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China Distance Education Holdings Limited Reports Financial Results for Second Quarter Fiscal Year 2017

2017-05-18 05:00
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BEIJING, May 18, 2017 /PRNewswire/ -- China Distance Education Holdings Limited (NYSE: DL) ("CDEL", or the "Company"), a leading provider of online education in China focusing on professional education, today announced unaudited financial results for the second quarter of fiscal year 2017 ended March 31, 2017.

Second Quarter Fiscal 2017 Financial and Operational Highlights

  • Total course enrollments reached 651,000, an increase of 9.8% from the second quarter of fiscal 2016.
  • Cash receipts from online course registration were $35.0 million, an increase of 24.7% from the second quarter of fiscal 2016. Without the impact of the Renminbi depreciation against the U.S. Dollar, cash receipts from online course registration increased by 31.3% year-over-year in the second quarter of fiscal 2017.
  • Net revenue decreased by 9.5% to $21.9 million from $24.1 million in the prior year period, within the Company's guidance range of $21.7 million to $22.9 million. Xiamen NetinNet, which was acquired by the Company in May 2016, contributed net revenue from the sale of learning simulation software of $0.9 million in the second quarter of fiscal 2017.
  • Gross profit was $10.1 million, a decrease of 26.7% from $13.7 million in the prior year period.
  • Non-GAAP1 gross profit was $10.1 million, a decrease of 26.7% from $13.8 million in the prior year period.
  • Gross margin was 46.0%, compared with 56.9% in the prior year period. Non-GAAP1 gross margin was 46.2%, compared with 57.0% in the prior year period.
  • Operating loss was $2.1 million compared with operating income of $4.6 million in the prior year period.
  • Non-GAAP1 operating loss was $1.6 million compared with non-GAAP1 operating income of $5.1 million in the prior year period.
  • Net loss was $2.4 million compared with net income of $2.5 million in the prior year period.
  • Non-GAAP1 net loss was $1.9 million compared with non-GAAP1 net income of $3.0 million in the prior year period.
  • Basic and diluted net loss per American Depositary Share ("ADS") were $0.073, compared with basic and diluted net income per ADS of $0.073 for the second quarter of fiscal 2016. Each ADS represents four ordinary shares.
  • Basic and diluted non-GAAP1 net loss per ADS were $0.059, compared with basic and diluted non-GAAP1 net income per ADS of $0.088 and $0.087, respectively, for the second quarter of fiscal 2016.
  • Cash flow from operations decreased by 6.2% to $11.3 million from $12.0 million in the second quarter of fiscal 2016.

Mr. Zhengdong Zhu, Chairman and CEO of CDEL, said, "The second quarter revenue decline of 9.5% year-over-year was within our guidance range. Key factors contributing to the second quarter revenue decline include (i) the previously disclosed suspension of the Accounting Certificate Exam; (ii) the Tax Agent Qualification Exam being held only in November 2017, instead of both February and November in 2016, which will defer enrollments for the related courses to the second half of fiscal 2017; and (iii) lower cash receipts from licensed pharmacist test preparation premium courses in fiscal 2016, resulting in a year-over-year decline in revenue that was recognized in the second quarter of fiscal 2017 upon the release of the licensed pharmacist exam results in the second quarter. Although the above factors in aggregate significantly impacted our second quarter revenue, we are pleased to report that our cash receipts from online course registration grew 24.7% year-over-year in the second quarter, driven primarily by strong growth in cash receipts in our accounting and healthcare verticals. We are also pleased to report that for the six month period ending March 31, 2017, our total cash receipts from online course registration grew 12.9% year-over-year."

Mr. Zhu added, "In the second quarter, we continued to execute on our strategic growth initiatives, including mobile related products, Big Data solutions, College Cooperation Program, and employment guidance services for accounting professionals. In particular, our focus on employment guidance services for accounting professionals, which bundle accounting practical skills training and employment guidance services, is beginning to bear fruit. Furthermore, we look forward to pursuing complementary acquisition and strategic investment opportunities that will enhance our business model, and further our effort to position China Distance Education as the premier life-long learning partner for our students."

Mr. Mark Marostica, Co-Chief Financial Officer of CDEL, said, "As expected, the revenue decline in our second quarter resulted in a net loss in the quarter. The loss was partly due to the impact of Xiamen NetinNet in its seasonally weak second quarter and the foreign currency exchange loss. Given the strong growth in cash receipts from online course registration in the second quarter, we anticipate returning to profitability in our third quarter of fiscal 2017. With our peak enrollment season now underway, we aim to continue to proactively manage expenses while maintaining operating efficiency, with a goal of balancing our growth and profitability."

Second Quarter Fiscal 2017 Financial Results

Net Revenue. Total net revenue decreased by 9.5% to $21.9 million in the second quarter of fiscal 2017 from $24.1 million in the second quarter of fiscal 2016. Net revenue from online education services, books and reference materials, and other sources contributed 77.2%, 5.8% and 17.0%, respectively, of total net revenues for the second quarter of fiscal 2017.

Online education services. Net revenue from online education services decreased by 11.2% to $16.9 million in the second quarter of fiscal 2017 from $19.0 million in the second quarter of fiscal 2016. This decrease was mainly due to (i) the previously disclosed suspension of the Accounting Certificate Exam; (ii) the Tax Agent Qualification Exam being held only in November 2017, instead of both February and November in 2016, which will defer enrollments for the related courses to the second half of fiscal 2017; (iii) lower cash receipts from licensed pharmacist test preparation premium courses in fiscal 2016, resulting in a year-over-year decline in revenue that was recognized in the second quarter of fiscal 2017 upon the release of the licensed pharmacist exam results in the second quarter.

Books and reference materials. Net revenue from books and reference materials decreased by 19.2% to $1.3 million in the second quarter of fiscal 2017 from $1.6 million in the second quarter of fiscal 2016.

Other revenues. Net revenue from other sources increased by 4.2% to $3.7 million in the second quarter of fiscal 2017 from $3.6 million in the second quarter of fiscal 2016, primarily due to Xiamen NetinNet's revenue contribution of $0.9 million, partially offset by a decline in revenue from business start-up training services.

Cost of Sales. Cost of sales increased by 13.3% to $11.8 million in the second quarter of fiscal 2017 from $10.4 million in the second quarter of fiscal 2016. Non-GAAP1 cost of sales increased by 13.3% to $11.8 million in the second quarter of fiscal 2017 from $10.4 million in the second quarter of fiscal 2016. This increase was primarily due to expenses associated with Xiamen NetinNet, as well as increased salaries and related expenses. This increase was partially offset by decreased cost of books and reference materials.

Gross Profit. Gross profit decreased by 26.7% to $10.1 million in the second quarter of fiscal 2017 from $13.7 million in the prior year period. Non-GAAP1 gross profit decreased by 26.7% to $10.1 million in the second quarter of fiscal 2017 from $13.8 million in the prior year period. Gross margin was 46.0% in the second quarter of fiscal 2017, compared with 56.9% in the second quarter of fiscal 2016. Non-GAAP1 gross margin was 46.2% in the second quarter of fiscal 2017, compared with 57.0% in the second quarter of fiscal 2016.

Operating Expenses. Total operating expenses increased by 43.5% to $13.1 million in the second quarter of fiscal 2017 from $9.1 million in the prior year period. Non-GAAP1 total operating expenses increased by 46.0% to $12.6 million in the second quarter of fiscal 2017 from $8.7 million in the prior year period.

Selling expenses. Selling expenses increased by 60.7% to $8.4 million in the second quarter of fiscal 2017 from $5.2 million in the prior year period. Non-GAAP1 selling expenses increased by 61.0% to $8.4 million in the second quarter of fiscal 2017 from $5.2 million in the prior year period. The increase was primarily driven by increased salaries and related expenses, and increased advertising and promotional expenses, together with expenses associated with Xiamen NetinNet.

General and administrative expenses. General and administrative expenses increased by 20.1% to $4.6 million in the second quarter of fiscal 2017 from $3.9 million in the prior year period. Non-GAAP1 general and administrative expenses increased by 23.2% to $4.2 million in the second quarter of fiscal 2017 from $3.4 million in the prior year period. The increase was mainly due to expenses associated with Xiamen NetinNet.

Income Tax Benefit /(Expense). Income tax benefit was $0.6 million in the second quarter of fiscal 2017 compared with income tax expense of $0.7 million in the prior year period, primarily due to the operating loss recorded in the second quarter.

Net Income /(Loss). As a result of the foregoing, net loss was $2.4 million in the second quarter of fiscal 2017 compared with net income of $2.5 million in the prior year period. Non-GAAP1 net loss was $1.9 million in the second quarter of fiscal 2017 compared with non-GAAP net income of $3.0 million in the prior year period.

Operating Cash Flow. Net operating cash inflow decreased by 6.2% to $11.3 million in the second quarter of fiscal 2017 from $12.0 million in the prior year period. The operating cash inflow was mainly attributable to the cash receipts from online course registration generated in the second quarter of fiscal 2017. This operating cash inflow was partially offset by the increase in prepayment and other current assets, and decrease in accrued expenses and other liabilities, and income tax payable.

Cash and Cash Equivalents, Term Deposits, Restricted Cash and Short-term Investments. Cash and cash equivalents, term deposits, restricted cash and short-term investments as of March 31, 2017 decreased by 6.1% to $99.6 million from $106.1 million as of December 31, 2016, mainly due to the dividend payment of $14.7 million, certain strategic investments of $3.8 million, and capital expenditures of $0.7 million. This decrease was partially offset by cash flow of $11.3 million generated from operating activities in the second quarter of fiscal 2017.

First Six Months of Fiscal 2017 Financial Results

Net Revenue. Total net revenue increased by 11.0% to $53.8 million in the first six months of fiscal 2017 from $48.5 million in the first six months of fiscal 2016. Net revenue from online education services, books and reference materials, and other sources contributed 68.7%, 5.4% and 25.9%, respectively, of total net revenues for the first six months of fiscal 2017.

Online education services. Net revenue from online education services was $37.0 million in the first six months of fiscal 2017, a 3.2% decrease from $38.2 million in the first six months of fiscal 2016.

Books and reference materials. Net revenue from books and reference materials decreased by 13.4% to $2.9 million in the first six months of fiscal 2017 from $3.4 million in the first six months of fiscal 2016.

Others. Net revenue from other sources increased by 100.6% to $13.9 million in the first six months of fiscal 2017 from $7.0 million in the first six months of fiscal 2016.

Cost of Sales. Cost of sales increased by 11.7% to $24.6 million in the first six months of fiscal 2017 from $22.0 million in the first six months of fiscal 2016. Non-GAAP1 cost of sales increased by 11.7% to $24.5 million in the first six months of fiscal 2017 from $21.9 million in the first six months of fiscal 2016.

Gross Profit. Gross profit increased by 10.4% to $29.2 million in the first six months of fiscal 2017 from $26.5 million in the prior year period. Non-GAAP1 gross profit increased by 10.3% to $29.3 million in the first six months of fiscal 2017 from $26.6 million in the prior year period. Gross margin was 54.3% in the first six months of fiscal 2017, compared with 54.6% in the first six months of fiscal 2016. Non-GAAP1 gross margin was 54.4% in the first six months of fiscal 2017, compared with 54.8% in the first six months of fiscal 2016.

Operating Expenses. Total operating expenses increased by 33.8% to $24.8 million in the first six months of fiscal 2017, from $18.5 million in the prior year period. Non-GAAP1 total operating expenses increased by 35.8% to $23.9 million in the first six months of fiscal 2017, from $17.6 million in the prior year period.

Selling expenses. Selling expenses increased by 46.4% to $15.6 million in the first six months of fiscal 2017 from $10.7 million in the prior year period. Non-GAAP1 selling expenses increased by 46.6% to $15.6 million in the first six months of fiscal 2017 from $10.6 million in the prior year period.

General and administrative expenses. General and administrative expenses increased by 16.8% to $9.2 million in the first six months of fiscal 2017 from $7.9 million in the prior year period. Non-GAAP1 general and administrative expenses increased by 19.4% to $8.3 million in the first six months of fiscal 2017 from $7.0 million in the prior year period.

Income Tax Expense. Income tax expense increased by 6.0% to $1.8 million in the first six months of fiscal 2017 from $1.7 million in the prior year period.

Net Income. As a result of the foregoing, net income decreased by 7.6% to $6.1 million in the first six months of fiscal 2017 from $6.7 million in the prior year period. Non-GAAP1 net income decreased by 7.0% to $7.1 million in the first six months of fiscal 2017 from $7.7 million in the prior year period.

Operating Cash Flow. Net operating cash inflow increased by 19.2% to $29.0 million in the first six months of fiscal 2017 from $24.3 million in the prior year period.

Outlook

For the third quarter of fiscal 2017, the Company expects to generate total net revenue in the range of $30.8 million to $32.3 million, representing a year-over-year increase of approximately 0% to 5%.

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

Conference Call

Management will hold a conference call at 8:00 a.m. Eastern Time the following morning on Thursday, May 18, 2017 (8:00 p.m. Beijing Time on May 18, 2017) to discuss financial results and answer questions from investors and analysts. Listeners may access the call by dialing:

U.S. Toll Free:                

+1-866-5194-004

International:                  

+65-6713-5090

Mainland China:             

400-620-8038

Hong Kong:                    

+852-3018-6771

United Kingdom:           

+44-203-6214-779

Passcode:                        

CDEL or DL

A telephone replay will be available approximately two hours after the call until May 25, 2017 by dialing:

U.S. Toll Free:                

+1-855-4525-696

International:                  

+61-2-8199-0299

Mainland China:  

400-632-2162

Hong Kong:    

800-963-117

United Kingdom:   

0808-234-0072

Replay Passcode:  

18369626

Additionally, a live and archived webcast of the conference call will be available at http://ir.cdeledu.com.

[1] 

For more information about the non-GAAP financial measures contained in this press release, please see "Use of Non-GAAP Financial Measures" below.

About China Distance Education Holdings Limited

China Distance Education Holdings Limited is a leading provider of online education in China focusing on professional education. The courses offered by the Company through its websites are designed to help professionals seeking to obtain and maintain professional licenses and to enhance their job skills through our professional development courses in China in the areas of accounting, healthcare, engineering & construction, and other industries. The Company also offers other professional education courses for the national judicial examination, online test preparation courses for self-taught learners pursuing higher education diplomas or degrees, test preparation courses for university students intending to take the nationwide graduate school entrance exam, and online language courses. The Company also offers third-party developed online courses through its Online Open Learning Platform, a proprietary education platform that allows people to share their educational content or deliver live courses online. For further information, please visit http://ir.cdeledu.com.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "may," "should," "potential," "continue," "expect," "predict," "anticipate," "future," "intend," "plan," "believe," "is/are likely to," "estimate" and similar statements. Among other things, the outlook for the third quarter of fiscal year 2017 and quotations from management in this announcement, as well as the Company's strategic and operational plans (in particular, the anticipated benefits of strategic growth initiatives, including the College Cooperation Program, mobile related products, Big Data solutions, bundling accounting practical skills training and employment guidance services, as well as acquisition and strategic investments) contain forward-looking statements. The Company may also make written or oral forward-looking statements in its periodic and annual reports to the SEC, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: goals and growth strategies; future prospects and market acceptance of the Company's courses and other products and services; future business development and results of operations; projected revenues, profits, earnings and other estimated financial information; projected enrollment numbers; plans to expand and enhance courses and other products and services; competition in the education and test preparation markets; and Chinese laws, regulations and policies, including those applicable to the Internet, Internet content providers, the education and telecommunications industries, mergers and acquisitions, taxation and foreign exchange.

Further information regarding these and other risks is included in the Company's annual report on Form 20-F and other documents filed or furnished with the SEC. All information provided in this press release is as of the date of this press release. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Statement Regarding Unaudited Financial Information

The unaudited financial information set forth in this press release is preliminary and subject to adjustments. Adjustments to the financial statements may be identified when audit work is performed for the year-end audit, which could result in significant differences from this preliminary unaudited financial information.

Use of Non-GAAP Financial Measures

To supplement the Company's consolidated financial results presented in accordance with U.S. generally accepted accounting principles, or GAAP, the Company uses the following measures defined as non-GAAP financial measures: non-GAAP net income, operating income, gross profit, cost of sales, selling expenses, general and administrative expenses, net income margin, operating margin, gross profit margin and basic and diluted earnings per ADS and per share. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of non-GAAP measures to comparable GAAP measures" set forth at the end of this release.

The Company believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based compensation expenses. However, non-GAAP financial measures may not be indicative of the Company's operating performance from a cash perspective. The Company believes that both management and investors benefit from these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management's internal comparisons to the Company's historical performance and liquidity. The Company computes its non-GAAP financial measures using the same consistent method from quarter to quarter. The Company believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of excluding share-based compensation expenses from the above-mentioned line items and presenting these non-GAAP measures is that such charges may continue to be for the foreseeable future a significant recurring expense in our business. Management compensates for this limitation by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying table at the end of this release provides more detail on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.

Contacts:

China Distance Education Holdings Limited

Investor Relations Department

Tel:+86-10-8231-9999 ext1805

Email: IR@cdeledu.com

 

The Piacente Group | Investor Relations

Brandi Piacente

Tel:+1 212-481-2050

Email: DL@tpg-ir.com

 

(Financial Tables on Following Pages)

 

China Distance Education Holdings Limited

 Consolidated Balance Sheets

(in thousands of US Dollars, except number of shares and per share data)









September 30, 2016


March 31, 2017



(Derived from Audited)


(Unaudited)


Assets:





Current assets:






Cash and cash equivalents

53,677


62,496



Restricted cash

15,547


33,696



Short term investments

1,278


3,417



Accounts receivable, net of allowance for doubtful accounts of US$812 and
US$661 as of March 31, 2017 and September 30, 2016, respectively

5,454


4,926



Inventories

971


1,147



Prepayment and other current assets

5,893


11,542



Amount due from a related party

208


112



Deferred tax assets, current portion

1,676


2,001



Deferred cost

1,118


944



   Total current assets

85,822


120,281








Non-current assets:






Property, plant and equipment, net

13,908


14,180



Goodwill

29,392


28,478



Long term investments

3,079


8,895



Other intangible assets, net

11,675


10,441



Deposit for purchase of non-current assets

1,116


500



Other non-current assets

3,928


3,332



   Total non-current assets

63,098


65,826









   Total assets

148,920


186,107








Liabilities and equity:





Current liabilities:






Bank  borrowings

15,551


29,963



Accrued expenses and other liabilities (including accrued expenses and other
liabilities of the consolidated VIE without recourse to China Distance
Education Holdings Limited of US$25,957 and US$26,279 as of March 31,
2017 and September 30, 2016, respectively)

30,564


30,363



Income tax payable (including income tax payable of the consolidated VIE
without recourse to China Distance Education Holdings Limited of US$2,331
and US$3,353  as of March 31, 2017 and September 30, 2016, respectively)

5,308


3,075



Deferred revenue (including deferred revenue of the consolidated VIE without
recourse to China Distance Education Holdings Limited of US$59,586 and
US$35,437 as of March 31, 2017 and September 30, 2016, respectively)

36,332


60,509



Refundable fees (including refundable fees of the consolidated VIE without
recourse to China Distance Education Holdings Limited of US$196 and
US$862 as of March 31, 2017 and September 30, 2016, respectively)

862


196



   Total current liabilities

88,617


124,106








Non-current liabilities:






Deferred tax liabilities, non-current portion

3,831


3,763



Total non-current liabilities

3,831


3,763















   Total liabilities

92,448


127,869








 

Equity:






Ordinary shares (par value of US$0.0001 per share at March 31, 2017 and
September 30, 2016, respectively; Authorized –500,000,000 shares at March
31, 2017 and September 30, 2016, respectively; Issued and outstanding –
131,854,773 and 131,729,773 shares at March 31, 2017 and September 30,
2016, respectively)

13


13



Additional paid-in capital

15,697


17,879



Accumulated other comprehensive loss

(3,418)


(6,873)



Retained Earnings

32,944


24,248



   Total China Distance Education Holdings Limited shareholder's equity

45,236


35,267



Noncontrolling interest

11,236


22,971



   Total equity

56,472


58,238



   Total liabilities and equity

148,920


186,107








 


 

China Distance Education Holdings Limited

Unaudited Consolidated Statements Of Operations

 (in thousands of US dollars, except number of shares, per share and per ADS data)



Three Months Ended March 31,


2016


2017





Sales, net of business tax, value-added tax and related surcharges:





Online education services

19,003


16,869


Books and reference materials

1,581


1,276


Others

3,563


3,713


-    Sale of learning simulation software

-


904


-    Business start-up training services

1,785


1,103


-    Others

1,778


1,706


   Total net revenues

24,147


21,858






Cost of sales





Cost of services and others

(9,467)


(11,099)


Cost of tangible goods sold

(946)


(698)


   Total cost of sales

(10,413)


(11,797)






Gross profit

13,734


10,061





Operating expenses





Selling expenses

(5,246)


(8,432)


General and administrative expenses

(3,870)


(4,648)


   Total operating expenses

(9,116)


(13,080)

Other operating income

13


950






Operating income/(loss) 

4,631


(2,069)





Interest income

375


495

Interest expense

(155)


(151)

Exchange loss

(1,278)


(1,137)






Income/(Loss) before income taxes

3,573


(2,862)

Income tax benefit/(expense)

(706)


572

Loss from equity method investment

-


(34)





Net income/(loss)

2,867


(2,324)

Less: Net income attributable to noncontrolling interest

(323)


(89)

Net income/(loss) attributable to China Distance Education Holdings
Limited

2,544


(2,413)

 

Net income/(loss) per share:




Net income/(loss) attributable to China Distance Education Holdings
Limited
 shareholders





Basic

0.018


(0.018)


Diluted

0.018


(0.018)

 

Net income/(loss) per ADS:




Net income/(loss) attributable to China Distance Education Holdings
Limited
 shareholders





Basic

0.073


(0.073)


Diluted

0.073


(0.073)





Weighted average shares used in calculating net income/(loss) per share:





Basic

138,762,726


131,449,547


Diluted

139,669,135


131,449,547

 


 

China Distance Education Holdings Limited

Unaudited Consolidated Statements Of Operations

 (in thousands of US dollars, except number of shares, per share and per ADS data)



Six Months Ended March 31,


2016


2017





Sales, net of business tax, value-added tax and related surcharges:





Online education services

38,190


36,975


Books and reference materials

3,370


2,918


Others

6,955


13,948


-      Sale of learning simulation software

-


7,367


-    Business start-up training services

3,055


2,749


-    Others

3,900


3,832


   Total net revenues

48,515


53,841






Cost of sales





Cost of services and others

(20,412)


(23,062)


Cost of tangible goods sold

(1,618)


(1,545)


   Total cost of sales

(22,030)


(24,607)






Gross profit

26,485


29,234





Operating expenses





Selling expenses

(10,668)


(15,617)


General and administrative expenses

(7,857)


(9,178)


Total operating expenses

(18,525)


(24,795)

Other operating income

198


1,450






Operating income 

8,158


5,889





Interest income

1,394


725

Interest expense

(300)


(270)

Exchange gain/(loss)

(559)


2,769






Income before income taxes

8,693


9,113

Income tax expense

(1,719)


(1,822)

Loss from equity method investment

-


(78)





Net income

6,974


7,213

Less: Net income attributable to noncontrolling interest

(323)


(1,070)

Net income attributable to China Distance Education Holdings Limited

6,651


6,143

 

Net income per share:




Net income attributable to China Distance Education Holdings Limited 
shareholders





Basic

0.047


0.047


Diluted

0.047


0.046

 

Net income per ADS:




Net income attributable to China Distance Education Holdings Limited 
shareholders





Basic

0.189


0.186


Diluted

0.188


0.185





Weighted average shares used in calculating net income per share:





Basic

140,440,182


131,375,890


Diluted

141,776,344


132,496,017

 

 

 

China Distance Education Holdings Limited

Reconciliations of non-GAAP measures to comparable GAAP measures

(In thousands of US Dollars, except number of shares, per share and per ADS data)






Three Months Ended March 31,



2016


2017



(Unaudited)


(Unaudited)






Cost of sales


10,413


11,797

Share-based compensation expense in cost of sales


40


40

Non-GAAP cost of sales


10,373


11,757






Selling expenses


5,246


8,432

Share-based compensation expense in selling expenses


21


21

Non-GAAP selling expenses


5,225


8,411






General and administrative expenses


3,870


4,648

Share-based compensation expense in general and administrative expenses


440


423

Non-GAAP general and administrative expenses


3,430


4,225






Gross profit


13,734


10,061

Share-based compensation expenses


40


40

Non-GAAP gross profit


13,774


10,101






Gross profit margin


56.9%


46.0%

Non-GAAP gross profit margin


57.0%


46.2%






Operating income/(loss)


4,631


(2,069)

Share-based compensation expenses


501


484

Non-GAAP operating income/(loss)


5,132


(1,585)






Operating margin


19.2%


(9.5%)

Non-GAAP operating margin


21.3%


(7.3%)






Net income/(loss)


2,544


(2,413)

Share-based compensation expense


501


484

Non-GAAP net income/(loss)


3,045


(1,929)






Net income margin


10.5%


(11.0%)

Non-GAAP net income margin


12.6%


(8.8%)






Net income / (loss) per share -- basic


0.018


(0.018)

Net income / (loss) per share -- diluted


0.018


(0.018)

Non-GAAP net income / (loss) per share -- basic


0.022


(0.015)

Non-GAAP net income / (loss) per share -- diluted


0.022


(0.015)






Net income / (loss) per ADS attributable to China Distance Education Holdings     
    Limited shareholders -- basic (note 1)


0.073


(0.073)

Net income / (loss) per ADS attributable to China Distance Education Holdings
    Limited shareholders -- diluted (note 1)


0.073


(0.073)

Non-GAAP net income / (loss) per ADS attributable to China Distance Education
    Holdings Limited shareholders -- basic (note 1)


0.088


(0.059)

Non-GAAP net income/ (loss) per ADS attributable to China Distance Education
    Holdings Limited shareholders -- diluted (note 1)


0.087


(0.059)






Weighted average shares used in calculating basic net income / (loss) per share


138,762,726


131,449,547

Weighted average shares used in calculating diluted net income / (loss) per share          


139,669,135


131,449,547

Weighted average shares used in calculating basic non-GAAP net income / (loss) per 
    share


 

138,762,726


131,449,547

Weighted average shares used in calculating diluted non-GAAP net income / (loss) per
    share


 

139,669,135


131,449,547






    Note 1: Each ADS represents four ordinary shares

 

 

 

China Distance Education Holdings Limited

Reconciliations of non-GAAP measures to comparable GAAP measures

(In thousands of US Dollars, except number of shares, per share and per ADS data)






Six Months Ended March 31,



2016


2017



(Unaudited)


(Unaudited)






Cost of sales


22,030


24,607

Share-based compensation expense in cost of sales


81


81

Non-GAAP cost of sales


21,949


24,526






Selling expenses


10,668


15,617

Share-based compensation expense in selling expenses


42


42

Non-GAAP selling expenses


10,626


15,575






General and administrative expenses


7,857


9,178

Share-based compensation expense in general and administrative expenses


889


859

Non-GAAP general and administrative expenses


6,968


8,319






Gross profit


26,485


29,234

Share-based compensation expenses


81


81

Non-GAAP gross profit


26,566


29,315






Gross profit margin


54.6%


54.3%

Non-GAAP gross profit margin


54.8%


54.4%






Operating income


8,158


5,889

Share-based compensation expenses


1,012


982

Non-GAAP operating income


9,170


6,871






Operating margin


16.8%


10.9%

Non-GAAP operating margin


18.9%


12.8%






Net income


6,651


6,143

Share-based compensation expense


1,012


982

Non-GAAP net income


7,663


7,125






Net income margin


13.7%


11.4%

Non-GAAP net income margin


15.8%


13.2%






Net income per share -- basic


0.047


0.047

Net income per share -- diluted


0.047


0.046

Non-GAAP net income per share -- basic


0.055


0.054

Non-GAAP net income per share -- diluted


0.054


0.054






Net income per ADS attributable to China Distance Education Holdings Limited
    shareholders -- basic (note 1)


0.189


0.186

Net income per ADS attributable to China Distance Education Holdings Limited            
    shareholders -- diluted (note 1)


0.188


0.185

Non-GAAP net income per ADS attributable to China Distance Education Holdings
    Limited shareholders -- basic (note 1)


0.218


0.217

Non-GAAP net income per ADS attributable to China Distance Education Holdings
    Limited shareholders -- diluted (note 1)


0.216


0.215






Weighted average shares used in calculating basic net income per share


140,440,182


131,375,890

Weighted average shares used in calculating diluted net income per share


141,776,344


132,496,017

Weighted average shares used in calculating basic non-GAAP net income per share


140,440,182


131,375,890

Weighted average shares used in calculating diluted non-GAAP net income per share


141,776,344


132,496,017






    Note 1: Each ADS represents four ordinary shares.

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/china-distance-education-holdings-limited-reports-financial-results-for-second-quarter-fiscal-year-2017-300459251.html

Source: China Distance Education Holdings Limited

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