2022-07-27 | NYSE:EDU | Press Launch

BEIJING, July 27, 2022 /PRNewswire/ — New Oriental Training & Expertise Group Inc. (the “Firm” or “New Oriental”) (NYSE: EDU/ 9901.SEHK), a supplier of personal instructional companies in China, at the moment introduced its unaudited monetary outcomes for the fourth fiscal quarter and financial yr ended Could 31, 2022.

Monetary Highlights for the Fourth Fiscal Quarter Ended Could 31, 2022

• Whole web revenues decreased by 56.8% yr over yr to US$524.0 million for the fourth fiscal quarter of 2022.
• Working loss was US$105.6 million for the fourth fiscal quarter of 2022.
• Internet loss attributable to New Oriental was US$189.3 million for the fourth fiscal quarter of 2022.

Key Monetary Outcomes

Working Highlights for the Fourth Fiscal Quarter Ended Could 31, 2022

• The entire variety of faculties and studying facilities was 744 as of Could 31, 2022, a lower of 103 and 925 in comparison with 847 as of February 28, 2022 and 1,669 as of Could 31, 2021, respectively. The entire variety of faculties was 107 as of Could 31, 2022.

Michael Yu, New Oriental’s Government Chairman, commented, “Fiscal yr 2022 has been a yr filled with challenges and alternatives. We restructured our core companies and operations to adjust to the federal government insurance policies in China and stepped onto a brand new stage. Our remaining key companies are seeing a steady development that lays a strong basis for our future growth. On this fiscal yr, the abroad take a look at preparation and abroad examine consulting companies elevated by 6% and 16% yr over yr, respectively. Our home take a look at preparation enterprise focusing on adults and college college students witnessed a file fast progress of roughly 30% yr over yr. On the identical time, varied new companies that we launched into earlier this yr achieved promising outcomes.

The non-academic tutoring enterprise was rolled out in over 50 cities, identical because the clever studying system and gadgets that had been adopted and examined in round 60 cities. Each have achieved optimistic buyer suggestions and improved buyer retention. Different companies, together with examine tour and analysis camp, instructional supplies and digitalized good examine options, in addition to examination preparation programs designed for college kids with junior faculty diplomas to acquire bachelor’s levels, are making exceptional progress. We’re assured that by leveraging our model recognition and academic sources accrued over our working historical past, these new companies will begin to generate notable income from the subsequent fiscal yr.”

Chenggang Zhou, New Oriental’s Chief Government Officer, added, “By the tip of this fiscal yr, the whole variety of faculties and studying facilities was lowered to 744. As we focus extra on enterprise alternatives within the main markets of higher-tier cities, we’re dedicated to leveraging our well-developed instructional infrastructure, human sources, and state-of-the-art expertise throughout our remaining key companies. We’re additionally actively wanting into new initiatives to offer high-quality and diversified instructional companies for our clients of all ages. Our online-merge-offline educating system helped us to take care of a excessive educating high quality to our clients amid the pandemic – particularly in main cities corresponding to Shanghai and Beijing. Koolearn.com, our on-line schooling platform, continues to develop its on-line instructional choices to adults and college college students, and actively seeks enterprise alternatives in new areas. On this fiscal yr, Koolearn established an e-commerce platform beneath the model title DONG FANG ZHEN XUAN(????) for the sale of agricultural and different merchandise. Koolearn additionally started to pilot livestreaming occasions on some well-known short-video social platforms corresponding to Douyin. DONG FANG ZHEN XUAN has made notable progress and obtained extensive recognitions from tens of thousands and thousands of subscribers and members alike.”

Stephen Zhihui Yang, New Oriental’s Government President and Chief Monetary Officer, commented, “We maintained a robust money place all through the entire restructuring course of. By the tip of this fiscal yr, our money and money equivalents, time period deposits and short-term investments totaled roughly US$4.2 billion. The extra prices and bills as a result of termination of lease agreements in relation to the closure of our studying facilities and worker layoffs had been largely absorbed in fiscal yr 2022. The Firm’s administration crew will proceed to make nice efforts to renew general profitability of the Firm as early as doable and proactively search worthwhile progress. Our continued dedication to prime quality companies and operational effectivity will ship extra worth to our clients, society and shareholders over the long run.”

Adoption of Share Repurchase Program

On July 26, 2022, New Oriental’s board of administrators licensed the repurchase of as much as US$400 million of the Firm’s frequent shares through the interval from July 28, 2022 by means of Could 31, 2023.

This share repurchase program authorizes the Firm to buy its ADSs or frequent shares sometimes on the open market at prevailing market costs, in privately negotiated transactions, in block trades or by means of different legally permissible methods in accordance with relevant guidelines and laws. The timing and extent of any purchases will depend on market situations, the buying and selling value of ADSs and its frequent shares, in addition to different elements.

New Oriental’s board of administrators will overview the share repurchase program periodically and will authorize adjustment to its phrases and measurement accordingly. New Oriental plans to fund any share repurchases made beneath this program from the Firm’s obtainable money steadiness.

Monetary Outcomes for the Fourth Fiscal Quarter Ended Could 31, 2022

Internet Revenues

For the fourth fiscal quarter of 2022, New Oriental reported web revenues of US$524.0 million, representing a 56.8% lower yr over yr. The decline was primarily as a result of cessation of Ok-9 educational after-school tutoring companies in compliance with the federal government insurance policies in China.

Working Prices and Bills

Working prices and bills for the quarter had been US$629.7 million, representing a 52.1% lower yr over yr. Non-GAAP working prices and bills for the quarter, which exclude share-based compensation bills, had been US$600.9 million, representing a 53.6% lower yr over yr. The lower was primarily as a result of discount of services and variety of workers because of the restructuring in fiscal yr 2022.

• Price of revenues decreased by 57.2% yr over yr to US$247.8 million.
• Promoting and advertising bills decreased by 50.7% yr over yr to US$95.8 million.
• Common and administrative bills for the quarter decreased by 43.9% yr over yr to US$286.1 million. Non-GAAP common and administrative bills, which exclude share-based compensation bills, had been US$257.2 million, representing a 47.4% lower yr over yr.

Whole share-based compensation bills, which had been allotted to associated working prices and bills, elevated by 42.9% to US$28.8 million within the fourth fiscal quarter of 2022. The rise is as a result of grants of restricted share models of the Firm to staff and administrators in Could 2021 with graded vesting over three years.

Working Loss and Working Margin

Working loss was US$105.6 million, in comparison with the lack of US$102.4 million in the identical interval of the prior fiscal yr. Non-GAAP loss from operations for the quarter was US$76.9 million, in comparison with the lack of US$82.2 million in the identical interval of the prior fiscal yr.

Working margin for the quarter was unfavorable 20.2%, in comparison with unfavorable 8.4% in the identical interval of the prior fiscal yr. Non-GAAP working margin, which excludes share-based compensation bills, for the quarter was unfavorable 14.7%, in comparison with unfavorable 6.8% in the identical interval of the prior fiscal yr.

Internet Loss and Internet Loss per ADS

Internet loss attributable to New Oriental for the quarter was US$189.3 million, in comparison with the lack of US$45.5 million in the identical interval of the prior fiscal yr. Primary and diluted web loss per ADS attributable to New Oriental had been US$1.12 and US$1.12, respectively.

Non-GAAP Internet Loss and Non-GAAP Internet Loss per ADS

Non-GAAP web loss attributable to New Oriental for the quarter was US$160.3 million, in comparison with the lack of US$27.9 million in the identical interval of the prior fiscal yr. Non-GAAP primary and diluted web loss per ADS attributable to New Oriental had been US$0.94 and US$0.94, respectively.

Money Stream

Internet working money movement for the fourth fiscal quarter of 2022 was roughly US$29.3 million and capital expenditures for the quarter had been US$22.3 million.

Stability Sheet

As of Could 31, 2022, New Oriental had money and money equivalents of US$1,148.6 million. As well as, the Firm had US$1,140.1 million in time period deposits and US$1,902.3 million in short-term funding.

New Oriental’s deferred income steadiness, which is money collected from registered college students for programs and acknowledged proportionally as income because the directions are delivered, on the finish of the fourth quarter of fiscal yr 2022 was US$933.1 million, a lower of 51.6% as in comparison with US$1,926.4 million on the finish of the fourth quarter of fiscal yr 2021. The lower is primarily as a result of cessation of Ok-9 educational after-school tutoring companies in compliance with the federal government insurance policies in China.

Monetary Outcomes for the Fiscal 12 months Ended Could 31, 2022

For the fiscal yr 2022 ended Could 31, 2022, New Oriental reported web revenues of US$3,105.2 million, representing a 27.4% lower yr over yr.

Loss from operations for the fiscal yr 2022 was US$982.5 million, in comparison with an revenue of US$117.3 million in the identical interval of the prior fiscal yr. Non-GAAP loss from operations for the fiscal yr 2022 was US$849.5 million, in comparison with an revenue of US$186.1 million in the identical interval of the prior fiscal yr.

Working margin for the fiscal yr 2022 was unfavorable 31.6%, in comparison with 2.7% for a similar interval of the prior fiscal yr. Non-GAAP working margin, which excludes share-based compensation bills for the fiscal yr 2022, was unfavorable 27.4%, in comparison with 4.4% for a similar interval of the prior fiscal yr.

Internet loss attributable to New Oriental for the fiscal yr 2022 was US$1,187.7 million, in comparison with an revenue of US$334.4 million in the identical interval of the prior fiscal yr. Primary and diluted web loss per ADS attributable to New Oriental for the fiscal yr 2022 amounted to US$7.00 and US$7.00, respectively.

Non-GAAP web loss attributable to New Oriental for the fiscal yr 2022 was US$1,046.2 million, in comparison with an revenue of US$389.0 million in the identical interval of the prior fiscal yr. Non-GAAP primary and diluted web loss per ADS attributable to New Oriental for the fiscal yr 2022 amounted to US$6.17 and US$6.17, respectively.

Outlook for the First Quarter of the Fiscal 12 months 2023

New Oriental expects whole web revenues within the first quarter of the fiscal yr 2023 (June 1, 2022 to August 31, 2022) to be within the vary of US$641.3 million to US$680.6 million, representing year-over-year decline within the vary of 51% to 48%.

This forecast displays New Oriental’s present and preliminary view, which is topic to alter.

Convention Name Info

New Oriental’s administration will host an earnings convention name at 8 AM on July 27, 2022, U.S. Japanese Time (8 PM on July 27, 2022, Beijing/Hong Kong Time).

Please register upfront of the convention, utilizing the hyperlink supplied beneath. Upon registering, you’ll be supplied with participant dial-in numbers, passcode and distinctive registrant ID.

Convention name registration hyperlink: https://s1.c-conf.com/diamondpass/10023381-cbs76d.html. It would routinely direct you to the registration web page of “New Oriental Fourth Fiscal Quarter 2022 Earnings Convention Name” the place chances are you’ll fill in your particulars for RSVP.

Within the 10 minutes previous to the decision begin time, chances are you’ll use the convention entry data (together with dial in quantity(s), direct occasion passcode and registrant ID) supplied within the affirmation electronic mail obtained on the level of registering.

A replay of the convention name could also be accessed by cellphone on the following quantity till August 3, 2022:

Moreover, a dwell and archived webcast of the convention name will probably be obtainable at http://investor.neworiental.org.

About New Oriental

New Oriental is a supplier of personal instructional companies in China providing a variety of instructional applications, companies and merchandise to a diversified scholar inhabitants all through China. New Oriental’s program, service and product choices primarily encompass take a look at preparation, language coaching for adults, schooling supplies and distribution, on-line schooling, and different companies. New Oriental is listed on NYSE (NYSE: EDU) and SEHK (9901.SEHK), respectively. New Oriental’s ADSs, every of which represents ten frequent shares. The Hong Kong-listed shares are absolutely fungible with the ADSs listed on NYSE.

For extra details about New Oriental, please go to http://www.neworiental.org/english/.

Protected Harbor Assertion

This announcement accommodates forward-looking statements. These statements are made beneath the “protected harbor” provisions of the U.S. Personal Securities Litigation Reform Act of 1995. These forward-looking statements will be recognized by terminology corresponding to “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and comparable statements. Amongst different issues, the outlook for the primary quarter of fiscal yr 2023, quotations from administration on this announcement, in addition to New Oriental’s strategic and operational plans, include forward-looking statements. New Oriental might also make written or oral forward-looking statements in its studies filed or furnished to the U.S. Securities and Alternate Fee, in its annual studies to shareholders, in press releases and different written supplies and in oral statements made by its officers, administrators or staff to 3rd events. Statements that aren’t historic info, together with statements about New Oriental’s beliefs and expectations, are forward-looking statements. Ahead-looking statements contain inherent dangers and uncertainties. Quite a few elements may trigger precise outcomes to vary materially from these contained in any forward-looking assertion, together with however not restricted to the next: our capability to draw college students and not using a important improve in course charges; our capability to proceed to rent, practice and retain certified lecturers; our capability to take care of and improve our “New Oriental” model; our capability to successfully and effectively handle the growth of our faculty community and efficiently execute our progress technique; the result of ongoing, or any future, litigation or arbitration, together with these regarding copyright and different mental property rights; competitors within the personal schooling sector in China; modifications in our revenues and sure price or expense gadgets as a proportion of our revenues; the anticipated progress of the Chinese language personal schooling market; Chinese language governmental insurance policies relating to personal instructional companies and suppliers of such companies; well being epidemics and different outbreaks in China; and common financial situations in China. Additional data concerning these and different dangers is included in our annual report on Type 20-F and different paperwork filed with the Securities and Alternate Fee. New Oriental doesn’t undertake any obligation to replace any forward-looking assertion, besides as required beneath relevant regulation. All data supplied on this press launch and within the attachments is as of the date of this press launch, and New Oriental undertakes no responsibility to replace such data, besides as required beneath relevant regulation.

About Non-GAAP Monetary Measures

To complement New Oriental’s consolidated monetary outcomes offered in accordance with GAAP, New Oriental makes use of the next measures outlined as non-GAAP monetary measures by the SEC: web revenue excluding share-based compensation bills and achieve / (loss) from honest worth change of long-term investments, working revenue excluding share-based compensation bills, working price and bills excluding share-based compensation bills, common and administrative bills excluding share-based compensation bills, working margin excluding share-based compensation bills, and primary and diluted web revenue per ADS and per share excluding share-based compensation bills and achieve / (loss) from honest worth change of long-term investments. The presentation of those non-GAAP monetary measures just isn’t supposed to be thought of in isolation or as an alternative choice to the monetary data ready and offered in accordance with GAAP. For extra data on these non-GAAP monetary measures, please see the tables captioned “Reconciliations of non-GAAP measures to probably the most comparable GAAP measures” set forth on the finish of this launch.

New Oriental believes that these non-GAAP monetary measures present significant supplemental data concerning its efficiency and liquidity by excluding share-based compensation bills and achieve / (loss) from honest worth change of long-term investments that will not be indicative of its working efficiency from a money perspective. New Oriental believes that each administration and traders profit from referring to those non-GAAP monetary measures in assessing its efficiency and when planning and forecasting future durations. These non-GAAP monetary measures additionally facilitate administration’s inside comparisons to New Oriental’s historic efficiency and liquidity. New Oriental believes these non-GAAP monetary measures are helpful to traders in permitting for larger transparency with respect to supplemental data utilized by administration in its monetary and operational determination making. A limitation of utilizing these non-GAAP measures is that they exclude share-based compensation cost and achieve / (loss) from honest worth change of long-term investments that has been and can proceed to be for the foreseeable future a major recurring expense in our enterprise. Administration compensates for these limitations by offering particular data concerning the GAAP quantities excluded from every non-GAAP measure. The accompanying tables have extra particulars on the reconciliations between GAAP monetary measures which can be most immediately similar to non-GAAP monetary measures.

Contacts

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SOURCE New Oriental Training and Expertise Group Inc.