Q3 net revenues decreased by 3.2%
year-over-year
Q3 New student enrollments[1] increased
by 44.7% year-over-year
Q3 net income reached RMB168.1
million
BEIJING, Nov. 23,
2022 /PRNewswire/ -- Sunlands Technology
Group (NYSE: STG) ("Sunlands" or the "Company"), a leader
in China's online post-secondary
and professional education, today announced its unaudited
financial results for the third quarter ended September 30, 2022.
Third Quarter 2022 Financial and
Operational Snapshots
- Net revenues were RMB576.2
million (US$81.0 million),
representing a 3.2% decrease year-over-year.
- Gross billings (non-GAAP) were RMB365.5
million (US$51.4 million),
representing a 21.0% decrease year-over-year.
- Gross profit was RMB491.3 million
(US$69.1 million), representing a
4.0% decrease year-over-year.
- Net income was RMB168.1 million
(US$23.6 million), representing an
81.1% increase year-over-year.
- Net income margin, defined as net income as a percentage of net
revenues, increased to 29.2% from 15.6% in the third quarter of
2021.
- New student enrollments were 134,987, representing a 44.7%
increase year-over-year.
- As of September 30, 2022, the
Company's deferred revenue balance was RMB1,798.6 million (US$252.8 million).
|
[1] New
student enrollments for a given period refers to the total number
of orders placed by students that newly enroll in at least one
course during that period, including those students that enroll and
then terminate their enrollment with us, excluding orders of our
low-price courses. (In June 2019, we introduced low-price courses,
including "mini courses" and "RMB1 courses," to strengthen our
competitiveness and improve customer experience. We offer such
low-price courses mainly in the formats of recorded videos or short
live streaming.)
|
"Despite the macroeconomic uncertainty and shifting industry
landscape, we delivered encouraging results in the third quarter
with sequential topline growth, further bottom-line improvement and
increased new student enrollments. These achievements testified to
the effectiveness of our strategic initiatives to prioritize
profitability and healthy growth," said Mr. Tongbo Liu, Chief Executive Officer of
Sunlands.
"With a leaner and more efficient organization, we further
refined our product strategy in the third quarter. We focused more
on margin accretive programs and allocated our capital and human
resources accordingly to expand our course offerings in these
programs, leading to an optimized product lineup and more
diversified course content. Additionally, as we continued to hone
our services to increase our user stickiness and cross-selling
opportunities, we transformed our student acquisition methods,
focusing more on users' lifetime value instead of investing heavily
in marketing activities. Thanks to these measures, our new student
enrollments for the quarter rose by 44.7% year-over-year and 11.8%
quarter-over-quarter, despite a 23.9% year-over-year and 8.2%
quarter-over-quarter decline in sales and marketing expenses.
Looking ahead, we are confident that our proven business strategies
and continued commitment to delivering premium and tailored
courses to more students will help us navigate current challenges
and achieve meaningful growth," concluded Mr. Liu.
Ms. Selena Lu Lv, Chief Financial Officer of Sunlands,
commented, "We are pleased with our third quarter results amid an
uncertain macro environment. Our net revenues reached RMB576.2 million during the quarter, exceeding
the high end of our guidance range by 6.7% despite the slight 3.2%
year-over-year decrease. Benefitting from our dedicated efforts and
measured steps in cost control and operational efficiency
enhancement, our third quarter operating expenses declined by 24.5%
year-over-year and 7.4% quarter-over-quarter. As a result, we
maintained our profitability with a net income of RMB168.1 million, up 81.1% year-over-year and
46.7% quarter-over-quarter. Our net income margin for the quarter
remained solid at 29.2%, expanding 13.6 percentage points
year-over-year and 8.6 percentage points quarter-over-quarter.
Moving forward, we will continue to prudently manage costs and
expenses, enrich our course offerings and further optimize our
operations, aiming for continued success and additional shareholder
value."
Financial Results for the third quarter of
2022
Net Revenues
In the third quarter of 2022, net revenues decreased by 3.2% to
RMB576.2 million (US$81.0 million) from RMB595.1 million in the third quarter of 2021.
The decrease was mainly driven by the decline in gross
billings.
Cost of Revenues
Cost of revenues increased by 2.2% to RMB84.9 million (US$11.9
million) in the third quarter of 2022 from RMB83.1 million in the third quarter of 2021. The
increase was primarily due to increased service fees paid to
educational institutions and increased cooperation costs.
Gross Profit
Gross profit decreased by 4.0% to RMB491.3 million (US$69.1
million) in the third quarter of 2022 from RMB512.0 million in the third quarter of
2021.
Operating Expenses
In the third quarter of 2022, operating expenses were
RMB325.0 million (US$45.7 million), representing a 24.5% decrease
from RMB430.6 million in the third
quarter of 2021.
Sales and marketing expenses decreased by 23.9% to RMB269.1 million (US$37.8
million) in the third quarter of 2022 from RMB353.5 million in the third quarter of 2021.
The decrease was mainly due to: (i) lower spending on branding and
marketing activities; and (ii) declined compensation expenses
related to our sales and marketing personnel.
General and administrative expenses decreased by 29.6% to
RMB44.4 million (US$6.2 million) in the third quarter of 2022 from
RMB63.2 million in the third quarter
of 2021. The decrease was mainly due to a decrease in rental
expenses.
Product development expenses decreased by 17.5% to RMB11.5 million (US$1.6
million) in the third quarter of 2022 from RMB14.0 million in the third quarter of 2021. The
decrease was mainly due to a decrease in compensation expenses to
our product development personnel.
Other Income
Other income decreased by 58.6% to RMB5.3
million (US$0.7 million) in
the third quarter of 2022 from RMB12.9
million in the third quarter of 2021.
Net Income
As a result of the foregoing, net income for the third quarter
of 2022 was RMB168.1 million
(US$23.6 million), compared with
RMB92.8 million in the third quarter
of 2021.
Basic and Diluted Net Income Per Share
Basic and diluted net income per share was RMB24.08 (US$3.38)
in the third quarter of 2022.
Cash and Cash Equivalents and Short-term Investments
As of September 30, 2022, the
Company had RMB678.8 million
(US$95.4 million) of cash and cash
equivalents and RMB170.1 million
(US$23.9 million) of short-term
investments, compared with RMB626.7
million of cash and cash equivalents and RMB184.2 million of short-term investments as of
December 31, 2021.
Deferred Revenue
As of September 30, 2022, the
Company had a deferred revenue balance of RMB1,798.6 million (US$252.8 million), compared with RMB2,348.2 million as of December 31, 2021.
Capital Expenditures
Capital expenditures were incurred primarily in connection with
information technology ("IT") infrastructure equipment and
leasehold improvements necessary to support the Company's
operations. Capital expenditures were RMB1.3
million (US$0.2 million) in
the third quarter of 2022, compared with RMB1.8 million in the third quarter of 2021.
Financial Results for the First Nine Months of
2022
Net Revenues
In the first nine months of 2022, net revenues decreased by 9.1%
to RMB1,744.5 million (US$245.2 million) from RMB1,918.9 million in the first nine months of
2021.
Cost of Revenues
Cost of revenues decreased by 4.9% to RMB272.9 million (US$38.4
million) in the first nine months of 2022 from RMB286.8 million in the first nine months of
2021.
Gross Profit
Gross profit decreased by 9.8% to RMB1,471.7 million (US$206.9 million) from RMB1,632.1 million in the first nine months of
2021.
Operating Expenses
In the first nine months of 2022, operating expenses were
RMB1,022.0 million (US$143.7 million), representing a 36.8% decrease
from RMB1,616.8 million in the first
nine months of 2021.
Sales and marketing expenses decreased by 39.2% to RMB857.0 million (US$120.5
million) in the first nine months of 2022 from RMB1,409.1 million in the first nine months of
2021.
General and administrative expenses decreased by 17.5% to
RMB129.5 million (US$18.2 million) in the first nine months of 2022
from RMB157.1 million in the first
nine months of 2021.
Product development expenses decreased by 30.0% to RMB35.5 million (US$5.0
million) in the first nine months of 2022 from RMB50.7 million in the first nine months of
2021.
Other Income
Other income for the first nine months of 2022 was RMB19.7 million (US$2.8
million), compared with RMB42.3
million in the first nine months of 2021. The decrease was
primarily because value-added tax exemption offered by the relevant
authorities as part of the national COVID-19 relief effort came to
an end in April 2021.
Net Income
Net income for the first nine months of 2022 was RMB462.1 million (US$65.0
million), compared with RMB61.6
million in the first nine months of 2021.
Basic and Diluted Net Income Per Share
Basic and diluted net income per share was RMB68.07 (US$9.57)
in the first nine months of 2022, compared with RMB9.69 in the first nine months of 2021.
Capital Expenditures
Capital expenditures were incurred primarily in connection with
IT infrastructure equipment and leasehold improvements necessary to
support the Company's operations. Capital expenditures
were RMB2.5 million (US$0.4
million) in the first nine months of 2022, compared with
RMB11.2 million in the first nine
months of 2021.
Outlook
For the fourth quarter of 2022, Sunlands currently expects net
revenues to be between RMB520 million
to RMB540 million, which would
represent a decrease of 8.3% to 11.7% year-over-year.
The above outlook is based on the current market conditions and
reflects the Company's current and preliminary estimates of market
and operating conditions and customer demand, which are all subject
to substantial uncertainty.
Exchange Rate
The Company's business is primarily conducted in China and all revenues are denominated in
Renminbi ("RMB"). This announcement contains currency conversions
of RMB amounts into U.S. dollars ("US$") solely for the convenience
of the reader. Unless otherwise noted, all translations from RMB to
US$ are made at a rate of RMB7.1135
to US$1.00, the effective noon buying
rate for September 30, 2022 as set
forth in the H.10 statistical release of the Federal Reserve Board.
No representation is made that the RMB amounts could have been, or
could be, converted, realized or settled into US$ at that rate on
September 30, 2022, or at any other
rate.
Conference Call and Webcast
Sunlands' management team will host a conference call
at 6:30 AM U.S. Eastern Time, (7:30 PM Beijing/Hong
Kong time) on November 23, 2022, following the
quarterly results announcement.
The dial-in details for the live conference call are:
International:
|
+1-412-902-4272
|
US toll
free:
|
+1-888-346-8982
|
Mainland China toll
free:
|
400-120-1203
|
Hong Kong toll
free:
|
800-905-945
|
Hong Kong:
|
+852-3018-4992
|
Please dial in 10 minutes before the call is scheduled to begin.
When prompted, ask to be connected to the call for "Sunlands
Technology Group." Participants will be required to state their
name and company upon entering the call.
A live webcast and archive of the conference call will be
available on the Investor Relations section of Sunlands' website at
http://www.sunlands.investorroom.com/.
A replay of the conference call will be available 1 hour after
the end of the conference call until November 30, 2022, by dialing the following
telephone numbers:
International:
|
+1-412-317-0088
|
US toll
free:
|
+1-877-344-7529
|
Replay access
code:
|
3978249
|
About Sunlands
Sunlands Technology Group (NYSE: STG) ("Sunlands" or the
"Company"), formerly known as Sunlands Online Education Group, is
the leader in China's online
post-secondary and professional education. With a one to many, live
streaming platform, Sunlands offers various degree and
diploma-oriented post-secondary courses as well as online
professional courses and educational content, to help students
prepare for professional certification exams and attain
professional skills. Students can access its services either
through PC or mobile applications. The Company's online platform
cultivates a personalized, interactive learning environment by
featuring a virtual learning community and a vast library of
educational content offerings that adapt to the learning habits of
its students. Sunlands offers a unique approach to education
research and development that organizes subject content into
Learning Outcome Trees, the Company's proprietary knowledge
management system. Sunlands has a deep understanding of the
educational needs of its prospective students and offers solutions
that help them achieve their goals.
About Non-GAAP Financial Measures
We use gross billings, EBITDA, non-GAAP Operating cost and
expense, non-GAAP loss/income from operations and Non-GAAP net
loss/income per share, each a non-GAAP financial measure, in
evaluating our operating results and for financial and operational
decision-making purposes.
We define gross billings for a specific period as the total
amount of cash received for the sale of course packages, net of the
total amount of refunds paid in such period. Our management uses
gross billings as a performance measurement because we generally
bill our students for the entire course tuition at the time of sale
of our course packages and recognize revenue proportionally over a
period. EBITDA is defined as net loss/income excluding
depreciation and amortization, interest expense, interest income,
and income tax expenses/benefit. We believe that gross billings and
EBITDA provide valuable insight into the sales of our course
packages and the performance of our business.
These non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, their most directly
comparable financial measure prepared in accordance with GAAP. A
reconciliation of the historical non-GAAP financial measures to
their respective most directly comparable GAAP measure has been
provided in the tables included below. Investors are encouraged to
review the reconciliation of the historical non-GAAP financial
measures to their respective most directly comparable GAAP
financial measures. As gross billings, EBITDA, operating cost and
expenses excluding share-based compensation expenses, general and
administrative expenses excluding share-based compensation
expenses, sales and marketing expenses excluding share-based
compensation expenses, product development expenses excluding
share-based compensation expenses, non-GAAP net loss/income
exclude share-based compensation expenses, and basic and diluted
net loss/income per share excluding share-based compensation
expenses have material limitations as an analytical metric and
may not be calculated in the same manner by all companies, it may
not be comparable to other similarly titled measures used by other
companies. In light of the foregoing limitations, you should not
consider gross billings and EBITDA as a substitute for, or superior
to, their respective most directly comparable financial measures
prepared in accordance with GAAP. We encourage investors and others
to review our financial information in its entirety and not rely on
a single financial measure.
Safe Harbor Statement
This press release contains forward-looking statements made
under the "safe harbor" provisions of Section 21E of the Securities
Exchange Act of 1934, as amended, and 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," "confident" and similar statements. Sunlands 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 report to shareholders, in press releases
and other written materials and in oral statements made by its
officers, directors or employees to third parties. Any statements
that are not historical facts, including statements about Sunlands'
beliefs and expectations, are forward-looking statements that
involve factors, risks and uncertainties that could cause actual
results to differ materially from those in the forward-looking
statements. Such factors and risks include, but not limited to the
following: Sunlands' goals and strategies; its expectations
regarding demand for and market acceptance of its brand and
services; its ability to retain and increase student enrollments;
its ability to offer new courses and educational content; its
ability to improve teaching quality and students' learning results;
its ability to improve sales and marketing efficiency and
effectiveness; its ability to engage, train and retain new faculty
members; its future business development, results of operations and
financial condition; its ability to maintain and improve technology
infrastructure necessary to operate its business; competition in
the online education industry in China; relevant government policies and
regulations relating to Sunlands' corporate structure, business and
industry; and general economic and business condition in
China Further information
regarding these and other risks, uncertainties or factors is
included in the Sunlands' filings with the U.S. Securities and
Exchange Commission. All information provided in this press release
is current as of the date of the press release, and Sunlands does
not undertake any obligation to update such information, except as
required under applicable law.
For investor and media enquiries, please contact:
Sunlands Technology Group
Investor Relations
Email: sl-ir@sunlands.com
The Piacente Group, Inc.
Brandi Piacente
Tel: +1-212-481-2050
Email: sunlands@tpg-ir.com
Yang Song
Tel: +86-10-6508-0677
Email: sunlands@tpg-ir.com
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Amounts in thousands,
except for share and per share data, or otherwise noted)
|
|
|
|
As of December
31,
|
|
As of September
30,
|
|
|
2021
|
|
2022
|
|
|
RMB
|
|
RMB
|
|
US$
|
ASSETS
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
626,715
|
|
678,763
|
|
95,419
|
Restricted cash
|
|
50,008
|
|
-
|
|
-
|
Short-term
investments
|
|
184,159
|
|
170,088
|
|
23,911
|
Prepaid expenses and other current assets
|
|
176,349
|
|
114,399
|
|
16,082
|
Deferred costs,
current
|
|
89,353
|
|
52,719
|
|
7,411
|
Total current
assets
|
|
1,126,584
|
|
1,015,969
|
|
142,823
|
Non-current
assets
|
|
|
|
|
|
|
Property and equipment,
net
|
|
857,648
|
|
831,982
|
|
116,958
|
Intangible assets,
net
|
|
2,761
|
|
1,834
|
|
258
|
Right-of-use
assets
|
|
362,335
|
|
344,215
|
|
48,389
|
Deferred costs,
non-current
|
|
109,020
|
|
83,811
|
|
11,782
|
Long-term
investments
|
|
54,844
|
|
62,730
|
|
8,818
|
Deferred tax
assets
|
|
39,265
|
|
30,354
|
|
4,267
|
Other non-current
assets
|
|
40,163
|
|
43,814
|
|
6,159
|
Total non-current
assets
|
|
1,466,036
|
|
1,398,740
|
|
196,631
|
TOTAL ASSETS
|
|
2,592,620
|
|
2,414,709
|
|
339,454
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accrued expenses and
other current liabilities (including accrued expenses
|
|
|
|
|
|
|
and other
current liabilities of the consolidated VIEs without recourse
to
|
|
|
|
|
|
|
Sunlands
Technology Group of RMB197,467 and RMB168,160 as of
|
|
|
|
|
|
|
December
31, 2021 and September 30, 2022, respectively)
|
|
586,043
|
|
530,783
|
|
74,618
|
Deferred revenue,
current (including deferred revenue, current of the consolidated
VIEs
|
|
|
|
|
|
|
without
recourse to Sunlands Technology Group of RMB295,958 and
|
|
|
|
|
|
|
RMB368,117
as of December 31, 2021 and September 30, 2022,
respectively)
|
|
1,266,948
|
|
1,052,068
|
|
147,897
|
Lease liabilities,
current portion (including lease liabilities, current portion of
the
|
|
|
|
|
|
|
consolidated VIEs without recourse to Sunlands Technology Group of
RMB8,366 and
|
|
|
|
|
|
|
RMB22,330
as of December 31, 2021 and September 30, 2022,
respectively)
|
|
14,310
|
|
28,783
|
|
4,046
|
Long-term debt,
current portion (including long-term debt, current portion of
the
|
|
|
|
|
|
|
consolidated VIEs without
recourse to Sunlands Technology Group of nil and nil
December
|
|
|
|
|
|
|
as
of December 31, 2021 and September 30, 2022,
respectively)
|
|
38,654
|
|
38,654
|
|
5,434
|
Total current
liabilities
|
|
1,905,955
|
|
1,650,288
|
|
231,995
|
|
|
|
|
|
|
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS-continued
|
|
(Amounts in thousands,
except for share and per share data, or otherwise noted)
|
|
|
|
|
|
As of December
31,
|
|
As of
September 30,
|
|
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
Deferred revenue,
non-current (including deferred revenue, non-current
|
|
|
|
|
|
|
|
of the consolidated
VIEs without recourse to Sunlands Technology Group of
|
|
|
|
|
|
|
|
RMB257,071 and
RMB256,755 as of December 31, 2021 and September 30,
2022,
|
|
|
|
|
|
|
|
respectively)
|
|
1,081,231
|
|
746,490
|
|
104,940
|
|
Lease liabilities,
non-current portion (including lease liabilities, non-current
portion
|
|
|
|
|
|
|
|
of the consolidated
VIEs without recourse to Sunlands Technology Group of
|
|
|
|
|
|
|
|
RMB318,598 and
RMB311,665 as of December 31, 2021 and September 30,
2022,
|
|
|
|
|
|
|
|
respectively)
|
|
404,133
|
|
392,033
|
|
55,111
|
|
Deferred tax liabilities (including deferred tax liabilities of the
consolidated
|
|
|
|
|
|
|
|
VIEs without recourse
to Sunlands Technology Group of RMB2,312 and RMB2,111
|
|
|
|
|
|
|
|
as of December 31,
2021 and September 30, 2022, respectively)
|
|
21,782
|
|
8,090
|
|
1,137
|
|
Other non-current
liabilities (including other non-current liabilities of the
consolidated
|
|
|
|
|
|
|
|
VIEs without recourse
to Sunlands Technology Group of RMB963 and RMB963
|
|
|
|
|
|
|
|
as of December 31,
2021 and September 30, 2022, respectively)
|
|
11,698
|
|
8,152
|
|
1,146
|
|
Long-term debt,
non-current portion (including long-term debt, non-current portion
of the
|
|
|
|
|
|
|
|
consolidated VIEs
without recourse to Sunlands Technology Group of nil and
nil
|
|
|
|
|
|
|
|
as of December 31,
2021 and September 30, 2022, respectively)
|
|
181,973
|
|
152,982
|
|
21,506
|
|
Total non-current
liabilities
|
|
1,700,817
|
|
1,307,747
|
|
183,840
|
|
TOTAL
LIABILITIES
|
|
3,606,772
|
|
2,958,035
|
|
415,835
|
|
|
|
|
SHAREHOLDERS'
DEFICIT
|
|
|
|
|
|
|
|
Class A ordinary shares (par value of US$0.00005, 796,062,195
shares
|
|
|
|
|
|
|
|
authorized; 2,085,939
and 2,460,939 shares issued as of December 31, 2021
|
|
|
|
|
|
|
|
and September 30,
2022, respectively; 1,839,553 and 2,123,691 shares
|
|
|
|
|
|
|
|
outstanding as of
December 31, 2021 and September 30, 2022, respectively)
|
|
1
|
|
1
|
|
-
|
|
Class B ordinary shares (par value of US$0.00005, 826,389
shares
|
|
|
|
|
|
|
|
authorized; 826,389
and 826,389 shares issued and outstanding
|
|
|
|
|
|
|
|
as of December 31,
2021 and September 30, 2022, respectively)
|
|
-
|
|
-
|
|
-
|
|
Class C ordinary
shares (par value of US$0.00005, 203,111,416 shares
|
|
|
|
|
|
|
|
authorized; 4,002,930
and 4,002,930 shares issued and outstanding
|
|
|
|
|
|
|
|
as of December 31,
2021 and September 30, 2022, respectively)
|
|
1
|
|
1
|
|
-
|
|
Treasury stock
|
|
-
|
|
-
|
|
-
|
|
Accumulated deficit
|
|
(3,456,073)
|
|
(2,992,738)
|
|
(420,712)
|
|
Additional paid-in capital
|
|
2,364,313
|
|
2,311,240
|
|
324,909
|
|
Accumulated other comprehensive income
|
|
82,532
|
|
143,823
|
|
20,218
|
|
Total Sunlands
Technology Group shareholders' deficit
|
|
(1,009,226)
|
|
(537,673)
|
|
(75,585)
|
|
Non-controlling
interest
|
|
(4,926)
|
|
(5,653)
|
|
(796)
|
|
|
TOTAL SHAREHOLDERS'
DEFICIT
|
|
(1,014,152)
|
|
(543,326)
|
|
(76,381)
|
|
TOTAL LIABILITIES AND
SHAREHOLDERS' DEFICIT
|
|
2,592,620
|
|
2,414,709
|
|
339,454
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(Amounts in thousands,
except for share and per share data, or otherwise noted)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended September 30,
|
|
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
Net revenues
|
|
595,128
|
|
576,208
|
|
81,002
|
|
Cost of
revenues
|
|
(83,103)
|
|
(84,902)
|
|
(11,935)
|
|
Gross profit
|
|
512,025
|
|
491,306
|
|
69,067
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Sales and marketing
expenses
|
|
(353,508)
|
|
(269,056)
|
|
(37,823)
|
|
Product development
expenses
|
|
(13,980)
|
|
(11,532)
|
|
(1,621)
|
|
General and administrative
expenses
|
|
(63,156)
|
|
(44,443)
|
|
(6,248)
|
|
Total operating
expenses
|
|
(430,644)
|
|
(325,031)
|
|
(45,692)
|
|
Income from
operations
|
|
81,381
|
|
166,275
|
|
23,375
|
|
Interest
income
|
|
3,144
|
|
2,200
|
|
309
|
|
Interest
expense
|
|
(3,042)
|
|
(2,487)
|
|
(350)
|
|
Other income,
net
|
|
12,853
|
|
5,325
|
|
749
|
|
Gain on disposal of
subsidiaries
|
|
-
|
|
1,709
|
|
240
|
|
Income
before income tax expenses
|
|
|
|
|
|
|
|
and loss
from equity method investments
|
|
94,336
|
|
173,022
|
|
24,323
|
|
Income tax
expenses
|
|
(1,110)
|
|
(4,225)
|
|
(594)
|
|
Loss from equity method
investments
|
|
(431)
|
|
(713)
|
|
(100)
|
|
Net income
|
|
92,795
|
|
168,084
|
|
23,629
|
|
|
|
|
|
|
|
|
|
Less: Net loss
attributable to non-controlling interest
|
|
(2,506)
|
|
(1)
|
|
-
|
|
Net income attributable
to Sunlands Technology Group
|
|
95,301
|
|
168,085
|
|
23,629
|
|
Net income per share
attributable to ordinary shareholders of
|
|
|
|
|
|
|
|
Sunlands
Technology Group:
|
|
|
|
|
|
|
|
Basic and diluted
|
|
14.16
|
|
24.08
|
|
3.38
|
|
|
Weighted average shares
used in calculating net income
|
|
|
|
|
|
|
|
per
ordinary share:
|
|
|
|
|
|
|
|
Basic and diluted
|
|
6,729,197
|
|
6,981,447
|
|
6,981,447
|
|
|
|
|
|
|
|
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended September
30,
|
|
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
Net income
|
|
92,795
|
|
168,084
|
|
23,629
|
|
Other
comprehensive (loss)/income, net
of tax effect of nil:
|
|
|
|
|
|
|
|
Change in cumulative
foreign currency translation adjustments
|
|
(1,105)
|
|
32,103
|
|
4,513
|
|
Total comprehensive
income
|
|
91,690
|
|
200,187
|
|
28,142
|
|
Less: comprehensive
loss attributable to non-controlling
|
|
|
|
|
|
|
|
interest
|
|
(2,506)
|
|
(1)
|
|
-
|
|
Comprehensive income
attributable to Sunlands Technology
|
|
|
|
|
|
|
|
Group
|
|
94,196
|
|
200,188
|
|
28,142
|
|
SUNLANDS TECHNOLOGY GROUP
RECONCILIATION
OF GAAP
AND NON-GAAP RESULTS
(Amounts in
thousands)
|
|
|
|
|
|
For the Three Months
Ended September
30,
|
|
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
Net revenues
|
|
595,128
|
|
576,208
|
|
Less: other
revenues
|
|
(26,497)
|
|
(28,525)
|
|
Add: tax and
surcharges
|
|
41,674
|
|
11,394
|
|
Add: ending deferred
revenue
|
|
2,540,886
|
|
1,798,558
|
|
Add: ending refund
liability
|
|
222,266
|
|
204,961
|
|
Less: beginning
deferred revenue
|
|
(2,690,221)
|
|
(1,998,062)
|
|
Less: beginning refund
liability
|
|
(220,745)
|
|
(199,028)
|
|
Gross billings
(non-GAAP)
|
|
462,491
|
|
365,506
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
92,795
|
|
168,084
|
|
Add: income tax
expenses
|
|
1,110
|
|
4,225
|
|
|
depreciation and
amortization
|
|
9,561
|
|
8,939
|
|
interest
expense
|
|
3,042
|
|
2,487
|
|
Less: interest
income
|
|
(3,144)
|
|
(2,200)
|
|
EBITDA
(non-GAAP)
|
|
103,364
|
|
181,535
|
|
SUNLANDS TECHNOLOGY GROUP
RECONCILIATION
OF GAAP
AND NON-GAAP RESULTS
(Amounts in
thousands)
|
|
|
|
For the Three Months
Ended September 30,
|
|
|
2021
|
|
2022
|
|
|
RMB
|
|
RMB
|
Cost of
revenues
|
|
(83,103)
|
|
(84,902)
|
Less: Share-based
compensation expenses in cost of revenues
|
|
(39)
|
|
-
|
Non-GAAP cost of
revenues
|
|
(83,064)
|
|
(84,902)
|
|
|
|
|
|
Sales and marketing
expenses
|
|
(353,508)
|
|
(269,056)
|
Less: Share-based
compensation expenses in sales and marketing expenses
|
|
13
|
|
-
|
Non-GAAP sales and
marketing expenses
|
|
(353,521)
|
|
(269,056)
|
|
|
|
|
|
General and
administrative expenses
|
|
(63,156)
|
|
(44,443)
|
Less: Share-based
compensation expenses in general and administrative
expenses
|
|
(67)
|
|
-
|
Non-GAAP general and
administrative expenses
|
|
(63,089)
|
|
(44,443)
|
|
|
|
|
|
Operating costs and
expense
|
|
(513,747)
|
|
(409,993)
|
Less: Share-based
compensation expenses
|
|
(93)
|
|
-
|
Non-GAAP operating
costs and expense
|
|
(513,654)
|
|
(409,993)
|
|
|
|
|
|
Income from
operations
|
|
81,381
|
|
166,275
|
Less: Share-based
compensation expenses
|
|
(93)
|
|
-
|
Non-GAAP income from
operations
|
|
81,474
|
|
166,275
|
|
|
|
|
|
Net income attributable
to Sunlands Technology Group
|
|
95,301
|
|
168,085
|
Less: Share-based
compensation expenses
|
|
(93)
|
|
-
|
Non-GAAP net income
attributable to Sunlands Technology Group
|
|
95,394
|
|
168,085
|
|
|
|
|
|
Net income per share
attributable to ordinary shareholders of
|
|
|
|
|
Sunlands
Technology Group:
|
|
|
|
|
Basic and diluted
|
|
14.16
|
|
24.08
|
Non-GAAP net income per
share attributable to ordinary shareholders of
|
|
|
|
|
Sunlands
Technology Group:
|
|
|
|
|
Basic and diluted
|
|
14.18
|
|
24.08
|
|
|
|
|
|
Weighted average shares
used in calculating net income
|
|
|
|
|
per
ordinary share:
|
|
|
|
|
Basic and diluted
|
|
6,729,197
|
|
6,981,447
|
Weighted average shares
used in calculating Non-GAAP net income
|
|
|
|
|
per
ordinary share:
|
|
|
|
|
Basic and diluted
|
|
6,729,197
|
|
6,981,447
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(Amounts in thousands,
except for share and per share data, or otherwise noted)
|
|
|
|
|
|
|
|
|
|
|
|
For the
Nine Months Ended September 30,
|
|
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
Net revenues
|
|
1,918,934
|
|
1,744,513
|
|
245,240
|
|
Cost of
revenues
|
|
(286,811)
|
|
(272,859)
|
|
(38,358)
|
|
Gross profit
|
|
1,632,123
|
|
1,471,654
|
|
206,882
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Sales and marketing
expenses
|
|
(1,409,068)
|
|
(857,031)
|
|
(120,480)
|
|
Product development
expenses
|
|
(50,669)
|
|
(35,465)
|
|
(4,986)
|
|
General and administrative
expenses
|
|
(157,103)
|
|
(129,538)
|
|
(18,210)
|
|
Total operating
expenses
|
|
(1,616,840)
|
|
(1,022,034)
|
|
(143,676)
|
|
Income from
operations
|
|
15,283
|
|
449,620
|
|
63,206
|
|
Interest
income
|
|
13,157
|
|
9,208
|
|
1,294
|
|
Interest
expense
|
|
(8,029)
|
|
(7,764)
|
|
(1,091)
|
|
Other income
|
|
42,301
|
|
19,667
|
|
2,765
|
|
Impairment loss on
long-term investments
|
|
-
|
|
(500)
|
|
(70)
|
|
Gain on disposal of
subsidiaries
|
|
-
|
|
1,709
|
|
240
|
|
Income before income
tax expenses
|
|
|
|
|
|
|
|
and loss
from equity method investments
|
|
62,712
|
|
471,940
|
|
66,344
|
|
Income tax
expenses
|
|
(963)
|
|
(8,568)
|
|
(1,204)
|
|
Loss from equity method
investments
|
|
(155)
|
|
(1,317)
|
|
(185)
|
|
Net income
|
|
61,594
|
|
462,055
|
|
64,955
|
|
|
|
|
|
|
|
|
|
Less: Net loss
attributable to non-controlling interest
|
|
(3,586)
|
|
(1,280)
|
|
(180)
|
|
Net income attributable
to Sunlands Technology Group
|
|
65,180
|
|
463,335
|
|
65,135
|
|
Net income per share
attributable to ordinary shareholders of
|
|
|
|
|
|
|
|
Sunlands
Technology Group:
|
|
|
|
|
|
|
|
Basic and diluted
|
|
9.69
|
|
68.07
|
|
9.57
|
|
Weighted average shares
used in calculating net income
|
|
|
|
|
|
|
|
per
ordinary share:
|
|
|
|
|
|
|
|
Basic and diluted
|
|
6,729,197
|
|
6,806,672
|
|
6,806,672
|
|
|
|
|
|
|
|
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
|
(Amounts in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
For the
Nine Months Ended September 30,
|
|
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
Net income
|
|
61,594
|
|
462,055
|
|
64,955
|
|
Other comprehensive
(loss)/income, net of tax effect of nil:
|
|
|
|
|
|
|
|
Change in cumulative
foreign currency translation adjustments
|
|
(7,841)
|
|
61,291
|
|
8,616
|
|
Total comprehensive
income
|
|
53,753
|
|
523,346
|
|
73,571
|
|
Less: comprehensive
loss attributable to non-controlling
|
|
|
|
|
|
|
|
interest
|
|
(3,586)
|
|
(1,280)
|
|
(180)
|
|
Comprehensive income
attributable to Sunlands Technology
|
|
|
|
|
|
|
|
Group
|
|
57,339
|
|
524,626
|
|
73,751
|
|
SUNLANDS TECHNOLOGY GROUP
RECONCILIATION
OF GAAP
AND NON-GAAP RESULTS
(Amounts in
thousands)
|
|
|
|
|
|
For the
Nine Months Ended September 30,
|
|
|
|
2021
|
|
2022
|
|
|
|
RMB
|
|
RMB
|
|
Net revenues
|
|
1,918,934
|
|
1,744,513
|
|
Less: other
revenues
|
|
(58,208)
|
|
(86,520)
|
|
Add: tax and
surcharges
|
|
119,873
|
|
55,815
|
|
Add: ending deferred
revenue
|
|
2,540,886
|
|
1,798,558
|
|
Add: ending refund
liability
|
|
222,266
|
|
204,961
|
|
Less: beginning
deferred revenue
|
|
(3,024,443)
|
|
(2,348,179)
|
|
Less: beginning refund
liability
|
|
(232,859)
|
|
(243,236)
|
|
Gross billings
(non-GAAP)
|
|
1,486,449
|
|
1,125,912
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
61,594
|
|
462,055
|
|
Add: income tax
expenses
|
|
963
|
|
8,568
|
|
depreciation and
amortization
|
|
28,266
|
|
28,100
|
|
interest
expense
|
|
8,029
|
|
7,764
|
|
Less: interest
income
|
|
(13,157)
|
|
(9,208)
|
|
EBITDA
(non-GAAP)
|
|
85,695
|
|
497,279
|
|
SUNLANDS TECHNOLOGY GROUP
RECONCILIATION
OF GAAP
AND NON-GAAP RESULTS
(Amounts in
thousands)
|
|
|
|
For the Nine Months
Ended September 30,
|
|
|
2021
|
|
2022
|
|
|
RMB
|
|
RMB
|
Cost of
revenues
|
|
(286,811)
|
|
(272,859)
|
Less: Share-based
compensation expenses in cost of revenues
|
|
(45)
|
|
(33)
|
Non-GAAP cost of
revenues
|
|
(286,766)
|
|
(272,826)
|
|
|
|
|
|
Sales and marketing
expenses
|
|
(1,409,068)
|
|
(857,031)
|
Less: Share-based
compensation expenses in sales and marketing expenses
|
|
72
|
|
(4,166)
|
Non-GAAP sales and
marketing expenses
|
|
(1,409,140)
|
|
(852,865)
|
|
|
|
|
|
General and
administrative expenses
|
|
(157,103)
|
|
(129,538)
|
Less: Share-based
compensation expenses in general and administrative
expenses
|
|
(324)
|
|
(2,982)
|
Non-GAAP general and
administrative expenses
|
|
(156,779)
|
|
(126,556)
|
|
|
|
|
|
Operating costs and
expense
|
|
(1,903,651)
|
|
(1,294,893)
|
Less: Share-based
compensation expenses
|
|
(297)
|
|
(7,181)
|
Non-GAAP operating
costs and expense
|
|
(1,903,354)
|
|
(1,287,712)
|
|
|
|
|
|
Income from
operations
|
|
15,283
|
|
449,620
|
Less: Share-based
compensation expenses
|
|
(297)
|
|
(7,181)
|
Non-GAAP income from
operations
|
|
15,580
|
|
456,801
|
|
|
|
|
|
Net income attributable
to Sunlands Technology Group
|
|
65,180
|
|
(463,335)
|
Less: Share-based
compensation expenses
|
|
(297)
|
|
(7,181)
|
Non-GAAP net income
attributable to Sunlands Technology Group
|
|
65,477
|
|
(470,516)
|
|
|
|
|
|
Net income per share
attributable to ordinary shareholders of
|
|
|
|
|
Sunlands
Technology Group:
|
|
|
|
|
Basic and diluted
|
|
9.69
|
|
68.07
|
Non-GAAP net income per
share attributable to ordinary shareholders of
|
|
|
|
|
Sunlands
Technology Group:
|
|
|
|
|
Basic and diluted
|
|
9.73
|
|
69.13
|
|
|
|
|
|
Weighted average shares
used in calculating net income
|
|
|
|
|
per
ordinary share:
|
|
|
|
|
Basic and diluted
|
|
6,729,197
|
|
6,806,672
|
Weighted average shares
used in calculating Non-GAAP net income
|
|
|
|
|
per
ordinary share:
|
|
|
|
|
Basic and diluted
|
|
6,729,197
|
|
6,806,672
|
View original
content:https://www.prnewswire.com/news-releases/sunlands-technology-group-announces-unaudited-third-quarter-2022-financial-results-301685944.html
SOURCE Sunlands Technology Group