BEIJING, Oct. 25, 2018 /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 2019 ended
August 31, 2018.
Highlights for the Second Quarter of Fiscal Year 2019
- Net revenues increased by 53.5% year-over-year to US$699.8 million from US$455.8 million in the same period of the prior
year.
- Income from operations increased by 18.4% to US$80.9 million from US$68.3 million in the same period of the prior
year.
- Non-GAAP income from operations increased by 23.8% to
US$99.0 million from US$79.9 million in the same period of the prior
year.
- Net income attributable to TAL increased by 29.5%
year-over-year to US$77.0 million,
from US$59.5 million in the same
period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 33.8% to
US$95.1 million from US$71.1 million in the same period of the prior
year.
- Basic and diluted net income per American Depositary Share
("ADS") were US$0.14 and US$0.13, respectively. Non-GAAP basic and diluted
net income per ADS, which excluded share-based compensation
expenses, were US$0.17 and
US$0.16, respectively. Three ADSs
represent one Class A common share.
- Cash, cash equivalents and short-term investments totaled
US$1,646.5 million as of August 31, 2018, compared to US$1,498.9 million as of February 28, 2018.
- Total student enrollments increased by 120.2% year-over-year to
approximately 4,937,320 from approximately 2,242,380 in the same
period of the prior year.
Highlights for the Six Months Ended August 31, 2018
- Net revenues increased by 60.8% year-over-year to US$1,250.4 million from US$777.7 million in the same period of the prior
year.
- Income from operations increased by 60.5% to US$155.9 million from US$97.1 million in the same period of fiscal year
2018.
- Non-GAAP income from operations increased by 58.2% to
US$188.9 million from US$119.4 million in the same period of the prior
year.
- Net income attributable to TAL increased by 63.0%
year-over-year to US$143.8 million,
from US$88.2 million in the same
period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 60.0% to
US$176.9 million from US$110.5 million in the same period of the prior
year.
- Basic and diluted net income per ADS were US$0.25 and US$0.24, respectively. Non-GAAP basic and diluted
net income per ADS, excluding share-based compensation expenses,
were US$0.31 and US$0.29, respectively.
- Average student enrollments per quarter during fiscal year 2019
increased by 110.2% year-over-year to approximately 3,457,140 from
approximately 1,645,070 in the same period of fiscal year
2018.
- Total physical network increased from 594 learning centers in
42 cities as of February 28, 2018 to
648 learning centers in 43 cities as of August 31, 2018.
Financial and Operating Data -- Second Quarter and First Six
Months of Fiscal Year 2019
(In US$ thousands, except per ADS data, student enrollments and
percentages)
|
Three Months
Ended
|
|
August
31,
|
|
2017
|
2018
|
Pct.
Change
|
Net
revenues
|
455,750
|
699,783
|
53.5%
|
Net income
attributable to TAL
|
59,450
|
76,990
|
29.5%
|
Non-GAAP net income
attributable to
TAL
|
71,069
|
95,091
|
33.8%
|
Operating
income
|
68,326
|
80,891
|
18.4%
|
Non-GAAP operating
income
|
79,945
|
98,992
|
23.8%
|
Net income per ADS
attributable to
TAL – basic
|
0.11
|
0.14
|
17.8%
|
Net income per ADS
attributable to
TAL – diluted
|
0.10
|
0.13
|
24.2%
|
Non-GAAP net income
per ADS
attributable to TAL – basic
|
0.14
|
0.17
|
21.7%
|
Non-GAAP net income
per ADS
attributable to TAL – diluted
|
0.12
|
0.16
|
28.4%
|
Total student
enrollments in small
class, one-on-one, and online courses
|
2,242,380
|
4,937,320
|
120.2%
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
August
31,
|
|
2017
|
2018
|
Pct.
Change
|
Net
revenues
|
777,653
|
1,250,432
|
60.8%
|
Net income
attributable to TAL
|
88,239
|
143,790
|
63.0%
|
Non-GAAP net income
attributable to
TAL
|
110,543
|
176,857
|
60.0%
|
Operating
income
|
97,131
|
155,880
|
60.5%
|
Non-GAAP operating
income
|
119,435
|
188,947
|
58.2%
|
Net income per ADS
attributable to
TAL – basic
|
0.17
|
0.25
|
46.1%
|
Net income per ADS
attributable to
TAL – diluted
|
0.16
|
0.24
|
53.9%
|
Non-GAAP net income
per ADS
attributable to TAL – basic
|
0.22
|
0.31
|
43.4%
|
Non-GAAP net income
per ADS
attributable to TAL – diluted
|
0.19
|
0.29
|
51.8%
|
Average student
enrollments per
quarter
|
1,645,070
|
3,457,140
|
110.2%
|
"In the second quarter, our revenue and enrollments grew
steadily, which was based on stable online and offline business
performance," said Mr. Rong Luo, TAL's Chief Financial Officer.
"Looking ahead, we will continue to enhance product quality and
customer satisfaction, and further our contribution to the healthy
and sustainable development of the education sector."
Mr. Luo continued, "We continue to explore new technologies and
deploy smart intelligence in our online and offline products to
help promote education progress. We are confident that through our
investments, we will continue to offer students innovative
technology-based tutoring in a positive learning environment."
Adoption of Share Repurchase Program
On October 24, 2018, TAL's board
of directors authorized the repurchase of up to US$100 million of the Company's common shares
over the next 12 months.
This share repurchase program authorizes the Company to purchase
its ADSs or common shares from time to time on the open market at
prevailing market prices, in negotiated transactions off the
market, in block trades and/ or other legally permissible ways in
accordance with applicable rules and regulations. The timing and
extent of any purchases will depend upon market conditions, the
trading price of ADSs and other factors. TAL's board of directors
will review the share repurchase program periodically and may
authorize adjustment to its terms and size accordingly. TAL plans
to fund any share repurchases made under this program from the
Company's available cash balance.
Financial Results for the Second Quarter of Fiscal Year
2019
Net Revenues
In the second quarter of fiscal year 2019, TAL reported net
revenues of US$699.8 million,
representing a 53.5% increase from US$455.8
million in the second quarter of fiscal year 2018. The
increase was mainly driven by the growth in quarterly student
enrollments, which rose by 120.2% to approximately 4,937,320 from
approximately 2,242,380 in the same period of the prior year. The
increase in total student enrollments was driven primarily by
summer promotions in small classes and online courses.
Operating Costs and Expenses
In the second quarter of fiscal year 2019, operating costs and
expenses were US$620.1 million, a
58.7% increase from US$390.7 million
in the second quarter of fiscal year 2018. Non-GAAP operating costs
and expenses, which excluded share-based compensation expenses,
were US$602.0 million, a 58.8%
increase from US$379.1 million in the
second quarter of fiscal year 2018.
Cost of revenues grew by 34.6% to US$329.6 million from US$244.9 million in the second quarter of fiscal
year 2018. The increase in cost of revenues was mainly due to an
increase in teacher compensation. Non-GAAP cost of revenues, which
excluded share-based compensation expenses, increased by 34.5% to
US$329.4 million, from US$244.8 million in the second quarter of fiscal
year 2018.
Selling and marketing expenses increased by 159.4% to
US$151.7 million from US$58.5 million in the second quarter of fiscal
year 2018. Non-GAAP selling and marketing expenses, which excluded
share-based compensation expenses, increased by 160.9% to
US$149.3 million from US$57.2 million in the second quarter of fiscal
year 2018. The increase of selling and marketing expenses in the
second quarter of fiscal year 2019 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 59.0% to
US$138.8 million from US$87.3 million in the second quarter of fiscal
year 2018. 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 60.0% to
US$123.3 million, from US$77.1 million in the second quarter of fiscal
year 2018.
Total share-based compensation expenses allocated to the related
operating costs and expenses increased by 55.8% to US$18.1 million in the second quarter of fiscal
year 2019 from US$11.6 million in the
same period of fiscal year 2018.
Gross
Profit
Gross profit grew by 75.6% to US$370.2
million from US$210.8 million
in the second quarter of fiscal year 2018.
Income from Operations
Income from operations increased by 18.4% to US$80.9 million from US$68.3 million in the second quarter of fiscal
year 2018. Non-GAAP income from operations, which excluded
share-based compensation expenses, increased by 23.8% to
US$99.0 million from US$79.9 million in the second quarter of fiscal
year 2018.
Other Income/(Expense)
Other expense was US$0.4 million
for the second quarter of fiscal year 2019, compared to other
income of US$2.0 million in the
second quarter of fiscal year 2018.
Income Tax Expense
Income tax expense was US$15.5
million in the second quarter of fiscal year 2019, compared
to US$16.2 million in the second
quarter of fiscal year 2018.
Net Income Attributable to TAL Education Group
Net income attributable to TAL increased by 29.5% to
US$77.0 million from US$59.5 million in the second quarter of fiscal
year 2018. Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 33.8% to
US$95.1 million from US$71.1 million in the second quarter of fiscal
year 2018.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were US$0.14 and US$0.13
respectively, in the second quarter of fiscal year 2019. Non-GAAP
basic and Non-GAAP diluted net income per ADS, which excluded
share-based compensation expenses, were US$0.17 and US$0.16, respectively.
Capital Expenditures
Capital expenditures for the second quarter of fiscal year 2019
were US$42.5 million, an increase of
US$4.9 million from US$37.6 million in the second quarter of fiscal
year 2018. The increase was mainly due to leasehold improvements
and the purchase of servers, computers, software systems and other
hardware for the Company's teaching facilities and mobile network
research and development.
Cash, Cash Equivalents, and Short-Term
Investments
As of August 31, 2018, the Company
had US$819.4 million of cash and cash
equivalents and US$827.1 million of
short-term investments, compared to US$711.5
million of cash and cash equivalents and US$787.4 million of short-term investments as of
February 28, 2018.
Deferred Revenue
As of August 31, 2018, the
Company's deferred revenue balance was US$869.8 million, compared to US$728.8 million as of August 31, 2017, representing an increase of
19.3%. Deferred revenue primarily consisted of the tuition
collected in advance for the fall semester of Xueersi small
classes.
Financial Results for the First Six Months of Fiscal Year
2019
Net Revenues
For the first six months of fiscal year 2019, TAL reported net
revenues of US$1,250.4 million,
representing a 60.8% increase from US$777.7
million in the first six months of fiscal year 2018. The
increase was mainly driven by the growth in average student
enrollments, which increased by 110.2% to approximately 3,457,140
from approximately 1,645,070 in the same period of the prior year.
The increase in average student enrollments was driven primarily by
the growth in enrollments in the small class offerings and online
courses.
Operating Costs and Expenses
In the first six months of fiscal year 2019, operating costs and
expenses were US$1,100.8 million, a
60.8% increase from US$684.4 million
in the first six months of fiscal year 2018. Non-GAAP operating
costs and expenses, which excluded share-based compensation
expenses, were US$1,067.7 million, a
61.3% increase from US$662.1 million
in the first six months of fiscal year 2018.
Cost of revenues grew by 42.5% to US$590.6 million from US$414.5 million in the first six months of
fiscal year 2018. The increase in cost of revenues was mainly due
to an increase in teacher compensation and rental costs. Non-GAAP
cost of revenues, which excluded share-based compensation expenses,
increased by 42.4% to US$590.3
million from US$414.4 million
in the first six months of fiscal year 2018.
Selling and marketing expenses increased by 141.5% to
US$246.2 million from US$102.0 million in the first six months of
fiscal year 2018. Non-GAAP selling and marketing expenses, which
excluded share-based compensation expenses, increased by 143.2% to
US$242.2 million from US$99.6 million in the first six months of fiscal
year 2018. The increase of selling and marketing expenses in the
first six months of fiscal year 2019 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 57.2% to
US$263.9 million from US$167.9 million in the first six months of
fiscal year 2018. 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 58.8% to US$235.3
million from US$148.2 million
in the first six months of fiscal year 2018.
Total share-based compensation expenses allocated to the related
operating costs and expenses increased by 48.3% to US$33.1 million in the first six months of fiscal
year 2019 from US$22.3 million in the
same period of fiscal year 2018.
Gross Profit
Gross profit grew by 81.7% to US$659.8
million from US$363.1 million
in the first six months of fiscal year 2018.
Income from Operations
Income from operations increased by 60.5% to US$155.9 million from US$97.1 million in the first six months of fiscal
year 2018. Non-GAAP income from operations, which excluded
share-based compensation expenses, increased by 58.2% to
US$188.9 million from US$119.4 million in the first six months of
fiscal year 2018.
Other Income/(Expense)
Other income was US$8.3 million
for the first six months of fiscal year 2019, mainly related to the
fair value changes of equity securities in accordance with the
update (ASU 2016-01 and ASU 2018-03) to the accounting standard
(ASC321) adopted on March 1,
2018.
Income Tax Expense
Income tax expense was US$32.9
million in the first six months of fiscal year 2019,
compared to US$24.6 million in the
first six months of fiscal year 2018.
Net Income Attributable to TAL Education Group
Net income attributable to TAL increased by 63.0% to
US$143.8 million from US$88.2 million in the first six months of fiscal
year 2018. Non-GAAP net income attributable to TAL, which excluded
share-based compensation expenses, increased by 60.0% to
US$176.9 million from US$110.5 million in the first six months of
fiscal year 2018.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were US$0.25 and US$0.24, respectively, in the first six months of
fiscal year 2019. Non-GAAP basic and Non-GAAP diluted net income
per ADS, which excluded share-based compensation expenses, were
US$0.31 and US$0.29, respectively.
Capital Expenditures
Capital expenditures for the first six months of fiscal year
2019 were US$71.2 million, an
increase of US$4.0 million from
US$67.2 million in the first six
months of fiscal year 2018. The increase was mainly due to
leasehold improvements and the purchase of servers, computers,
software systems and other hardware for the Company's teaching
facilities and mobile network research and development.
Business Outlook
Based on our current estimates, total net revenues for the third
quarter of fiscal year 2019 are expected to be between US$563.2 million and US$571.9 million, representing an increase of 30%
to 32% on a year-over-year basis. If not taking into consideration
the impact of potential change in exchange rate between Renminbi
and the U.S. Dollar, the projected revenue growth rate is expected
to be in the range of 35% to 37% for the third quarter of fiscal
year 2019. These estimates reflect our current expectations, 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 2019 ended August 31,
2018 at 8:00 a.m. Eastern Time
on October 25, 2018 (8:00 p.m. Beijing time on October
25, 2018).
The dial-in details for the live conference call are as
follows:
- U.S. toll
free:
|
+1-866-519-4004
|
- Hong Kong toll
free:
|
800-906-601
|
- International
toll:
|
+65-6713-5090
|
Conference
ID:
|
2299945
|
A live and archived webcast of the conference call will be
available on the Investor Relations section of TAL's website at
http://ir.100tal.com
A telephone replay of the conference call will be available
through 9:59 a.m. on November 2, 2018, U.S. Eastern Time (9:59 p.m. on November 2,
2018, Beijing Time).
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:
|
2299945
|
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 2019, quotations
from management in this announcement, as well as TAL Education
Group's strategic and operational plans, contain forward-looking
statements. The Company may also make written or oral
forward-looking statements in its reports filed with, or furnished
to, the U.S. Securities and Exchange Commission, in its annual
reports to shareholders, in press releases and other written
materials and in oral statements made by its officers, directors or
employees to third parties. Statements that are not historical
facts, including statements about the Company's beliefs and
expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. A number of
factors could cause actual results to differ materially from those
contained in any forward-looking statement, including but not
limited to the following: the Company's ability to continue to
attract students to enroll in its courses; the Company's ability to
continue to recruit, train and retain qualified teachers; the
Company's ability to improve the content of its existing course
offerings and to develop new courses; the Company's ability to
maintain and enhance its brand; the Company's ability to maintain
and continue to improve its teaching results; and the Company's
ability to compete effectively against its competitors. Further
information regarding these and other risks is included in the
Company's reports filed with, or furnished to the U.S. Securities
and Exchange Commission. All information provided in this press
release and in the attachments is as of the date of this press
release, and TAL Education Group undertakes no duty to update such
information or any forward-looking statement, except as required
under applicable law.
About TAL Education Group
TAL Education Group is a leading K-12 after-school tutoring
services provider in China. The
acronym "TAL" stands for "Tomorrow Advancing Life", which reflects
our vision to promote top learning opportunities for Chinese
students through both high-quality teaching and content, as well as
leading edge application of technology in the education experience.
TAL Education Group offers comprehensive tutoring services to
students from pre-school to the twelfth grade through three
flexible class formats: small classes, personalized premium
services, and online courses. Our tutoring services cover the core
academic subjects in China's
school curriculum including mathematics, English, Chinese, physics,
chemistry, and biology. The Company's learning center network
currently covers over 40 key cities in China.
We also operate www.jzb.com, a leading online education platform
in China. Our ADSs trade on the
New York Stock Exchange under the symbol "TAL".
About Non-GAAP Financial Measures
In evaluating its business, TAL considers and uses the following
measures defined as non-GAAP financial measures by the U.S.
Securities and Exchange Commission as supplemental metrics to
review and assess its operating performance: non-GAAP operating
costs and expenses, non-GAAP cost of revenues, non-GAAP selling and
marketing expenses, non-GAAP general and administrative expenses,
non-GAAP income from operations, non-GAAP net income attributable
to TAL, non-GAAP basic and non-GAAP diluted net income per ADS. To
present each of these non-GAAP measures, the Company excludes
share-based compensation expenses. The presentation of these
non-GAAP financial measures is not intended to be considered in
isolation from or as a substitute for the financial information
prepared and presented in accordance with GAAP. For more
information on these non-GAAP financial measures, please see the
table captioned "Reconciliations of non-GAAP measures to the most
comparable GAAP measures" set forth at the end of this release.
TAL believes that these non-GAAP financial measures provide
meaningful supplemental information regarding its performance and
liquidity by excluding share-based expenses that may not be
indicative of its operating performance from a cash perspective.
TAL believes that both management and investors benefit from these
non-GAAP financial measures in assessing its performance and when
planning and forecasting future periods. These non-GAAP financial
measures also facilitate management's internal comparisons to TAL's
historical performance and liquidity. TAL computes its non-GAAP
financial measures using the same consistent method from quarter to
quarter and from period to period. TAL believes these non-GAAP
financial measures are useful to investors in allowing for greater
transparency with respect to supplemental information used by
management in its financial and operational decision making. A
limitation of using non-GAAP measures is that these non-GAAP
measures exclude share-based compensation charges that have been
and will continue to be for the foreseeable future a significant
recurring expense in the Company's business. Management compensates
for these limitations by providing specific information regarding
the GAAP amounts excluded from each non-GAAP measure. The
accompanying tables have more details on the reconciliations
between GAAP financial measures that are most directly comparable
to non-GAAP financial measures.
For further information, please contact:
Echo Yan
Investor Relations
TAL Education Group
Tel: +86 10 5292 6658
Email: ir@100tal.com
Caroline Straathof
IR Inside
Tel: +31 6 5462 4301
Email: info@irinside.com
TAL EDUCATION
GROUP
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
|
|
As
of
February 28,
2018
|
|
As
of
August 31,
2018
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$ 711,519
|
|
$ 819,376
|
Restricted
cash-current
|
6,267
|
|
1,867
|
Short-term
investments
|
787,391
|
|
827,074
|
Inventory
|
5,272
|
|
8,375
|
Amounts due from
related parties-current
|
3,229
|
|
14,886
|
Income tax
receivables
|
15,093
|
|
7,058
|
Prepaid expenses and
other current assets
|
133,235
|
|
172,157
|
Total current
assets
|
1,662,006
|
|
1,850,793
|
Restricted
cash-non-current
|
9,911
|
|
9,513
|
Property and
equipment, net
|
247,266
|
|
269,858
|
Deferred tax
assets-non-current
|
17,361
|
|
25,033
|
Rental
deposits
|
47,333
|
|
51,008
|
Intangible assets,
net
|
43,505
|
|
57,275
|
Goodwill
|
291,382
|
|
280,222
|
Long-term
investments
|
597,606
|
|
811,619
|
Long-term prepayments
and other non-current assets
|
138,190
|
|
100,818
|
Total
assets
|
$
3,054,560
|
|
$
3,456,139
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
Accounts payable
(including accounts payable of
the consolidated VIEs
without recourse to TAL
Education Group of
51,809 and 63,469 as of
February 28, 2018, and August 31, 2018,
respectively)
|
$ 57,605
|
|
$ 71,370
|
Deferred
revenue-current (including deferred revenue-
current of the consolidated VIEs without recourse
to
TAL Education Group of 772,642 and 816,155 as of
February 28, 2018, and August 31, 2018,
respectively)
|
824,276
|
|
864,573
|
Amounts due to
related parties-current (including
amounts due to
related parties-current of the
consolidated VIEs without recourse to TAL
Education Group of 2,875 and 3,337 as of February
28, 2018, and August 31, 2018,
respectively)
|
8,746
|
|
13,652
|
Accrued expenses and
other current liabilities
(including accrued
expenses and other current
liabilities of the
consolidated VIEs without recourse
to TAL Education
Group of 158,849 and 283,872 as of
February 28, 2018, and August 31, 2018,
respectively)
|
229,122
|
|
342,087
|
Income tax payable
(including income tax payable of
the consolidated VIEs
without recourse to TAL
Education Group of 12,106 and 24,904 as of
February 28, 2018, and August 31, 2018,
respectively)
|
13,638
|
|
29,948
|
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 nil as
of February 28, 2018, and August 31, 2018,
respectively)
|
-
|
|
239,641
|
Bond payable, current
portion (including bond
payable, current portion of the consolidated
VIEs
without recourse to TAL Education Group of nil
and nil as of February 28, 2018, and August 31,
2018, respectively)
|
-
|
|
5,275
|
Total current
liabilities
|
1,133,387
|
|
1,566,546
|
Deferred
revenue-non-current (including deferred
revenue-non-current of the consolidated VIEs
without recourse to TAL Education Group of
17,980 and 5,273 as of February 28, 2018, and
August 31, 2018, respectively)
|
17,980
|
|
5,273
|
Amounts due to
related parties-non-current (including
amounts due to related parties-non-current of the
consolidated VIEs without recourse to TAL
Education Group of nil and 151 as of
February 28,
2018, and August 31, 2018, respectively)
|
271
|
|
331
|
Deferred tax
liabilities-non-current (including deferred
tax liabilities-non-current of the consolidated
VIEs
without recourse to TAL Education Group of
19,867 and 7,260 as of February 28, 2018, and
August 31, 2018, respectively)
|
20,039
|
|
7,400
|
Bond payable
(including bond payable of the
consolidated VIEs without recourse to TAL
Education Group of nil and nil as of February 28,
2018, and August 31,2018, respectively)
|
11,075
|
|
-
|
Long-term payable
(including long-term payable of
the consolidated VIEs without recourse to TAL
Education Group of 4,660 and nil as of February
28,
2018, and August 31, 2018, respectively)
|
6,344
|
|
1,683
|
Long-term debt
(including long-term debt of the
consolidated VIEs without recourse to TAL
Education Group of nil and nil as of February 28,
2018, and August 31, 2018, respectively)
|
225,000
|
|
-
|
Total
liabilities
|
1,414,096
|
|
1,581,233
|
|
|
|
|
TAL Education
Group Shareholders' Equity
|
|
|
|
Class A common
shares
|
118
|
|
120
|
Class B common
shares
|
71
|
|
71
|
Additional paid-in
capital
|
884,717
|
|
924,059
|
Statutory
reserve
|
38,315
|
|
38,315
|
Retained
earnings
|
565,202
|
|
717,243
|
Accumulated other
comprehensive income
|
132,325
|
|
176,906
|
Total TAL
Education Group's equity
|
1,620,748
|
|
1,856,714
|
Noncontrolling
interest
|
19,716
|
|
18,192
|
Total
equity
|
1,640,464
|
|
1,874,906
|
Total liabilities
and equity
|
$
3,054,560
|
|
$
3,456,139
|
TAL EDUCATION
GROUP
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except share, ADS, per share and per ADS data)
|
|
|
For the Three
Months Ended
August 31,
|
|
For the Six Months
Ended August
31,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
Net
revenues
|
$ 455,750
|
|
$ 699,783
|
|
$ 777,653
|
|
$
1,250,432
|
Cost of revenues
(note 1)
|
244,930
|
|
329,565
|
|
414,534
|
|
590,647
|
Gross
profit
|
210,820
|
|
370,218
|
|
363,119
|
|
659,785
|
Operating expenses
(note 1)
|
|
|
|
|
|
|
|
Selling and
marketing
|
58,491
|
|
151,700
|
|
101,953
|
|
246,207
|
General and
administrative
|
87,312
|
|
138,798
|
|
167,943
|
|
263,949
|
Total operating
expenses
|
145,803
|
|
290,498
|
|
269,896
|
|
510,156
|
Government
subsidies
|
3,309
|
|
1,171
|
|
3,908
|
|
6,251
|
Income from
operations
|
68,326
|
|
80,891
|
|
97,131
|
|
155,880
|
Interest
income
|
10,534
|
|
19,259
|
|
18,235
|
|
35,822
|
Interest
expense
|
(3,870)
|
|
(3,957)
|
|
(9,095)
|
|
(7,822)
|
Other
income/(expense)
|
2,018
|
|
(355)
|
|
8,806
|
|
8,331
|
Impairment loss on
long-term
investments
|
-
|
|
-
|
|
(700)
|
|
(9,713)
|
Income before
provision for
income tax and loss from
equity method investments
|
77,008
|
|
95,838
|
|
114,377
|
|
182,498
|
Provision for income
tax
|
(16,158)
|
|
(15,532)
|
|
(24,553)
|
|
(32,864)
|
Loss from equity
method
investments
|
(1,965)
|
|
(4,081)
|
|
(3,248)
|
|
(7,138)
|
Net
income
|
58,885
|
|
76,225
|
|
86,576
|
|
142,496
|
Add: Net loss
attributable to
noncontrolling interest
|
565
|
|
765
|
|
1,663
|
|
1,294
|
Total net income
attributable
to TAL Education Group
|
$ 59,450
|
|
$ 76,990
|
|
$ 88,239
|
|
$ 143,790
|
Net income per
common share
|
|
|
|
|
|
|
|
Basic
|
$ 0.34
|
|
$ 0.41
|
|
$ 0.52
|
|
$ 0.76
|
Diluted
|
0.31
|
|
0.38
|
|
0.47
|
|
0.72
|
Net income per ADS
(note 2)
|
|
|
|
|
|
|
|
Basic
|
$ 0.11
|
|
$ 0.14
|
|
$ 0.17
|
|
$ 0.25
|
Diluted
|
0.10
|
|
0.13
|
|
0.16
|
|
0.24
|
Weighted average
shares used in
calculating net income per
common share
|
|
|
|
|
|
|
|
Basic
|
172,388,942
|
|
189,483,546
|
|
169,669,402
|
|
189,250,482
|
Diluted
|
193,131,866
|
|
200,422,889
|
|
193,585,695
|
|
200,406,007
|
|
|
Note1: Share-based
compensation expenses are included in the operating costs and
expenses as follows:
|
|
|
For the Three
Months
|
|
For the Six
Months
|
|
Ended August
31,
|
|
Ended August
31,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
Cost of
revenues
|
$109
|
|
$185
|
|
$142
|
|
$348
|
Selling and
marketing
|
1,258
|
|
2,407
|
|
2,376
|
|
4,033
|
General and
administrative
|
10,252
|
|
15,509
|
|
19,786
|
|
28,686
|
Total
|
$11,619
|
|
$18,101
|
|
$22,304
|
|
$33,067
|
|
Note 2: Three ADSs
represent one Class A common Share.
|
TAL EDUCATION
GROUP
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
|
(In
thousands)
|
|
|
For the Three
Months Ended
August
31,
|
|
For the Six Months
Ended
August
31,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
|
|
|
|
|
|
|
Net
income
|
$ 58,885
|
|
$ 76,225
|
|
$ 86,576
|
|
$ 142,496
|
Other
comprehensive
income/(loss), net of tax
|
24,005
|
|
(43,380)
|
|
31,299
|
|
43,329
|
Comprehensive
income
|
82,890
|
|
32,845
|
|
117,875
|
|
185,825
|
Add: Comprehensive
loss
attributable to noncontrolling
interest
|
565
|
|
1,804
|
|
1,663
|
|
2,546
|
Comprehensive
income
attributable to TAL
Education Group
|
$ 83,455
|
|
$ 34,649
|
|
$ 119,538
|
|
$ 188,371
|
TAL EDUCATION
GROUP
|
Reconciliation of
Non-GAAP Measures to the Most Comparable GAAP
Measures
|
(In thousands,
except share, ADS, per share and per ADS data)
|
|
|
For the Three
Months
Ended August
31,
|
|
For the Six
Months
Ended August 31,
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
$ 244,930
|
|
$ 329,565
|
|
$ 414,534
|
|
$ 590,647
|
Share-based
compensation expense
in cost of revenues
|
109
|
|
185
|
|
142
|
|
348
|
Non-GAAP cost of
revenues
|
244,821
|
|
329,380
|
|
414,392
|
|
590,299
|
|
|
|
|
|
|
|
|
Selling and
marketing expenses
|
58,491
|
|
151,700
|
|
101,953
|
|
246,207
|
Share-based
compensation expense
in selling and marketing expenses
|
1,258
|
|
2,407
|
|
2,376
|
|
4,033
|
Non-GAAP selling
and marketing
expenses
|
57,233
|
|
149,293
|
|
99,577
|
|
242,174
|
General and
administrative
expenses
|
87,312
|
|
138,798
|
|
167,943
|
|
263,949
|
Share-based
compensation expense
in general and administrative
expenses
|
10,252
|
|
15,509
|
|
19,786
|
|
28,686
|
Non-GAAP general
and
administrative expenses
|
77,060
|
|
123,289
|
|
148,157
|
|
235,263
|
|
|
|
|
|
|
|
|
Operating costs
and expenses
|
390,733
|
|
620,063
|
|
684,430
|
|
1,100,803
|
Share-based
compensation expense
in operating costs and expenses
|
11,619
|
|
18,101
|
|
22,304
|
|
33,067
|
Non-GAAP operating
costs and
expenses
|
379,114
|
|
601,962
|
|
662,126
|
|
1,067,736
|
|
|
|
|
|
|
|
|
Income from
operations
|
68,326
|
|
80,891
|
|
97,131
|
|
155,880
|
Share based
compensation expenses
|
11,619
|
|
18,101
|
|
22,304
|
|
33,067
|
Non-GAAP income
from
operations
|
79,945
|
|
98,992
|
|
119,435
|
|
188,947
|
|
|
|
|
|
|
|
|
Net income
attributable to TAL
Education Group
|
59,450
|
|
76,990
|
|
88,239
|
|
143,790
|
Share based
compensation expenses
|
11,619
|
|
18,101
|
|
22,304
|
|
33,067
|
Non-GAAP net
income
attributable to TAL Education
Group
|
$ 71,069
|
|
$ 95,091
|
|
$ 110,543
|
|
$ 176,857
|
|
|
Net income per
ADS
|
|
Basic
|
$ 0.11
|
|
$ 0.14
|
|
$ 0.17
|
|
$ 0.25
|
Diluted
|
0.10
|
|
0.13
|
|
0.16
|
|
0.24
|
Non-GAAP Net
income per ADS
(note 3)
|
|
|
|
|
|
|
|
Basic
|
$ 0.14
|
|
$ 0.17
|
|
$ 0.22
|
|
$ 0.31
|
Diluted
|
0.12
|
|
0.16
|
|
0.19
|
|
0.29
|
ADSs used in
calculating net
income per ADS
|
|
|
|
|
|
|
|
Basic
|
517,166,827
|
|
568,450,639
|
|
509,008,205
|
|
567,751,446
|
Diluted
|
579,395,597
|
|
601,268,668
|
|
580,757,085
|
|
601,218,021
|
|
Note 3: The Non-GAAP
adjusted net income per ADS is computed using Non-GAAP adjusted
net
income and the same number of ADSs used in GAAP basic and diluted
EPS calculation.
|
View original
content:http://www.prnewswire.com/news-releases/tal-education-group-announces-unaudited-financial-results-for-the-second-fiscal-quarter-ended-august-31-2018-and-adoption-of-up-to-us100-million-share-repurchase-program-300737667.html
SOURCE TAL Education Group