Q2 2021 Four Seasons Education (Cayman) Inc Earnings Call

Well, ladies and gentlemen, thank you for standing by for the four she is an education second quarter fiscal year Twentytwenty, One earnings conference call.

At this time, all participants are in listen only mode.

After managements prepared remarks, there will be a question and answer session.

This conference call is being recorded.

I will turn the call to your host Ms., Olivia Elliott Investor Relations manager for the company. Please go ahead Olivia.

Rwanda and welcome to the second quarter fiscal year 2021, Arnie cohort core all foresee this education the company without issued bond yields watts. All this is all that today and posted online you can download the earnings press release and sign up for their companies email distribution.

I want my public school I, all section of our website at <unk> Dot S.J. ideal dotcom.

Joe on thoughts on what Youve executed office, so with all the core by providing an overview of the company performance highlights for the quarter midstream wall that completes my pardon Oh finance will provide details on the company's financial results and business outlook before opening the call for <unk>.

Sure.

Before we continue please know that today's discussion will contain forward looking statements made under the safe Harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 four.

Well, one lucky Siemens evolving how her risks and uncertainties.

As such the Companys results may be materially different from the views expressed today.

Further information regarding this and other risks and uncertainties is included either late prospectus filed with the U.S. Cadiz and Exchange Commission.

The company does not assume any obligation to update and if we're lucky same as except as required under applicable war.

Please also note that fall seasons Educations earnings press release, and this conference call include discussions on audited GAAP financial information as well as audited non-GAAP financial measures.

Four seasons Education's press release contains a reconciliation of the unaudited non-GAAP measures to the all does its most directly comparable GAAP measures.

I will now turn the core although to all with the Yankees. So please go ahead.

Thank you Olivia and Hello, everyone. Thank you for joining our call today.

Second quarter of fiscal 2021, we continued to focus on operational improvement on multiple fronts to further optimize the learning experience of our students.

I'm happy to report that all of our learning centers across the country have we opened and the fully operational during this quarter delivering high quality educational products to our students.

Well operating in a rapidly evolving environment that brings with it both significant challenges as well as new opportunities.

Those challenges include the increasingly fierce competition from all IPO seen the aftermath of Cobiz 90, and the Shanghai Mothership I do kitchen Cook mission has adopted fully random like random nice.

Admission policy for private.

And for profit.

Men trait and the secondary schools things this year.

Both of these changes impacted the customer demand.

You bet market uncertainty, we broadened our primary school caused us to batches.

And address the evolving customer demand due to the new policy.

Also we have teams did you see the world Upper Middle School tutoring classes.

Primarily driven by our designated the curriculum adapted for the new customer demand.

Yeah.

Diligent efforts to improve education, a product with a man to dedicated to continuously enhancing our service quality by expanding our pre and post cost other 'cause your service package was more then the both subjects.

Last but not least I'd like to update you on the strategic initiatives as we continue to leverage our core capabilities to drive all growth in the long run.

Firstly, a nationwide expansion initiatives remain intact, and we are making progress in consolidating and upgrading nationwide applicable.

Okay sure no materials to prepare for our market expansion.

Second well make the encouraging strides in collaboration with full time schools highlighted by 11, New school partnerships, where we draw the offered.

School true true cautious and the service for students.

This year, our meth lab project continued to gain industries recognition, let's face it should be selected to participate in the night watershed Acacia equipment exhibition under the 78, China additional equipment exhibition separate late October most prestigious industry events.

Speaking of expansion of our English treat all of our interests oriented of course offerings, we entered into a strategic cooperation agreement with shell has said I'm proud we.

We will jointly develop a stem curriculum and organize activities to better address the increasing demand of the market.

Oh apologies Sam can was launched this October and has been well received by the market.

Looking ahead, we are excited about the opportunities that will come from Ali has a deep portfolio of programs.

Subject to very interesting nurturing and the intellectual development.

Yes, our online much off my model for them matures, we will continue to drive student enrollment and engagement every news.

[laughter].

Watching what 10 years like walking to improve learning center network optimization, and the strategic like rolling cost offerings.

Well I believe I'll focus on all cost trends and fundamentals will set the foundation for sustainable operation, we remain confident about the recovery and robust long term prospects.

With that I would now turn the call, but vice President of Finance Midstream Wong, who will discuss our key financial results.

Thank you Joanne and Hello, everyone now I'd like to walk you through further details on our second quarter fiscal year Twentytwenty, one financial results Ron.

Revenue was RMB 83.8 million for the second quarter fiscal year can be 21, compared with RMB 128.8 million in the same period last year, primarily due.

To lead you through does not trade policy and expanding pack the co not cheap.

Cost of revenue decreased by 16.7% to.

A one 2 million for the second quarter fiscal year 221, So arm B 57.9 million in.

In the same period of last year as.

Gross profit was RMB <unk>.

35.6 needed for the second quarter fiscal year, 221, compared with RMB jumped to 1.0 million in the same period last year.

General and have my notes trading expenses.

I used to buy some important there.

<unk> percent to RMB 30.

One 3 million for the second quarter fiscal year, 221, well RMB 32.6 million in the same period of last year.

Sales and marketing expenses.

<unk> by 21.66.

6%.

The one they don't need it for the second quarter fiscal year 20.1 go RMB 10.0 million in the same period of last year.

Operating loss was RMB 2.7 million for the second quarter of fiscal year 221, compared with operating income of RMB 28.8 million in the same period of last year.

Adjusted operating income was RMB 4.5 million for the second quarter of fiscal year 220 to one compared with RMB.

35.7 billion in the same period of last year.

Income tax expenses was RMB 1.8 million for the second quarter of fiscal year 221, compared with RMB 9.2 million in the same period of last year.

Net income was RMB fourth one.

They don't need it during the second quarter of fiscal year 2021, compared with RMB 20.3 million in the same period of last year. Adjusted net income was RMB 6.8 million for the second quarter fiscal year 2021, compared with RMB 26.9 million in the same period.

Of last year.

Basic and diluted net income.

Attributable to ordinary shareholders for the second quarter fiscal year touched on one we're both ARQ <unk> seven cents compared with RMB 40 cents and RMB 39 cents, respectively for the same period of last year.

Adjusted basic and diluted net income attributable to ordinary shareholders will vote on be searching sense sort of second quarter fiscal year 221, compared with RMB 53 cents and RMB 52 cents, respectively for the same period.

Of last year.

Cash and cash equivalents as of August 31 country Punchy, the company had cash and cash equivalents of RMB 423.0 million to be.

<unk> was RMB four Oh, well one several immediate actual February 29.

2020.

So be mindful of the last of all Ernie cool with first six months of fiscal year touched on few financial results I encourage listeners to its worked well earnings press release Watergate House.

Looking forward for the second quarter fiscal 2020, the company expects to generate revenue in the range of RMB 62.1 million to RMB 67.2 million.

So soft outlook is based on the current market conditions.

<unk> companies preliminary estimates of market and operating conditions and customer demand, which are all subject to change. This concludes my portion of prepared remarks, we will not open the call to questions. Operator. Please go ahead.

Yes. Thank you we will now begin today's session.

If you would like to ask a question you May Press Star then one on your Touchtone phone.

If you're using a speaker phone [laughter] per.

Your handset before pressing the keys to withdraw your question. Please press star that's true.

For the benefit of all participants on today's call. If you wish mr. questions for management in Chinese sales immediately repeat your question in English.

This time, we'll pause momentarily to assemble the roster.

And once again pressing star then one will allow you to ask your question.

All right as there is nothing as opposed to Tom I would like to return the call to the company for any closing comments.

Thank you once again for joining US today, if you have follow classroom. Please feel free to content for all seasons Investor relations through the call.

Tapping formation provided on our website will that be awesome group Investor Relations.

Thank you.

That concludes today's conference call. Thank you for attending today's presentation. You may now disconnect your lines.

[noise].