BEIJING, Oct. 22, 2020 /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 2021 ended
August 31, 2020.
Highlights for the Second Quarter of Fiscal Year 2021
- Net revenues increased by 20.8% year-over-year to US$1,103.3 million from US$913.2 million in the same period of the prior
year.
- Loss from operations was US$49.1
million, compared to income from operations of US$60.8 million in the same period of the prior
year.
- Non-GAAP loss from operations, which excluded share-based
compensation expenses, was US$11.8
million, compared to non-GAAP income from operations of
US$89.7 million in the same period of
the prior year.
- Net income attributable to TAL was US$15.0 million, compared to net loss
attributable to TAL of US$23.5
million in the same period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, was US$52.3 million, compared to non-GAAP net income
attributable to TAL of US$5.3 million
in the same period of the prior year.
- Basic and diluted net income per American Depositary Share
("ADS") were both US$0.02. Non-GAAP
basic and diluted net income per ADS, which excluded share-based
compensation expenses, were US$0.09
and US$0.08, respectively. Three ADSs
represent one Class A common share.
- Cash, cash equivalents and short-term investments totaled
US$2,786.9 million as of August 31, 2020, compared to US$2,219.3 million as of February 29, 2020.
- Total student enrollments of normal priced long-term course
increased by 65.0% year-over-year to approximately 5,632,210 from
approximately 3,413,120 in the same period of the prior year.
Highlights for the Six Months Ended August 31, 2020
- Net revenues increased by 26.9% year-over-year to US$2,013.9 million from US$1,586.6 million in the same period of the
prior year.
- Loss from operations was US$13.6
million, compared to income from operations of US$109.3 million in the same period of the prior
year.
- Non-GAAP income from operations, which excluded share-based
compensation expenses, decreased by 65.3% to US$56.9 million from US$164.2 million in the same period of the prior
year.
- Net income attributable to TAL was US$96.6 million, compared to net loss
attributable to TAL of US$39.7
million in the same period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, was US$167.2 million, compared to non-GAAP net income
attributable to TAL of US$15.3
million in the same period of the prior year.
- Basic and diluted net income per ADS were US$0.16 and US$0.15, respectively. Non-GAAP basic and diluted
net income per ADS, excluding share-based compensation expenses,
were US$0.28 and US$0.27, respectively.
- Average student enrollments of normal priced long-term course
per quarter during fiscal year 2021 increased by 67.4%
year-over-year to approximately 4,294,300 from approximately
2,565,660 in the same period of fiscal year 2020.
- Total physical network increased from 871 learning centers in
70 cities as of February 29, 2020 to
936 learning centers in 91 cities as of August 31, 2020.
Financial and Operating Data——Second Quarter and First Six
Months of Fiscal Year 2021
(In US$ thousands, except per ADS
data, student enrollments and percentages)
|
Three Months
Ended
|
|
August
31,
|
|
|
|
2019
|
2020
|
Pct.
Change
|
Net
revenues
|
913,195
|
1,103,267
|
20.8%
|
Operating
income/(loss)
|
60,812
|
(49,116)
|
(180.8%)
|
Non-GAAP operating
income/(loss)
|
89,668
|
(11,809)
|
(113.2%)
|
Net (loss)/income
attributable to TAL
|
(23,527)
|
14,969
|
(163.6%)
|
Non-GAAP net income
attributable to TAL
|
5,329
|
52,276
|
881.0%
|
Net (loss)/income per
ADS attributable to TAL – basic
|
(0.04)
|
0.02
|
(162.8%)
|
Net (loss)/income per
ADS attributable to TAL –
diluted
|
(0.04)
|
0.02
|
(160.4%)
|
Non-GAAP net income
per ADS attributable to TAL –
basic
|
0.01
|
0.09
|
869.0%
|
Non-GAAP net income
per ADS attributable to TAL –
diluted
|
0.01
|
0.08
|
872.1%
|
Total Student
Enrollments of normal priced long-term
course
|
3,413,120
|
5,632,210
|
65.0%
|
|
Six Months
Ended
|
|
August
31,
|
|
|
|
2019
|
2020
|
Pct.
Change
|
Net
revenues
|
1,586,609
|
2,013,931
|
26.9%
|
Operating
income/(loss)
|
109,278
|
(13,625)
|
(112.5%)
|
Non-GAAP operating
income
|
164,218
|
56,947
|
(65.3%)
|
Net (loss)/income
attributable to TAL
|
(39,683)
|
96,620
|
(343.5%)
|
Non-GAAP net income
attributable to TAL
|
15,257
|
167,192
|
995.8%
|
Net (loss)/income per
ADS attributable to TAL – basic
|
(0.07)
|
0.16
|
(340.3%)
|
Net (loss)/income per
ADS attributable to
TAL – diluted
|
(0.07)
|
0.15
|
(330.8%)
|
Non-GAAP net income
per ADS
attributable to TAL – basic
|
0.03
|
0.28
|
981.5%
|
Non-GAAP net income
per ADS
attributable to TAL – diluted
|
0.02
|
0.27
|
985.2%
|
Average Student
Enrollments of normal
priced long-term course
|
2,565,660
|
4,294,300
|
67.4%
|
"TAL's financial results of the second fiscal quarter reflected
a combination of the continued strong growth momentum of our online
courses and the lingering pressure on our offline business in this
period. Although the second fiscal quarter was marked by the
extended impact of the COVID-19 outbreak, we are encouraged to see
that the public health situation and general economy began to
improve in China, and offline
teaching and tutoring gradually resumed during the summer months,"
said Rong Luo, TAL's chief financial officer.
"We will strictly adhere to all relevant government policies and
regulations regarding national public health and remain fully
committed to the protection of our students and employees. We will
continue to be well prepared to flexibly serve our students and
parents with diversified educational support. Despite the
short-term challenges, we stay the course in our online and offline
strategy and further development of our quality products, service
and technology to satisfy the ever-changing customer demand and to
pursue long-term success of our business," Mr. Luo continued.
Financial Results for the Second Quarter of Fiscal Year
2021
Net Revenues
In the second quarter of fiscal year 2021, TAL reported net
revenues of US$1,103.3 million,
representing a 20.8% increase from US$913.2
million in the second quarter of fiscal year 2020. The
increase was mainly driven by an increase in total student
enrollments of normal priced long-term course, which increased by
65.0% to approximately 5,632,210 from approximately
3,413,120 in the same period of the prior year. The increase
in total student enrollments of normal priced long-term
course was primarily driven by the growth of enrollments in
the small class offerings and online courses.
Operating Costs and Expenses
In the second quarter of fiscal year 2021, operating costs and
expenses were US$1,155.6 million,
representing a 34.7% increase from US$857.8
million in the second quarter of fiscal year 2020. Non-GAAP
operating costs and expenses, which excluded share-based
compensation expenses, were US$1,118.3
million, representing a 34.9% increase from US$829.0 million in the second quarter of fiscal
year 2020.
Cost of revenues increased by 29.1% to US$522.0 million from US$404.5 million in the second quarter of fiscal
year 2020. The increase in cost of revenues was mainly due to an
increase in teacher compensation, rental costs and learning
materials. Non-GAAP cost of revenues, which excluded share-based
compensation expenses, increased by 29.0% to US$521.5 million, from US$404.2 million in the second quarter of fiscal
year 2020.
Selling and marketing expenses increased by 44.3% to
US$379.8 million from US$263.3 million in the second quarter of fiscal
year 2020. Non-GAAP selling and marketing expenses, which excluded
share-based compensation expenses, increased by 43.0% to
US$370.3 million, from US$258.9 million in the second quarter of fiscal
year 2020. The increase of selling and marketing expenses in the
second quarter of fiscal year 2021 was primarily a result of more
marketing promotion activities to expand our customer base and
brand enhancement, as well as a rise in the compensation to sales
and marketing staff to support a greater number of programs and
service offerings compared to the same period in the prior
year.
General and administrative expenses increased by 33.5% to
US$253.8 million from US$190.1 million in the second quarter of fiscal
year 2020. 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 same period in the prior
year and a rise in compensation to our general and administrative
personnel. Non-GAAP general and administrative expenses, which
excluded share-based compensation expenses, increased by 36.5% to
US$226.4 million, from US$165.9 million in the second quarter of fiscal
year 2020.
Total share-based compensation expenses allocated to the related
operating costs and expenses increased by 29.3% to US$37.3 million in the second quarter of fiscal
year 2021 from US$28.9 million in the
same period of fiscal year 2020.
Gross
Profit
Gross profit increased by 14.3% to US$581.2 million from US$508.7 million in the second quarter of fiscal
year 2020.
Income/(loss) from Operations
Loss from operations was US$49.1
million in the second quarter of fiscal year 2021, compared
to income from operations of US$60.8
million in the second quarter of fiscal year 2020. Non-GAAP
loss from operations was US$11.8
million, compared to Non-GAAP income from operations of
US$89.7 million in the same period of
the prior year.
Other (expense)/Income
Other income was US$45.3 million
for the second quarter of fiscal year 2021, was primarily due to
the value-added tax and social security expense exemption offered
by the government during the COVID-19 outbreak. Other expense was
US$55.6 million in the second quarter
of fiscal year 2020, mainly related to loss from the fair
value change of an equity security with readily determinable fair
value.
Impairment Loss on Long-term Investments
Impairment loss on long-term investments was US$4.6 million for the second quarter of fiscal
year 2021, compared to US$54.2
million for the second quarter of fiscal year 2020.
Impairment loss on long-term investments was mainly due to declines
in the value of long-term investments in several investees.
Income Tax Benefit/(expense)
Income tax expense was US$2.4
million in the second quarter of fiscal year 2021, compared
to US$8.1 million of income tax
benefit in the second quarter of fiscal year 2020.
Net (loss)/Income Attributable to TAL Education
Group
Net income attributable to TAL was US$15.0 million in the second quarter of fiscal
year 2021, compared to net loss attributable to TAL of US$23.5 million in the second quarter of fiscal
year 2020. Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, was US$52.3 million, compared to Non-GAAP net income
attributable to TAL of US$5.3 million
in the second quarter of fiscal year 2020.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were both US$0.02, in the second quarter of fiscal year
2021. Non-GAAP basic and diluted net income per ADS, which excluded
share-based compensation expenses, were US$0.09 and US$0.08, respectively, in the second quarter of
fiscal year 2021.
Cash Flow
Net cash flow used in operating activities for the second
quarter of fiscal year 2021 was US$56.3
million. Capital expenditures for the second quarter of
fiscal year 2021 were US$67.8
million, compared to US$43.7
million for the second quarter of fiscal year 2020. The
increase was mainly due to the purchase of fixed assets and
leasehold improvement.
Cash, Cash Equivalents, and Short-Term
Investments
As of August 31, 2020, the Company
had US$2,206.1 million of cash and
cash equivalents and US$580.8 million
of short-term investments, compared to US$1,873.9 million of cash and cash equivalents
and US$345.4 million of short-term
investments as of February 29,
2020.
Deferred Revenue
The Company's deferred revenue balance was US$1,172.5 million, compared to US$497.6 million as of August 31, 2019, representing a year-over-year
increase of 135.6%, which was mainly contributed by the tuition
collected in advance of part of the fall
semester of Xueersi Peiyou small classes and online courses through
www.xueersi.com.
Financial Results for the First Six Months of Fiscal Year
2021
Net Revenues
For the first six months of fiscal year 2021, TAL reported net
revenues of US$2,013.9 million,
representing a 26.9% increase from US$1,586.6 million in the first six months of
fiscal year 2020. The increase was mainly driven by the growth in
average student enrollments, which increased by 67.4% to
approximately 4,294,300 from approximately 2,565,660 in the same
period of the prior year. The increase in average 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 2021, operating costs and
expenses were US$2,035.6 million, a
37.1% increase from US$1,485.2
million in the first six months of fiscal year 2020.
Non-GAAP operating costs and expenses, which excluded share-based
compensation expenses, were US$1,965.0
million, a 37.4% increase from US$1,430.2 million in the first six months of
fiscal year 2020.
Cost of revenues grew by 35.8% to US$951.6 million from US$700.9 million in the first six months of
fiscal year 2020. The increase in cost of revenues was mainly due
to an increase in teacher compensation, rental costs and learning
materials. Non-GAAP cost of revenues, which excluded share-based
compensation expenses, increased by 35.8% to US$950.8 million from US$700.3 million in the first six months of
fiscal year 2020.
Selling and marketing expenses increased by 43.0% to
US$598.9 million from US$418.7 million in the first six months of
fiscal year 2020. Non-GAAP selling and marketing expenses, which
excluded share-based compensation expenses, increased by 41.8% to
US$581.5 million from US$410.2 million in the first six months of
fiscal year 2020. The increase of selling and marketing expenses in
the first six months of fiscal year 2021 was primarily a result of
more marketing promotion activities to expand our customer base and
brand enhancement, as well as a rise in the compensation to sales
and marketing staff to support a greater number of programs and
service offerings compared to the same period in the prior
year.
General and administrative expenses increased by 32.6% to
US$484.9 million from US$365.6 million in the first six months of
fiscal year 2020. 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 same period in the
prior year and a rise in compensation to our general and
administrative personnel. Non-GAAP general and administrative
expenses, which excluded share-based compensation expenses,
increased by 35.3% to US$432.4
million from US$319.7 million
in the first six months of fiscal year 2020.
Total share-based compensation expenses allocated to the related
operating costs and expenses increased by 28.5% to US$70.6 million in the first six months of fiscal
year 2021 from US$54.9 million in the
same period of fiscal year 2020.
Gross Profit
Gross profit grew by 19.9% to US$1,062.4
million from US$885.7 million
in the first six months of fiscal year 2020.
Income/(loss) from Operations
Loss from operations was US$13.6
million in the first six months of fiscal year 2021,
compared to income from operations of US$109.3 million in the same period of the prior
year. Non-GAAP income from operations, which excluded share-based
compensation expenses, decreased by 65.3% to US$56.9 million from US$164.2 million in the first six months of
fiscal year 2020.
Other (expense)/Income
Other income was US$87.4 million
for the first six months of fiscal year 2021, was primarily due to
the value-added tax and social security expense exemption offered
by the government during the COVID-19 outbreak. Other expense was
US$86.9 million for the first six
months of fiscal year 2020, mainly related to loss from the fair
value change of an equity security with readily determinable fair
value.
Impairment Loss on Long-term Investments
Impairment loss on long-term investments was US$6.9 million for the first six months of fiscal
year 2021, compared to US$104.8
million for the first six months of fiscal year 2020.
Impairment loss on long-term investments was mainly due to declines
in the value of long-term investments in several investees.
Income Tax Benefit/(expense)
Income tax expense was US$24.4
million in the first six months of fiscal year 2021,
compared to US$10.9 million of income
tax benefit in the first six months of fiscal year 2020.
Net (loss)/Income Attributable to TAL Education
Group
Net income attributable to TAL was US$96.6 million in the first six months of fiscal
year 2021, compared to net loss attributable to TAL of US$39.7 million in the first six months of fiscal
year 2020. Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 995.8% to
US$167.2 million from US$15.3 million in the first six months of fiscal
year 2020.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were US$0.16 and US$0.15, respectively, in the first six months of
fiscal year 2021. Non-GAAP basic and Non-GAAP diluted net income
per ADS, which excluded share-based compensation expenses, were
US$0.28 and US$0.27, respectively.
Cash Flow
Net cash flow provided by operating activities for the first six
months of fiscal year 2021 was US$736.6
million. Capital expenditures for the first six months of
fiscal year 2021 were US$121.0
million, compared to US$85.1
million in the first six months of fiscal year 2020. The
increase was mainly due to the purchase of fixed assets and
leasehold improvement.
Business Outlook
Based on our current estimates, total net revenues for the third
quarter of fiscal year 2021 are expected to be between US$1,061.1 million and US$1,094.3 million, representing an increase of
28% to 32% on a year-over-year basis.
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 2021 ended August 31,
2020 at 8:00 a.m. Eastern Time
on October 22, 2020 (8:00 p.m. Beijing time on October
22, 2020).
Please note that you will need to pre-register for conference
call participation, using the link provided below. Upon
registering, you will be sent participant dial-in numbers, Direct
Event passcode and unique registrant ID by email.
Conference call registration link:
http://apac.directeventreg.com/registration/event/7287105. It will
automatically direct you to the registration page of "TAL Education
Group Second Quarter of Fiscal Year 2021 Earnings Conference Call",
where you may fill in your details for RSVP. When you are requested
to submit a participant conference ID, please enter the number
"7287105".
In the 10 minutes prior to the call start time, you may use the
conference access information (including dial-in number(s), Direct
Event passcode and unique registrant ID) provided in the
confirmation email that you have received following your
pre-registration.
A live and archived webcast of the conference call will be
available on the Investor Relations section of TAL's website at
https://ir.100tal.com/.
A telephone replay of the conference call will be available
through 8:59 a.m. on October 30, 2020, U.S. Eastern time (8:59 p.m. Beijing time on October
30, 2020).
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:
|
7287105
|
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 2021, 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 as well as competence oriented programs. The
Company's learning center network currently covers 91 cities.
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 SEC 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 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:
Echo Yan
Investor Relations
TAL Education Group
Tel: +86 10 5292 6658
Email: ir@tal.com
Caroline Straathof
IR Inside
Tel: +31 6 5462 4301
Email: info@irinside.com
TAL EDUCATION
GROUP
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of
U.S. dollars)
|
|
|
|
|
As
of
February 29,
2020
|
|
As
of
August 31,
2020
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
$
1,873,866
|
|
$
2,206,095
|
|
Restricted
cash-current
|
28,084
|
|
27,816
|
|
Short-term
investments
|
345,457
|
|
580,758
|
|
Inventory
|
25,832
|
|
34,331
|
|
Amounts due
from related parties-current
|
3,642
|
|
1,802
|
|
Income tax
receivables
|
11,548
|
|
28
|
|
Prepaid
expenses and other current assets
|
207,352
|
|
267,964
|
|
Total current
assets
|
2,495,781
|
|
3,118,794
|
|
Restricted
cash-non-current
|
13,235
|
|
15,857
|
|
Property and
equipment, net
|
366,656
|
|
450,253
|
|
Deferred tax
assets
|
79,534
|
|
146,673
|
|
Rental
deposits
|
72,721
|
|
90,465
|
|
Intangible
assets, net
|
58,985
|
|
73,659
|
|
Land use
right, net
|
204,853
|
|
206,978
|
|
Goodwill
|
378,913
|
|
551,227
|
|
Long-term
investments
|
571,601
|
|
620,234
|
|
Long-term prepayments
and other non-current assets
|
85,275
|
|
62,557
|
|
Operating lease
right-of-use assets
|
1,243,692
|
|
1,363,110
|
|
Total
assets
|
$
5,571,246
|
|
$
6,699,807
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts payable
(including accounts payable of the
consolidated VIEs without recourse to TAL
Education
Group of 104,231 and 155,879 as of February 29,
2020
and August 31, 2020, respectively)
|
$ 117,770
|
|
$ 169,267
|
|
Deferred
revenue-current (including deferred revenue-current of
the consolidated VIEs without recourse to TAL
Education
Group of 733,253 and 1,094,480 as of February 29,
2020
and August 31, 2020, respectively)
|
780,167
|
|
1,144,414
|
|
Amounts due to
related parties-current (including amounts due
to related parties-current of the consolidated VIEs
without
recourse to TAL Education Group of 4,264 and 3,596 as
of
February 29, 2020 and August 31, 2020,
respectively)
|
4,361
|
|
3,611
|
|
Accrued expenses and
other current liabilities (including
accrued expenses and other current liabilities of
the
consolidated VIEs without recourse to TAL
Education
Group of 470,519 and 735,052 as of February 29, 2020
and
August 31, 2020, respectively)
|
552,650
|
|
884,217
|
|
Income tax payable
(including income tax payable of the
consolidated VIEs without recourse to TAL Education
Group
of 43,233 and 56,321 as of February 29, 2020 and
August 31,
2020, respectively)
|
46,650
|
|
79,722
|
|
Short-term debt and
current portion of long-term debt
(including short-term debt and current portion of
long-term
debt of the consolidated VIEs without recourse to
TAL
Education Group of nil and 1,320 as of February 29,
2020
and August 31, 2020, respectively)
|
-
|
|
1,320
|
|
Operating lease
liabilities, current portion (including
operating lease liabilities, current portion of the
consolidated
VIEs without recourse to TAL Education Group of
276,712
and 305,937 as of February 29, 2020 and August 31,
2020,
respectively)
|
304,960
|
|
334,554
|
|
Total current
liabilities
|
1,806,558
|
|
2,617,105
|
|
Deferred
revenue-non-current (including deferred revenue-non-
current of the consolidated VIEs without recourse to
TAL
Education Group of 833 and 28,089 as of February 29,
2020
and August 31, 2020, respectively)
|
833
|
|
28,089
|
|
Deferred tax
liabilities (including deferred tax liabilities of the
consolidated VIEs without recourse to TAL Education
Group
of 7,197 and 11,624 as of February 29, 2020 and August
31,
2020, respectively)
|
7,789
|
|
12,277
|
|
Long-term debt
(including long-term debt of the consolidated
VIEs without recourse to TAL Education Group of nil
and nil
as of February 29, 2020 and August 31, 2020,
respectively)
|
261,950
|
|
264,050
|
|
Operating lease
liabilities, non-current portion (including
operating lease liabilities, non-current portion of
the
consolidated VIEs without recourse to TAL Education
Group
of 883,603 and 981,871 as of February 29, 2020 and
August
31, 2020, respectively)
|
949,919
|
|
1,049,355
|
|
Total
liabilities
|
3,027,049
|
|
3,970,876
|
|
Mezzanine
equity
|
|
|
|
|
Redeemable
non-controlling interests
|
-
|
|
1,775
|
|
Equity
|
|
|
|
|
Class A common
shares
|
133
|
|
134
|
|
Class B common
shares
|
67
|
|
67
|
|
Additional paid-in
capital
|
1,675,640
|
|
1,741,037
|
|
Statutory
reserve
|
82,712
|
|
81,853
|
|
Retained
earnings
|
786,097
|
|
876,925
|
|
Accumulated other
comprehensive (loss)/income
|
(28,913)
|
|
3,599
|
|
Total TAL
Education Group's equity
|
2,515,736
|
|
2,703,615
|
|
Noncontrolling
interest
|
28,461
|
|
23,541
|
|
Total
equity
|
2,544,197
|
|
2,727,156
|
|
Total liabilities,
mezzanine equity and equity
|
$
5,571,246
|
|
$
6,699,807
|
|
|
|
|
|
|
|
TAL EDUCATION
GROUP
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of
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,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
Net
revenues
|
$ 913,195
|
|
$
1,103,267
|
|
$
1,586,609
|
|
$
2,013,931
|
Cost of revenues
(note 1)
|
404,499
|
|
522,037
|
|
700,870
|
|
951,552
|
Gross
profit
|
508,696
|
|
581,230
|
|
885,739
|
|
1,062,379
|
Operating expenses
(note 1)
|
|
|
|
|
|
|
|
Selling and
marketing
|
263,258
|
|
379,774
|
|
418,657
|
|
598,851
|
General and
administrative
|
190,056
|
|
253,756
|
|
365,641
|
|
484,892
|
Impairment
loss on intangible
assets and goodwill
|
-
|
|
-
|
|
-
|
|
304
|
Total operating
expenses
|
453,314
|
|
633,530
|
|
784,298
|
|
1,084,047
|
Government
subsidies
|
5,430
|
|
3,184
|
|
7,837
|
|
8,043
|
Income/(loss) from
operations
|
60,812
|
|
(49,116)
|
|
109,278
|
|
(13,625)
|
Interest
income
|
17,783
|
|
23,697
|
|
33,870
|
|
50,186
|
Interest
expense
|
(2,104)
|
|
(3,068)
|
|
(5,228)
|
|
(6,664)
|
Other
(expense)/income
|
(55,555)
|
|
45,330
|
|
(86,886)
|
|
87,441
|
Impairment loss on
long-term
investments
|
(54,194)
|
|
(4,585)
|
|
(104,788)
|
|
(6,885)
|
(Loss)/income before
provision
for income tax and loss from
equity method investments
|
(33,258)
|
|
12,258
|
|
(53,754)
|
|
110,453
|
Income tax
benefit/(expense)
|
8,116
|
|
(2,443)
|
|
10,875
|
|
(24,443)
|
(Loss)/income from
equity
method investments
|
(1,358)
|
|
2,601
|
|
(2,689)
|
|
5,941
|
Net
(loss)/income
|
(26,500)
|
|
12,416
|
|
(45,568)
|
|
91,951
|
Add: Net loss
attributable to
noncontrolling interest
|
2,973
|
|
2,553
|
|
5,885
|
|
4,669
|
Total net
(loss)/income
attributable to TAL
Education Group
|
$ (23,527)
|
|
$ 14,969
|
|
$ (39,683)
|
|
$ 96,620
|
Net (loss)/income
per common
share
|
|
|
|
|
|
|
|
Basic
|
$ (0.12)
|
|
$ 0.07
|
|
$ (0.20)
|
|
$ 0.48
|
Diluted
|
(0.12)
|
|
0.07
|
|
(0.20)
|
|
0.46
|
Net (loss)/income
per ADS
(note 2)
|
|
|
|
|
|
|
|
Basic
|
$ (0.04)
|
|
$ 0.02
|
|
$ (0.07)
|
|
$ 0.16
|
Diluted
|
(0.04)
|
|
0.02
|
|
(0.07)
|
|
0.15
|
Weighted average
shares used in
calculating net (loss)/income
per common share
|
|
|
|
|
|
|
|
Basic
|
197,940,260
|
|
200,391,436
|
|
197,550,175
|
|
200,167,150
|
Diluted
|
197,940,260
|
|
208,477,760
|
|
197,550,175
|
|
208,429,705
|
|
|
|
|
|
|
|
|
Note1: Share-based
compensation expenses are included in the operating costs and
expenses as follows:
|
|
|
|
|
|
|
|
|
|
For the Three
Months
Ended August
31,
|
|
For the Six
Months
Ended August
31,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
Cost of
revenues
|
$ 318
|
|
$ 490
|
|
$ 565
|
|
$ 754
|
Selling and marketing
expenses
|
4,377
|
|
9,469
|
|
8,417
|
|
17,322
|
General and
administrative expenses
|
24,161
|
|
27,348
|
|
45,958
|
|
52,496
|
Total
|
$ 28,856
|
|
$ 37,307
|
|
$ 54,940
|
|
$ 70,572
|
|
Note 2: Three ADSs
represent one Class A common Share.
|
TAL EDUCATION
GROUP
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE
(LOSS)/INCOME
(In thousands of
U.S. dollars)
|
|
|
For the Three
Months Ended
August
31,
|
|
For the Six Months
Ended
August
31,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
|
|
|
|
|
|
|
Net
(loss)/income
|
$ (26,500)
|
|
$ 12,416
|
|
$ (45,568)
|
|
$ 91,951
|
Other comprehensive
(loss)
/income, net of tax
|
(40,767)
|
|
58,325
|
|
(75,723)
|
|
32,890
|
Comprehensive
(loss)/income
|
(67,267)
|
|
70,741
|
|
(121,291)
|
|
124,841
|
Add: Comprehensive
loss
attributable to noncontrolling
interest
|
4,370
|
|
1,703
|
|
8,548
|
|
4,291
|
Comprehensive
(loss)/income
attributable to TAL
Education Group
|
$ (62,897)
|
|
$ 72,444
|
|
$
(112,743)
|
|
$ 129,132
|
TAL EDUCATION
GROUP
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF
CASH
FLOWS
(In thousands of
U.S. dollars)
|
|
|
For the Three
Months Ended
August
31,
|
|
For the Six Months
Ended
August
31,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
|
|
|
|
|
|
|
Net cash (used
in)/provided by operating
activities
|
$
(269,007)
|
|
$ (56,273)
|
|
$ 299,457
|
|
$ 736,637
|
Net cash used in
investing activities
|
(17,780)
|
|
(58,336)
|
|
(133,620)
|
|
(388,885)
|
Net cash provided
by/(used in) financing
activities
|
366
|
|
2,889
|
|
(139,659)
|
|
(6,839)
|
Effect of exchange
rate changes
|
5,584
|
|
(2,799)
|
|
7,851
|
|
(6,330)
|
|
|
|
|
|
|
|
|
Net change in cash,
cash equivalents and
restricted cash
|
(280,837)
|
|
(114,519)
|
|
34,029
|
|
334,583
|
Cash, cash
equivalents and restricted
cash at beginning of period
|
1,578,567
|
|
2,364,287
|
|
1,263,701
|
|
1,915,185
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and restricted
cash at end of period
|
$
1,297,730
|
|
$
2,249,768
|
|
$
1,297,730
|
|
$
2,249,768
|
TAL EDUCATION
GROUP
Reconciliation of
Non-GAAP Measures to the Most Comparable GAAP
Measures
(In thousands of
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,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
$ 404,499
|
|
$ 522,037
|
|
$ 700,870
|
|
$ 951,552
|
Share-based
compensation expense
in cost of revenues
|
318
|
|
490
|
|
565
|
|
754
|
Non-GAAP cost of
revenues
|
404,181
|
|
521,547
|
|
700,305
|
|
950,798
|
|
|
|
|
|
|
|
|
Selling and
marketing expenses
|
263,258
|
|
379,774
|
|
418,657
|
|
598,851
|
Share-based
compensation expense
in selling and marketing expenses
|
4,377
|
|
9,469
|
|
8,417
|
|
17,322
|
Non-GAAP selling
and marketing
expenses
|
258,881
|
|
370,305
|
|
410,240
|
|
581,529
|
|
General and
administrative
expenses
|
190,056
|
|
253,756
|
|
365,641
|
|
484,892
|
Share-based
compensation expense
in general and administrative
expenses
|
24,161
|
|
27,348
|
|
45,958
|
|
52,496
|
Non-GAAP general
and
administrative expenses
|
165,895
|
|
226,408
|
|
319,683
|
|
432,396
|
|
|
|
|
|
|
|
|
Operating costs
and expenses
|
857,813
|
|
1,155,567
|
|
1,485,168
|
|
2,035,599
|
Share-based
compensation expense
in operating costs and expenses
|
28,856
|
|
37,307
|
|
54,940
|
|
70,572
|
Non-GAAP operating
costs and
expenses
|
828,957
|
|
1,118,260
|
|
1,430,228
|
|
1,965,027
|
|
|
|
|
|
|
|
|
Income/(loss) from
operations
|
60,812
|
|
(49,116)
|
|
109,278
|
|
(13,625)
|
Share based
compensation expenses
|
28,856
|
|
37,307
|
|
54,940
|
|
70,572
|
Non-GAAP
income/(loss) from
operations
|
89,668
|
|
(11,809)
|
|
164,218
|
|
56,947
|
|
|
|
|
|
|
|
|
Net (loss)/income
attributable to
TAL Education Group
|
(23,527)
|
|
14,969
|
|
(39,683)
|
|
96,620
|
Share based
compensation expenses
|
28,856
|
|
37,307
|
|
54,940
|
|
70,572
|
Non-GAAP net
income
attributable to TAL Education
Group
|
$ 5,329
|
|
$ 52,276
|
|
$ 15,257
|
|
$ 167,192
|
Net (loss)/income
per ADS
|
|
Basic
|
$ (0.04)
|
|
$ 0.02
|
|
$ (0.07)
|
|
$ 0.16
|
Diluted
|
(0.04)
|
|
0.02
|
|
(0.07)
|
|
0.15
|
Non-GAAP Net
income per ADS
|
|
|
|
|
|
|
|
Basic
|
$ 0.01
|
|
$ 0.09
|
|
$ 0.03
|
|
$ 0.28
|
Diluted
|
0.01
|
|
0.08
|
|
0.02
|
|
0.27
|
ADSs used in
calculating net
(loss)/income per ADS
|
|
|
|
|
|
|
|
Basic
|
593,820,780
|
|
601,174,308
|
|
592,650,525
|
|
600,501,450
|
Diluted
|
593,820,780
|
|
625,433,280
|
|
592,650,525
|
|
625,289,115
|
ADSs used in
calculating Non-
GAAP net income per ADS
|
|
|
|
|
|
|
|
Basic
|
593,820,780
|
|
601,174,308
|
|
592,650,525
|
|
600,501,450
|
Diluted
|
619,765,083
|
|
625,433,280
|
|
619,203,039
|
|
625,289,115
|
View original
content:http://www.prnewswire.com/news-releases/tal-education-group-announces-unaudited-financial-results-for-the-second-fiscal-quarter-ended-august-31-2020-301157718.html
SOURCE TAL Education Group