113.0% year-over-year to US$19.2 million, from US$9.0 million in the same period of the prior
fiscal year.
- Income from operations increased by 185.3% year-over-year to
US$10.4 million, from US$3.7 million in the same period of the prior
fiscal year; excluding the Disposal Loss, income from operations
would have increased by 227.3% year-over-year to US$12.0 million, from US$3.7 million in the same period of the prior
fiscal year.
- Non-GAAP income from operations, which excludes share-based
compensation expenses and the Disposal Loss, increased by 122.1%
year-over-year to US$15.4 million,
from US$6.9 million in the same
period of the prior fiscal year.
- Basic and diluted net income attributable to New Oriental per
ADS were US$0.37 and US$0.37, respectively. Non-GAAP basic and diluted
net income per ADS, which excludes share-based compensation
expenses and the Disposal Loss, were US$0.50 and US$0.49, respectively. Each ADS currently
represents four common shares of the Company. Effective on
August 18, 2011, New Oriental will
adjust the ratio of its ADS representing common shares from one ADS
for four common shares to one ADSs for one common share.
- Total student enrollments in academic subjects tutoring and
test preparation courses increased by 11.9% year-over-year to
approximately 489,100, from approximately 437,200 in the same
period of the prior fiscal year.
Highlights for the Fiscal Year Ended May 31,
2011
- Total net revenues for the fiscal year increased by 44.4%
year-over-year to US$557.9 million,
from US$386.3 million.
- Net income attributable to New Oriental increased by 30.8%
year-over-year to US$101.8 million,
from US$77.8 million.
- Non-GAAP net income attributable to New Oriental for the fiscal
year, which excludes share-based compensation expenses and the
Disposal Loss, increased by 25.9% year-over-year to US$118.4 million, from US$94.0 million.
- Income from operations increased by 23.5% year-over-year to
US$95.5 million, from US$77.3 million. Non-GAAP income from operations
for the fiscal year, which excludes share-based compensation
expenses and the Disposal Loss, increased by 19.9% year-over-year
to US$112.1 million, from
US$93.5 million.
- Basic and diluted net income attributable to New Oriental per
ADS were US$2.66 and US$2.61, respectively. Non-GAAP basic and diluted
earnings per ADS for the fiscal year, which exclude share-based
compensation expenses and the Disposal Loss, were US$3.09 and US$3.03, respectively.
- Total student enrollments in academic subjects tutoring and
test preparation courses increased by 15.6% year-over-year to
approximately 2,089,600, from approximately 1,807,700 in the prior
fiscal year.
- The total number of schools and learning centers increased to
487 as of May 31, 2011, up from 367
as of May 31, 2010. A net of 2 new
schools were opened in the fourth quarter, bringing the total
number of schools to 54 as of May 31,
2011, up from 52 as of February 28,
2011. The number of learning centers increased by 29 in the
quarter to 433 as of May 31, 2011, up
from 404 as of February 28,
2011.
Financial
and Student Enrollments Summary – Fourth Quarter and Fiscal Year
2011
(US$ in thousands, except
per ADS data and student enrollments)
|
|
|
Q4 of
FY2011
|
Q4 of
FY2010
|
Pct.
Change
|
|
Net revenues
|
137,386
|
86,581
|
58.7%
|
|
Net income attributable
to New Oriental
|
14,303
|
5,773
|
147.8%
|
|
Non-GAAP net income
attributable to New
Oriental (1)
|
19,247
|
9,037
|
113.0%
|
|
Operating income
|
10,421
|
3,653
|
185.3%
|
|
Non-GAAP operating income
(1)
|
15,365
|
6,917
|
122.1%
|
|
Net income per ADS
attributable to New
Oriental – basic
(2)
|
0.37
|
0.15
|
144.0%
|
|
Net income per ADS
attributable to New
Oriental – diluted (2)
|
0.37
|
0.15
|
145.9%
|
|
Non-GAAP net income per
ADS attributable to New
Oriental – basic(1)(2)(3)
|
0.50
|
0.24
|
109.8%
|
|
Non-GAAP net income per
ADS attributable to New
Oriental - diluted (1)(2)(3)
|
0.49
|
0.23
|
111.3%
|
|
Total student enrollments in
academic subjects tutoring and test preparation courses
|
489,100
|
437,200
|
11.9%
|
|
|
|
|
|
|
|
|
|
|
FY2011
|
FY2010
|
Pct.
Change
|
|
Net revenues
|
557,872
|
386,307
|
44.4%
|
|
Net income attributable
to New Oriental
|
101,774
|
77,789
|
30.8%
|
|
Non-GAAP net income
attributable to New
Oriental (1)
|
118,356
|
93,972
|
25.9%
|
|
Operating income
|
95,501
|
77,314
|
23.5%
|
|
Non-GAAP operating income
(1)
|
112,083
|
93,497
|
19.9%
|
|
Net income per ADS
attributable to New
Oriental - basic (2)
|
2.66
|
2.06
|
28.9%
|
|
Net income per ADS
attributable to New
Oriental - diluted (2)
|
2.61
|
2.01
|
29.8%
|
|
Non-GAAP net income per
ADS attributable to New
Oriental – basic
(1)(2)(3)
|
3.09
|
2.49
|
24.1%
|
|
Non-GAAP net income per
ADS attributable to New
Oriental – diluted (1)(2)(3)
|
3.03
|
2.43
|
24.9%
|
|
Total student enrollments in
academic subjects tutoring and test preparation courses
|
2,089,600
|
1,807,700
|
15.6%
|
|
|
|
|
|
|
|
- New Oriental provides net income attributable to New Oriental,
operating income, and net income per ADS attributable to New
Oriental on a Non-GAAP basis that excludes share-based compensation
expenses and the Disposal Loss of subsidiaries to reflect
meaningful 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.
- Each ADS currently represents four common shares. Effective on
August 18, 2011, New Oriental will
adjust the ratio of its ADS representing common shares from one ADS
for four common shares to one ADSs for one common share.
- The Non-GAAP adjusted net income per share and per ADS are
computed using Non-GAAP adjusted net income and the same number of
shares and ADSs used in GAAP basic and diluted EPS
calculation.
"We are pleased to end our 2011 fiscal year with another stellar
quarter, recording strong revenue growth of 58.7% as well as
substantially higher profit growth of 147.8%. In fact, excluding
the Disposal Loss recorded in the quarter for the divestment of two
subsidiaries, net profit growth would have increased over 174% to
over US$15.8 million and operating
income growth would have increased over 227% to approximately
US$12 million," said Michael Yu, New Oriental's Chairman and Chief
Executive Officer.
Mr. Yu continued, "We achieved several important milestones
during our fiscal year 2011 with revenues of over US$500 million, up more than 44%, net profit of
over US$100 million, up more than
30%, and student enrollments of over 2 million, up more than 15%.
This is particularly exciting given that we invested heavily in the
business in fiscal year 2011, adding 120 schools and learning
centers, and that we started the fiscal year with the Shanghai
World Expo negatively impacting first fiscal quarter performance
with revenue growth of just 28.8%, net income growth of 9.3%, and
student enrollment growth of 8.8%. In the final three quarters of
fiscal year 2011, we successfully turned around our financial
performance, with revenues up over 54%, net income up over 90%, and
student enrollments up over 19% compared to the same nine-month
period in the previous year. We have strong momentum going into
fiscal year 2012 and we are very confident in both New Oriental's
market leading position in the Chinese education and training
market and our long-term business prospects."
Louis T. Hsieh, New Oriental's
President and Chief Financial Officer, commented, "We are extremely
pleased with the record level of demand for our educational
programs and services with annual revenues re-accelerating in
fiscal year 2011 to over US$550
million, up more than 44%, compared to revenue growth of 32%
in fiscal year 2010. This record top-line performance was led by
continued strength in our three key business segments. First,
enrollment in our overseas test preparation programs grew by more
than 23% to over 317,000 year-over-year, while gross revenues grew
by more than 55% to over US$166
million year-over-year. Second, enrollment in our middle and
high school English and U-Can all-subjects training programs grew
by about 30% to over 472,800 year-over-year, while gross revenues
grew by over 65% to about US$116
million year-over-year. Third, enrollment in our POP Kids
programs grew by about 34% to over 581,500 year-over-year, while
gross revenues grew by about 52% to over US$77 million year-over-year. Given the growth of
U-Can and POP Kids programs, our K-12 all-subjects after-school
tutoring business recorded year-over-year enrollment growth of 32%
to over one million and year-over-year gross revenue growth of
about 60% to about US$193 million. On
top of the success of these three key business segments, our
one-teacher-to-maximum-five-students VIP personalized classes
experienced explosive growth in fiscal year 2011 with enrollment
growth of more than 73% to over 63,500 and year-over-year cash
revenue growth of more than 154% to over US$120 million."
Mr. Hsieh continued, "Although enrollment growth in the fourth
fiscal quarter of 11.9% to over 489,000 appears below average for
New Oriental, this is not indicative of any demand slowdown. Rather
it was primarily the result of difficult year-over-year comparisons
due to the late timing of Chinese New
Year last year which fell on February
14, 2010,and pushed enrollments from the third fiscal
quarter ended February 28, 2010, to
the fourth fiscal quarter in fiscal year 2010. In 2010, students
returned to their primary school studies and enrolled in New
Oriental after-school tutoring classes in early March, in the
fourth fiscal quarter, instead of late February, in the third
fiscal quarter. Consequently, we experienced enrollment growth of
32.4% to over 437,000 in the fourth fiscal quarter of last year,
making year-over-year comparisons very challenging in this fourth
fiscal quarter. This year, Chinese New
Year fell on February 3, 2011,
a more traditional calendar, allowing students to enroll in New
Oriental Spring tutoring classes at the end of February, in the
third fiscal quarter. In fact, demand for New Oriental classes
remains quite robust for the Summer quarter as evidenced by our
record deferred revenue balance of over US$194 million, up over 81% year-over-year, at
the end of our 2011 fiscal fourth quarter."
Four-for-One ADS Ratio Change
New Oriental will change the ratio of its American depositary
shares to Common Shares from one (1) ADS representing four (4)
Common Shares to one (1) ADS representing one (1) Common Share,
effective on August 18, 2011.
New Oriental ADS holders as of the close of business on
August 17, 2011, will receive three
additional ADSs for each ADS then held. The effect of this ratio
change on the ADS price is expected to take place on August 19, 2011.
For New Oriental's ADS holders, this ratio change will have the
same effect as a four-for-one stock split. There will be no change
to New Oriental's underlying common shares. Furthermore, no action
by ADS holders is required to effect the ratio change.
Disposal of Mingshitang School and
Tomorrow Oriental
During the fourth quarter of 2011, New Oriental disposed of
Beijing Haidian Mingshitang Exam Training Education School
("Mingshitang School"), a Beijing-based private school that specializes
in tutoring students seeking to retake the "gaokao", the Chinese
college entrance examination. In April
2011, the Company disposed of 60% equity interest in
Mingshitang School to Mr. Ma Yonggang, the principal of Mingshitang
School. New Oriental also disposed of Beijing Tomorrow Oriental
Technology Co., Ltd. ("Tomorrow Oriental"), a subsidiary providing
software development services. In May
2011, the Company disposed of 100% equity interest in
Tomorrow Oriental to Mr. Huang
Binliang, the general manager of Tomorrow Oriental. New
Oriental recorded disposal losses of US$1.2
million and US$0.4 million in
respect of the disposal of Mingshitang School and Tomorrow
Oriental, respectively.
Financial Results for the Fiscal Quarter Ended May 31,
2011
For the fourth fiscal quarter of 2011, New Oriental reported net
revenues of US$137.4 million,
representing a 58.7% increase year-over-year.
Net revenues from educational programs and services for the
fourth fiscal quarter were US$120.4
million, representing a 62.1% increase year-over-year. The
growth was mainly driven by an increase in the number of student
enrollments in academic subjects tutoring and test preparation
courses, and higher average selling prices resulting from price
increases and students selecting more expensive, smaller class
options. Total student enrollments in academic subjects tutoring
and test preparation courses in the fourth quarter of fiscal year
2011 increased by 11.9% year-over-year to approximately 489,100,
from approximately 437,200 in the same period of the prior fiscal
year.
Operating costs and expenses for the quarter were US$127.0 million, a 53.1% increase
year-over-year. Non-GAAP operating costs and expenses, which
exclude share-based compensation expenses and Disposal Loss, for
the quarter, were US$122.0 million, a
53.2% increase year-over-year.
Cost of revenues increased by 55.9% year-over-year to
US$56.7 million, primarily due to the
increased number of courses and the greater number of schools and
learning centers in operation.
Selling and marketing expenses increased by 29.9% year-over-year
to US$22.6 million, primarily due to
an increase in the number of customer service representatives and
marketing staff.
General and administrative expenses for the quarter increased by
58.1% year-over-year to US$46.2
million. Non-GAAP general and administrative expenses, which
exclude share-based compensation expenses, were US$43.0 million, a 65.6% increase year-over-year,
primarily due to increased headcount as the Company expanded its
network of schools and learning centers.
Total share-based compensation expenses, which were allocated to
related operating costs and expenses, increased by 4.4% to
US$3.4 million in the fourth quarter
of fiscal year 2011, from US$3.3
million in the same period of the prior fiscal year.
Income from operations for the quarter was US$10.4 million, a 185.3% increase from
US$3.7 million in the same period of
the prior fiscal year. Non-GAAP income from operations, which
excludes share-based compensation expenses and the Disposal Loss,
for the quarter was US$15.4 million,
a 122.1% increase from US$6.9 million
in the same period of the prior fiscal year.
Operating margin for the quarter was 7.6%, compared to 4.2% in
the same period of the prior fiscal year. Non-GAAP operating
margin, which excludes share-based compensation expenses and the
Disposal Loss, for the quarter was 11.2%, compared to 8.0% in the
same period of the prior fiscal year. This rise was primarily due
to improved operating efficiency as revenue growth outpaced the
growth in operating costs and expenses.
Net income attributable to New Oriental for the quarter was
US$14.3 million, representing a
147.8% increase from the same period of the prior fiscal year.
Basic and diluted earnings per ADS attributable to New Oriental
were US$0.37 and US$0.37, respectively.
Non-GAAP net income attributable to New Oriental for the quarter
was US$19.2 million, representing a
113.0% increase from the same period of the prior fiscal year.
Non-GAAP basic and diluted earnings per ADS attributable to New
Oriental were US$0.50 and
US$0.49, respectively.
Capital expenditures for the quarter were US$7.3 million, which were primarily used to add
a net of 31 schools and learning centers.
As of May 31, 2011, New Oriental
had cash and cash equivalents of US$317.3
million, as compared to US$348.0
million as of February 28,
2011. In addition, New Oriental had US$152.7 million in term deposits and
US$143.7 million in short term
investments as of May 31, 2011. Net
operating cash flow for the fourth quarter of fiscal year 2011 was
approximately US$71.6 million.
The 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 fourth
quarter of fiscal year 2011 was US$194.3
million, an increase of 81.5% as compared to US$107.1 million at the end of the fourth quarter
of fiscal year 2010.
Financial Results for the Fiscal Year Ended May 31,
2011
For the fiscal year ended May 31,
2011, New Oriental reported net revenues of US$557.9 million, a 44.4% increase
year-over-year.
Net revenues from educational programs and services for the
fiscal year ended May 31, 2011, were
US$508.4 million, representing a
44.1% increase year-over-year. The growth was mainly driven by an
increase in the number of student enrollments in academic subjects
tutoring and test preparation courses and higher average selling
prices resulting from students selecting more expensive, smaller
class options. Total student enrollments in academic subjects
tutoring and test preparation courses for the fiscal year ended
May 31, 2011, increased by 15.6%
year-over-year to approximately 2,089,600 from approximately
1,807,700 in the fiscal year ended May 31,
2010.
Income from operations for the fiscal year ended May 31, 2011, was US$95.5
million, a 23.5% increase year-over-year. Non-GAAP income
from operations, which excludes share-based compensation expense
and the Disposal Loss, for the fiscal year ended May 31, 2011, was US$112.1
million, a 19.9% increase year-over-year.
Operating margin for the fiscal year ended May 31, 2011, was 17.1%, compared to 20.0% for
the fiscal year ended May 31, 2010.
Non-GAAP operating margin, which excludes share-based compensation
expenses and the Disposal Loss, for the fiscal year ended
May 31, 2011, was 20.1%, compared to
24.2% for the fiscal year ended May 31,
2010.
Net income attributable to New Oriental for the fiscal year
ended May 31, 2011, was US$101.8 million, representing a 30.8% increase
year-over-year. Basic and diluted earnings per ADS attributable to
New Oriental for the fiscal year ended May
31, 2011, were US$2.66 and
US$2.61, respectively.
Non-GAAP net income attributable to New Oriental, which excludes
share-based compensation expenses and the Disposal Loss, for the
fiscal year ended May 31, 2011, was
US$118.4 million, a 25.9% increase
year-over-year. Non-GAAP basic and diluted earnings per ADS
attributable to New Oriental for the fiscal year ended May 31, 2011, were US$3.09 and US$3.03, respectively.
Outlook for First Quarter of Fiscal Year
2012
New Oriental expects its total net revenues in the first quarter
of fiscal year 2012 (June 1, 2011, to
August 31, 2011) to be in the range
of US$255.8 million to US$265.4
million, representing year-over-year growth in the range of
33% to 38%. 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 July 18, 2011, U.S. Eastern Time (8 PM on July 18,
2011, Beijing/Hong Kong time).
Dial-in details for the earnings conference call are as
follows:
US:
|
+1-617-786-2901
|
|
Hong Kong:
|
+852-3002-1672
|
|
UK:
|
+44-207-365-8426
|
|
|
|
Please dial in 10 minutes before the call is scheduled to begin
and provide the passcode to join the call. The passcode is "New
Oriental Earnings Call."
A replay of the conference call may be accessed by phone at the
following number until July 25,
2011:
International:
|
+1-617-801-6888
|
|
Passcode:
|
14746699
|
|
|
|
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
English and other foreign language training, test preparation
courses for major admissions and assessment tests in the United States, the PRC and Commonwealth
countries, primary and secondary school education, development and
distribution of educational content, software and other technology,
and online education. New Oriental's ADSs, each of which represents
four common shares, currently trade on the New York Stock Exchange
under the symbol ''EDU.'' Effective on August 18, 2011, New Oriental will adjust the
ratio of its ADS representing common shares from one ADS for four
common shares to one ADSs for one common share.
For more information about New Oriental, please visit
http://english.neworiental.org.
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 first quarter of fiscal year 2012 and
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
income excluding share-based compensation expenses and Disposal
Loss, operating income excluding share-based compensation expenses
and Disposal Loss, operating costs and expenses excluding
share-based compensation expenses and Disposal Loss, general and
administrative expenses excluding share-based compensation
expenses, operating margin excluding share-based compensation
expenses and Disposal Loss, and basic and diluted net income per
ADS and per share excluding share-based compensation expenses and
Disposal Loss. 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 Disposal Loss that may not be indicative of its
operating performance from a cash perspective or our ongoing
operations. 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 that has been and will continue to
be for the foreseeable future a significant recurring expense in
our business in the case of share-based compensation charge. In
addition, although Disposal Loss was one-time charge and thus is
not indicative of New Oriental's ongoing operations, New Oriental
cannot exclude the possibilities that similar events may occur in
the future which will require similar charges being recorded.
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:
In China:
Ms. Sisi Zhao
New Oriental Education and Technology Group Inc.
Tel: +86-10-6260-5568
Email: zhaosisi@xdf.cn
Mr. Martin Reidy
Beijing Brunswick Consultancy Ltd.
Tel: +86-10-5960 8616
Email: mreidy@brunswickgroup.com
In the U.S.:
Ms. Kate Tellier
Brunswick Group LLC
Tel: +1-212 333 3810
Email: ktellier@brunswickgroup.com
NEW ORIENTAL
EDUCATION & TECHNOLOGY GROUP INC.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(In
thousands)
|
|
|
As of May 31
|
|
As of February 28
|
|
2011
|
|
2011
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
USD
|
|
RMB
|
|
ASSETS:
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash
equivalents
|
317,260
|
|
348,046
|
|
Restricted cash
|
3,374
|
|
2,998
|
|
Term deposits
|
152,680
|
|
190,622
|
|
Short term investment
(note1)
|
143,704
|
|
-
|
|
Accounts receivable,
net
|
1,655
|
|
2,390
|
|
Inventory
|
18,011
|
|
17,307
|
|
Deferred tax
assets-Current
|
5,337
|
|
3,511
|
|
Prepaid expenses and other
current assets
|
33,248
|
|
31,487
|
|
|
|
|
|
|
Total
current assets
|
675,269
|
|
596,361
|
|
|
|
|
|
|
Property, plant and equipment,
net
|
160,421
|
|
153,338
|
|
Land use right, net
|
3,502
|
|
3,474
|
|
Deferred tax assets
|
997
|
|
985
|
|
Long term deposit
|
7,826
|
|
6,941
|
|
Long term prepaid
rent
|
2,789
|
|
2,754
|
|
Intangible assets
|
4,976
|
|
5,364
|
|
Goodwill
|
7,588
|
|
8,670
|
|
Long term investment
|
2
|
|
2
|
|
|
|
|
|
|
Total assets
|
863,370
|
|
777,889
|
|
|
|
|
|
|
LIABILITIES
AND EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts payable
(including accounts payable of the consolidated VIEs without
recourse to New Oriental of US$ 8,994 and US$ 9,416 as of
February 28, 2011 and May 31, 2011, respectively)
|
9,518
|
|
9,001
|
|
Accrued expenses and other
current liabilities (including accrued expenses and other current
liabilities of the consolidated VIEs without recourse to New
Oriental of US$ 53,998 and US$ 63,728 as of February 28, 2011 and
May 31, 2011, respectively)
|
72,759
|
|
57,416
|
|
Income tax payable
(including income tax payable of the consolidated VIEs without
recourse to New Oriental of US$ 5,202 and US$ 7,050 as of February
28, 2011 and May 31, 2011, respectively)
|
7,163
|
|
6,648
|
|
Acquisition Payable
(including acquisition payable of the consolidated VIEs without
recourse to New Oriental of US$ 4,184 and US$ 4,243 as of February
28, 2011 and May 31, 2011, respectively)
|
4,243
|
|
4,184
|
|
Deferred revenue
(including deferred revenue of the consolidated VIEs without
recourse to New Oriental of US$ 149,664 and US$ 192,481 as of
February 28, 2011 and May 31, 2011, respectively)
|
194,317
|
|
150,652
|
|
|
|
|
|
|
Total
current liabilities
|
288,000
|
|
227,901
|
|
|
|
|
|
|
Deferred tax
liabilities
|
1,147
|
|
1,178
|
|
|
|
|
|
|
Total
long-term liabilities
|
1,147
|
|
1,178
|
|
|
|
|
|
|
Total
liabilities
|
289,147
|
|
229,079
|
|
|
|
|
|
|
Total shareholder's
equity
|
574,223
|
|
548,810
|
|
|
|
|
|
|
Total liabilities and
shareholder's equity
|
863,370
|
|
777,889
|
|
|
|
|
|
|
Note 1:Short term
investment represented held-to-maturity investment with maturity of
less than one year.
|
|
|
|
|
|
|
|
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 May 31
|
|
|
2011
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
USD
|
|
USD
|
|
Net
Revenues:
|
|
|
|
|
Educational Programs and
services
|
120,419
|
|
74,303
|
|
Books and others
|
16,967
|
|
12,278
|
|
Total net
revenues
|
137,386
|
|
86,581
|
|
|
|
|
|
|
Operating
costs and expenses (note 1):
|
|
|
|
|
Cost of revenues
|
56,691
|
|
36,356
|
|
Selling and marketing
|
22,550
|
|
17,362
|
|
General and
administrative
|
46,187
|
|
29,210
|
|
Disposal loss
|
1,537
|
|
-
|
|
|
|
|
|
|
Total
operating costs and expenses
|
126,965
|
|
82,928
|
|
Operating income
|
10,421
|
|
3,653
|
|
|
|
|
|
|
Other
income, net
|
4,414
|
|
1,563
|
|
|
|
|
|
|
Provision (benefits) for income
taxes
|
(532)
|
|
734
|
|
Net
income
|
14,303
|
|
5,950
|
|
|
|
|
|
|
Less: Net income attributable to
the noncontrolling interests
|
-
|
|
(177)
|
|
|
|
|
|
|
Net income
attributable to New Oriental Education & Technology Group
Inc.
|
14,303
|
|
5,773
|
|
|
|
|
|
|
Net income per share
attributable to New Oriental-Basic
|
0.09
|
|
0.04
|
|
Net income per share
attributable to New Oriental-Diluted
|
0.09
|
|
0.04
|
|
|
|
|
|
|
Net income per ADS
attributable to New Oriental-Basic (note 2)
|
0.37
|
|
0.15
|
|
Net income per ADS
attributable to New Oriental-Diluted (note 2)
|
0.37
|
|
0.15
|
|
|
|
|
|
Notes:
|
|
|
|
|
|
|
Note 1: Share-based
compensation expenses (in thousands) are included in the operating
costs and expenses as follows:
|
|
|
|
|
|
|
|
For the
Three Months Ended May 31
|
|
|
2011
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
USD
|
|
USD
|
|
Cost of
revenues
|
225
|
|
22
|
|
Selling and
marketing
|
-
|
|
2
|
|
General and
administrative
|
3,182
|
|
3,240
|
|
Total
|
3,407
|
|
3,264
|
|
|
|
|
|
|
|
|
Note 2: Each ADS
represents four common shares.
|
|
|
|
|
|
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 May 31
|
|
|
2011
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
USD
|
|
USD
|
|
|
|
|
|
|
General and administrative
expenses
|
46,187
|
|
29,210
|
|
Share-based compensation
expense in general and administrative expenses
|
3,182
|
|
3,240
|
|
Non-GAAP general and
administrative expenses
|
43,005
|
|
25,970
|
|
|
|
|
|
|
Total operating costs and
expenses
|
126,965
|
|
82,928
|
|
Share-based compensation
expenses
|
3,407
|
|
3,264
|
|
Disposal loss
|
1,537
|
|
-
|
|
Non-GAAP operating costs
and expenses
|
122,021
|
|
79,664
|
|
|
|
|
|
|
Operating
income
|
10,421
|
|
3,653
|
|
Share-based compensation
expenses
|
3,407
|
|
3,264
|
|
Disposal loss
|
1,537
|
|
-
|
|
Non-GAAP operating
income
|
15,365
|
|
6,917
|
|
|
|
|
|
|
Operating
margin
|
7.6%
|
|
4.2%
|
|
Non-GAAP operating
margin
|
11.2%
|
|
8.0%
|
|
|
|
|
|
|
Net income attributable to
New Oriental
|
14,303
|
|
5,773
|
|
Share-based compensation
expense
|
3,407
|
|
3,264
|
|
Disposal loss
|
1,537
|
|
-
|
|
Non-GAAP net
income
|
19,247
|
|
9,037
|
|
|
|
|
|
|
Net income per ADS
attributable to New Oriental- Basic (note 1)
|
0.37
|
|
0.15
|
|
Net income per ADS
attributable to New Oriental- Diluted (note 1)
|
0.37
|
|
0.15
|
|
|
|
|
|
|
Non-GAAP net income per
ADS attributable to New Oriental - Basic (note 1)
|
0.50
|
|
0.24
|
|
Non-GAAP net income per
ADS attributable to New Oriental - Diluted (note 1)
|
0.49
|
|
0.23
|
|
|
|
|
|
|
Weighted average shares
used in calculating basic net income per ADS (note 1)
|
153,856,715
|
|
151,530,498
|
|
Weighted average shares
used in calculating diluted net income per ADS (note 1)
|
156,470,579
|
|
155,268,339
|
|
|
|
|
|
|
Non-GAAP Income per share
- basic
|
|
|
|
|
Non-GAAP Income per share
- diluted
|
|
|
|
|
|
|
|
|
|
Note 1: Each ADS
represents four common shares.
|
|
|
|
|
|
NEW ORIENTAL
EDUCATION & TECHNOLOGY GROUP INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(In
thousands except for per share and per ADS amounts)
|
|
|
|
|
|
|
For the Year
Ended May 31
|
|
|
2011
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
USD
|
|
USD
|
|
Net
Revenues:
|
|
|
|
|
Educational Programs and
services
|
508,439
|
|
352,857
|
|
Books and others
|
49,433
|
|
33,450
|
|
Total net
revenues
|
557,872
|
|
386,307
|
|
|
|
|
|
|
Operating
costs and expenses (note 1):
|
|
|
|
|
Cost of revenues
|
222,625
|
|
147,261
|
|
Selling and marketing
|
82,797
|
|
58,396
|
|
General and
administrative
|
155,412
|
|
103,336
|
|
Disposal loss
|
1,537
|
|
-
|
|
|
|
|
|
|
Total
operating costs and expenses
|
462,371
|
|
308,993
|
|
Operating income
|
95,501
|
|
77,314
|
|
|
|
|
|
|
Other
income, net
|
14,274
|
|
6,222
|
|
|
|
|
|
|
Provision (benefits) for income
taxes
|
(8,236)
|
|
(5,974)
|
|
Net
income
|
101,539
|
|
77,562
|
|
|
|
|
|
|
Less: Net income attributable to
the noncontrolling interests
|
235
|
|
227
|
|
|
|
|
|
|
Net income
attributable to New Oriental Education & Technology Group
Inc.
|
101,774
|
|
77,789
|
|
|
|
|
|
|
Net income per share
attributable to New Oriental-Basic
|
0.66
|
|
0.52
|
|
Net income per share
attributable to New Oriental-Diluted
|
0.65
|
|
0.50
|
|
|
|
|
|
|
Net income per ADS
attributable to New Oriental-Basic (note 2)
|
2.66
|
|
2.06
|
|
Net income per ADS
attributable to New Oriental-Diluted (note 2)
|
2.61
|
|
2.01
|
|
|
|
|
|
Notes:
|
|
|
|
|
|
|
|
|
|
Note 1: Share-based
compensation expenses (in thousands) are included in the operating
costs and expenses as follows:
|
|
|
|
|
|
|
|
For the Year
Ended May 31
|
|
|
2011
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
USD
|
|
USD
|
|
Cost of
revenues
|
900
|
|
657
|
|
Selling and
marketing
|
-
|
|
117
|
|
General and
administrative
|
14,145
|
|
15,409
|
|
Total
|
15,045
|
|
16,183
|
|
|
|
|
|
|
|
|
Note 2: Each ADS
represents four common shares.
|
|
|
|
|
|
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 Year
Ended May 31
|
|
|
2011
|
|
2010
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
USD
|
|
USD
|
|
|
|
|
|
|
General and administrative
expenses
|
155,412
|
|
103,336
|
|
Share-based compensation
expense in general and administrative expenses
|
14,145
|
|
15,409
|
|
Non-GAAP general and
administrative expenses
|
141,267
|
|
87,927
|
|
|
|
|
|
|
Total operating costs and
expenses
|
462,371
|
|
308,993
|
|
Share-based compensation
expenses
|
15,045
|
|
16,183
|
|
Disposal loss
|
1,537
|
|
-
|
|
Non-GAAP operating costs
and expenses
|
445,789
|
|
292,810
|
|
|
|
|
|
|
Operating
income
|
95,501
|
|
77,314
|
|
Share-based compensation
expenses
|
15,045
|
|
16,183
|
|
Disposal loss
|
1,537
|
|
-
|
|
Non-GAAP operating
income
|
112,083
|
|
93,497
|
|
|
|
|
|
|
Operating
margin
|
17.1%
|
|
20.0%
|
|
Non-GAAP operating
margin
|
20.1%
|
|
24.2%
|
|
|
|
|
|
|
Net income attributable to
New Oriental
|
101,774
|
|
77,789
|
|
Share-based compensation
expense
|
15,045
|
|
16,183
|
|
Disposal loss
|
1,537
|
|
-
|
|
Non-GAAP net
income
|
118,356
|
|
93,972
|
|
|
|
|
|
|
Net income per ADS
attributable to New Oriental- Basic (note 1)
|
2.66
|
|
2.06
|
|
Net income per ADS
attributable to New Oriental- Diluted (note 1)
|
2.61
|
|
2.01
|
|
|
|
|
|
|
Non-GAAP net income per
ADS attributable to New Oriental - Basic (note 1)
|
3.09
|
|
2.49
|
|
Non-GAAP net income per
ADS attributable to New Oriental - Diluted (note 1)
|
3.03
|
|
2.43
|
|
|
|
|
|
|
Weighted average shares
used in calculating basic net income per ADS (note 1)
|
153,253,065
|
|
150,952,249
|
|
Weighted average shares
used in calculating diluted net income per ADS (note 1)
|
156,071,833
|
|
154,831,633
|
|
|
|
|
|
|
Note 1: Each ADS
represents four common shares.
|
|
|
|
|
|
SOURCE New Oriental Education and Technology Group Inc.