16.5% Increase in First Quarter Net Revenue Year-Over-Year with First Quarter Net Revenue Exceeding Guidance
Live Conference Call to be held on Thursday, May 21, 2009 at 8 a.m. (Eastern) / 5 a.m. (Pacific) / 8 p.m. (Beijing/Hong Kong)
BEIJING, May 21 /PRNewswire-Asia/ -- ChinaEdu Corporation (Nasdaq: CEDU) ("ChinaEdu" or the "Company"), an educational services provider in China, today announced its unaudited financial results for the first quarter ended March 31, 2009(1).
First Quarter 2009 Highlights
(in thousands, unaudited) 3 Months Ended
Period
March March March over
Period Ended 31, 2008 31, 2009 31, 2009 Period %
Currency in thousands RMB RMB USD
Financial Data:
Net revenue 69,655 81,170 11,880 17%
Gross profit 45,500 48,600 7,113 7%
Income from operations 12,825 17,536 2,566 37%
Net income attributable to
CEDU 2,087 9,564 1,400 358%
Adjusted EBITDA (Non-GAAP) 18,338 25,588 3,745 40%
Adjusted net income
attributable to CEDU
(Non-GAAP) 4,782 13,379 1,959 180%
EPS 0.04 0.19 0.03 375%
Adjusted EPS 0.08 0.27 0.04 238%
Earnings per ADS 0.12 0.57 0.09 375%
Adjusted earnings per ADS 0.24 0.81 0.12 238%
Operating Data:
Revenue students for online
degree program 91,000 118,000 118,000 30%
-- Total net revenue for the first quarter of 2009 increased by 16.5% to
RMB81.2 million ($11.9 million) from RMB69.7 million for the
corresponding period in 2008.
-- Net revenue from online degree programs, the Company's major business
segment, increased by 19.7% to RMB65.8 million ($9.6 million) for the
first quarter of 2009 from RMB55.0 million for the corresponding period
in 2008.
-- The number of revenue students(2) in online degree programs during the
first quarter of 2009 increased by approximately 30% to over 118,000
from approximately 91,000 for the corresponding period in 2008.
-- Adjusted EBITDA, which is a non-GAAP measure defined as net income
before interest income, taxes, depreciation, amortization, share-based
compensation and goodwill and intangibles impairment charges, if
applicable, increased by 39.5% to RMB25.6 million ($3.7 million) in the
first quarter of 2009 from RMB18.3 million for the corresponding period
in 2008.
-- Income from operations for first quarter of 2009 increased by 36.7% to
RMB17.5 million ($2.6 million) from RMB12.8 million for the
corresponding period in 2008.
-- Net income attributable to ChinaEdu Corporation, which is net income
excluding net income attributable to noncontrolling interest, for the
first quarter of 2009 increased by 358.3% to RMB9.6 million ($1.4
million) from RMB2.1 million for the corresponding period in 2008.
-- Adjusted net income attributable to ChinaEdu Corporation, which is a
non-GAAP measure defined as net income attributable to ChinaEdu
Corporation excluding share-based compensation, noncontrolling interest
for share-based compensation, amortization and goodwill and intangibles
impairment charges, if applicable, increased by 179.8% to RMB13.4
million ($1.9 million) in the first quarter of 2009 from RMB4.8 million
for the corresponding period in 2008.
(1) This announcement contains translations of certain Renminbi ("RMB")
amounts into U.S. dollar ("$") amounts at specified rates solely for
the convenience of the reader. Unless otherwise stated, all
translations from RMB to U.S. dollars were made at the rate of
RMB6.8329 to $1.00, the noon buying rate in effect on March 31, 2009
in the H. 10 statistical release of the Federal Reserve Board. The
Company makes no representation that the RMB or U.S. dollar amounts
referred to could be converted into U.S. dollars or RMB, as the case
may be, at any particular rate or at all. For analytical presentation,
all percentages are calculated using the numbers presented in the
financial statements contained in this earnings release. An
explanation of the Company's non-GAAP financial measures is included
in the section entitled "Non-GAAP Financial Measures" below, and the
related reconciliations to GAAP financial measures are presented in
the accompanying financial statements.
(2) "Revenue students" refers to students of university online degree
programs who have paid tuition in the applicable period.
"We are pleased to report healthy growth for the first quarter of 2009, which reflects solid enrollment growth for the fall semester of 2008 compared to the fall semester of 2007. In the first quarter of 2009, we have continued to invest in the company's future," said Ms. Julia Huang, ChinaEdu's Chairman and Chief Executive Officer. "We continued to build out additional franchised learning centers and were focused on preparing for the spring semester enrollment for all of our learning centers. Progress for our 101 online tutoring program and Phase II construction for the Anqing School are both on track. We have also continued to invest in courseware development, technology upgrade and the learning platform for both online degree and non-degree programs, establishing a strong foundation for future growth. We strongly believe our current investments will contribute to the growth and success of our company."
Financial Results for the First Quarter Ended March 31, 2009
Net Revenue
Total net revenue for the first quarter of 2009 was RMB81.2 million ($11.9 million), representing a 16.5% increase from the corresponding period in 2008. Net revenue from online degree programs for the first quarter of 2009 was RMB65.8 million ($9.6 million), representing a 19.7% increase from RMB55.0 million for the corresponding period in 2008. The growth in net revenue was primarily due to strong enrollment growth for the fall semester of 2008, which registered over 118,000 revenue students compared to 91,000 revenue students for the fall semester of 2007.
Net revenue from the Company's non-online degree programs (online tutoring program, international curriculum programs and private primary and secondary schools) for the first quarter of 2009 was RMB15.4 million ($2.3 million), representing a 4.8% increase from RMB14.7 million for the corresponding period in 2008. This increase was attributable to the increase in student enrollment at Anqing School for the academic year beginning in September 2008 as a result of the completion of Phase I of the new campus construction as well as a slight increase in net revenue for the 101 online tutoring programs.
Cost of revenue
Total cost of revenue for the first quarter of 2009 was RMB32.6 million ($4.8 million), representing an increase of 34.8% as compared to RMB24.2 million for the corresponding period of 2008. Cost of revenue for online degree programs for the first quarter of 2009 was RMB22.7 million ($3.3 million), representing an increase of 48.2% as compared to RMB15.3 million for the first quarter of 2008. The increase in cost of revenue for online degree programs was attributable primarily to enrollment growth in our university partners' online degree programs in the fall semester of 2008 compared to fall semester of 2007, which recorded an approximate 30% growth in the number of registered students, as well as the expansion of our learning center network. We had 49 operational learning centers by the first quarter of 2009 compared to one operational learning center in the first quarter of 2008. In addition, in the first quarter of 2009, we continued to make investments in courseware development for selected university partners at our collaborative alliances(3).
Cost of revenue for non-online degree programs for the first quarter of 2009 was RMB9.9 million ($1.4 million), representing an 11.7% increase from RMB8.9 million for the corresponding period in 2008. This increase was attributable primarily to increased cost of revenue related to Anqing School's new campus, which was partially offset by a decrease in cost of revenue for the international curriculum programs.
(3) "Collaborative alliance" or "Collaborative alliances" refer to the
subsidiary or subsidiaries that the Company formed with certain
university partners to provide services to their online degree
programs, which subsidiaries are majority owned by the Company.
Gross Profit
Gross profit for the first quarter of 2009 was RMB48.6 million ($7.1 million), representing a 6.8% increase from RMB45.5 million for the corresponding period of 2008. Gross margin for the first quarter of 2009 was 59.9% as compared to 65.3% for the corresponding period of 2008. This decrease was primarily attributable to our continued investment in our learning center network.
Operating Expenses
Total operating expenses were RMB31.1 million ($4.5 million) for the first quarter of 2009, representing a 4.9% decrease from RMB32.7 million for the corresponding period in 2008. This decrease was attributable primarily to the factors discussed below.
-- General and administrative expenses for the first quarter of 2009 were
RMB19.6 million ($2.9 million), which represented a 6.4% decrease from
RMB20.9 million for the corresponding period of 2008. This decrease
was attributable primarily to a decrease in provisional
performance-based annual bonuses in 2009 as compared to 2008.
-- Selling and marketing expenses were RMB4.9 million ($0.7 million) for
the first quarter of 2009, which represented a 16.2% decrease from
RMB5.9 million for the corresponding period in 2008. This decrease is
attributable primarily to controlled sales and marketing expenses,
specifically as a result of a decrease in the amount spent on
advertising and promotional activities, for our learning center
operations in the first quarter in 2009.
-- Research and development expenses for the first quarter of 2009 were
RMB6.6 million ($1.0 million), representing an 11.4% increase from
RMB5.9 million for the corresponding period in 2008. This increase was
attributable primarily to increased technological support and a
platform upgrade for some of our collaborative alliances in order to
further enhance and support our online degree programs.
-- Share-based compensation for the first quarter of 2009, which was
allocated to the related cost and operating expense line items, was
RMB2.3 million ($0.3 million) as compared to RMB 0.4 million for the
corresponding period in 2008. The increase was attributable primarily
to adjust lower forfeiture rate for previous years in the first quarter
of 2008 and an increase in the number of options granted in the fourth
quarter of 2008, which in turn increased share-based compensation for
the first quarter of 2009.
Income from Operations
As a result of the factors discussed above, income from operations for the first quarter of 2009 was RMB17.5 million ($2.6 million), which increased by 36.7% from RMB12.8 million for the corresponding period of 2008.
Adjusted income from operations, which is a non-GAAP measure defined as income from operations excluding share-based compensation, amortization and goodwill and intangibles impairment charges, if applicable, was RMB21.6 million ($3.2 million) for the first quarter of 2009, which increased by 38.7% as compared to RMB15.6 million in the corresponding period of 2008. The increase was attributable primarily to the net revenue growth and the decrease in operating expenses (each as discussed above), which was partially offset by the increase in the cost of revenue discussed above.
Interest Income
Interest income was RMB1.7 million ($0.2 million) in the first quarter of 2009, as compared to RMB2.7 million in the corresponding quarter of 2008. This decrease was attributable primarily to a reduced fixed deposit balance, which earned less interest income than the corresponding period in 2008, when the fixed deposit balance was higher.
Income Tax Expense
Income tax income for the first quarter was RMB2.7 million ($0.4 million), as compared to income tax expense of RMB4.9 million for the corresponding period in 2008. This was attributable primarily to the fact that, in the fourth quarter of 2008, seven of our subsidiaries and affiliate companies applied and qualified for the "new and high technology enterprise" status under the new Chinese Enterprise Income Tax Regulation, which came into effect on January 1, 2008. As a result of their qualification for the "new and high technology enterprises" status, these subsidiaries received certain tax exemptions and a preferential statutory tax rate of 15%, thereby reducing the effective tax rate for the first quarter of 2009 as compared to the corresponding period in 2008. The effective tax rate in the first quarter of 2009 was 13.7%, which reflects the preferential tax rate of 15% applicable to the Company's main operating entity as a High and New Technology Enterprises and the preferential tax rate of 7.5% applicable to certain of the Company's subsidiaries and affiliate companies.
Noncontrolling Interest
Noncontrolling interest was RMB7.6 million ($1.1 million) in the first quarter of 2009, representing a 7.0% decrease from RMB8.1 million in the corresponding period in 2008, which was attributable primarily to reduced profitability at one of our collaborative alliances as a result of increased courseware development costs.
Net Income (loss) attributable to ChinaEdu Corporation
Net income attributable to ChinaEdu Corporation, which is net income excluding net income attributable to noncontrolling interest, was RMB9.6 million ($1.4 million) for the first quarter of 2009, representing an increase of 358.3% from net income attributable to ChinaEdu Corporation of RMB2.1 million for the corresponding period in 2008. Adjusted net income attributable to ChinaEdu Corporation (non-GAAP) increased by 179.8% to RMB13.4 million ($2.0 million) for the first quarter of 2009, as compared to RMB4.8 million in the corresponding period of 2008. The increase in both net income and adjusted net income attributable to ChinaEdu Corporation (non-GAAP) was primarily due to strong revenue growth in our online degree programs and private primary and secondary schools, and well controlled operating expenses.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA (non-GAAP) was RMB25.6 million ($3.7 million) for the first quarter of 2009, which increased by 39.5% as compared to RMB18.3 million for the corresponding period in 2008.
Deferred Revenue
Deferred revenue at the end of the first quarter of 2009 was RMB36.5 million ($5.3 million), with current deferred revenue of RMB29.6 million ($4.3 million) and non-current deferred revenue of RMB6.9 million ($1.0 million). Deferred revenue at the end of the first quarter of 2009 decreased significantly compared to deferred revenue of RMB102.1 million at the end of the fourth quarter 2008 due to the seasonality of enrollments, which results in tuition being received generally during the second quarter (spring semester) and the fourth quarter (fall semester) of each year.
Cash and Cash Equivalents
As of March 31, 2009, ChinaEdu reported cash and cash equivalents of RMB243.7 million ($35.7 million), which primarily consisted of cash-on-hand, demand deposits and term deposits with maturity periods of three months or less.
Term Deposits and Amount Due from Related Parties
Term deposits and the amount due from related parties (which represents cash owed to us by our collaborative alliance partners) amounted to RMB94.5 million ($13.8 million) and RMB114.7 million ($16.8 million), respectively, at March 31, 2009.
Second Quarter 2009 Total Net Revenue Guidance
For the second quarter of 2009, ChinaEdu expects its total net revenue to be in the range of RMB83 million ($12.1 million) to RMB87 million ($12.7 million). This forecast reflects ChinaEdu's current and preliminary view, which is subject to change.
Conference Call
ChinaEdu senior management will host a conference call on Thursday, May 21, 2009 at 8:00 a.m. U.S. Eastern time / 5:00 a.m. U.S. Pacific time / 8:00 p.m. Beijing/Hong Kong time.
The conference call may be accessed by calling (US) 866 700 7441/ (International) +1 617 213 8839/ (HK) +852 3002 1672/ (China) +86 10 800 130 0399, and entering the passcode: 82148177. A telephone replay of the conference call will be available shortly after the call until May 28, 2009 at (US) 888 286 8010/ (International) +1 617 801 6888 and entering passcode: 62253206. A live and archived webcast may be accessed via the Internet at http://ir.chinaedu.net .
Non-GAAP Financial Measures
To supplement the unaudited condensed consolidated financial information presented in accordance with Accounting Principles Generally Accepted in the United States of America ("GAAP"), the Company uses non-GAAP measures of income from operations and net income attributable to ChinaEdu Corporation, which are adjusted from results based on GAAP to exclude certain non-cash items of share-based compensation, amortization and goodwill and intangibles impairment charges, if applicable. The Company also uses adjusted EBITDA, which is also a non-GAAP measure and is adjusted from GAAP results of net income to exclude interest income, taxes, depreciation, amortization,
share-based compensation and goodwill and intangibles impairment charges, if applicable. These non-GAAP financial measures are provided to enhance the investors' overall understanding of the Company's current and past financial performance in on-going core operations as well as prospects for the future. These measures should be considered in addition to results prepared and presented in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. Management considers the non-GAAP information as important measures internally and therefore deems it important to provide all of this information to investors.
About ChinaEdu
ChinaEdu Corporation is an educational services provider in China, incorporated as an exempted limited liability company in the Cayman Islands. Established in 1999, the Company's primary business is to provide comprehensive services to the online degree programs of leading Chinese universities. These services include academic program development, technology services, enrollment marketing, student support services and finance operations. The Company's other lines of businesses include the operation of private primary and secondary schools, online interactive tutoring services and providing marketing and support for international curriculum programs.
The Company believes it is the largest service provider to online degree programs in China in terms of the number of higher education institutions that are served and the number of student enrollments supported. The Company currently has 12 long-term, exclusive contracts that generally vary from 15 to 50 years in length. ChinaEdu also performs recruiting services for 15 universities through our nationwide learning center network.
Forward-Looking Statement
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including certain plans, expectations, goals, and projections, which are subject to numerous assumptions, risks, and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and contingencies, many of which are beyond our control which may cause actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. The Company's actual results could differ materially from those contained in the forward-looking statements due to a number of factors, including those described under the heading "Risk Factors" in the Company's Annual Report on Form 20-F for the year ended December 31, 2007, and in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission. Unless required by law, the Company undertakes no obligation to (and expressly disclaim any such obligation to) update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Company Contacts:
Lily Liu, CFO
ChinaEdu Corporation
Tel: +86-10-8418-6655 x1002
Email: ir@chinaedu.net
S. Jimmy Xia, IR Manager
ChinaEdu Corporation
Tel: +86-10-8418-6655 x1150
Email: ir@chinaedu.net
ChinaEdu Corporation
Unaudited Condensed Consolidated Balance Sheets
December
31,2008 As March March
(in thousands, unaudited) Adjusted (1) 31, 2009 31, 2009
RMB RMB US$
Current assets:
Cash and cash equivalents 353,933 243,710 35,667
Accounts receivable, net 14,854 4,414 646
Term deposits 63,500 94,499 13,830
Prepaid expenses and other current
assets 20,251 22,129 3,239
Amounts due from related parties 150,472 114,688 16,785
Deferred tax assets 3,986 1,743 255
Total current assets 606,996 481,183 70,422
Cost method investment 1,210 1,210 177
Land use rights, net 28,344 28,330 4,146
Property and equipment, net 161,925 165,802 24,265
Deposits paid for acquisition of
property and equipment 8,619 8,619 1,261
Intangible assets, net 70,377 69,192 10,126
Deferred tax assets 2,096 2,645 387
Rental deposits 958 911 133
Goodwill 38,155 38,155 5,584
Total assets 918,680 796,047 116,501
Liabilities and equity
Current liabilities:
Accounts payable 8,530 6,905 1,011
Deferred revenues 96,068 29,641 4,338
Accrued expenses and other current
liabilities 51,629 49,595 7,257
Amounts due to related parties 25,769 30,072 4,401
Income taxes payable 27,917 18,688 2,735
Other taxes payable 12,008 7,475 1,094
Total current liabilities 221,921 142,376 20,836
Deferred revenues 6,073 6,885 1,008
Deferred tax liabilities 11,069 11,170 1,635
Unrecognized tax benefit 5,473 5,821 852
Total liabilities 244,536 166,252 24,331
Total shareholders' equity: 589,829 541,036 79,180
Noncontrolling interest (2) 84,315 88,759 12,990
Total equity 674,144 629,795 92,170
Total liabilities and equity 918,680 796,047 116,501
(1) Effective January 1, 2009, the Company adopted SFAS 160. SFAS 160,
which was retrospectively applied, requires noncontrolling interests
to be separately presented as a component of stockholders' equity on
the unaudited condensed consolidated financial statements.
(2) December 31, 2008 balances were extracted from the form 6-K for the
quarters ended December 31, 2008, as adjusted resulting from the
adoption of Statement of Financial Accounting Standards No. 160.
ChinaEdu Corporation
Unaudited Condensed Consolidated Statements of Operations
Three Months Ended
(in thousands, except for March December
percentage, share, and per 31, 2008 As 31, 2008 As March March
share information) Adjusted(3) Adjusted(3) 31, 2009 31, 2009
RMB RMB RMB US$
Net Revenue:
Online degree programs 54,960 69,945 65,764 9,625
International curriculum
programs 7,542 5,300 5,583 817
Online tutoring programs 3,277 4,472 3,592 526
Private primary and
secondary schools 3,876 6,823 6,231 912
Total net revenue 69,655 86,540 81,170 11,880
Cost of revenue:
Online degree programs 15,302 28,195 22,683 3,320
International curriculum
programs 4,765 3,532 2,948 431
Online tutoring programs 727 1,443 1,441 211
Private primary and
secondary schools 3,361 5,828 5,498 805
Total cost of revenue 24,155 38,998 32,570 4,767
Gross profit:
Online degree programs 39,658 41,750 43,081 6,305
International curriculum
programs 2,777 1,768 2,635 386
Online tutoring programs 2,550 3,029 2,151 315
Private primary and
secondary schools 515 995 733 107
Total gross profit 45,500 47,542 48,600 7,113
Online degree programs 72.2% 59.7% 65.5% 65.5%
International curriculum
programs 36.8% 33.4% 47.2% 47.2%
Online tutoring programs 77.8% 67.7% 59.9% 59.9%
Private primary and
secondary schools 13.3% 14.6% 11.8% 11.8%
Gross margin 65.3% 54.9% 59.9% 59.9%
Operating expenses:
General and administrative 20,915 27,410 19,583 2,866
Selling and marketing 5,862 8,202 4,910 719
Research and development 5,898 8,947 6,571 962
Goodwill and intangible
assets impairment -- 52,236 -- --
Total operating expenses 32,675 96,795 31,064 4,547
Income (loss) from
operations 12,825 (49,253) 17,536 2,566
Operating margin 18.4% -56.9% 21.6% 21.6%
Other income (expense) 151 145 626 92
Interest income 2,748 2,973 1,672 245
Interest expense (606) (1) -- --
Income (loss) before
income tax provisions 15,118 (46,136) 19,834 2,903
Income tax expense (4,900) 19,621 (2,708) (396)
Net income 10,218 (26,515) 17,126 2,507
Net income attributable to
the noncontrolling
interest (4) (8,131) (12,469) (7,562) (1,107)
Net income attributable to
ChinaEdu Corporation 2,087 (38,984) 9,564 1,400
Net margin 3.0% -45.0% 11.8% 11.8%
Net income (loss) per
share:
Basic 0.04 (0.70) 0.19 0.03
Diluted 0.03 (0.70) 0.18 0.03
Net income (loss) per ADS:
Basic 0.12 (2.10) 0.57 0.09
Diluted 0.09 (2.10) 0.54 0.09
Weighted average aggregate
number of ordinary shares
outstanding:
Basic 58,434,407 55,951,673 49,983,675 49,983,675
Diluted 62,789,582 55,951,673 52,919,048 52,919,048
(3) Effective January 1, 2009, the Company adopted SFAS 160. SFAS 160,
which was retrospectively applied, requires noncontrolling interests
to be separately presented as a component of stockholders' equity on
the unaudited condensed consolidated financial statements.
(4) Amounts were extracted from Form 6-K for the quarter ended March 31,
2008 and for the quarter ended December 31, 2008, as adjusted
resulting from the adoption of Statement of Financial Accounting
Standards No. 160.
ChinaEdu Corporation
Unaudited Condensed Consolidated Statements of Cash Flow
Three Months Ended
March December March March
(in thousands) 31, 2008 31, 2008 31, 2009 31, 2009
RMB RMB RMB US$
Operating activities:
Net income 10,218 (26,515) 17,126 2,507
Share-based compensation 383 1,683 2,262 331
Depreciation 2,734 3,570 3,941 577
Amortization of land use
rights 141 182 163 24
Amortization of intangible
assets 2,255 2,087 1,686 247
Goodwill and intangible
assets impairment -- 52,236 -- --
Accounts receivable write-
off -- 1,215 62 9
Interest expense 606 -- -- --
Loss (gain) from disposal
of property and equipment -- 1,663 78 11
Deferred income taxes 5,856 (16,310) 1,795 263
Accounts receivable (163) (10,341) 10,378 1,519
Prepaid expenses and other
current assets (7,386) (7,287) (1,881) (275)
Amounts due from related
parties 35,589 (22,991) 46,384 6,788
Rental deposits 828 107 47 7
Accounts payable (147) (1,084) 1,084 159
Deferred revenues (57,483) 68,925 (65,617) (9,603)
Accrued expenses and other
current liabilities (10,114) 16,213 (2,046) (299)
Amounts due to related
parties (12,052) (29,096) 1,005 147
Unrecognized tax benefit 133 872 348 51
Other taxes payable (4,307) 5,287 (4,533) (663)
Income tax payable (7,182) (4,556) (9,229) (1,351)
Net cash provided by (used in)
operating activities (40,091) 35,860 3,053 449
Investing activities:
Purchase of land use right -- (160) (949) (139)
Purchase of property and
equipment (8,485) (4,745) (10,605) (1,552)
Deposits paid for
acquisition of property
and equipment (31) (2,616) -- --
Purchase of term deposit (1,958) 41,000 (31,008) (4,538)
Purchase of contractual
right -- -- (500) (73)
Proceeds from disposal of
property and equipment 31 -- -- --
Net cash provided by (used in)
investing activities (10,443) 33,479 (43,062) (6,302)
Financing activities:
Repurchase of ordinary
shares -- (13,714) (61,647) (9,022)
Repayment of long-term
loan interest and
principal (1,671) -- -- --
Cash dividends paid to
noncontrolling
shareholders -- (7,269) (10,600) (1,551)
Capital contributions by
noncontrolling
shareholders -- -- 980 143
Proceeds from exercise of
options -- 1,383 713 104
Net cash provided by (used in)
financing activities (1,671) (19,600) (70,554) (10,326)
Effect of foreign exchange rate
changes (12,930) 865 340 48
CASH AND CASH EQUIVALENTS, beginning
of period 497,114 303,329 353,933 51,798
CASH AND CASH EQUIVALENTS, end of
period 431,979 353,933 243,710 35,667
Net increase (decrease) in cash (65,135) 50,604 (110,223) (16,131)
ChinaEdu Corporation
Reconciliations of non-GAAP results of operations measures to GAAP
measures
Three Months Ended
March December March March
(in thousands, unaudited) 31, 2008 31, 2008 31, 2009 31, 2009
RMB RMB RMB US$
Income (loss) from
operations
GAAP Result 12,825 (49,253) 17,536 2,566
Share-based compensation 383 1,683 2,262 331
Amortization 2,396 2,269 1,849 271
Goodwill and intangible
assets impairment -- 52,236 -- --
Adjusted income from
operations (Non-GAAP) 15,604 6,935 21,647 3,168
Adjusted operating margin 22.4% 8.0% 26.7% 26.7%
Net income (loss)
attributable to ChinaEdu
Corporation
GAAP Result 2,087 (38,984) 9,564 1,400
Share-based compensation 383 1,683 2,262 331
Noncontrolling interest
for share-based
compensation (84) (203) (296) (43)
Amortization 2,396 2,269 1,849 271
Goodwill and intangible
assets impairment -- 52,236 -- --
Adjusted net income
attributable to ChinaEdu
Corporation (Non-GAAP) 4,782 17,001 13,379 1,959
Adjusted net margin 6.9% 19.6% 16.5% 16.5%
Adjusted net income per
share:
Basic 0.08 0.30 0.27 0.04
Diluted 0.08 0.30 0.25 0.04
Weighted average aggregate
number of ordinary shares
outstanding:
Basic 58,434,407 55,951,673 49,983,675 49,983,675
Diluted 62,789,582 57,563,770 52,919,048 52,919,048
Adjusted income from operations, which is a non-GAAP measure defined as
income from operations excluding share-based compensation, amortization
and goodwill and intangibles impairment, if applicable.
Adjusted net income attributable to ChinaEdu Corporation, which is a
non-GAAP measure defined as net income attributable to the ChinaEdu
Corporation excluding share-based compensation, noncontrolling interest
for share-based compensation, amortization and goodwill and intangibles
impairment charges, if applicable.
ChinaEdu Corporation
Reconciliation from net income to adjusted EBITDA (*)
Three Months Ended
March December March March
(in thousands, unaudited) 31, 2008 31, 2008 31, 2009 31, 2009
RMB RMB RMB US$
Net income 10,218 (26,515) 17,126 2,507
Income tax provision 4,900 (19,621) 2,708 396
Interest income and other, net (2,293) (3,117) (2,298) (337)
Depreciation 2,734 3,570 3,941 577
Amortization 2,396 2,269 1,849 271
Goodwill and intangible assets
impairment -- 52,236 -- --
Share-based compensation 383 1,683 2,262 331
Adjusted EBITDA 18,338 10,505 25,588 3,745
Adjusted EBITDA margin 26.3% 12.1% 31.5% 31.5%
Adjusted EBITDA, which is a non-GAAP measure defined as earnings before
interest income, taxes, depreciation, amortization, share-based
compensation and goodwill and intangibles impairment charges, if
applicable.
