Q4 2021 Four Seasons Education (Cayman) Inc Earnings Call

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Hello, ladies and gentlemen.

Thank you for standing by for the four seasons Education's four.

Fourth quarter and fiscal year 2021 earnings conference call.

At this time all participants are in listen only mode. After management's prepared remarks, there will be a question and answer session.

Today's conference call is being recorded.

I will now turn the call over to your host Ms. Olivia Li Investor Relations manager for the company. Please go ahead Olivia.

Hello, everyone and welcome to four seasons Education's fourth quarter fiscal year 2021 on a conference call.

Sometimes with Atlas issued via Newswire services on there today and are posted on line with had download the earnings press release and sign up for the company's email distribution list, but it doesn't seem the IR section of our website at <unk> Dot S. J I E <unk> Dot com.

On today's core MS. Johnson, our Chief Security Officer will start by providing an overview of the Companys performance highlights for the quarter extremely.

Meanwhile, the company's Vice President Finance will provide details on the company's financial results and business outlook before opening a core for your question.

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

Forward looking statements involving hallow risks and uncertainties as such the company's results may be materially different from the music plus a day.

Further information regarding this and other line.

And also on a net is included in the company's prospectus and its annual report on form 20-F as filed with the U S Securities and Exchange Commission.

The company does not assume any obligation to update any forward looking statements, except as required on the ethical lore.

Please also note that four seasons Education's earnings press release on this conference call include discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial measure.

Four seasons Education's press release contains a reconciliation of the unaudited non-GAAP measure to the on audited most directly comparable GAAP measures.

I will now turn the call over to our CEO. Mr. Xu. Please go ahead.

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

This fiscal year has been unusual and Andy President tend to in many ways largely due to the COVID-19 pandemic.

Despite the challenges we faced throughout the year, we have been proactively optimizing our operations and course offerings to maintain competitive advantages in that tough market as we endeavor to propel our business towards the long term sustainability.

In the fourth quarter office co 2020. One we are pleased to have concluded the year with a robust businesses recovering momentum as market demand from our effective academically focused their curricula and a superior learning experience remains strong.

We continue to outperform our revenue guidance.

<unk> achieved a 26 year over year increase in total student enrollment during the quarter.

And the scoring a solid recovery to address trajectory.

Our heavy emphasis on curriculum design and the development distinguishes us as a trusted partner of choice for students in their pursuit of our academic and intellectual excellence.

In addition, our exceptional educational resources and the world rest of the two tests withdraw on academic background ensure that adaptive curricula and effective education no programs resonated with student's needs.

It doesn't need to design, the learning outcomes and ex damage. It goes throughout the day Unprison inhibitor ear.

We are also very excited to see a setup of accelerating enrollment retention rates across all our class offerings.

For the spring season in Shanghai based on money centers.

As they reach some of the highest level a record in history.

Heading into fiscal 'twenty 'twenty, two we have more comfort incident ever that we're on the high we're on the right track to further improve our operations and the return to our pre pandemic gross trajectory.

Student enrollment in our Middle school programs maintained its gross momentum with 78, yeah on your increase in the fourth quarter.

But that demonstrating our curriculum development capabilities to capture market dynamics in the fast evolving after school education landscape.

Our proven track record of delivering tangible learning outcomes enables us to generate to broad appeal four.

Well a line in the Middle School course offerings and the furthest meant a foothold in the after school education market.

In order to strengthen any engagement and its students in loyalty. We continue to feature a wider spectrum on co curricular and extracurricular programs such as winter camps on writing and I said, Mexico thing key intangible cultural heritage et cetera.

As part of outstretched expand our education service portfolio, we have collaborated with community service providers to establish a community based study room chain brand Bachelor lending space.

Which aims to deliver a wide range of education programs, especially edge education us along.

That is plenty south study rooms et cetera.

But also leverage the best day to a host of various education related events across online and offline venues to tap into a broader base of lifelong learners.

Additionally, we will cooperate with tech focus the internet companies such as tension to explore the possibilities of delivery Inc.

Intelligent to education to various consumers.

Our learning space will support our endeavors to reach a wider student base and does that daily and the basic learning meat.

But the more assets to optimize on nationwide and learning Center network continue that during the quarter as we add a new center outside of Shanghai.

A further testament to the growing organic demand for high quality K 12 after school tutoring services across the nation.

Going forward, we will continue to enhance our stellar cost and the service offerings in the K 12 after school market to propel sustainable business development, while simultaneously exploring new growth avenues.

Mostly on the best in class educational programs and a strong tutoring team, we're confident in our ability to serve a broader user base in their pursuit of better learning experience, while delivering long term value to our shareholders.

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

Thank you Joanne and Hello, everyone now, let's move to the financial results.

He was RMB 71, 2 million for the fourth quarter of fiscal year 'twenty to 'twenty, one compared with RMB $71 1 million in the same period of last year.

Cost of revenue decreased by nine four.

Percentage to RMB 41, 9 million for the fourth quarter of fiscal year 'twenty 'twenty. One from RMB 46.3 median in the same period of last year gross profit increased by 14, one 1% to RMB 28 points right media for the fourth quarter.

Fiscal year 2021 from RMB 24, 8 million in the same period of last year General and administrative expenses decreased by 20, 910% to RMB $28 3 million for the fourth quarter of fiscal year 2021 from RMB.

He has 39 8 million in the same period of last year, primarily attributable to the allowance a pool that last year.

Impairment loss on intangible assets and goodwill with now for the fourth quarter of fiscal year, 2021 compared to RMB $445 4 million in the same period of last year.

Sales and marketing expenses increased by 10.2 percentage to RMB eight 5 million in the from the fourth quarter of fiscal year 2021 from RMB seven 7 million in the same period of last year.

Net loss was RMB eight 5 million four fourth quarter of fiscal year 2021, compared with RMB $168 2 million in the same period.

Last year.

Adjusted operating income loss was RMB 149 million four fourth quarter of fiscal year 2021, compared with RMB 15, One media Inc. The same period of last year.

Other income net was RMB <unk> 6 million four fourth quarter of fiscal year, 2021 compared with RMB four four night meeting in the same period of last year, primarily due to investment fair value change in foreign exchange loss.

Income tax expenses was RMB four 7 million from the fourth quarter of fiscal year, 2021 compared with benefit of RMB 15.

Seven medium in the same period of last year, primarily attributable to the weather issue alone.

Our tax assets recorded in the fiscal year 2021 notch.

That's loss was RMB 11 point, not the 5 million during the fourth quarter of fiscal year 2021, compared with RMB 145 points for media in the same period of last year.

Adjusted net loss was RMB 442 million compared with RMB $4 7 million from the same period of last year.

Basic and diluted net loss attributable.

Attributable to ordinary shareholders for the fourth quarter of fiscal year 2021 were both RMB <unk> 25, compared with both RMB three point.

114 at the same period of last year obstruct two basic and diluted net loss per ads attributable to ordinary shareholders were both RMB nine cents compared with both RMB seven cents for the same period of last year.

Cash on cash equivalent.

February 'twenty eight 2021 the company had cash on cash equivalence of RMB 410 million compared with RMB 404 points Telemedia as of February 29th 10th T 20 cause mindful.

The length of our earnings call for the fiscal year 2021 financial results I will encourage listeners to refer to on earnings press release for further details.

Looking forward.

For the first quarter of fiscal year 'twenty to 'twenty two the company expects to generate revenues in the range of RMB 70, 67, 5 million to RMB 70 414 million.

Sending an increase of 15% to 20% on year over year basis.

The above guidance reflects the company's current and preliminary view, which is subject to change.

This concludes my portion of prepared remarks, we will now open the call to questions. Operator. Please go ahead.

We will now begin the question and answer session.

To ask a question you May press Star then one on your telephone keypad.

If you are using a speakerphone please pick up your handset before pressing the keys.

If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two.

For the benefit of all participants on today's call. If you wish to ask your question to management in Chinese. Please immediately repeat your question in English.

At this time, we will pause momentarily to assemble our roster.

As there are no further questions now I would like to turn the call back over to the company for closing remarks.

Thank you once again for joining US today. If you have further questions. Please feel free to contact four seasons Investor relations through the contact information provided on our website or depends on group Investor Relations.

This concludes this conference call.

You may now disconnect. Your line. Thank you.

Okay.

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Yes.