Q3 2021 Four Seasons Education (Cayman) Inc Earnings Call

Hello, Ladies and gentlemen, thank you for standing by for the four seasons education third quarter fiscal year 2021 earnings Conference call.

This time, all participants are in listen only mode.

After managements prepared remarks, there will be a question and answer session. Today's conference call is being recorded.

I'll now turn the call over to your host Ms. Olivia on <unk> Investor Relations manager for the Company Inc.

Olivia.

Hello, everyone and welcome to the third quarter fiscal year two fell from 21 are nice comfort core for four seasons education. The company right now four <unk> on your small services on their today and posted on line down all the Army's press release I sign up four to accommodate the email distribution list by property the IR section of <unk>.

The website at <unk> Dot com.

On today's core muscular on for what our Chief Executive Officer, well start a carbon providing an overview of the company's performance highlights for the quarter midstream, while the country's vice president of finance will provide details on the company's financial results and burgers on <unk>. The four older name a core four l. posture.

Before we continue please note that today's discussion will contain forward looking statements made on or the safe Harbor provisions on the U.S. Private Securities Litigation Reform Act on 90 95 four.

Forward looking statements involve inherent risks and uncertainties.

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

Although information regarding these and other risks and uncertainties is included in the Companys prospectus and its annual report on form 20-F as filed with the U.S. Connie on Exchange Commission.

The company does not assume any obligation to update on it for one lucky statements, except that they were caught on the applicable nor.

Please also note that four seasons education on its price relief on this conference coring four discussion on on audited GAAP financial information as low as on audited non-GAAP financial measures [noise].

Four seasons Education press release contains a reconciliation on the on what did in non-GAAP measure to the on non it had most directly comparable GAAP measure.

I will now turn on a core over to our CEO Mr. <unk>. Please go ahead.

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

Corporate office costs 2021, we continued to optimize our operations to provide a superior learning experience for students ineptitude on academic excellence and the person that development.

In the quarter total student enrollment should reach.

53000, and 493 was up better than expected revenue, which further boost our confidence your strategies and assures us that our business is close to get Tony to its pre pandemic debt developed.

Developed much trajectory was met in China in the midst of a recovering from COVID-19.

Given the flow random knives admission policy four private hybrid and the secondary schools adopted by the Shanghai Municipal Education Commission sales. This year, we have seen growth opportunities for Middle School cautious.

Order to four the tapping into the fast evolving market of high school entrance exam preparation, we continued our efforts to be rich and the Dod. This if I recall, there was new education programs.

Tony I flow spectrum off academic subjects.

We are excited to witness a 54.15% year over year growth you on Middle school classes enrollments in the quarter on your record high price.

Good day upon ops will go on education, no expertise and experience, we believe that on a comprehensive and high quality in Middle School course offerings, which addresses students deferred on the objectives and abilities will continue to get the growth momentum and to further strengthen our competitive advantage in the K 12.

After school education landscape.

During this quarter, our relentless efforts to enhance our unique curricula on offerings paid off well, which continued to growth in our enrollment to retention rates.

Currently we are seeing a year on year increase in cash receipt and enrollment form four albian took classes.

The achievement is a great Testament to the effectiveness of our core capabilities, he offering high quality education the product.

<unk> innovative and responsive curriculum development as well as maintaining a strong tutoring team.

On top of this we featured a wide array of coal curricula and extracurricular activities to inspire students learning motivations and to further drive engagement.

Also remain focused on.

Moving our education those service offerings are low.

Learning centers, why adopting digital technology that helps optimize operating efficiency and hardness huh.

Hi, quality products and services to drive student enrollments on retention on.

Cost trends coupled with these complementary average will further solidify our position as an outstanding player in the markets and the spa recoveries from pandemic related to challenges.

For what we expected these efforts to help generate an even broad appeal four offerings a volume student base.

Moreover, our deep expertise in delivering tangible on the outcomes helped our nationwide expansion plans gain traction.

Like enrollment from my learning centers outside Shanghai Rose, 4% to 5.5% yelled at year end, that's up four to.

Our strategy to consolidate and upgrade their nationwide applicable adaptation on materials that may well on track as we seek to cement and extend all four cold in the Chinese K 12 after school tutoring markets.

In the quarter, we introduced the audio teacher model in most cities. This multi involves deploying our lead teachers and education, though we saw some Shanghai, where there was an outstanding level of education quality.

Alongside the local students efficient face to face guidance.

[laughter].

We believe this will distinguish us from on the education or service providers.

Looking ahead, we will keep strengthening our brand the education no offerings and the teacher approach in K 12. After school caused us to further increase student involvement and engagement paving the way towards a future profitable growth.

We believe our ability to provide instead on our cost and the service offering has positioned us to capture emerging opportunities in non recovering market.

And it creates a sustainable business in the long run.

With that I will now turn the call over to our Vice President of Finance Ministry Wong, who will discuss our key financial results.

Thank you Ed and Hello, everyone, no, let's move onto the financial results.

Oh that was RMB 60.

7.6 million for the fourth quarter of fiscal year, two authentic compared with RMB 100 and.

It's one surprise me that in the same period last year, primarily due to the latest Rugelach equality index.

Got it and pet Coke and coal to partially offset by the proactive steps that you have the uptake in response to the evolving market needs.

Cost of revenue decreased by 16.9%, who on the 40 coupon slides needed for the fourth quarter fiscal year two of country from RMB 54.

On slide from me that in the same period last year, primarily attributable to the secret stuff costs and ongoing optimization over the learning center that work.

What was it was RMB 10 flights on to meet in fourth quarter of fiscal year, two attendees compared with RMB 53 points there mainly on the things you live on last year.

General and administrative expenses decreased by 9.0% ground beef so to go on sports needed for the third quarter of fiscal year two of her well RMB 33.4 million and essentially on a blog, yes, huberty due to the Inc, who human resource management.

Sales and marketing expenses decreased by 14.2 media <unk>, 14.2% to RMB seven points was needed for the second quarter of fiscal year, two utterances from RMB 8.8 million in the same period of last year.

Operating loss was on the 12.8 needed fourth quarter fiscal year two countries.

Compared with operating income of RMB 10.9, either in the same period of last year.

Adjusted operating loss was RMB 6.8 million, one third quarter fiscal year, two attendees compared with adjusted operating income of RMB 17 ones. There will be there in the same period on last year.

Income tax benefit was arms and once once they need in fourth quarter of fiscal year, two countries compared with income tax expense hope on before it's going to need it in the same period of last year.

Net loss was RMB eight once they needed during the second quarter of fiscal year two countries.

There was net income of RMB 11.3 million in the same period of last year.

Adjusted net loss was RMB four point blessing that once a quarter or people, who your tools on cheap compared with adjusted net income on being 14.5 million in the same period of last year.

Basic and diluted net loss attributable.

Attributable to ordinary shareholders for the third quarter of fiscal year. Two countries. We're both on be 19 cents compared with net income from RMB 24 cents and RMB 23 cents, respectively for the same period last year.

Adjusted basic and diluted net loss of <unk>, yes attributable to ordinary share holders were both RMB 10 cents for this quarter on fiscal year, two countries compared with adjusted net income.

On this study one cents and RBC 30 cents, respectively for the same period last year.

Cash and cash equivalents.

November 32 on content the company had cash and cash equivalents on the 439.0 million compared with RMB, four or 4.7 million as of February 29, two attendees.

But my thought on the landfill ball and cool weather.

Nine months of fiscal year two of your financial results I would encourage listeners to four to our earnings press release will flow to certain pills.

Looking forward for the fourth quarter sales he school or contribute towards on to the company expects to generate revenue in the range of RMB six.

64.0 million to RMB six to 7.5 million.

The above all feel good based on the current market conditions under this left the company preliminary estimates over the market LP routine conditions on the March customer demand, which are all subject to change. This concludes my portion of the prepared remarks, we.

We will now open the call to questions all day.

Operator, Please go ahead.

Thank you we will now begin the question and answer session to ask a question you May Press Star then one on your touched on phone. If you are using a speakerphone. Please pick up your handset before pressing <unk>.

To withdraw your question. Please press Star then Q4 the benefit of all participants on todays call. If you wish to ask a question can management in Chinese we immediately you repeat your question in English on.

This time, we will cost momentarily to assemble our roster.

Once again to ask a question on its star then one.

[noise] showing no further questions about those price now I'd like to turn the call back over to Olivia we for any closing remarks.

Thank you once again for joining us today. If you have filled on question. Please feel free to contact from seasons Investor Relations Stuart the contact information provided on our website, what TPG Investor Relations.

[laughter] Conference call you May now disconnect. Your line. Thank you.