New Oriental Share Price Drops 7.34%
As of the market close on August 11, New Oriental Education & Tech Group (01797: HK) closed at HKD 34.70 per share, with a decrease of 7.34%. The trading volume was 8,486,300 shares, and the total market cap was HKD 32.613 billion.
New Oriental's Koolearn Reports 2020 Fiscal Year Earnings
Koolearn's revenue of CNY 1.08 billion was an increase of 17.6% year-on-year with a net loss of CNY 758 million, up 1082.7% year-on-year. The total number of paying students reached 2.852 million, also an increase of 30.9% year-on-year.
The financial report shows that, thanks to the implementation of the long-term development strategy and the active measures during the epidemic, New Oriental Online's university education and K12 education businesses have grown. Among them, the K12 segment's net income and number of paying students increased by 85.4% and 224.5% year-on-year respectively. The university education business was relatively stable, with a net income of CNY 642 million, a year-on-year increase of 1.6%. Due to the optimization and enhancement of the Donut English app and the termination of the live English courses of the app's online classroom, the pre-school education business income has declined, with a net income of CNY 30 million, down 10.1% year-on-year.
The revenue of Koolearn's K12 education was CNY 295 million, an increase of 85.4% compared to CNY 159 million in the same period last year. This part of the growth is due to the increase of New Oriental Online K12 courses and the expansion and strengthening of Oriental Youbo.
At the same time, the number of K12 paying students has also increased. During the reporting period, the number of paying students increased from 572,000 in the same period last year to 1.85 million. Among them, the number of paying students in K12 courses increased by 269.4% year-on-year, while the number of paying students for Oriental Youbo courses increased by 184.2% year-on-year.
Koolearn has adjusted its university business division and now focuses on the domestic and overseas test preparation business lines. In the future, the firm plans to continue to strengthen cooperation with overseas English test providers such as Cambridge University's English Assessment Department.
In terms of pre-school business, Koolearn is now focusing on optimizing the Donut English App. In the report, it outlines the improved quality and participation rates of the app and how it expanded the scope of the educational content provided.
As for the K12 business, it will remain the strategic focus. As of May 31, 2020, Dongfang Youbo had entered 172 cities in 24 provinces across the country. In the future, Dongfang Youbo will continue to expand its business to more cities and further deepen customer operations in existing cities.
New Oriental Signed a Contract with the Employment and Career Development Research Center for Normal Students
New Oriental Prepares for a Secondary Listing in Hong Kong
Another rumor suggesting that the edtech giant is edging towards a secondary listing in Hong Kong has been circulating in the Chinese media today. It is said that the company is looking to raise around USD 1 billion from the IPO.
New Oriental chose not to comment on the matter upon being asked by Chinese media channel TechWeb.
This is not the first time that New Oriental has been rumored to be preparing to go to Hong Kong for a second listing. As early as early June, we reported that New Oriental and TAL, two of China's US-listed edtech veterans, were each considering a secondary listing in Hong Kong.
New Oriental's financial results for the fourth quarter of the fiscal year 2020 and the full year as of May 31, 2020, show that the firm's net income in the fourth quarter of the fiscal year 2020 was around USD 798 million, a year-on-year decrease of 5.3% with a net profit of USD 13.2 million, a year-on-year decrease of 69.5%. New Oriental's full-year net income for the fiscal year 2020 was approximately USD 3.579 billion, a year-on-year increase of 15.6% with a net profit of USD 413 million – up 73.6% year-on-year.
GSX Techedu's Market Value Exceeds that of New Oriental
New Oriental Generates a Staggering USD 3.6 Billion in Net Income
New Oriental’s full-year net income for the fiscal year 2020 was approximately USD 3.579 billion, a YoY increase of 15.6% and an operating profit of USD399 million, a YoY increase of 30.6%. Net profit attributable to New Oriental was USD 413 million, which is a significant YoY of 73.6%.
The financial report shows that net income in the fourth quarter of fiscal 2020 was over USD 798 million, a YoY decrease of 5.3%; operating profit was USD 10.3 million, a YoY decrease of 86.7%. Net profit attributable to the company was USD 13.2 million, a decrease of 69.5% YoY.
According to statistics, the number of student registrations in the fourth quarter of New Oriental's 2020 fiscal year was approximately 2,585,600, a decrease of 6.2% YoY. As of May 31, 2020, the total number of schools and learning centers reached 1,465, a net increase of 211 compared with the same period last year (the total number of learning centers in 2019 was 1,254), and a net increase of 49 compared with the previous quarter.
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