BEIJING, Sept. 24, 2021 /PRNewswire/ -- Tarena
International, Inc. (NASDAQ: TEDU) ("Tarena" or the "Company"), a
leading provider of adult professional education and childhood
& adolescent quality education services in China, today announced its unaudited financial
results for the second quarter ended June 30, 2021.
Highlights for the Second Quarter of 2021
- Net revenues increased by 75.5% year-over-year to
RMB582.3 million (US$90.2 million), from RMB331.8 million in the same period of 2020.
- Net revenue from adult professional education business, which
represented 50.3% of the total net revenues, increased by 22.3%
year-over-year to RMB292.9 million
(US$45.4 million), from RMB239.4 million in the same period of 2020.
- Net revenue from childhood & adolescent quality education
business, which represented 49.7% of the total net revenues,
increased by 213.2% year-over-year to RMB289.4 million (US$44.8
million), from RMB92.4 million
in the same period of 2020.
- Gross profit increased by 211.0% year-over-year to
RMB294.4 million (US$45.6 million), from RMB94.7 million in the same period of 2020.
- Gross profit margin increased by 22.1% points year-over-year to
50.6%, from 28.5% in the same period of 2020.
- Operating loss decreased by 69.2% to a loss of
RMB90.7 million (US$14.0 million), from a loss
of RMB294.9 million in the same period of 2020.
- Non-GAAP operating loss, which excluded share-based
compensation expenses, was RMB86.6
million (US$13.4 million),
compared to non-GAAP operating loss of RMB282.7 million in the same period of 2020.
- Net loss was RMB76.7 million (US$11.9 million), compared to net loss
of RMB267.6 million in the same period of 2020.
- Non-GAAP net loss, which excluded share-based compensation
expenses, was RMB72.5 million
(US$11.2 million), compared to
non-GAAP net loss of RMB255.4 million
in the same period of 2020.
- Basic and diluted loss per American Depositary Share ("ADS")
was RMB1.39 (US$0.22), compared to loss per ADS of
RMB4.92 in the second quarter of
2020.
- Cash, cash equivalents and time deposits, including current and
non-current, and restricted cash totaled RMB295.9 million (US$45.8
million) as of June 30, 2021,
compared to RMB364.8 million as of
December 31, 2020.
- Net cash outflow from operating activities in the second
quarter of 2021 was RMB47.5 million
(US$7.4 million). Net cash inflow
from investing activities in the second quarter of 2021 was
RMB30.4 million (US$4.7 million).
- Deferred revenue totaled RMB2,063.1 million (US$319.5 million) as of June 30, 2021, compared to RMB1,998.2 million as of December 31, 2020, representing an increase of
3.2%.
- Total student enrollments in adult professional education
business, defined as the total number of courses enrolled by
students during that period, including multiple courses enrolled by
the same student, in the second quarter of 2021 decreased by
14.8% year-over-year to 31,100.
- Total number of learning centers in adult professional
education decreased to 99 as of June 30,
2021, from 108 as of June 30,
2020.
- Total student enrollments in childhood &
adolescent quality education business, defined as the total
number of students who attended at least one paid lesson during
that period or have deposit balances in their accounts at the end
of that period, in the second quarter of 2021 reached 140,200,
increased by 40.2%, compared to the student enrollments of
100,000 in the same period of 2020.
- Total number of learning centers in childhood &
adolescent quality education increased to 235 as of
June 30, 2021, from 232 as of
June 30, 2020.
Highlights for the Six Months Ended June 30, 2021
- Net revenues increased by 78.0% year-over-year to RMB1,116.0 million (US$172.8 million), from RMB626.8 million in the same period in 2020.
- Net revenue from adult professional education business, which
represented 49.1% of the total net revenues, increased by 21.2%
year-over-year to RMB548.3 million
(US$84.9 million), from RMB452.5 million in the same period of 2020
- Net revenue from childhood & adolescent quality education
business, which represented 50.9% of the total net revenues
increased by 225.7% year-over-year to RMB567.7 million (US$87.9
million), from RMB174.3
million in the same period of 2020
- Gross profit increased by 345.1% year-over-year to RMB544.3 million (US$84.3
million), from RMB122.3
million in the same period in 2020.
- Gross profit margin increased by 29.3% points year-over-year to
48.8%, from 19.5% in the same period of 2020.
- Operating loss was RMB220.2
million (US$34.1 million),
compared to operating loss of RMB664.7 million in
the same period in 2020.
- Non-GAAP operating loss, which excluded share-based
compensation expenses, was RMB209.2
million (US$32.4 million),
compared to non-GAAP operating loss of RMB643.4 million in the same period in 2020.
- Net loss was RMB198.5 million (US$30.7 million), compared to net loss
of RMB612.6 million in the same period in 2020.
- Non-GAAP net loss, which excluded share-based compensation
expenses, was RMB187.5 million
(US$29.0 million), compared to
non-GAAP net loss of RMB591.3 million
in the same period in 2020.
- Basic and diluted loss per American Depositary Share ("ADS")
was RMB3.56 (US$0.55).
- Total student enrollments in adult professional education
business, defined as the total number of courses enrolled by
students during that period, including multiple courses enrolled by
the same student, in the first half of 2021 decreased by 16.1%
year-over-year to 43,300.
- Total student enrollments in childhood & adolescent quality
education business, defined as the total number of students who
attended at least one paid lesson during that period or have
deposit balances in their accounts at the end of that period, in
the first half of 2021 reached 147,800, increased by 40.1%,
compared to the student enrollments of 105,500 in the same period
of 2020.
Key Financial
Results
|
|
|
|
For the Three Months Ended
June 30,
|
Variance
|
% of
change
|
For the Six Months Ended
June 30,
|
Variance
|
% of
change
|
|
|
2020
|
|
2021
|
|
|
|
2020
|
|
2021
|
|
|
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
|
|
(in thousands,
except for percentages)
|
Net
revenues
|
|
331,833
|
|
582,258
|
|
250,425
|
75.5
|
626,826
|
|
1,116,044
|
|
489,218
|
78.0
|
Cost of
revenues(a)
|
|
(237,167)
|
|
(287,878)
|
|
(50,711)
|
21.4
|
(504,526)
|
|
(571,722)
|
|
(67,196)
|
13.3
|
Gross
profit
|
|
94,666
|
|
294,380
|
|
199,714
|
211.0
|
122,300
|
|
544,322
|
|
422,022
|
345.1
|
Gross
margin
|
|
28.5%
|
|
50.6%
|
|
22.1%
|
|
19.5%
|
|
48.8%
|
|
29.3%
|
|
Selling and
marketing
expenses(a)
|
|
(206,254)
|
|
(218,876)
|
|
(12,622)
|
6.1
|
(443,784)
|
|
(432,632)
|
|
11,152
|
-2.5
|
General and
administrative
expenses(a)
|
|
(151,585)
|
|
(142,820)
|
|
8,765
|
-5.8
|
(292,224)
|
|
(286,012)
|
|
6,212
|
-2.1
|
Research and
development
expenses(a)
|
|
(31,681)
|
|
(23,415)
|
|
8,266
|
-26.1
|
(50,963)
|
|
(45,882)
|
|
5,081
|
-10.0
|
Total operating
expenses
|
|
(389,520)
|
|
(385,111)
|
|
4,409
|
-1.1
|
(786,971)
|
|
(764,526)
|
|
22,445
|
-2.9
|
Operating
loss
|
|
(294,854)
|
|
(90,731)
|
|
204,123
|
-69.2
|
(664,671)
|
|
(220,204)
|
|
444,467
|
-66.9
|
Notes:
(a) Includes share-based compensation expenses.
" Despite some areas in China
were still experiencing the negative impact from sporadic
occurrences of COVID-19 cases, thanks to the effective prevention
controls implemented by the government, which have successfully
alleviated the further spread of the pandemic in China. We are delighted to see that our total
net revenues have achieved a continued growth in the second quarter
of this year. The total net revenues increased by 75.5%, to
RMB582.3 million in the second
quarter of 2021 from RMB331.8 million
in the same period of 2020. The total net revenues generated in the
second quarter of this year were in line with the revenue guidance
we gave in the last quarter. The gross profit margin increased by
22.1 percentage points year-over-year to 50.6% in the second
quarter of 2021 from 28.5% in the same period of 2020. Net revenues
from childhood & adolescent quality education business
increased by 213.2% to RMB289.4
million in the second quarter of 2021 from RMB92.4 million in the same period of 2020. The
number of student enrollments increased by 40.2% to 140,200 in the
second quarter of 2021 from 100,000 in the same period of 2020. The
core strategies of our adult professional education business are to
maintain a stable growth as well as improve our operational
efficiency. Net revenues from adult professional education business
increased by 22.3% to RMB292.9
million in the second quarter of 2021 from RMB239.4 million in the same period of 2020. The
number of student enrollments decreased by 14.8% year-over-year to
31,100 in the second quarter of 2021 mainly because we have ceased
the operation of nine under-performing adult learning centers since
June 30, 2020. The operating loss
decreased by 69.2% to a loss of RMB90.7
million in the second quarter of 2021, from RMB294.9 million in the same period of 2020. The
net loss decreased by 71.3% to RMB76.7million in the second quarter of 2021 from
RMB267.6 million in the same quarter
of 2020. These were mainly attributable to the significant growth
in total net revenues, continuous enhancement of operational
efficiency and execution of cost and expenses optimization in the
second quarter of this year." remarked Ms. Ying Sun, the Chief Executive Officer of
Tarena.
"Looking ahead, we will continue to upgrade the quality of our
comprehensive products and services and uplift our operational
efficiencies. With the introduction of the new regulations on the
education industry announced by the Chinese government, we expect
that we can continue to maintain a sustainable growth in our adult
professional education and childhood & adolescent quality
education businesses." concluded Ms. Sun.
Financial Results for the Second Quarter of 2021
Net Revenues
Total net revenues increased by 75.5% to RMB582.3 million (US$90.2 million) in the second quarter of
2021, from RMB331.8 million in the
same period of 2020.
Net revenue from adult professional education business increased
by 22.3% to RMB292.9 million
(US$45.4 million) in the second
quarter of 2021, from RMB239.4
million in same period of 2020. The increase was primarily
due to the increase in class consumption rate and the alleviation
of the negative impact from COVID-19 in the second quarter of 2021
as compared to the same period of 2020.
Net revenue from childhood & adolescent quality
education business increased by 213.2% to RMB289.4 million (US$44.8
million) in the second quarter of 2021, from RMB92.4 million in same period of 2020. The
increase was primarily due to the increase in student enrollment of
childhood & adolescent quality education from 100,000 in the
second quarter of 2020 to 140,200 in the same period of 2021 and
the alleviation of the negative impact from COVID-19 in the second
quarter of 2021 as compared to the same period of 2020.
Cost of Revenues
Cost of revenues increased by 21.4% to RMB287.9 million (US$44.6 million) in the second quarter of
2021, from RMB237.2 million in the
same period of 2020. The increase was primarily due to an increase
in personnel-related costs and social security fees resulting from
growing number of teaching staffs at our childhood & adolescent
quality education learning centers.
Gross Profit and Gross Margin
Gross profit increased by 211.0% to RMB294.4 million (US$45.6
million) in the second quarter of 2021, from RMB94.7 million in the same period of 2020. Gross
margin, which is equal to gross profit divided by net revenues, was
50.6% in the second quarter of 2021, compared to 28.5% in the
same period of 2020. The increase in gross margin was primarily
because the increase in net revenue outweighed the increase in cost
of revenue in the second quarter of 2021.
Operating Expenses
Total operating expenses decreased by 1.1% to RMB385.1 million (US$59.6 million) in the second quarter of 2021,
from RMB389.5 million in the
same period of 2020. Total non-GAAP operating expenses, which
excluded share-based compensation expenses, increased by
1.0% to RMB381.2 million
(US$59.0 million) in the second
quarter of 2021, from RMB377.5
million in the same period of 2020. Total share-based
compensation expenses allocated to the related operating expenses
decreased by 67.1% to RMB3.9
million (US$0.6 million)
in the second quarter of 2021, from RMB12.0
million in the same period of 2020.
Selling and marketing expenses increased by 6.1% to
RMB218.9 million (US$33.9 million) in the second quarter of 2021,
from RMB206.3 million in the same period of
2020. The increase was mainly due to the increase in spending
on marketing and promotional activities in the second quarter of
2021 as compared to the marketing and promotional expenses incurred
in the same period of 2020.
General and administrative expenses decreased by 5.8% to
RMB142.8 million (US$22.1 million) in the second quarter of 2021,
from RMB151.6 million in the same
period of 2020. The decrease was mainly due to the decrease of
one-time professional expenses related to financial restatement and
internal control improvement advisory incurred in the same period
of last year, partially offset by the loss on disposal of property
and the increase of the employees' social security fees which were
exempted according to the preferential policies enacted by the
government during COVID-19 pandemic in the second quarter of 2020
but were not exempted in the second quarter of 2021.
Research and development expenses decreased by 26.1% to
RMB23.4 million (US$3.6 million) in the second quarter of 2021,
from RMB31.7 million in the same
period of 2020. The decrease was mainly due to the decrease in
personnel-related costs and welfare expenses as the number of
staffs decreased.
Operating Loss
Operating loss was RMB90.7 million
(US$14.0 million) in the second
quarter of 2021, compared to operating loss of RMB294.9 million in the same period of 2020.
Non-GAAP operating loss, which excluded share-based compensation
expenses, was RMB86.6 million
(US$13.4 million) in the second
quarter of 2021, compared to non-GAAP operating loss of
RMB282.7 million in the same period
of 2020.
Interest Income / (Expense)
Net interest income was RMB0.6
million (US$0.1 million) in
the second quarter of 2021, compared to net interest expense of
RMB0.6 million in the same period of
2020. Interest income in both periods consisted of interest earned
on our cash, cash equivalents and time deposits in commercial banks
and interest income recognized in relation to our installment
payment plan for students. Interest expense decreased in the second
quarter of 2021 as compared to the same period of 2020 was mainly
because the bank loans were fully repaid in February of 2021.
Other Income
Other income was RMB0.8 million
(US$0.1 million) in the second
quarter of 2021, compared to other income of RMB0.09 million in the same period of
2020. The income was mostly from government grant offered to
our learning centers.
Foreign Exchange Gain / (Loss)
Foreign exchange gain was RMB0.4 million (US$0.1 million) in the second quarter of 2021,
compared to foreign exchange loss of RMB0.6
million in the same period of 2020.
Income Tax Benefit
The Company recorded an income tax benefit of RMB12.3 million (US$1.9 million) in the second quarter of 2021,
compared to income tax benefit of RMB28.4
million in the same period of 2020.
Net Loss
As a result of the foregoing, net loss was RMB76.7 million (US$11.9
million) in the second quarter of 2021, compared to net loss
of RMB267.6 million in the same
period of 2020. Non-GAAP net loss, which excluded share-based
compensation expenses, was RMB72.5 million (US$11.2 million) in the second quarter of 2021,
compared to non-GAAP net loss of RMB255.4
million in the same period of 2020.
Basic and Diluted Loss per ADS
Loss per ADS was RMB1.39 (US$0.22) in the second quarter of
2021, compared to loss per ADS of RMB4.92 in the second quarter of 2020.
Non-GAAP loss per ADS, which excluded share-based compensation
expenses, was RMB1.32 (US$0.20) in the second quarter of 2021, compared
to non-GAAP loss per ADS of RMB4.70 in the second quarter of 2020.
Cash Flow
Net cash outflow used in operating activities in the second
quarter of 2021 was RMB47.5 million (US$7.4 million). Net cash inflow from
investing activities of RMB30.4
million (US$4.7 million) in
the second quarter of 2021 was mainly due to the proceeds of
RMB46.0 million (US$7.1 million) received from disposal of
property and RMB0.5 million
(US$0.1 million) received from
disposal of office equipment, minus the spending of RMB16.5 million (US$2.6
million) on leasehold improvement and
office equipment.
Financial Results for the Six Months Ended June 30, 2021
Net Revenues
Total net revenues increased by 78.0% to RMB1,116.0 million (US$172.8 million) in the first half of 2021, from
RMB626.8 million in the same period
of 2020. The increase was primarily driven by the significant
increase in net revenue generated from the childhood &
adolescent quality education business. Net revenue from childhood
& adolescent quality education business increased by 225.7% in
the first half of 2021 to RMB567.7
million (US$87.9 million),
from RMB174.3 million in the same
period of 2020.
Cost of Revenues
Cost of revenues increased by 13.3% to RMB571.7 million (US$88.5
million) in the first half of 2021, from RMB504.5 million in the same period of 2020. The
increase was mainly due to the addition of teaching staffs in
childhood & adolescent quality education, which resulted in
increase in personnel-related costs.
Gross Profit and Gross Margin
Gross profit increased by 345.1% to RMB544.3 million (US$84.3
million) in the first six months of 2021, from RMB122.3 million in the same period of 2020.
Gross margin, which is equal to gross profit divided by net
revenues, was 48.8% in the first six months of 2021, compared with
19.5% in the same period of 2020. The significant increase in
gross margin was primarily attributable to the increase in total
net revenue largely outweighed the increase in cost of revenue in
the first half of 2021.
Operating Expenses
Total operating expenses decreased by 2.9% to RMB764.5 million (US$118.4
million) in the first six months of 2021, from RMB787.0 million in the same period of 2020.
Total non-GAAP operating expenses, which excluded share-based
compensation expenses, decreased by 1.6% to RMB753.9 million (US$116.8
million) in the first six months of 2021, from RMB765.9 million in the same period of 2020.
Total share-based compensation expenses allocated to the related
operating expenses decreased by 49.3% to RMB10.7 million (US$1.7 million) in the first six months of 2021,
from RMB21.1 million in the same
period of 2020.
Selling and marketing expenses decreased by 2.5% to
RMB432.6 million (US$67.0 million) in the first six months of 2021,
from RMB443.8 million in the same
period of 2020. The decline was mainly due to decrease in
advertising expenses in the first six months of this year.
General and administrative expenses decreased by 2.1% to
RMB286.0 million (US$44.3 million) in the first six months of 2021,
from RMB292.2 million in the same
period of 2020. The decline was mainly due to one-time professional
expenses related to financial restatement and internal control
improvement advisory incurred in the same period of last year,
partially offset by the loss on disposal of property and the
increase of the employees' social security fees which were exempted
according to the preferential policies enacted by the government
during COVID-19 pandemic in the first six months of 2020 but were
not exempted in the same period of 2021.
Research and development expenses decreased by 10.0% to
RMB45.9 million (US$7.1 million) in the first six months of 2021,
from RMB51.0 million in the same
period of 2020. The decline was mainly due to the decrease in
personnel-related costs and welfare expenses as the number of
staffs decreased.
Operating Loss
Operating loss was RMB220.2
million (US$34.1 million) in
the first six months of 2021, compared to operating loss of
RMB664.7 million in the same period
of 2020. Non-GAAP operating loss, which excluded share-based
compensation expenses, was RMB209.2
million (US$32.4 million) in
the first six months of 2021, compared to non-GAAP operating loss
of RMB643.4 million in the same
period of 2020.
Interest Income / (Expense)
Interest income was RMB1.2 million
(US$0.2 million) in the first six
months of 2021, compared to interest expense of RMB2.1 million in the same period in 2020.
Interest income in both periods consisted of interest earned on our
cash, cash equivalents and time deposits in commercial banks and
interest income recognized in relation to our installment payment
plan for students. Interest expense decreased in the first six
months of 2021 as compared to the same period of 2020 was mainly
because the bank loans were fully repaid in February of 2021.
Other Income
Other income was RMB1.1 million
(US$0.2 million) in the first six
months of 2021, compared to RMB0.3
million in other income in the same period of 2020. The
income was mostly from government grants offered to learning
centers.
Foreign Exchange Gain / (loss)
Foreign exchange loss was RMB0.3
million (US$0.05 million) in
the first six months of 2021, compared to RMB1.6 million foreign exchange gain in the same
period of 2020.
Income Tax Benefit
The Company recorded an income tax benefit of RMB19.6 million (US$3.0
million) in the first six months of 2021, compared to
RMB52.2 million in income tax
benefit in the same period of 2020.
Net Loss
As a result of the foregoing, net loss was RMB198.5 million (US$30.7
million) in the first six months of 2021, compared to net
loss of RMB612.6 million in the same
period of 2020. Non-GAAP net loss, which excluded share-based
compensation expenses, was RMB187.5
million (US$29.0 million) in
the first six months of 2021, compared to non-GAAP net loss of
RMB591.3 million in the same period
of 2020.
Basic and Diluted Loss per ADS
Loss per ADS was RMB3.56
(US$0.55) in the first six months of
2021. Non-GAAP loss per ADS, which excluded share-based
compensation expenses, was RMB3.36
(US$0.52) in the first six months of
2021.
Cash Flow
Net cash outflow from operating activities in the first six
months of 2021 was RMB85.6 million
(US$13.3 million). Net cash inflow
from investing activities of RMB24.7
in the first half of 2021 was mainly due to the proceeds of
RMB46.0 million (US$7.1 million) received from disposal of
properties and RMB1.0 million
(US$0.2 million) received from
disposal of office equipment, minus the spending of RMB28.9 million (US$4.5
million) on leasehold improvement and office equipment.
Recent Developments Regarding Pending Going Private
Transaction
On April 30, 2021, the Company
announced that it entered into an Agreement and Plan of Merger (the
"Merger Agreement") with Kidedu Holdings Limited ("Parent") and
Kidarena Merger Sub, a wholly owned subsidiary of Parent ("Merger
Sub"). Pursuant to the Merger Agreement, Merger Sub will merge with
and into the Company, with the Company continuing as the surviving
company and becoming a wholly owned subsidiary of Parent (the
"Merger"), in a transaction at $4 per
share. The Company subsequently obtained the PRC anti-trust
approval. On August 3, 2021, the
Company received a letter from Parent and Ascendent Capital
Partners ("ACP") proposing that relevant parties to the Merger
engage in business discussions with respect to a recent PRC
government policy issued on July 23,
2021 regarding after-school tutoring for students in
compulsory education (the "Policy") and the implications of the
Policy on the Company's business and the Merger Agreement. Since
then the Company, through the special committee of independent
directors consisting of Mr. Arthur Lap Tat Wong and Mr.
Hon Sang Lee, and Parent and ACP
have engaged in multiple rounds of discussions, including
discussions of potential alternative terms for the Merger
Agreement. The relevant parties have not been able to resolve their
differences. While the Merger Agreement continues in effect, the
Board of Directors of the Company cautions the Company's
shareholders and the public that there can be no assurance that the
Merger and the other transactions contemplated by the Merger
Agreement will be consummated, as substantial uncertainty exists as
to whether the Merger will close, either on the terms of the Merger
Agreement or on alternative terms. The Board of Directors of the
Company is evaluating all options. The Company will provide further
updates as required by applicable law.
Business Outlook
Based on the Company's current estimates, total net revenues for
the third quarter of 2021 are expected to be in the range of
RMB600 million and RMB630 million, after taking into
consideration the seasonal fluctuation factor and the likely
continued impact of the COVID-19.
This guidance is based on the current market conditions and
reflects the Company's current and preliminary estimates of market
and operating conditions, which are subject to change, particularly
as to the potential impact of COVID-19 on the economy in
China and elsewhere in the
world.
Exchange Rate Information
All translations made in the financial statements or elsewhere
in this press release made from RMB into United States dollars ("US$") are solely for
convenience and calculated at the rate of US$1.00=RMB 6.4566,
representing the exchange rate as of June
30, 2021, set forth in the H.10 statistical release of the
U.S. Federal Reserve Board. No representation is made that the RMB
amounts could have been, or could be, converted, realized or
settled into US$ at that rate, or at any other rate, on
June 30, 2021.
About Tarena International, Inc.
Tarena is a leading provider of adult professional education and
childhood and adolescent quality education services in
China. Through its innovative
education platform combining live distance instruction,
classroom-based tutoring and online learning modules, Tarena offers
adult professional education courses in IT and non-IT subjects. Its
adult professional education courses provide students with
practical skills to prepare them for jobs in industries with
significant growth potential and strong hiring demand. Tarena also
offers childhood and adolescent quality education programs,
including computer coding and robotics programming courses, etc.,
targeting students aged between three and eighteen.
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. Among other
things, quotations from management in this announcement, as well as
the Company's strategic and operational plans (in particular, the
impact of COVID-19 on our businesses; the solutions we adopt to
address such impact of COVID-19; balancing growth and
profitability; as well as the growth prospects of adult
professional education and childhood and adolescent quality
education services in China)
contain forward-looking statements. Tarena 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 any business outlook and statements about Tarena's
beliefs and expectations, are forward-looking statements. Many
factors, risks and uncertainties 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:
the impact of the COVID-19 outbreak; the potential impact of the
Proposal and any transaction in connection with the Proposal;
Tarena's goals and strategies; its future business development,
financial condition and results of operations; its ability to
continue to attract students to enroll in its courses; its ability
to continue to recruit, train and retain qualified instructors and
teaching assistants; its ability to continually tailor its
curriculum to market demand and enhance its courses to adequately
and promptly respond to developments in the professional job
market; its ability to maintain or enhance its brand recognition,
its ability to maintain high job placement rate for its students,
and its ability to maintain cooperative relationships with
financing service providers for student loans. In addition, with
respect to the "going private" Proposal, there can be no assurance
that the Buyer Group will make any definitive offer to the Company,
that any definitive agreement relating to the Proposal will be
entered into between the Company and the Buyer Group or that a
transaction based on the Proposal or any other similar transaction
will be approved or consummated.
Further information regarding these and other risks,
uncertainties or factors is included in Tarena's 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 Tarena does not undertake any obligation to update
such information, except as required under applicable law.
About Non-GAAP Financial Measures
Beginning in the second quarter of 2016, the Company revised its
non-GAAP financial measures to exclude gain or loss on derivative
instruments, goodwill impairment, impairment of intangibles via
acquisitions of businesses and the related tax impact, in addition
to its historical practice of excluding share-based compensation
expenses for non-GAAP results.
To supplement Tarena's consolidated financial results presented
in accordance with United States Generally Accepted Accounting
Principles ("GAAP"), Tarena's management uses non-GAAP measures of
cost of revenues, operating expenses, operating income, net income,
and basic and diluted net income per ADS, which are adjusted from
results based on GAAP to exclude the share-based compensation
expenses, gain or loss on derivative instruments, goodwill
impairment, impairment of intangibles via acquisitions of
businesses and the related tax impact. These non-GAAP financial
measures should be considered in addition to results prepared in
accordance with GAAP, but should not be considered a substitute
for, or superior to, GAAP results. In addition, calculation of the
non-GAAP financial measures may be different from the calculation
used by other companies, and therefore comparability may be
limited.
Tarena's management believes that excluding the share-based
compensation expenses, gain or loss on derivative instruments,
goodwill impairment, impairment of intangibles via acquisitions of
businesses and the related tax impact provides meaningful
supplemental information regarding our performance and liquidity by
excluding certain items identified as non-recurring and infrequent
in nature, and non-cash charges. The amount of share-based
compensation expenses, gain or loss on derivative instruments,
goodwill impairment, impairment of intangibles via acquisitions of
businesses and the related tax impact are not built into the
Company's annual budgets and quarterly forecasts, which generally
will be the basis for information Tarena provides to analysts and
investors as guidance for future operating performance.
The non-GAAP financial measures are provided to enhance
investors' overall understanding of Tarena's current financial
performance and prospects for the future. A limitation of using
non-GAAP cost of revenues, operating expenses, operating income
(loss) and net income (loss), excluding the share-based
compensation expenses, gain or loss on derivative instruments,
goodwill impairment, impairment of intangibles via acquisitions of
businesses and the related tax impact is that the share-based
compensation charge has been and will continue to be a recurring
expense in the Company's business for the foreseeable future, and
gain or loss on derivative instruments, goodwill impairment,
impairment of intangibles via acquisitions of businesses and the
related tax impact may recur in the future. In order to mitigate
these limitations the Company has provided specific information
regarding the GAAP amounts excluded from each non-GAAP measure. The
accompanying tables include details on the reconciliation between
GAAP financial measures that are most directly comparable to the
non-GAAP financial measures the Company has presented.
TARENA
INTERNATIONAL, INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands,
except share data and per share data)
|
|
|
|
As
of
|
|
|
December 31,
|
|
June
30,
|
|
June
30,
|
|
|
2020
|
|
2021
|
|
2021
|
|
|
Audited
|
|
Unaudited
|
|
Unaudited
|
|
|
RMB
|
|
RMB
|
|
USD
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
320,179
|
|
257,601
|
|
39,897
|
Time
deposits
|
|
6,257
|
|
6,217
|
|
963
|
Restricted
cash
|
|
38,369
|
|
31,930
|
|
4,945
|
Accounts receivable,
net of allowance for doubtful accounts
|
|
32,790
|
|
43,538
|
|
6,743
|
Amounts due from
related parties
|
|
305
|
|
1,047
|
|
162
|
Asset held for
sale
|
|
-
|
|
91,034
|
|
14,099
|
Prepaid expenses and
other current assets
|
|
138,353
|
|
160,914
|
|
24,922
|
Total current
assets
|
|
536,253
|
|
592,281
|
|
91,731
|
Time deposits-non
current
|
|
-
|
|
120
|
|
19
|
Accounts receivable,
net of allowance for doubtful accounts-non current
|
|
192
|
|
146
|
|
23
|
Property and
equipment, net
|
|
464,490
|
|
316,667
|
|
49,045
|
Intangible assets,
net
|
|
13,444
|
|
11,548
|
|
1,789
|
Goodwill
|
|
52,782
|
|
52,782
|
|
8,176
|
Right-of-use
assets
|
|
586,451
|
|
566,617
|
|
87,758
|
Long-term investments,
net
|
|
67,592
|
|
67,580
|
|
10,467
|
Deferred income tax
assets
|
|
142,220
|
|
167,242
|
|
25,902
|
Other non-current
assets, net
|
|
95,825
|
|
90,976
|
|
14,092
|
Total
assets
|
|
1,959,249
|
|
1,865,959
|
|
289,002
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Short-term bank
loans
|
|
10,710
|
|
-
|
|
-
|
Accounts
payable
|
|
10,293
|
|
8,572
|
|
1,328
|
Amounts due to related
parties
|
|
180
|
|
96
|
|
15
|
Operating lease
liabilities-current
|
|
199,083
|
|
230,230
|
|
35,658
|
Income taxes
payable
|
|
76,817
|
|
81,560
|
|
12,632
|
Deferred
revenue-current
|
|
1,980,138
|
|
2,046,359
|
|
316,941
|
Advance received for
disposal of property
|
|
-
|
|
46,000
|
|
7,124
|
Accrued expenses and
other current liabilities
|
|
391,904
|
|
417,984
|
|
64,738
|
Total current
liabilities
|
|
2,669,125
|
|
2,830,801
|
|
438,436
|
Deferred revenue-non
current
|
|
18,060
|
|
16,761
|
|
2,596
|
Operating lease
liabilities-non current
|
|
406,251
|
|
336,598
|
|
52,132
|
Other non-current
liabilities
|
|
5,082
|
|
4,927
|
|
763
|
Total
liabilities
|
|
3,098,518
|
|
3,189,087
|
|
493,927
|
Commitments and
contingencies
|
|
-
|
|
-
|
|
-
|
Shareholders'
equity:
|
|
|
|
|
|
|
Class A ordinary
shares
|
|
349
|
|
354
|
|
55
|
Class B ordinary
shares
|
|
74
|
|
75
|
|
12
|
Treasury
stock
|
|
(459,815)
|
|
(459,815)
|
|
(71,216)
|
Additional paid-in
capital
|
|
1,324,161
|
|
1,338,981
|
|
207,382
|
Accumulated other
comprehensive income
|
|
49,120
|
|
50,145
|
|
7,766
|
Accumulated
deficit
|
|
(2,045,891)
|
|
(2,246,337)
|
|
(347,913)
|
Total deficit
attributable to the shareholders of Tarena
International, Inc.
|
|
(1,132,002)
|
|
(1,316,597)
|
|
(203,914)
|
Non-controlling
interest
|
|
(7,267)
|
|
(6,531)
|
|
(1,011)
|
Total liabilities
and equity
|
|
1,959,249
|
|
1,865,959
|
|
289,002
|
|
|
|
|
|
|
|
|
TARENA
INTERNATIONAL, INC. AND SUBSIDIARIES UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (in
thousands, except share data and per share data)
|
|
|
|
For the Three Months Ended
June 30
|
|
For the Six Months Ended
June 30
|
|
|
2020 (Unaudited)
|
|
2021
(Unaudited)
|
|
2021
(Unaudited)
|
|
2020
(Unaudited)
|
|
2021
(Unaudited)
|
|
2021
(Unaudited)
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
USD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenues
|
|
331,833
|
|
582,258
|
|
90,180
|
|
626,826
|
|
1,116,044
|
|
172,853
|
Cost of
revenues(a)
|
|
(237,167)
|
|
(287,878)
|
|
(44,587)
|
|
(504,526)
|
|
(571,722)
|
|
(88,548)
|
Gross
profit
|
|
94,666
|
|
294,380
|
|
45,593
|
|
122,300
|
|
544,322
|
|
84,305
|
Selling and marketing
expenses(a)
|
|
(206,254)
|
|
(218,876)
|
|
(33,900)
|
|
(443,784)
|
|
(432,632)
|
|
(67,006)
|
General and
administrative
expenses(a)
|
|
(151,585)
|
|
(142,820)
|
|
(22,120)
|
|
(292,224)
|
|
(286,012)
|
|
(44,298)
|
Research and
development
expenses(a)
|
|
(31,681)
|
|
(23,415)
|
|
(3,627)
|
|
(50,963)
|
|
(45,882)
|
|
(7,106)
|
Operating
loss
|
|
(294,854)
|
|
(90,731)
|
|
(14,054)
|
|
(664,671)
|
|
(220,204)
|
|
(34,105)
|
Interest income
(expense)
|
|
(586)
|
|
600
|
|
93
|
|
(2,063)
|
|
1,189
|
|
184
|
Other
income
|
|
85
|
|
768
|
|
119
|
|
307
|
|
1,111
|
|
172
|
Foreign exchange
gains (loss)
|
|
(642)
|
|
410
|
|
64
|
|
1,649
|
|
(279)
|
|
(43)
|
Loss before income
taxes
|
|
(295,997)
|
|
(88,953)
|
|
(13,778)
|
|
(664,778)
|
|
(218,183)
|
|
(33,792)
|
Income tax
benefit
|
|
28,444
|
|
12,283
|
|
1,902
|
|
52,172
|
|
19,634
|
|
3,041
|
Net
loss
|
|
(267,553)
|
|
(76,670)
|
|
(11,876)
|
|
(612,606)
|
|
(198,549)
|
|
(30,751)
|
Less: Net loss
(profit) attributable
to non-controlling interests
|
|
1,216
|
|
(1,776)
|
|
(275)
|
|
3,148
|
|
(737)
|
|
(114)
|
Net loss
attributable to Class A
and Class B ordinary
shareholders
|
|
(266,337)
|
|
(78,446)
|
|
(12,151)
|
|
(609,458)
|
|
(199,286)
|
|
(30,865)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per Class
A and Class B
ordinary share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
(4.92)
|
|
(1.39)
|
|
(0.22)
|
|
(11.29)
|
|
(3.56)
|
|
(0.55)
|
Weighted average
number of
Class A and Class B ordinary
shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
54,123,107
|
|
56,257,188
|
|
56,257,188
|
|
54,004,236
|
|
55,965,711
|
|
55,965,711
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
(267,553)
|
|
(76,670)
|
|
(11,876)
|
|
(612,606)
|
|
(198,549)
|
|
(30,751)
|
Other comprehensive
income
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation
adjustment, net of nil income
taxes
|
|
130
|
|
938
|
|
145
|
|
199
|
|
1,025
|
|
159
|
Comprehensive loss
|
|
(267,423)
|
|
(75,732)
|
|
(11,731)
|
|
(612,407)
|
|
(197,524)
|
|
(30,592)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
(a) Includes
share-based compensation expenses as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended
June 30,
|
|
For the Six Months Ended
June 30,
|
|
|
2020
|
|
2021
|
|
2021
|
|
2020
|
|
2021
|
|
2021
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
USD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
138
|
|
185
|
|
29
|
|
242
|
|
370
|
|
57
|
Selling and marketing
expenses
|
|
575
|
|
945
|
|
146
|
|
1,038
|
|
1,978
|
|
306
|
General and
administrative expenses
|
|
7,810
|
|
2,641
|
|
409
|
|
13,718
|
|
7,951
|
|
1,231
|
Research and
development expenses
|
|
3,602
|
|
356
|
|
55
|
|
6,298
|
|
736
|
|
114
|
TARENA
INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF
GAAP MEASURES TO NON-GAAP MEASURES
(in thousands,
except share data and per share data)
|
|
|
|
For the Three Months Ended
June 30,
|
|
For the Six Months Ended
June 30,
|
|
|
2020 (Unaudited)
|
|
2021
(Unaudited)
|
|
2021
(Unaudited)
|
|
2020
(Unaudited)
|
|
2021 (Unaudited)
|
|
2021
(Unaudited)
|
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
USD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Cost of
revenues
|
|
237,167
|
|
287,878
|
|
44,587
|
|
504,526
|
|
571,722
|
|
88,548
|
Share-based
compensation expense in
cost of revenues
|
|
138
|
|
185
|
|
29
|
|
242
|
|
370
|
|
57
|
Non-GAAP Cost of
revenues
|
|
237,029
|
|
287,693
|
|
44,558
|
|
504,284
|
|
571,352
|
|
88,491
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Selling and
marketing expenses
|
|
206,254
|
|
218,876
|
|
33,900
|
|
443,784
|
|
432,632
|
|
67,006
|
Share-based
compensation expense in
selling and marketing expenses
|
|
575
|
|
945
|
|
146
|
|
1,038
|
|
1,978
|
|
306
|
Non-GAAP Selling
and marketing
expenses
|
|
205,679
|
|
217,931
|
|
33,754
|
|
442,746
|
|
430,654
|
|
66,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP General and
administrative
expenses
|
|
151,585
|
|
142,820
|
|
22,120
|
|
292,224
|
|
286,012
|
|
44,298
|
Share-based
compensation expense in
general and administrative expenses
|
|
7,810
|
|
2,641
|
|
409
|
|
13,718
|
|
7,951
|
|
1,231
|
Non-GAAP General
and
administrative expenses
|
|
143,775
|
|
140,179
|
|
21,711
|
|
278,506
|
|
278,061
|
|
43,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Research and
development
expenses
|
|
31,681
|
|
23,415
|
|
3,627
|
|
50,963
|
|
45,882
|
|
7,106
|
Share-based
compensation expense in
research and development expenses
|
|
3,602
|
|
356
|
|
55
|
|
6,298
|
|
736
|
|
114
|
Non-GAAP Research
and
development expenses
|
|
28,079
|
|
23,059
|
|
3,572
|
|
44,665
|
|
45,146
|
|
6,992
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
|
(294,854)
|
|
(90,731)
|
|
(14,054)
|
|
(664,671)
|
|
(220,204)
|
|
(34,105)
|
Share-based
compensation expenses
|
|
12,125
|
|
4,127
|
|
639
|
|
21,296
|
|
11,035
|
|
1,708
|
Non-GAAP Operating
loss
|
|
(282,729)
|
|
(86,604)
|
|
(13,415)
|
|
(643,375)
|
|
(209,169)
|
|
(32,397)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
(267,553)
|
|
(76,670)
|
|
(11,876)
|
|
(612,606)
|
|
(198,549)
|
|
(30,751)
|
Share-based
compensation expenses
|
|
12,125
|
|
4,127
|
|
639
|
|
21,296
|
|
11,035
|
|
1,708
|
Non-GAAP Net
loss
|
|
(255,428)
|
|
(72,543)
|
|
(11,237)
|
|
(591,310)
|
|
(187,514)
|
|
(29,043)
|
Less: Net loss
(profit) attributable to
non-controlling interests
|
|
(1,216)
|
|
1,776
|
|
275
|
|
(3,148)
|
|
737
|
|
114
|
Non-GAAP net loss
attributable to
Class A and Class B ordinary
shareholders
|
|
(254,212)
|
|
(74,319)
|
|
(11,512)
|
|
(588,162)
|
|
(188,251)
|
|
(29,157)
|
Non-GAAP net loss
per Class A and
Class B ordinary share(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
(4.70)
|
|
(1.32)
|
|
(0.20)
|
|
(10.89)
|
|
(3.36)
|
|
(0.52)
|
Weighted average
number of ordinary
shares outstanding used in calculating
Non-GAAP net loss per Class A and
Class B ordinary share(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
54,123,107
|
|
56,257,188
|
|
56,257,188
|
|
54,004,236
|
|
55,965,711
|
|
55,965,711
|
|
Notes:
|
(a) The Non-GAAP net
loss per share is computed using Non-GAAP net loss attributable to
ordinary shareholders and the same number of ordinary shares used
in GAAP basic and diluted net loss per share
calculation.
|
(b) There was no tax
impact of share-based compensation expenses for the second quarter
of 2021.
|
View original
content:https://www.prnewswire.com/news-releases/tarena-international-inc-announces-the-results-for-the-second-quarter-of-2021-301384641.html
SOURCE Tarena International, Inc.