omniture

51job, Inc. Reports Second Quarter 2021 Financial Results

2021-09-24 18:00 12192

SHANGHAI, Sept. 24, 2021 /PRNewswire/ -- 51job, Inc. (Nasdaq: JOBS) ("51job" or the "Company"), a leading provider of integrated human resource services in China, announced today its unaudited financial results for the second quarter of 2021 ended June 30, 2021.

Second Quarter 2021 Financial Highlights:

  • Net revenues increased 32.6% over Q2 2020 to RMB1,098.7 million (US$170.2 million)
  • Online recruitment services revenues increased 17.4%
  • Other human resource related revenues increased 56.2%
  • Income from operations was RMB109.3 million (US$16.9 million)
  • Fully diluted earnings per share was RMB2.66 (US$0.41)
  • Excluding share-based compensation expense, loss from foreign currency translation, and change in fair value of listed equity securities investment, as well as the related tax effect of these items, non-GAAP adjusted fully diluted earnings per share was RMB3.64 (US$0.56)

Second Quarter 2021 Unaudited Financial Results

Net revenues for the second quarter ended June 30, 2021 were RMB1,098.7 million (US$170.2 million), an increase of 32.6% from RMB828.6 million for the same quarter in 2020.

Online recruitment services revenues for the second quarter of 2021 increased 17.4% to RMB590.6 million (US$91.5 million) compared with RMB503.3 million for the same quarter in 2020 primarily due to improved market conditions and more hiring activity from employers this year. While the Company believes there will be continued recovery in its online recruitment business in 2021, the recruitment outlook may be affected by uncertainty in the ongoing global pandemic and occasional restrictions instituted by authorities to contain outbreaks in China.

Other human resource related revenues for the second quarter of 2021 increased 56.2% to RMB508.1 million (US$78.7 million) from RMB325.4 million for the same quarter in 2020. The growth was primarily driven by strong demand for training services, campus recruitment campaigns, placement projects and business process outsourcing services this year.

Gross profit for the second quarter of 2021 increased 21.8% to RMB678.9 million (US$105.1 million) from RMB557.5 million for the same quarter of the prior year. Gross margin, which is gross profit as a percentage of net revenues, was 61.8% in the second quarter of 2021 compared with 67.3% for the same quarter in 2020. The increase in cost of services was primarily due to higher employee compensation expenses, staff additions and greater direct costs, such as venue rentals and media production services, incurred in providing training, campus recruitment and placement services to employers.

Operating expenses for the second quarter of 2021 increased 45.3% to RMB569.5 million (US$88.2 million) from RMB391.9 million for the same quarter in 2020. Sales and marketing expenses for the second quarter of 2021 increased 55.7% to RMB455.6 million (US$70.6 million) from RMB292.7 million for the same quarter of the prior year, primarily due to greater spending on brand advertising as well as more headcount and higher employee compensation expenses. Advertising and promotion expenses increased 86.9% to RMB127.4 million (US$19.7 million) in the second quarter of 2021 from RMB68.2 million in the same quarter of the prior year. The Company has plans to significantly increase sales and marketing investments this year to strengthen its brands and promote its wide range of service offerings.

General and administrative expenses for the second quarter of 2021 increased 14.8% to RMB113.9 million (US$17.6 million) from RMB99.2 million for the same quarter of the prior year, primarily due to higher employee compensation, share-based compensation, and professional services fees.

Income from operations for the second quarter of 2021 was RMB109.3 million (US$16.9 million) compared with RMB165.5 million for the second quarter of 2020. Operating margin, which is income from operations as a percentage of net revenues, was 9.9% in the second quarter of 2021 compared with 20.0% for the same quarter in 2020. Excluding share-based compensation expense, operating margin would have been 14.4% in the second quarter of 2021 compared with 24.6% for the same quarter in 2020.

The Company recognized a loss from foreign currency translation of RMB12.5 million (US$1.9 million) in the second quarter of 2021 compared with RMB0.5 million in the second quarter of 2020, primarily due to the impact of the change in exchange rate between the Renminbi and the U.S. dollar on the Company's U.S. dollar cash deposits.

Interest and investment income for the second quarter of 2021 was RMB31.9 million (US$4.9 million) compared with RMB66.4 million in the second quarter of 2020, primarily due to the reallocation of cash resources from time deposits to lower interest-bearing demand accounts.

The Company recognized a mark-to-market, non-cash loss of RMB5.2 million (US$0.8 million) in the second quarter of 2021 compared with a gain of RMB56.8 million in the second quarter of 2020 associated with a change in fair value of listed equity securities investment in Huali University Group Limited, which is traded on the Hong Kong Stock Exchange.

Other income in the second quarter of 2021 included local government financial subsidies of RMB85.2 million (US$13.2 million) compared with RMB144.9 million in the second quarter of 2020.

Net income attributable to 51job for the second quarter of 2021 was RMB181.7 million (US$28.1 million) compared with RMB376.7 million for the same quarter in 2020. Fully diluted earnings per share for the second quarter of 2021 was RMB2.66 (US$0.41) compared with RMB5.55 for the same quarter in 2020.

In the second quarter of 2021, total share-based compensation expense was RMB49.3 million (US$7.6 million) compared with RMB38.1 million in the second quarter of 2020.

Excluding share-based compensation expense, loss from foreign currency translation, and change in fair value of listed equity securities investment, as well as the related tax effect of these items, non-GAAP adjusted net income attributable to 51job for the second quarter of 2021 was RMB248.7 million (US$38.5 million) compared with RMB358.5 million for the second quarter of 2020. Non-GAAP adjusted fully diluted earnings per share was RMB3.64 (US$0.56) in the second quarter of 2021 compared with RMB5.28 in the second quarter of 2020.

As of June 30, 2021, cash and short-term investments totaled RMB10,812.9 million (US$1,674.7 million) compared with RMB10,761.9 million as of December 31, 2020.

Currency Convenience Translation

For the convenience of readers, certain Renminbi amounts have been translated into U.S. dollar amounts at the rate of RMB6.4566 to US$1.00, the noon buying rate on June 30, 2021 in New York for cable transfers of Renminbi as set forth in the H.10 weekly statistical release of the Federal Reserve Board.

Use of Non-GAAP Financial Measures

To supplement the consolidated financial statements presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), 51job uses non-GAAP financial measures of income before income tax expense, income tax expense, adjusted net income, adjusted net income attributable to 51job and adjusted earnings per share, which are adjusted from results based on GAAP to exclude share-based compensation expense, gain/loss from foreign currency translation and change in fair value of listed equity securities investment, as well as the related tax effect of these items. The Company believes excluding share-based compensation expense and its related tax effect from its non-GAAP financial measures is useful for its management and investors to assess and analyze the Company's core operating results as such expense is not directly attributable to the underlying performance of the Company's business operations and do not impact its cash earnings. The Company believes excluding gain/loss from foreign currency translation and change in fair value of listed equity securities investment, as well as the related tax effect, from its non-GAAP financial measures is useful for its management and investors as such translation, mark-to-market gain or loss is not indicative of the Company's core business operations and will not result in cash settlement nor impact the Company's cash earnings. 51job also believes these non-GAAP financial measures excluding share-based compensation expense, gain from foreign currency translation and change in fair value of listed equity securities investment, as well as the related tax effect of these items, are important in helping investors to understand the Company's current financial performance and future prospects and to compare business trends among different reporting periods on a consistent basis. The presentation of these additional measures should not be considered a substitute for or superior to GAAP results or as being comparable to results reported or forecasted by other companies. The non-GAAP measures have been reconciled to GAAP measures in the attached financial statements.

About 51job

Founded in 1998, 51job is a leading provider of integrated human resource services in China. With a comprehensive suite of HR solutions, 51job meets the needs of enterprises and job seekers through the entire talent management cycle, from initial recruitment to employee retention and career development. The Company's main online recruitment platforms (http://www.51job.com, http://www.yingjiesheng.com, http://www.51jingying.com, http://www.lagou.com, and http://www.51mdd.com), as well as mobile applications, connect millions of people with employment opportunities every day. 51job also provides a number of other value-added HR services, including business process outsourcing, training, professional assessment, campus recruitment, executive search and compensation analysis. 51job has a call center in Wuhan and a nationwide network of sales and service locations spanning more than 30 cities across China.

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," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "targets," "confident" and similar statements. Among other things, statements that are not historical facts, including statements about 51job's beliefs and expectations, as well as 51job's strategic and operational plans, are or contain forward-looking statements. 51job may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. All forward-looking statements are based upon management's expectations at the time of the statements and 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: execution of 51job's strategies and business plans; growth and trends of the human resource services industry in China; market acceptance of 51job's products and services; competition in the industry; 51job's ability to control costs and expenses; 51job's ability to retain key personnel and attract new talent; relevant government policies and regulations relating to 51job's industry, corporate structure and business operations; seasonality in the business; fluctuations in the value of the Renminbi against the U.S. dollar and other currencies; risks related to acquisitions or investments 51job has made or will make in the future; accounting adjustments that may occur during the quarterly or annual close or auditing process; and fluctuations in general economic and business conditions in China and globally, including the impact of the coronavirus or other pandemic. Further information regarding these and other risks are included in 51job's filings with the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of the press release and based on assumptions that 51job believes to be reasonable as of this date, and 51job undertakes no obligation to update any forward-looking statement, except as required under applicable law.

 

 

 

51job, Inc.

Consolidated Statements of Operations and Comprehensive Income








For the Three Months Ended


June 30, 2020


June 30, 2021


June 30, 2021

(In thousands, except share and per share data)

(unaudited)


(unaudited)


(unaudited)


RMB


RMB


US$ (Note 1)







Revenues:






   Online recruitment services

503,254


590,594


91,471

   Other human resource related revenues

325,374


508,147


78,702







Net revenues

828,628


1,098,741


170,173

Cost of services (Note 2)

(271,176)


(419,884)


(65,032)







Gross profit

557,452


678,857


105,141







Operating expenses:






   Sales and marketing (Note 3)

(292,732)


(455,648)


(70,571)

   General and administrative (Note 4)

(99,192)


(113,888)


(17,639)







Total operating expenses

(391,924)


(569,536)


(88,210)







Income from operations

165,528


109,321


16,931







Loss from foreign currency translation

(547)


(12,523)


(1,940)

Interest and investment income, net

66,419


31,938


4,947

Change in fair value of listed equity securities investment

56,806


(5,158)


(799)

Other income, net

144,590


85,015


13,167







Income before income tax expense

432,796


208,593


32,306

Income tax expense

(59,621)


(37,517)


(5,811)







Net income

373,175


171,076


26,495

Net loss attributable to non-controlling interests

3,485


10,600


1,642







Net income attributable to 51job, Inc.

376,660


181,676


28,137







Net income

373,175


171,076


26,495

Other comprehensive loss

(5)


(225)


(35)







Total comprehensive income

373,170


170,851


26,460







Earnings per share:






   Basic

5.62


2.69


0.42

   Diluted

5.55


2.66


0.41







Weighted average number of common shares outstanding:






   Basic

67,009,015


67,434,856


67,434,856

   Diluted

67,878,333


68,247,200


68,247,200













Notes:






(1) The conversion of Renminbi amounts into U.S. dollar amounts is based on the noon buying rate of RMB6.4566

to US$1.00 on June 30, 2021 in New York for cable transfers of Renminbi as set forth in the H.10 weekly statistical

release of the Federal Reserve Board.

(2) Includes share-based compensation expense of RMB6,079 and RMB7,875 (US$1,220) for the three months ended 

June 30, 2020 and 2021, respectively.

(3) Includes share-based compensation expense of RMB5,225 and RMB6,770 (US$1,048) for the three months ended

June 30, 2020 and 2021, respectively.

(4) Includes share-based compensation expense of RMB26,826 and RMB34,684 (US$5,372) for the three months ended

June 30, 2020 and 2021, respectively.

 

 

 

51job, Inc.

Consolidated Statements of Operations and Comprehensive Income








For the Six Months Ended


June 30, 2020


June 30, 2021


June 30, 2021

(In thousands, except share and per share data)

(unaudited)


(unaudited)


(unaudited)


RMB


RMB


US$ (Note 1)







Revenues:






   Online recruitment services

1,050,271


1,135,956


175,937

   Other human resource related revenues

569,468


857,938


132,878







Net revenues

1,619,739


1,993,894


308,815

Cost of services (Note 2)

(525,479)


(741,650)


(114,867)







Gross profit

1,094,260


1,252,244


193,948







Operating expenses:






   Sales and marketing (Note 3)

(568,924)


(929,566)


(143,971)

   General and administrative (Note 4)

(189,834)


(209,428)


(32,436)







Total operating expenses

(758,758)


(1,138,994)


(176,407)







Income from operations

335,502


113,250


17,541







Gain (Loss) from foreign currency translation

9,624


(7,178)


(1,112)

Interest and investment income, net

110,734


91,955


14,242

Change in fair value of equity securities investment

66,697


(18,413)


(2,852)

Other income, net

148,925


89,744


13,900







Income before income tax expense

671,482


269,358


41,719

Income tax expense

(96,392)


(52,164)


(8,079)







Net income

575,090


217,194


33,640

Net loss attributable to non-controlling interests

6,816


21,707


3,362







Net income attributable to 51job, Inc.

581,906


238,901


37,002







Net income

575,090


217,194


33,640

Other comprehensive income (loss)

303


(163)


(25)







Total comprehensive income

575,393


217,031


33,615







Earnings per share:






   Basic

8.70


3.54


0.55

   Diluted

8.56


3.50


0.54







Weighted average number of common shares outstanding:






   Basic

66,906,106


67,421,251


67,421,251

   Diluted

67,942,579


68,202,198


68,202,198













Notes:






(1) The conversion of Renminbi amounts into U.S. dollar amounts is based on the noon buying rate of RMB6.4566

to US$1.00 on June 30, 2021 in New York for cable transfers of Renminbi as set forth in the H.10 weekly

statistical release of the Federal Reserve Board.

(2) Includes share-based compensation expense of RMB11,996 and RMB14,077 (US$2,181) for the six months ended 

June 30, 2020 and 2021, respectively.

(3) Includes share-based compensation expense of RMB10,312 and RMB12,102 (U$1,874) for the six months ended

June 30, 2020 and 2021, respectively.

(4) Includes share-based compensation expense of RMB52,946 and RMB62,068 (US$9,613) for the six months ended

June 30, 2020 and 2021, respectively.

 

 

 

51job, Inc.

Reconciliation of GAAP and Non-GAAP Results








For the Three Months Ended


June 30, 2020


June 30, 2021


June 30, 2021

(In thousands, except share and per share data)

(unaudited)


(unaudited)


(unaudited)


RMB


RMB


US$ (Note 1)







GAAP income before income tax expense

432,796


208,593


32,306

Add: Share-based compensation

38,130


49,329


7,640

Add: Loss from foreign currency translation

547


12,523


1,940

Add (Less): Change in fair value of listed equity securities
     investment

(56,806)


5,158


799

Non-GAAP income before income tax expense

414,667


275,603


42,685







GAAP income tax expense

(59,621)


(37,517)


(5,811)

Tax effect of non-GAAP line items

(8)


(9)


(1)

Non-GAAP income tax expense

(59,629)


(37,526)


(5,812)







Non-GAAP adjusted net income

355,038


238,077


36,873







Non-GAAP adjusted net income attributable to 51job, Inc.

358,523


248,677


38,515







Non-GAAP adjusted earnings per share:






   Basic

5.35


3.69


0.57

   Diluted

5.28


3.64


0.56







Weighted average number of common shares outstanding:






   Basic

67,009,015


67,434,856


67,434,856

   Diluted

67,878,333


68,247,200


68,247,200








For the Six Months Ended


June 30, 2020


June 30, 2021


June 30, 2021

(In thousands, except share and per share data)

(unaudited)


(unaudited)


(unaudited)


RMB


RMB


US$ (Note 1)







GAAP income before income tax expense

671,482


269,358


41,719

Add: Share-based compensation

75,254


88,247


13,668

Add (Less): (Gain) Loss from foreign currency translation

(9,624)


7,178


1,112

Add (Less): Change in fair value of listed equity securities
     investment

(66,697)


18,413


2,852

Non-GAAP income before income tax expense

670,415


383,196


59,351







GAAP income tax expense

(96,392)


(52,164)


(8,079)

Tax effect of non-GAAP line items

(39)


84


13

Non-GAAP income tax expense

(96,431)


(52,080)


(8,066)







Non-GAAP adjusted net income

573,984


331,116


51,285







Non-GAAP adjusted net income attributable to 51job, Inc.

580,800


352,823


54,647







Non-GAAP adjusted earnings per share:






   Basic

8.68


5.23


0.81

   Diluted

8.55


5.17


0.80







Weighted average number of common shares outstanding:






   Basic

66,906,106


67,421,251


67,421,251

   Diluted

67,942,579


68,202,198


68,202,198













Note (1): The conversion of Renminbi amounts into U.S. dollar amounts is based on the noon buying rate of RMB6.4566

to US$1.00 on June 30, 2021 in New York for cable transfers of Renminbi as set forth in the H.10 weekly statistical

release of the Federal Reserve Board.

 

 

 

51job, Inc.

Consolidated Balance Sheets










As of



December 31,
2020


June 30,
2021


June 30,
2021

(In thousands, except share and per share data)

(unaudited)


(unaudited)


(unaudited)



RMB


RMB


US$ (Note 1)








ASSETS













Current assets:







Cash

3,292,698


9,036,457


1,399,569


Restricted cash

2,258




Short-term investments

7,469,213


1,776,482


275,142


Accounts receivable (net of allowance of RMB26,798 and







  RMB24,240 as of December 31, 2020 and  June 30, 2021,







  respectively)

290,480


329,184


50,984


Prepayments and other current assets

492,980


562,226


87,078








Total current assets

11,547,629


11,704,349


1,812,773








Non-current assets:







Time deposits 

719,189


732,212


113,405


Long-term investments

1,576,250


1,556,171


241,020


Property and equipment, net

273,157


269,892


41,801


Goodwill

1,036,124


1,036,124


160,475


Intangible assets, net

163,503


145,628


22,555


Right-of-use assets

307,869


314,536


48,715


Other long-term assets

13,946


424,144


65,692


Deferred tax assets

38,013


44,102


6,831








Total non-current assets

4,128,051


4,522,809


700,494








Total assets

15,675,680


16,227,158


2,513,267








LIABILITIES, MEZZANINE EQUITY AND EQUITY













Current liabilities:







Accounts payable

83,087


136,943


21,210


Salary and employee related accrual

182,565


134,771


20,873


Taxes payable

172,254


122,720


19,007


Advances from customers

1,158,604


1,310,715


203,004


Lease liabilities, current

34,952


42,406


6,568


Other payables and accruals

1,178,955


1,305,834


202,248








Total current liabilities

2,810,417


3,053,389


472,910








Non-current liabilities:







Lease liabilities, non-current

44,949


47,719


7,391


Deferred tax liabilities

232,087


225,891


34,986








Total non-current liabilities

277,036


273,610


42,377








Total liabilities

3,087,453


3,326,999


515,287








Mezzanine equity:







Redeemable non-controlling interests

189,811


167,434


25,932








Shareholders' equity:







Common shares (US$0.0001 par value: 500,000,000 shares







  authorized, 67,406,657 and 67,437,209 shares issued and







  outstanding as of December 31, 2020 and June 30, 2021,







  respectively)

54


54


8


Additional paid-in capital

5,206,154


5,301,874


821,156


Statutory reserves

18,474


18,474


2,861


Accumulated other comprehensive income

276,975


276,812


42,873


Retained earnings

6,871,090


7,109,991


1,101,197








Total 51job, Inc. shareholders' equity

12,372,747


12,707,205


1,968,095








Non-controlling interests

25,669


25,520


3,953








Total equity

12,398,416


12,732,725


1,972,048








Total liabilities, mezzanine equity and equity

15,675,680


16,227,158


2,513,267















Note (1): The conversion of Renminbi amounts into U.S. dollar amounts is based on the noon buying rate of RMB6.4566 to US$1.00

on June 30, 2021 in New York for cable transfers of Renminbi as set forth in the H.10 weekly statistical release of the Federal

Reserve Board.

 

Cision View original content:https://www.prnewswire.com/news-releases/51job-inc-reports-second-quarter-2021-financial-results-301384568.html

Source: 51job
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