Q2 2020 Earnings Call

October 24, 2019

To the F T L Education group second fiscal quarter 2020.

Conference call at this time all participants.

I would just speak especially station there will be a question answer session and asking questions. During this session you will need to press star one.

Please be advised that todays conference is being recorded.

Like they had the topics with you as we speak if we did they need to take okay. Thank you. Please go ahead.

Thanks, operator. Thank you also joining us today close Yeah Education group second fiscal quarter 2020, or do you conference call Thirtys really what these for butane audio today on the you may find a copy of the company I know that's not Oh somebody newsletter.

During this call you will hear from Chief Financial Officer, Mr., the legal fees, how cool like coffee, Doug I'll find out on the myself I R T cell.

During the prepared remarks, mr., <unk> money, well well be available to us through <unk>.

We continue please note that these countries today will contain forward looking statement.

I'm going to stay Pablo coalition self the U.S. Private Securities Litigation Reform Act of 19 magnified.

<unk> statement.

Subject to risks and uncertainties somebody calls actual results to differ materially from overcoming expectations.

Potential risks and uncertainties include but not limited to those outside in public filings with the FTC.

Well you formation all of these risks and uncertainties. Please refer to all the findings with the FCC also onethree be seen this coal includes discussions on certain non-GAAP financial matters, they sort of supposed to only three D.

Contains a reconciliation of non-GAAP measures to the most lots to be comparable GAAP measures I would like no tend to coal where Mr. Rahul I don't see.

Thank you Michael.

Go you winning and good morning to you all think.

Thanks for joining us today.

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Our second quarter of underperformance was based on their robots I heard as it grows.

Cost even in the cities were currently cover I have a continuous scattered in golf.

Yes.

Net revenue growth during the second quarter was 43.8% year over year.

You S. dollar tense.

To U.S. dollar 946.6 minute.

And 68.7% I'd be tense.

Total normal price long term cost student enrollment increase.

By 54.5% year over year.

Most driven by boasts the girls online enrollments.

That's right. So the shows pay was more costs.

GAAP net income for all Creech has decreased by 13.5% to U.S. dollar six to nine point in Mcmillan in the second question.

non-GAAP income from operations was almost flat to go stalled and <unk> a minute.

The rising operating expenses incurred in Q2 was mainly due to increased sales and marketing spending research and development spending.

And on Lucky initiatives.

I would know tunnel call over to lean, though I would watch president finance.

Sure I'll give you an update on operational progress during the second quarter.

Not a Korean IR director.

Well review second quarter financials after that I'll update you on <unk>.

Kissed drugs your execution and discuss RMBS all this next quarter.

[noise] lead up to.

Thanks Joel.

Oh second quarter revenue was based on solid goes momentum in a very education filling out our children's business.

Let me review the anything different I'm used to it.

Let me start with small class and other business.

Leach Conceits, Oh, you asked the Peiyou small class.

First leap hobby and some other I do patients coupons and silly thing.

Nice accounted for 76% of total net revenue compared to 81% you have a second called her last year.

The revenue go through it was 25% U.S. dollar to him and 30% I'm be true.

You asked appeal small class, which remains our stable car business.

Presented 63% of total net revenue compared with 17% you listen Yoko period.

The lower revenue contribution from New York Appeal was mostly due to the fast to go okyanos without come online courses.

Which accounted for 16% of total revenue in the quarter compared to 12%. He was same period last year.

Net revenue from yachts appeal small class was up by 20% U.S. dollar terms and the 24% <unk> Army tour.

Nominal price that long term, causing goldman increased 27% year over year.

This go straight dipped left the Saudi to go on both the pay you offline and online class.

Hey, you alkaline small class revenue increased a healthy right up 12% last dollar to him and 16% I'm He took him.

Well alternate nominal price, but long term colchicine Goldman increased by 12% year over year.

We pay you on that I feel no we offer the online courses with localized content.

Complementary though is to pay you also not anymore on the more major cities of our nice work.

Are you on that offers regular and shout from courses and the other promotion causes.

In the second called her I'll fiscal year, 2020 , which is this fiscal year pay you on that accounted for.

Approximately 11% of totals yachts tail small class revenue under 20% of totals just pay your normal price long term smokes asking Goldman.

In the second quarter fiscal year, COVID-19, which is last fiscal year revenue on the nominal price long term, even goldman's brought to you on none or 5% at 9% respectively of comatose yachts and tail small class business [noise].

We continue to enjoy let's stay focused on performance across the board of the cities. We currently to cover.

Yes, the Peiyou small class revenue from the top five cities, we chopped 18, Shanghai's well Joshi engine and the 19 grew by 15% year over year U.S. dollar tour and accounted for 54% of yachts appeal smoke house business.

Revenue generated from cities other than that top five grew by 26% U.S. dollar to him.

And the other thing <unk> accounting for the remaining 46% of this yachts appeal small class business.

The driver of these why why do they spread skills.

Got it market demand caused outdated incremental run cop I'll be Goldman from our earlier classroom expansion as well as our ongoing efforts to improve operational efficiency.

We continue to reach our called out really well so growing number of awful lot on holidays in curricular extracurricular subjects.

As always we believe that no quality full name and the relevance of content on the basis of our business [noise].

We have successfully expanding our curriculum with Chinese and English causes.

That's the end of all good contained 19th we have offered just tell you Chinese Canarsie <unk> 25 cities and English classes in 29 cities.

Furthermore, Firstleap Mobby a few other education programs all grew at a steady pace, both in granules and Goldman either second fiscal quarter.

We had that meets that weren't they fight causes we were doing contributes more to our over I'll give me.

Right.

I'd like to briefly discuss our to come what I want business.

<unk> business, that's sector had a strong second the called her and achieved year over year round, you'll go up 40% eat U.S. dollar terms and 46% RMB tour.

<unk> on one accounted for approximately 8% of total gun.

Compared to 7% in the second quarter fiscal year Punchy Nike.

Let me update here our capacity expansion as always we put he'll where pissed off and on capacity go.

At the same time waiting right in your technology and online business.

Further into our overall operational efficiency and the closely follow all the standards and the regulations.

We added a net 30 learning centers up wage 24, where peiyou small class learning centers.

Your first of these centers and to what I want centers.

During the quarter, we added 300 tail small class classroom.

Meanwhile, we continue to anchor and you'll see taste, according to our strategic and operational plan.

In the second quarter, we entered into 12, new locations with though dual teacher small class learning center each.

Our geographic coverage currently amongst who 16 nice cities across China.

Then you will see taste or see NIM Pat.

The interim 10, Hijau seems like to enjoy high Joel Jackson dome named gone under Jungle.

Over Oh by the end of August we had 758 learning centers. These 16 nice seating.

Up wage 538, where peiyou small class.

17, where Bobby small class 86 were forced to be small class.

114 or to kind of what I'll, one and three words yards international.

As for the third quarter here now we have a run paid approximately 11 peiyou small class learning centers.

We expect to add a few more at close down some learning centers based on standard operations.

These estimates reflect our current expectation, which is subject to change.

Moving now to our online business.

Second quarter revenue from Ceocs without Com grew by 88% U.S. dollar terms year over year.

94%, Yeah I'm detour.

Oil and almost twice as long term, causing goldman's grew by 134% year over year to about 1.4 meeting.

Alone contributed 16% of total revenues under 40% of total nom applies long term edelman. These called her compared to 12% of total revenue under 26% of total nominal price that long term calls you Goldman you listen Yoko period it.

Activity.

Got it through online business was supported by a dedicated sales and marketing expert retention of the previous quarter's as well as they go in the month for allied to patients.

With that I will now turn the call over to I call yen for the uptake of second fiscal quarter took financial results I copies.

Thanks, Linda let me now go through some key financial points for the second quarter of physical year 2020, the breakdown of ASP for the various businesses is as follows normal price to long term stewards of pay your small class ASP decreased by 3% in RMB I'm, a 6% you.

Dollar year over year.

Are you off my normal price long term courses ASP increase it by a low single digit percentage RMB times you're over here.

No price long time to come long one constant yes, he increased by 10% the RMB on the increased by 5% U.S. dollar terms year over year normal price longtime online courses ASP decreased by 10% beyond beyond the 13% U.S. dollar times year over year.

Mainly due to the mix change up a larger propulsion Oh high school enrollment.

Hi School on time on my part the T.S.P. is relatively lower down overall average long time of course, the P.S. Pete.

Well I'll profit increased by 39.9% to U.S. dollar its 500 under 17.8 million from 370.2, meaning U.S. dollar in the same year ago appeal, it well imagine for the second quarter improved to 55.3% I've compared.

Q, 52.9% for the same period of loftier, selling and marketing expenses increased by 73.5% to 200.

53.3 million just dollars from a 151 point from a mini U.S. dollar in the second quarter fiscal year 2019.

non-GAAP , selling and marketing expenses, which excluded share based compensation expenses increased by 73.4% to 258.9 billion just dollars from $149.3 million you Miss any ago appeal in the Ukraine.

I've said in marketing expenses in the second quarter fiscal year 2020 was primarily a result of more marketing promotion activities to expand our customer base on the brand enhancement.

Well as a life in the conversation to sales on the marketing stuff just call. It a week number all.

Programs and services offerings compared to the same period in the last year operating income decreased by 13.5% year over year to $30 million to $69.9 million.

non-GAAP operating income decreased by 0.2% to $98.8 million odd takes months was $55.6 million for the second quarter fiscal year 2020, mainly related to not from fair value change all kind of equity securities.

He is rapidly determinable file value impairment loss on long time, you last month was [noise].

50 people going to many U.S. dollar for the second quarter fiscal year 2020, compared to two Neal for the same period in the prior year.

We haven't lost on long time, even last month was mainly due to other than temporary decline in the value of long time, you last month in several Umass Pete.

Income tax benefit was 8.1 million U.S. dollars in the second quarter fiscal year 2020, compared to 15.5. Many goes dollars of tax income tax expenses in the second quarter of fiscal year 2019, now actually beautiful too tall.

Was $14.4 million second quarter of physical year 2020, compared to net income Contributable to toll all 77, Many York dollars.

Second quarter of physical your 2019.

non-GAAP net income attributable to toll, which exclude share based compensation expenses decreased by 84.8% to 14 point of my many young dollars from 95.1, given your thought it was in the same here go period basic and diluted net.

The real 0.0 to U.S. dollar in the second quarter fiscal year, 2020, non-GAAP basic and diluted net income per ATM, which excluded the share based compensation come up fishing sensors were both your real 0.0 to U.S. dollars.

That's correct.

Ongoing efforts to true or operational efficiency, the profitability will appeal would like to be truly childrenswear.

For the father offline network original go speed and scale the business.

As always was long term sustainability tomorrow.

Oh Lumpiness, there's a high gross early stage business, which also very intense competition.

Ever changing market dynamics.

That's right off the pioneers in this sector, where we're confident about a huge potential medication with strong we recognize the social value and the much opportunities on that occasion, hence our ongoing.

[noise] portions explorations and developments in this area.

Other teach them Paradise service provider will never just go up to a high revenue girls spin on me, but more importantly, the Fox groceries.

True.

Hello.

We will spend <unk> efforts to forever has to a super real online business model that brings the students and parents lasting satisfactory experiences and let me talk house.

Well, we're continuously investing to innovate report us technology operational efficiencies.

Through different service level, you are open platform.

Both my other patient solutions and open platform opinions are still small scale and early development stage.

As we mentioned before by leveraging our boss I've occasionally sauces movies, which we continue to see diversified to buy them opportunities contributions or other kitchen success from the vision optimizations.

As we gradually rich more and more lower switches.

True educational resources with you assess and.

For the full costs.

Based on our through a smidge total net revenues for the <unk> cultural fiscal year 2020 .

Expected to be betrayed U.S. dollar <unk> hundred 62.6 million and yourself 843.8 million, representing an increase of 41% to 44% or your or your basis.

If not taking into consideration the impact on potential change exchange rate between <unk> and U.S. dollar. The project. Your revenue growth is expected to be grinch, all 45% to 48% for us a culture of fiscal year <unk>.

That concludes my purpose my prepared remarks, operator, we're now ready to pick crushers.

Thank you.

And gentlemen, I'll begin the question answer session and to physician asked the question. Please press Star then the move one telephone anyway to needs to be.

And you can't say you eat quest is.

The fast it is the upheld <unk> once again ask the question. It is Taiwan on your telephone keypad.

But first question comes in something like 60 of Credit Suisse. Please go ahead.

Like Ms Attics T.

So for now.

For the for you all Sutro tunnel extension and Waddell expect hours strategies to better integrate online and offline.

Thank you Alex.

After several quarters with today, a were made a little bit progress in offline fitness. Despite its so not only including the.

Close the protests, let's students kind of interactions.

Perfect and see that August efforts paid off and we see things outward KBR is also improving.

So starting from a almost last year, sorry last quarter, we decided to gradually southern living awful offline learning center expansion a pace.

Now did you make us easier to be scalable to cities you know much bigger way.

So and looking for a opinion to come full quarters were continuing to do to be worried cautious, but with the improvement in our management efficiencies and Oh, and our appeal online kind of new technologies and all of that we will gradually et cetera.

And which just work away pop for us to to contribute to it.

Revenue and profitability.

It appears you online some especially numbers I need to draw your attention I think Q2 will grow our peer on a revenue by 192%.

It doesn't mean, we can go back to.

So that's the general strategy for us and by Wayne, even where you'll see how we're adding a new learning centers.

The contribution will not call, where soon you pay them around several quarters to constantly effects. So maybe next year spring on next year summer, we'll invest into <unk> <unk> to do that.

So that's the agenda structure for us to about a pay you a people business books online offline. Thank you Alex.

Thank you very helpful. Thank you.

Your next question is from the line the usual go above sea ice DC. Please go ahead.

Oh, hey on not only Nicole thanks for that opportunity.

Yes on solid results. So a question focus on your online business.

So so 'cause it cannot clearly we have seeing and tends to affect competition in the past summer and there seems to be a deceleration this quarter. So could you maybe share your.

It sounds the latest competitive landscape.

And over I'm going to revenue growth trajectory you, both some near term and long term as while this margin outlook. Thank you.

I can assure us online school business is growing own tracking the Q on Q2 EPS in Q1, the grow revenue gross wants ginger, 2% because once you launch can you walk.

I think no.

Timing for us to go back to see what happened in the past two quarters, you've already beginning as I mentioned last earning call actually where an awfully prepare for his walks away.

Oh wait a little could be highlighting the other payors in U.S Maki the good thing as their team quickly and we improved a lot, especially operations added to a would do a lot of adjustments and offers so are we tried to catch on and the final resolved.

SKU by a were also want to keep them what color about it.

He left from perspective, I think how to reduce the cost to Oh to acquire one new customer actually was always a top challenger to us.

And where NOL our company, who is water experience the marketing themselves.

And wait a little bit went behind the beginning by without a catch up so by pieces of work to kind of.

Come over which keep looking so much confidence they they could do even better than today.

On the other sites were also a little bit lock is because I'd Acacia is a worry.

No I appreciate intensive industry I have a when there were a try to students contrail rustler online online classes, that's not over that's only the beginning so you know are coming that they feel tons. The team leader the whole fusion system, and then management system. We worked with unique we'll make sure to students fuel.

They they deliver something and they they go.

Oh, you lost fuel, which Oh, we're seeing in HM management, obviously, you always also to to be there teacher assistance in instant booking Clos. So during the all these projects will also pick up a lot of challenge.

Because progress in our system.

And on the outside is I think I, so allocation Proto and service providers.

Crazy revenue gross.

And that's what went wrong offline business more importantly, the grocery must be achieve Harrison and sustainable way.

Oh, we have lessened loans and waiting to be more balance and we need to improve operational efficiency and looking and looking for we'll continue to leverage for the whole like offered to attract more students get more market share <unk> enrollment.

So looking into looking tool are coming quarters, all online way public and see how enrollment growth continues to be quite healthy revenue growth, maybe a little bit.

Lower than that.

Enrollment growth and you know coming quarter is because the contribution limits quite a bit.

More enrollments today, the the will have home is thrown a students in the senior high school compared to last years well that's in a high school.

Students ASP is lower than a private school students all off this number is only one core this numbers I think we talk about where a lot we need to be.

This view these sectors in three years time. So we're still strongly believe this potential and we will continue to improve our investments in research and development side. It's another Stanford aside to make sure that much more product portfolios to offer students waking hopper.

So much more optimized cost structure part us through something what people so thats, our acute strategy looking forward.

Thank you. My next question is from the line of markedly of Citi. Please go ahead.

Hi management, congratulations on a very strong results I want ask for our next quarter I think that revenue guidance is around a five cents a heads up consensus expectation so.

Well, we know what is that because affect her to beat for online or offline.

Thank you Mark.

Into first place I should have no idea or waste the consensus for the online or offline revenue gross.

Separately, so in our common subsided, we only give revenue guidance in a quarter level I think oh assumption, if we compare quarter over quarter in chose SREC compelled to Q2, I think Q2 with grow around 8% I chose three our guidance 45% to 48%.

I think most the big the biggest difference coming from the Peiyou small class business. We have seen their growth rate is interest rate is higher than Q2. We're also seeing the appeal online is also fast growing.

While two quarters actually they are close to 200% rather gross and we became fully see with HEICO. So we're continuing to coming quarters.

And there are Shaw's online school is also growing.

Is going on China Us we'll expect.

And pop considering their high grossing though in first quarter second quarters with don't see any differences quarter over quarter and their most important kind of contributes over the coming from the appeal of coffins.

Well the sales and marketing I think if I can see this summer with running.

Oil and Penn and looking closer at Newport, and we're also running a online promotion competitors.

Oh and compared to last year.

Same quarter thing sorry last year actually we don't run that much. So this quarter's sales and marketing bottom line kill shred. It is higher than last and then then.

The same quarter last year, so which will give us some kind of pressures Muslims pad.

Sure.

And a bike we put everything you know what your severe or your PERC and see that this year to online will be lossmaking position, Bob will be slightly lower loss, making position, but we don't foresee any huge loss over there and since we still have one quarter is to grow especially in Q4. So.

But but based on why not today, we don't see any huge price we need to keep that central guys.

And running our online business, it's not easy or maybe nothing is easy way I mean why high target.

So we will make we'll make sure both online and offline gross can be Harris and sustainable way that are key priority since mark.

Thank you. My next question is from the line of Jim Jones of Morgan Stanley . Please go ahead.

Oh, thank for taking my question I Love you mentioned a lot about done regulation has picking in Oh. Please call. So can you keep that some more updates the regulation now and whether it will impact youre offline and online both going forward.

And secondly, I want to ask.

Have a follow up on the Oh my business.

Can you keep us some some breakdown on the Oh My Oh my students from tier one tier two cities and know what do you see teach so and then what's your strategy too.

Okay Johnson I think for the regulations. The offline regulations is almost he pays for more than one years. So fresh speaking our company have experience a tough time, how to be more Vince kind of new policies and regulations now so I can say today, that's perfect Buck.

Two weeks ago.

Yes.

On September 13, together with other target date hated be pacman, China Ministry of Education adult Coleman regarding potent general guidance Alpha how cidade de bad all night occasion industry in China, the the documents continuously illustrated and provide.

The policy level of this upon to China alone I do patient next step on the long term demand.

As one of the leading online education 10 years, they're very happy to see and even welcome the allied location regulations as always.

We'll do our best to support and work with the whole industry and the government to keep improving the all night occasion, Florida technologies and services.

We believe that with the government so parts technology advancements and industry I've heard the online education will benefit more and more students you, especially the kids, who happens to lower key geographic areas.

I have to say butting up today I.

I think there's enrollments coming from lower tier cities actually all the you know must come from the places we don't have a trust to networks actually I think the contributions steel.

Everything to be costs went online offerings can be 70, actually which is more popular in the high cure.

Sure about your children cost as a place where we are here, we'll have to shoot presence would have brendans, where with everything and the students and as soon as parents you've done a tier one.

And but looking forward that since you would need to buy a worry effective way how to penetrate that shows ranch or fall, even much lower tier cities now.

Objections, and we're also pilots self destruction seeing sounds like it's because based on a small pilots would run today stop as making progress on up it doesn't work.

So based because were important topic for US Hall, we can potentially low pure.

And Oh, we can rely on the same way of doing on him oxygen to penetrate that okay. So this would need much great creative and innovative ways to do so I don't have probably offices now when we were still doing a lot of pilots now, but what we can say as you know show by show.

Uhhuh.

Women's we'd have I'll spend a lot of people that there were also were open to see why screen gurus allergy industry. In other sectors were also are open to hear all investors over their friends, who has some new ideas stupid. So please feel free to that no oh, well figure all the best way to do that and both weekend balance and the call.

It's all new customer acquisition in the profitability of the lifetime value. So were killed guys postage if were making more progress. Thank you.

Thank you.

Next in line is actually you have Chinese Oems Anderson. Please go ahead.

Yes.

Hi, Thanks, Thanks officer, and so forth for looking at this opportunity.

Just on a very high level I'll now, there's a lot of the new players.

So the market for online besides or whether this means just one of your thoughts on does a lot of this means the entry barrier that you're in that sense is lower compared to before simply because we have the all my model right.

Company in general will be conducting user acquisition.

Every single years going forward. Thanks.

I think in the first fit let's compare to numbers.

For the offline.

Education companies in China, I think more than half million.

More or less while the only on payers CMBS market, you're probably not a lot of men spot below 100.

So half million compared to 100 would probably can see actually look up the competition into a better actually is quite different from before.

The second pace you.

The only model so a life like forecasting and the <unk> recorded combined model.

Oh, My God occasion doesn't mean, we're using the internet always use that knowledge is to move for the open in classrooms to own and that's it.

For example hall to students do a pretty saudis haul students the answer their questions Holifield official homework hauler students can a base on a statistic, let's say it just takes off data through their learnings and then right way to do so.

The only model today, we meet you continue to invest and can you give others to measure the only modeling Sarah has more kind of entered Belarus compared to the other one.

Because spend a few or time last time, but they have must be all kinds of this will lead to kind of their intelligent lending you love culture, which has a lot.

Kind off the tech, both technical and operational or kind of challenge so last.

So if we are sitting here with doing nothing with only investments and waste Josh used to be still call. Okay to go models to try to replicate the whole country I think desktops and that's not the right thing to do so competition will be even more fierce because you'll catch on all making progress so we way out why.

We don't believe the competition today is the most important problem to us because the only penetration rate versus the total students. Even today is very low given all of my growth is faster by the penetration rate is quite low so what we need to struggle is actually is.

Our school to senior high the punish penetration of it will be higher higher.

Across the market with PARP would probably wouldn't see multiple players play in English markets.

You know still them spotted the multiple players can offer you guys look past experiences and much competitive all in a much affordable price I think that school workers sort of students and parents and so today, where do you feel most of the progress we think over setup for us most.

Challenges and most some states we've made because our success not because of competition. So a way, we'll make sure our off our leaders and all of our people can be highly connected choice you. It as Thomas do this and being there teach us be their friends to know what their pinpoints I think that it's that the reduction.

Oh, we have to go how we can use of any investments collage attribute to to relieve the province and improve the efficiency I think that's the direction to go. Thank you.

[noise] [noise] no operator.

Yeah.

Hello.

Yes. He has open the line of Lucy Youve Bank of America. Please go ahead.

Thank you.

Oh gosh two questions. Firstly could you please share with us about conversion rate and the retention rate.

So any low basis, if you if we excluding that impact will you smell Clos du accelerating thank you.

Yes in the first place think of so much broke for local memories.

I think this year compared to last year, yes, we have swung longwall weekends packages because last years there.

We are compelled to look total revenue growth Republican see that in Q2, the pay you a rather necrosis around 25% can you sort of 25%.

Even with Haim, Israel packaging, Oh from Kindred Acos repeal grow still higher asking you can hire I think you'll do it so that's the case.

Well, we're going to show today and your first question up all the commercial rate and the retention rate I think commission rate.

You, especially about all I can Washington race, why can say is the only conversion rates this year compared to last years almost thing as I assume that level. The retention rate all online trussell at school, it's low single digit improved improvement compared to last year. So thats the kind of the information as we can show.

Yes.

Thank you.

Thank you. Our next question is from that I know Felix view of you'd be yes. Please go ahead.

[noise] thinking for questions.

I think.

And the way they knew changed at all behave a behavior.

And to a new behavior wishes for folks more proto and students so about your big time.

So I'll hop golf all the players actually they do a lot how things and death wall to mop monthly time compared to us. So we feel very good is that the team actually quickly.

And on the other side as I think we don't see Auburn commercially half such huge differences compared to last year and sometimes compelled to our payer some as our culture is even lower especially in the beginning Oh summer so.

When it you Butler she the the Q reason, it's not be cost will you must too much money. The key reasons, because when you invest in the throng, you'll need to have a lot how things ready, especially the supply chain perspective, so we need to have a worry Kuwait three improved efficiency all pre.

And in a bad.

As to attract new students normal price students for online school.

Prepare for that we need to evaluating a with me too.

Luke into other competition and some other market dynamics to decided rather what was that NOL. So wed have to make everything ready about having met the final decision yeah.

I would probably will let us know would be.

And again, we don't think promotion Muckety money is the only way to grow the business. The key outgrowing our business steel pull back sort of Proto go back to operation efficiency go back to do a lot of decoupling in the 30 works well need to be much closer to the students than before and with me too.

Make sure the whole can carry our quickly much quicker than before so this will have a lot of lessons learned from summer and from four so we were happy lifting is a faster than there. So we will continue to Macy's back in better even not perfect I will try our best Thank you.

Thank you for a cousin think of youth.

Thank you ladies and gentlemen, this is a June a session and our Oh. That's helpful. Today. Thank you for participating you know August .

[noise] Oh.

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