United states of america Now uncovered 1,139 U.S. constitution educational institutions experienced $1 billion in PPP loans forgiven.
The investigation discovered virtually all – 93{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} – shed no funds in the course of the pandemic.
Critics want Smaller Business Administration to get PPP repayments from constitution educational facilities.
The publicly funded but privately operated schools that teach a fraction of U.S. small children obtained additional than $1 billion in forgiven Paycheck Defense System financial loans built to help struggling modest organizations all through the pandemic.
The mortgage method had plenty of leeway to allow smaller organizations, including constitution universities, to qualify with no showing any monetary require. Federal restrictions only required businesses in search of the financial loans to say they faced “economic uncertainty” and the cash was necessary to support ongoing operations.
A congresswoman and fiscal watchdogs are contacting on the federal Modest Company Administration (SBA), which administered the loan forgiveness method, to claw back again some of that money.
Constitution schools’ PPP financial loans
Usa Today examined documents from the Internal Income Assistance, SBA, state Departments of Education and charter faculties, and interviewed dozens of persons, including education professionals and watchdogs to discover:
►The vary of forgiven financial loans for 1,139 charter universities in 37 states was $150,746 to $9.8 million.
►One California constitution chain attained $32.7 million in PPP loans by making use of 12 independent nonprofit organizations that are connected to various educational facilities to get the revenue. All of the financial loans were being sent to the very same address in Lancaster. The chain, Understand4Existence, denied any wrongdoing.
Have a tip on organization or investigative stories? Arrive at the reporter at craig.harris@usatoday.com or 602-509-3613 or on Twitter @CraigHarrisUSAT or linkedin.com/in/craig-harris-70024030/
Sen. Joe Manchin, D-WV, solutions Fox Information Digital’s thoughts at CERAWeek.
Sen. Joe Manchin Friday lauded the Federal Electrical power Regulatory Fee (FERC) for reversing a February plan assertion on gasoline pipelines, after slamming it and demanding its chairman do his “damn occupation” earlier this thirty day period.
“Today’s unanimous vote through FERC’s open up conference was a system correction from their past partisanship and I respect their willingness to tackle the significant issues raised by many users of the Senate Vitality and Normal Assets Committee,” Manchin stated in a Friday early morning statement.
Senator Joe Manchin, a Democrat from West Virginia and chairman of the Senate Vitality and Organic Means Committee, speaks throughout a news meeting at the 2022 CERAWeek by S&P World-wide meeting in Houston, Friday, March 11, 2022. (F. Carter Smith/Bloomberg by means of Getty Photos / Getty Visuals)
MANCHIN TO Main Energy REGULATOR Holding UP Natural Gasoline Jobs: ‘DO YOUR DAM JOB’
“I was also happy to see them approve three more pipeline projects. Vitality security for The us and our allies is dependent on FERC’s skill to transfer much needed power infrastructure jobs ahead,” Manchin additional. “To do so they ought to preserve distinct and predictable procedures that strike the ideal equilibrium amongst strength security, affordability and environmental considerations.”
FERC very last month issued a plan statement relating to organic fuel pipelines that would have increased scrutiny of “environmental impacts” and “prospective impression on climate alter” of new pipeline initiatives. The statement also highlighted factors of “the passions of landowners and surrounding communities, including environmental justice communities.”
At its assembly Thursday, FERC’s commissioners voted to make that policy assertion and one other “Draft Policy Statements,” rather, FERC Chairman Richard Glick tweeted.
MANCHIN BLASTS ANTI-FOSSIL Gas AGENDA AMID RUSSIA-UKRAINE WAR: ‘BEYOND THE PALE’
FERC Thursday also authorised the enlargement of a few organic gas pipelines.
Manchin was incensed by the first transfer in February and hauled FERC’s commissioners right before a hearing of the Senate Power and Pure Means Committee on March 3. In that hearing, he blasted regulatory moves by Glick and his fellow commissioners as “over and above the pale” amid Russia’s war in opposition to Ukraine.
“To deny or place up obstacles to natural gas jobs and the gains they give while Putin is actively and properly employing electricity as an financial and political weapon in opposition to our allies is just past the pale,” he reported.
FOX Business asks FERC Chairman Richard Glick about criticism of the Biden administration’s regulatory method.
Glick defended his agency’s move the future 7 days at the CERAWeek by S&P Worldwide electricity conference in Houston, when questioned about his trade with Manchin by Fox Information Electronic. He claimed it really is significant to be certain pipeline projects are accomplished “right the very first time.”
A appropriate course of action, Glick additional, can steer clear of “years of litigation and … hundreds of thousands and thousands, if not billions, of dollars of added price.”
“Nicely, talk up and aid us, Mr. Chairman Glick. Communicate up and aid us,” Manchin stated the future working day at the meeting when requested by Fox News Electronic about Glick’s opinions.
The senator claimed FERC is intentionally withholding assistance from permit seekers. When he was West Virginia’s governor, Manchin mentioned, he instructed state regulators, “If you go out with a cease and desist order ahead of you test to assistance an individual do a thing proper and explain to them what they’re performing wrong, shame on you. Shame on all of you.”
Sen. Joe Manchin, chairman of the Senate Vitality and Natural Assets Committee, speaks during the 2022 CERAWeek by S&P International meeting in Houston, on Friday, March 11, 2022. (F. Carter Smith/Bloomberg through Getty Illustrations or photos / Getty Visuals)
“The fossil fuel industry and the politicians they finance are pitching a in shape mainly because they’re concerned FERC’s modest proposed plan adjustments may possibly suggest they no extended have totally free rein to build as many polluting pipelines as they want with no regard for the impacts on communities or the local climate,” Sierra Club Senior Director of Strength Strategies Kelly Sheehan said.
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“The commission’s draft plan statements are just a modest action toward performing what is lawfully necessary of them and creating a fairer method, but FERC’s acceptance today of fracked gasoline pipelines makes it painfully crystal clear that FERC has not improved training course,” Sheehan included.
FERC’s improve of course arrives amid as momentum builds in the U.S. to maximize domestic power manufacturing and exports, in certain to Europe amid Russia’s war on Ukraine. One consequence of the war was that Germany froze action on the controversial Nord Stream 2 purely natural gasoline pipeline from Russia.
FOX Business’ Breck Dumas and Ronn Blitzer contributed to this report.
Image by means of Benchmark Federal Credit history Union.
The price of performing enterprise carries on to increase as we in the vicinity of the close of Q1, and reducing company costs can make a large effect on your bottom line. Regardless of whether you’re a begin-up or a effectively-proven business, it’s critical to devise a strategy. Right here are 8 guidelines for reducing business fees without the need of negatively impacting your client company or product or service top quality.
1. Re-examine your budget
With costs mounting additional and much more each and every thirty day period, you might not realize how substantially it’s impacting your P&L until it is too late. Re-assessing your spending plan, as you close the 1st quarter of 2022, can give you a clearer strategy of the income flowing in and out, which is the first stage to pinpointing regions exactly where you can preserve.
2. Go paperless
The value of paper, ink, mailing supplies, and postage can genuinely make an impact on the cost of doing business more than time. Going paperless can help you lessen this price tag, by switching to electronic correspondence and electronic invoicing when proper and safe. A digital workplace that is considerably less reliant on paper and print is also much more environmentally welcoming.
3. Contemplate acquiring refurbished machines and furnishings
Shopping for almost everything brand name new could not constantly be the smartest choice when you’re striving to help save. In accordance to Entrepreneur, by buying refurbished products, you could realize personal savings that typical 30 percent to 50 per cent of the providing price for the identical gear in new problem. Refurbished gear is typically fully inspected and comes with a warranty for better peace of intellect. For unexpected conditions like an products failure, retain in mind that Benchmark’s Smaller Business Funding provide at BenchmarkFCU.org can be excellent with financial loans of $25,000 to $500,000 funding in as minor as a single week.
4. Store all-around and review prices
As a organization operator, you will need to keep on best of the price tag of items. This implies regular monitoring and price comparison. Don’t be shy about asking your sellers for a low cost when warranted. This goes for organization insurance policies as well. Whilst insurance policies is a required cost, you can sit down with your broker to examine your coverage and shop for distinctive insurance companies. You may possibly obtain a shocking variance in costs concerning businesses. You may possibly also locate your distributors and suppliers are inclined to negotiate to continue to keep your business enterprise. It’s good to study and negotiate all bills to locate cost savings.
5. Assess your location
Do you seriously require all of that place? If not, you may be ready to lessen your office environment space charge. Is it achievable for some workers to perform from home (even part time) and nonetheless be as productive? Make the most of your bodily space, and assess the require for the house you have. This can be a fantastic way to know major personal savings.
6. Unplug to Help you save
If your electric power expenses are out of regulate, unplug unused gear and switch off lights. Improve to power-conserving bulbs and other electricity-preserving engineering. Communicate to your staff the importance of conserving and saving on electrical power.
7. Evaluate your computer software subscriptions
Let’s encounter it, we all have numerous subscriptions that go unused. By auditing your monthly software program subscriptions, you might be in a position to discover substantial personal savings as you unsubscribe from those not essential.
8. Slash vehicle expenses
With gasoline prices soaring, slicing non-vital small business journey can aid lower car bills. If you locate oneself in have to have of a new organization auto and finances are tight, consider leasing with a lower month to month payment. You may perhaps even take into consideration carpooling with colleagues to small business gatherings to help help save, as effectively as give an chance to socialize and discuss organization.
Take into consideration Benchmark FCU for your organization borrowing needs
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Rebecca Worthington is the Vice President of Neighborhood Relations at Benchmark Federal Credit rating Union. The only federal credit score union to completely serve Chester County, Benchmark FCU has been serving the community for much more than 80 decades and is identified for remarkable products and services to its members. For more data on credit history union eligibility and shielding your economical properly-staying, take a look at BenchmarkFCU.org.
QUINCY, Mass., March 24, 2022 (World NEWSWIRE) — Retail Business Products and services, the expert services corporation of Ahold Delhaize Usa, now introduced that it has released a Diversity, Fairness & Inclusion (DE&I) Council, which is charged with driving consciousness, adoption and acceleration of the company’s DE&I method and supports the company’s motivation to producing a workplace in which each and every affiliate feels they belong.
The Council features a wide wide variety of views coming jointly to make an effect. It is led by Retail Company Solutions President Roger Wheeler, who serves as Chair, and DE&I Manager Valencia Seals, who serves as Vice Chair and contains representation from every single of Retail Enterprise Services’ Organization Source Teams (BRGs), five at-huge associates, each and every member of the Retail Enterprise Companies leadership crew, and DE&I Coordinator Carley James, who serves as coordinator of the council.
“At Retail Business Solutions, we hold ourselves accountable for fostering an setting exactly where all associates come to feel welcome and know they operate for a enterprise wherever they belong,” reported Wheeler. “In standing up the Council, we are ready to even more our journey and accelerate action.”
The group will collaborate above the training course of a two-calendar year expression to share insights that tell Retail Company Services’ DE&I journey, determine alternatives to create the tradition of belonging and assist to produce motion strategies that leverage options and conquer obstacles.
Retail Enterprise Providers thanks the pursuing people for their provider as section of the Council:
Business enterprise Source Group Chairs
Richard Benton, Manager, Model Connection and Chair, EDGE + Allies
Caroline Chamoun, Manager, Course of action Excellence and Analytics and Chair, CONEXIÓN + Allies
Erin DeWaters, Director, Communications and Chair, Stability + Allies
Celeste Freeland, Manager, IT Supply Methodology and Chair, ELEVATE + Allies BRG
Haydn Fry, Analyst, Payment and Chair, Prosper + Allies
“The DE&I workforce is fired up to companion with this numerous team of persons to further more our progress,” claimed Seals. “We’re wanting ahead to leveraging their special experiences and insights to tell our DE&I approach, and we are grateful for their determination to furthering DE&I at Retail Business Products and services.”
Afterwards this spring, Retail Company Services will release its second annual DE&I Development Report, which provides associates a transparent see into how Retail Company Providers is progressing on its DE&I journey towards a set of described actions.
About Retail Enterprise Providers Retail Company Products and services, is the services organization of foremost grocery retail team Ahold Delhaize United states, currently providing providers to five omnichannel grocery brand names, including Meals Lion, Big Food items, The Giant Enterprise, Hannaford and Cease & Store. Retail Company Products and services leverages the scale of the neighborhood brand names to push synergies and gives business-leading expertise, insights and analytics to regional makes to guidance their approaches with solutions together with Organization Integrity Providers (Legal, Danger Administration, High quality Assurance), Business Solutions (HR Technologies Techniques and Process Administration), Communications & Omnichannel Support, Finance Enterprise Companies, Monetary Organizing & Assessment, Human Resources, Indirect Sourcing, Data Technologies, Pharmacy Services, Retail Innovation, Store Growth, Leasing and Services Guidance, and Approach & Business Advancement. We are fully commited to diversity, equity and inclusion and we foster a local community of belonging in which absolutely everyone is valued. For much more details, visit www.retailbusinessservices.com.
MEDIA CONTACTS: Christy Phillips-Brown 704-310-2221
The stereotypes about millennials and money setting up may possibly be genuine, according to some scientific tests. One survey identified that the ordinary millennial spends 150 more hrs on social media than they expend running their funds, GOBankingRates earlier noted. And, when it comes to personalized finance, the long term does not hold a great deal of promise for the upcoming generations established to graduate faculty, possibly.
See: 7 Swiftest Ways To Save $20K, According To Specialists Millennials vs. Gen X: Who Spends Far more Time Performing and Who Spends Much more Time Shelling out?
Only 23 states at present have to have learners to have any instruction in personalized finance just before graduating. What is worse, in the two a long time due to the fact the Survey of the States was published by the Council for Economic Education, only two states extra a personalized finance system necessity for graduation.
Of the 23 states necessitating particular finance instruction, only 10 have a standalone training course prerequisite, though the relaxation combine coursework into one more class. Is your condition on the record for demanded private finance instruction?
Standalone Substantial School Training course Required
Alabama
Florida
Mississippi
Missouri
Nebraska
North Carolina
Ohio
Tennessee
Utah
Virginia
Coursework Integrated Into One more System
Arizona
Georgia
Idaho
Kentucky
Michigan
Missouri
New Hampshire
New Jersey
New Mexico
New York
North Dakota
South Carolina
Texas
If your point out is not on this checklist, there are actions you can get to advocate for private finance education. The CEE report mentioned, “Effective private economical instruction requires equally the pressure of state-degree action and the adaptability of community-primarily based implementation.”
Initially, if your college district delivers monetary training, but it is not demanded, inspire your young children to choose the course. Go over what they are understanding at home. Carry out solutions so they can commence training personalized finance. You could take into consideration supplying them their own debit card and a financial savings account so they can learn to regulate income.
Next, get concerned in your local community. Write to your school board and superintendent to request a own finance classes for your university or district. Also, create to condition legislators and advocate for statewide requirements, whilst permitting districts to set their individual curriculum that is appropriate for the people today inside their community.
Retirement: 45{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of Millennials Really do not Believe Now Is the Time to Commit in Their Futures Discover: Millennial Wealth Has Doubled All through Pandemic, but Nonetheless Considerably Powering Boomers
Eventually, advocate at the state and area stage for your district’s academics to get the experienced improvement they want and want to train personalized finance as portion of a nicely-rounded curriculum.
Additional From GOBankingRates
About the Writer
Dawn Allcot is a comprehensive-time freelance writer and articles advertising professional who geeks out about finance, e-commerce, technology, and authentic estate. Her prolonged list of publishing credits contain Bankrate, Lending Tree, and Chase Financial institution. She is the founder and proprietor of GeekTravelGuide.web, a journey, technological know-how, and amusement web-site. She lives on Extended Island, New York, with a veritable menagerie that involves 2 cats, a rambunctious kitten, and a few lizards of various dimensions and personalities – as well as her two kids and husband. Discover her on Twitter, @DawnAllcot.
In the news release, China Online Education Group Announces Full Year 2021 Results, issued 24-Mar-2022 by China Online Education Group over PR Newswire, we are advised by the company that there are some figures and words updates based on the original copy. The complete, corrected release follows:
China Online Education Group Announces Full Year 2021 Results
BEIJING, March 24, 2022 /PRNewswire/ — China Online Education Group (“51Talk” or the “Company”) (NYSE: COE), a leading online education platform in China, with core expertise in English education, announced its unaudited financial results for the third quarter ended September 30, 2021, as well as the fourth quarter and full year ended December 31, 2021.
Full Year 2021 Financial and Operating Highlights
Net revenues were RMB2,166.5 million (US$340.0 million), a 5.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB2,054.1 million for the full year 2020.
Gross margin was 74.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with 71.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the full year 2020.
GAAP net income was RMB105.7 million(US$16.6 million), compared with GAAP net income RMB147.0 million for the full year 2020.
Non-GAAP net income1 was RMB132.7 million (US$20.8million), compared with non-GAAP net income RMB 173.7 million for the full year 2020.
Operating cash outflow was RMB676.1 million (US$106.1 million), compared with RMB719.2 million cash inflow for the full year 2020.
Fourth Quarter 2021 Financial and Operating Metrics
Net revenues were RMB412.8 million (US$64.8 million), a 22.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB535.1 million for the fourth quarter of 2020.
Gross margin was 78.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with 72.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the fourth quarter of 2020.
Net income was RMB52.0million (US$8.2 million), compared with net income of RMB31.8 million for the fourth quarter of 2020.
Non-GAAP net income was RMB55.0 million (US$8.6 million), compared with non-GAAP net income of RMB38.6 million for the fourth quarter of 2020.
Operating cash outflow was RMB268.6 million (US$42.1 million), compared with RMB188.5 million of operating cash inflow for the fourth quarter of 2020.
Cash, cash equivalents, restricted cash, time deposits and short-term investments balance stood at RMB992.6 million (US$155.8 million) as of December 31, 2021.
Third Quarter 2021 Financial and Operating Metrics
Net revenues were RMB573.6 million (US$90.0 million), a 6.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB538.5 million for the third quarter of 2020.
Gross margin was 73.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with 72.8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the third quarter of 2020.
Net income was RMB 72.7 million (US$11.4 million), compared with net income of RMB31.6 million for the third quarter of 2020.
Non-GAAP net income1 was RMB78.7 million (US$12.3 million), compared with non-GAAP net income of RMB38.5 million for the third quarter of 2020.
Operating cash outflow was RMB376.7 million (US$59.1 million), compared with RMB186.1 million of operating cash inflow for the third quarter of 2020.
Cash, cash equivalents, time deposits and short-term investments balance stood at RMB1,265.7 million (US$198.6 million) as of September 30, 2021.
Active students with attended lesson consumption [2]
(in thousands)
376.5
299.1
455.9
Active students with general lesson consumption[3]
(in thousands)
338.0
406.2
20.2
353.8
363.8
2.8
470.7
483.5
2.7
“In response to the changes in regulations related to After-School Tutoring (“AST”) promulgated by the Chinese government, we have taken measures to restructure our business so that the Company’s 2022 strategy will keenly focus on overseas business. In the fourth quarter, net gross billings of overseas business have reached $2.9 million, representing 222.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} sequential growth,” said Mr. Jack Jiajia Huang, Founder, Chairman and Chief Executive Officer of 51Talk.,
“As the overseas business momentum continue to build, we have extended our product offerings to students in more than 50 countries and regions outside Mainland China. We have been able to leverage our strength in high quality teacher resources, interactive curriculum, and advanced technology platform to quickly establish presence in a new market. We will stick with our business model which balances growth with profitability and was proven in Mainland China market. We are excited in exploring opportunities in oversea markets and allow our Filipino teachers to help more students to be able to talk to the world,” concluded Mr. Huang.
[1] For more information on non-GAAP financial measures, please see the section of “Use of Non-GAAP Financial Measures” and the table captioned “Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures” set forth in this press release.
[2] An “active student with attended lesson consumption” for a specified period refers to a student who attended at least one paid lesson, excluding those students who only attended paid live broadcasting lessons or trial lessons.
[3] An “active student with general lesson consumption” for a specified period refers to a student who consumed at least one paid lesson credit, in attendance or due to minimum consumption or expiration,excluding those students who only attended paid live broadcasting lessons or trial lessons.
Third Quarter 2021 Financial Results
Net Revenues
Net revenues for the third quarter of 2021 were RMB573.6 million (US$90.0 million), a 6.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB538.5 million for the same quarter last year. The increase was primarily attributed to an increase in the number of active students, partially offset by a decrease in average revenue per active student. The number of active students with general lesson consumption in the third quarter of 2021 was 406,200, a 20.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from 338,000 for the same quarter last year. The number of active students with attended lesson consumption in the third quarter of 2021 was 376,500.
Cost of Revenues
Cost of revenues for the third quarter of 2021 was RMB151.9 million (US$23.8 million), a 3.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB146.7 million for the same quarter last year. The increase was primarily driven by an increase in total service fees paid to teachers, mainly due to an increased number of paid lessons.
Gross Profit and Gross Margin
Gross profit for the third quarter of 2021 was RMB421.8 million (US$66.2 million), a 7.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB391.8 million for the same quarter last year.
Gross margin for the third quarter of 2021 was 73.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with 72.8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year. The increase was mainly attributable to the decrease of the cost per lesson, partially offset by the decrease of the revenue per lesson.
Operating Expenses
Total operating expenses for the third quarter of 2021 were RMB369.3 million (US$58.0 million), a 2.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB379.6 million for the same quarter last year. The decrease was mainly due to a decrease in sales and marketing expenses and product development expenses, partially offset by an increase of general and administrative expenses and goodwill and intangibles impairment.
Sales and marketing expenses for the third quarter of 2021 were RMB191.9 million (US$30.1 million), a 32.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB282.8 million for the same quarter last year. The decrease was mainly due to decrease in the number of personnel and lower marketing and branding expenses. Excluding share-based compensation expenses, non-GAAP sales and marketing expenses for the third quarter of 2021 were RMB191.0 million (US$30.0 million), a 31.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB280.6 million for the same quarter last year.
Product development expenses for the third quarter of 2021 were RMB40.7 million (US$6.4 million), a 6.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB43.8 million for the same quarter last year. The decrease was primarily due to lower product development personnel costs related to decrease in the number of personnel. Excluding share-based compensation expenses, non-GAAP product development expenses for the third quarter of 2021 were RMB39.3 million (US$6.2 million), a 6.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB42.1 million for the same quarter last year.
General and administrative expenses for the third quarter of 2021 were RMB104.9 million (US$16.5 million), a 97.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB53.0 million for the same quarter last year. The increase was primarily due to restructuring cost of RMB 51.4 million during the quarter. Excluding share-based compensation expenses, non-GAAP general and administrative expenses for the third quarter were RMB101.1 million (US$15.9 million), a 102.3{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB50.0 million for the same quarter last year. Excluding restructuring cost and share-based compensation expenses, general and administrative expenses for the third quarter would have been RMB 49.7 million (US$7.8 million), a 0.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB50.0 million for the same quarter last year.
Goodwill and intangibles impairment for the third quarter of 2021 was RMB31.8 million (US$4.9 million), compared with nil for the same quarter last year. The goodwill and intangible impairment was mainly due to the decline of fair value related to the intangible assets and goodwill in connection with the acquisition of 91waijiao.com completed in January 2015, assets acquisition of GKid completed in December 2020, and business combination of Kaola Reading completed in the second quarter of 2021. Considering recent regulatory policies on further alleviating the burden of homework and after-school tutoring for students and the changes in operating environment, the Company recognized impairment losses of the intangible assets and goodwill in the third quarter of 2021.
Other income
The exemption for the value added tax (VAT) of consumer services has been stopped as of March 31, 2021. This exemption, which covers a wide range of consumer services, was part of the Chinese government’s effort to ease the burden of businesses affected by the COVID-19 pandemic. The income obtained by taxpayers from providing essential services shall be exempted from VAT. The favorable impact of such COVID-19 relief policies was nil and RMB7.6 million in the third quarter of 2021 and 2020 respectively.
On September 30, 2019, the Ministry of Finance and the State Taxation Administration announced that from October 1, 2019 to December 31, 2021, taxpayers engaging in the provision of essential services are allowed to deduct an extra 15{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of the deductible input value-added tax for the current period from the payable value-added tax. The impact of the policy of additional value-added tax credit for the income generated by the essential services provided by enterprises was RMB6.0 million and RMB1.7 million in the third quarter of 2021 and 2020 respectively.
Income from Operations
Operating income for the third quarter of 2021 was RMB58.4 million (US$9.2 million), compared with operating income of RMB21.4 million for the same quarter last year. Operating margin for the third quarter was 10.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with operating margin of 4.0{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Non-GAAP operating income for the third quarter of 2021 was RMB64.4 million (US$10.1million), compared with non-GAAP operating income of RMB28.3 million for the same quarter last year. Non-GAAP operating margin for the third quarter was 11.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with non-GAAP operating margin of 5.3{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Net income
Net income for the third quarter of 2021 was RMB72.7 million (US$11.4 million), compared with net income of RMB31.6 million for the same quarter last year. Net margin for the third quarter was 12.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with net margin of 5.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Non-GAAP net income for the third quarter of 2021 was RMB78.7 million (US$12.3 million), compared with non-GAAP net income of RMB38.5 million for the same quarter last year. Non-GAAP net margin for the third quarter was 13.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with non-GAAP net margin of 7.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Interest income for the third quarter of 2021 was negative RMB7.0 million, due to RMB15.0 million reversal of interest income accrual from the time-deposits early withdraw, partially offset by interest income of RMB8.0 million.
Income tax benefits for the third quarter of 2021 was RMB20.5 million.
Basic net income per share attributable to ordinary shareholders for the third quarter of 2021 was RMB0.22(US$0.03), compared with basic net income per share of RMB0.10 for the same quarter last year. Diluted net income per share attributable to ordinary shareholders for the third quarter of 2021 was RMB0.21(US$0.03), compared with diluted net income per share of RMB0.09 for the same quarter last year.
Non-GAAP basic net income per share attributable to ordinary shareholders for the third quarter of 2021 was RMB0.24(US$0.04), compared with non-GAAP basic net income per share attributable to ordinary shareholders of RMB0.12 for the same quarter last year. Non-GAAP diluted net income per share attributable to ordinary shareholders for the third quarter of 2021 was RMB0.23(US$0.04), compared with non-GAAP diluted net income per share attributable to ordinary shareholders of RMB0.11 for the same quarter last year.
Basic net income per American depositary share (“ADS”) attributable to ordinary shareholders for the third quarter of 2021 was RMB3.28(US$0.51), compared with basic net income per ADS of RMB1.46 for the same quarter last year. Diluted net income per ADS attributable to ordinary shareholders for the third quarter of 2021 was RMB3.22(US$0.51), compared with diluted net income per ADS of RMB1.38 for the same quarter last year. Each ADS represents 15 Class A ordinary shares.
Non-GAAP basic net income per ADS attributable to ordinary shareholders for the third quarter of 2021 was RMB3.56(US$0.56), compared with non-GAAP basic net income per ADS attributable to ordinary shareholders of RMB1.78 for the same quarter last year. Non-GAAP diluted net income per ADS attributable to ordinary shareholders for the third quarter of 2021 was RMB3.49(US$0.55), compared with non-GAAP diluted net income per ADS attributable to ordinary shareholders of RMB1.68 for the same quarter last year.
Balance Sheet
As of September 30, 2021, the Company had total cash, cash equivalents, time deposits and short-term investments of RMB1,265.7 million (US$198.6 million), compared with RMB1,727.7 million as of December 31, 2020. As a part of cash, cash equivalents, time deposits and short-term investments, the Company had non-current time deposits of RMB30.0 million (US$4.7 million), compared with RMB414.0 million as of December 31, 2020.
As of September 30, 2021, the Company has a consolidated net current liability of RMB919.9 million, compared with net current liability of RMB1,400.4 million as of December 31, 2020. The Company had advances from students[4] (current and non-current) of RMB2,262.5 million (US$355.0 million) as of September 30, 2021, compared with RMB2,721.0 million as of December 31, 2020.
[4] “Advances from students,” which is defined as the amount of obligation to transfer good or service to students or business partners for which consideration has been received from students in advance. The deposits from students are also presented in the total amount of “advances from students”.
Fourth Quarter 2021 Financial Results
Net Revenues
Net revenues for the fourth quarter of 2021 were RMB412.8 million (US$64.8 million), a 22.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB535.1 million for the same quarter last year. The decrease was primarily attributed to a decrease in the number of lessons booked, partially offset by an increase in the number of active students with general lesson consumption. The number of active students with general lesson consumption in the fourth quarter of 2021 was 363,800, a 2.8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from 353,800 for the same quarter last year. The number of active students with attended lesson consumption in the fourth quarter of 2021 was 299,100.
Cost of Revenues
Cost of revenues for the fourth quarter of 2021 was RMB 88.3 million (US$13.9 million), a 39.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB146.1 million for the same quarter last year. The decrease was primarily driven by a decrease in total service fees paid to teachers, mainly due to a decreased number of paid lessons.
Gross Profit and Gross Margin
Gross profit for the fourth quarter of 2021 was RMB324.5 million (US$50.9 million), a 16.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB388.9million for the same quarter last year.
Gross margin for the fourth quarter of 2021 was 78.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with 72.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year. The increase was mainly attributable to the decrease of the cost per lesson and the increase of the revenue per lesson.
Operating Expenses
Total operating expenses for the fourth quarter of 2021 were RMB321.2 million (US$50.4 million), a 16.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB385.7 million for the same quarter last year. The decrease was mainly due to a decrease in sales and marketing expenses and product development expenses, partially offset by an increase in general and administrative expenses.
Sales and marketing expenses for the fourth quarter of 2021 were RMB235.8 million (US$37.0 million), a 17.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB284.5 million for the same quarter last year. The decrease was mainly due to decrease in the number of personnel and lower marketing and branding expenses. Excluding share-based compensation expenses, non-GAAP sales and marketing expenses for the fourth quarter of 2021 were RMB235.4 million (US$36.9 million), a 16.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB282.6 million for the same quarter last year.
Product development expenses for the fourth quarter of 2021 were RMB15.3 million (US$2.4 million), a 65.8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB44.6 million for the same quarter last year. The decrease was primarily due to lower product development personnel costs related to decrease in the number of personnel. Excluding share-based compensation expenses, non-GAAP product development expenses for the fourth quarter of 2021 were RMB15.6 million (US$2.4 million), a 64.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB43.3 million for the same quarter last year.
General and administrative expenses for the fourth quarter of 2021 were RMB69.7 million (US$10.9 million), a 23.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB56.6 million for the same quarter last year. The increase was primarily due to restructuring cost of RMB 25.8 million during the quarter. Excluding share-based compensation expenses, non-GAAP general and administrative expenses for the fourth quarter were RMB66.7 million (US$10.5 million), a 26.0{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB53.0 million for the same quarter last year. Excluding restructuring cost and share-based compensation expenses, general and administrative expenses for the fourth quarter would have been RMB40.9 million (US$6.4 million), a 22.8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB53.0 million for the same quarter last year.
Goodwill and intangibles impairment for the fourth quarter of 2021 was RMB0.4 million (US$0.1 million), compared with nil for the same quarter last year. The goodwill and intangibles impairment was mainly due to the decline of fair value related to the system for employee performance evaluation. Considering recent regulatory policies on further alleviating the burden of homework and after-school tutoring for students and the changes in operating environment, the Company recognized impairment losses of the intangible assets in the fourth quarter of 2021.
Other income
The exemption for the VAT of consumer services has been stopped as of March 31, 2021. This exemption, which covers a wide range of consumer services, was part of the Chinese government’s effort to ease the burden of businesses affected by the COVID-19 pandemic. The income obtained by taxpayers from providing essential services shall be exempted from VAT. The favorable impact of such COVID-19 relief policies was nil and RMB7.5 million in the fourth quarter of 2021 and 2020 respectively.
On December 31, 2019, the Ministry of Finance and the State Taxation Administration announced that from October 1, 2019 to December 31, 2021, taxpayers engaging in the provision of essential services are allowed to deduct an extra 15{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of the deductible input value-added tax for the current period from the payable value-added tax. The impact of the policy of additional value-added tax credit for the income generated by the essential services provided by enterprises was RMB0.6 million and RMB0.3 million in the fourth quarter of 2021 and 2020 respectively.
Income from Operations
Operating income for the fourth quarter of 2021 was RMB3.9 million (US$0.6 million), compared with operating income of RMB11.0 million for the same quarter last year. Operating margin for the fourth quarter was 0.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with operating margin of 2.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Non-GAAP operating income for the fourth quarter of 2021 was RMB6.9 million (US$1.1 million), compared with non-GAAP operating income of RMB17.8 million for the same quarter last year. Non-GAAP operating margin for the fourth quarter was 1.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with non-GAAP operating margin of 3.3{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Net income
Net income for the fourth quarter of 2021 was RMB52.0 million (US$8.2 million), compared with net income of RMB31.8million for the same quarter last year. Net margin for the fourth quarter was 12.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with net margin of 5.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Non-GAAP net income for the fourth quarter of 2021 was RMB55.0 million (US$8.6 million), compared with non-GAAP net income of RMB38.6 million for the same quarter last year. Non-GAAP net margin for the fourth quarter was 13.3{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with non-GAAP net margin of 7.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for the same quarter last year.
Income tax benefits for the fourth quarter of 2021 was RMB34.7 million.
Basic net income per share attributable to ordinary shareholders for the fourth quarter of 2021 was RMB0.16(US$0.02), compared with basic net income per share of RMB0.10 for the same quarter last year. Diluted net income per share attributable to ordinary shareholders for the fourth quarter of 2021 was RMB0.15(US$0.02), compared with diluted net income per share of RMB0.09 for the same quarter last year.
Non-GAAP basic net income per share attributable to ordinary shareholders for the fourth quarter of 2021 was RMB0.17(US$0.03), compared with non-GAAP basic net income per share attributable to ordinary shareholders of RMB0.12 for the same quarter last year. Non-GAAP diluted net income per share attributable to ordinary shareholders for the fourth quarter of 2021 was RMB0.16(US$0.03), compared with non-GAAP diluted net income per share attributable to ordinary shareholders of RMB0.11 for the same quarter last year.
Basic net income per ADS attributable to ordinary shareholders for the fourth quarter of 2021 was RMB2.34(US$0.37), compared with basic net income per ADS of RMB1.48 for the same quarter last year. Diluted net income per ADS attributable to ordinary shareholders for the fourth quarter of 2021 was RMB2.31(US$0.36), compared with diluted net income per ADS of RMB1.39 for the same quarter last year. Each ADS represents 15 Class A ordinary shares.
Non-GAAP basic net income per ADS attributable to ordinary shareholders for the fourth quarter of 2021 was RMB2.48(US$0.39), compared with non-GAAP basic net income per ADS attributable to ordinary shareholders of RMB1.79 for the same quarter last year. Non-GAAP diluted net income per ADS attributable to ordinary shareholders for the fourth quarter of 2021 was RMB2.45(US$0.38), compared with non-GAAP diluted net income per ADS attributable to ordinary shareholders of RMB1.68 for the same quarter last year.
Balance Sheet
As of December 31, 2021, the Company had total cash, cash equivalents,restricted cash, time deposits and short-term investments of RMB992.6 million (US$155.8 million)and among which RMB50.6 million of restricted cash, compared with RMB1,727.7 million as of December 31, 2020 with nil of restricted cash. As a part of cash, cash equivalents, time deposits and short-term investments, the Company had non-current time deposits of RMB100.9 million (US$15.8 million), compared with RMB414.0 million as of December 31, 2020.
As of December 31, 2021, the Company has a consolidated net current liability of RMB944.4 million, compared with net current liability of RMB1,400.4 million as of December 31, 2020. The Company had advances from students (current and non-current) of RMB1,767.2 million (US$277.3 million) as of December 31, 2021, compared with RMB2,721.0 million as of December 31, 2020.
Full Year 2021 Financial Results
Net Revenues
Net revenues for 2021 were RMB2,166.5 million (US$340.0 million), a 5.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB2,054.1 million for 2020. The increase was primarily attributed to an increase in the number of active students with general lesson consumption.
Cost of Revenues
Cost of revenues for 2021 was RMB558.0 million (US$87.6 million), a 3.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB580.4 million for 2020. The decrease was primarily driven by a decrease in total service fees paid to teachers, mainly due to the decrease of cost per lesson driven from cost control.
Gross Profit and Gross Margin
Gross profit for 2021 was RMB1,608.6 million (US$252.4 million), a 9.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB1,473.7 million for 2020.
Gross margin for 2021 was 74.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with 71.7{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for 2020.
Operating Expenses
Total operating expenses for 2021 were RMB1,597.4 million (US$250.7 million), a 13.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB1,412.7 million for 2020. The increase was mainly the result of the increases in sales and marketing expenses, general and administrative expenses, product development expenses and goodwill and intangibles impairment.
Sales and marketing expenses for 2021 were RMB1,062.5 million (US$166.7 million), a 2.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB1,035.6 million for 2020. The increase was mainly due to increase in the sales and marketing personnel costs. Excluding share-based compensation expenses, non-GAAP sales and marketing expenses for 2021 were RMB1,056.3 million (US$165.8 million), a 2.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB1,026.8 million for 2020.
Product development expenses for 2021 were RMB178.8 million (US$28.1 million), a 9.8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB162.8 million for 2020. Excluding share-based compensation expenses, non-GAAP product development expenses for 2021 were RMB174.3 million (US$27.4 million), a 10.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB158.4 million for 2020.
General and administrative expenses for 2021 were RMB324.0 million (US$50.8 million), a 51.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB214.2 million for 2020. The increase was primarily due to restructuring cost of RMB 85.9 million during the year. Excluding share-based compensation expenses, non-GAAP general and administrative expenses for 2021 were RMB307.5 million (US$48.3 million), a 53.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} increase from RMB200.8 million for 2020. Excluding restructuring cost and share-based compensation expenses, general and administrative expenses for 2021 would have been RMB221.6 million (US$34.8 million), a 10.4{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} decrease from RMB200.8 million for 2020.
Goodwill and intangibles impairment for 2021 was RMB32.2 million (US$5.0 million), compared with nil for the same quarter last year. The goodwill and intangibles impairment was mainly due to the decline of fair value related to the acquisition of 91waijiao.com completed in January 2015, the assets acquisition of GKid completed in December 2020, the acquisition of Kaola Reading completed in the second quarter of 2021, and the system for employee performance evaluation. Considering recent regulatory policies on further alleviating the burden of homework and after-school tutoring for students and the changes in operating environment, the company recognized impairment losses of the intangible assets in 2021.
Other income
As part of Chinese government’s effort to ease the burden of businesses affected by the coronavirus (COVID-19) outbreak, the State Taxation Administration (STA) exempted a wide range of consumer services from VAT from January 2020. The income obtained by taxpayers from providing essential services shall be exempted from VAT. The favorable impact of coronavirus relief policies was RMB10.7 million and RMB32.3 million in 2021 and 2020, respectively.
On September 30, 2019, Ministry of Finance and the State Taxation Administration announced that from October 1,2019 to December 31, 2021, the taxpayers engaging in the provision of essential services are allowed to deduct an extra 15{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} of the deductible input tax for the current period from the payable tax. The impact of the policy of additional value-added tax credit for the income generated by the essential services provided by enterprises was RMB12.5 million and RMB11.1 million in 2021 and 2020, respectively.
Income from Operations
Operating income for 2021 was RMB34.4 million (US$5.4 million), compared with RMB104.4 million for 2020. Operating margin for 2021 was 1.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with operating margin of 5.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for 2020.
Non-GAAP operating income for 2021 was RMB61.4 million (US$9.6 million), compared with RMB131.2 million for 2020. Non-GAAP operating margin for 2021 was 2.8{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with non-GAAP operating margin of 6.4{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for 2020.
The favorable impact of coronavirus relief policies was RMB10.7 million in 2021. Excluding the favorable impact, operating income and non-GAAP operating income for 2021 would have been RMB23.7 million (US$3.7 million) and RMB50.7 million (US$8.0 million), representing operating margin of 1.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} and 2.3{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} respectively.
Net income
Net income for 2021 was RMB105.7 million (US$16.6 million), compared with RMB147.0 million for 2020. Net margin for 2021 was 4.9{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with net margin of 7.2{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for 2020.
Non-GAAP net income for 2021 was RMB132.7 million (US$20.8 million), compared with RMB173.7 million for 2020. Non-GAAP net margin for 2021 was 6.1{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}, compared with non-GAAP net margin of 8.5{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} for 2020.
The favorable impact of coronavirus relief policies was RMB10.7 million in 2021. Excluding the favorable impact, net income and non-GAAP net income for 2021 would have been RMB95.0 million (US$14.9 million) and RMB122.0 million (US$19.1 million), representing net margin of 4.4{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} and 5.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} respectively.
Income tax benefits for the fourth quarter of 2021 was RMB46.1 million.
Basic net income per ADS attributable to ordinary shareholders for 2021 was RMB4.82(US$0.76), compared with basic net income per ADS of RMB6.90 for 2020. Diluted net income per ADS attributable to ordinary shareholders for 2021 was RMB4.66(US$0.73), compared with diluted net income per ADS of RMB6.46 for 2020. Each ADS represents 15 Class A ordinary shares.
Non-GAAP basic net income per ADS attributable to ordinary shareholders for 2021 was RMB6.06(US$0.95), compared with non-GAAP basic net income per ADS of RMB8.15 for 2020. Non-GAAP diluted net income per American depositary share (“ADS”) attributable to ordinary shareholders for 2021 was RMB5.86(US$0.92), compared with non-GAAP diluted net income per ADS of RMB7.63 for 2020. Each ADS represents 15 Class A ordinary shares.
The favorable impact of coronavirus relief policies was RMB10.7 million in 2021. Excluding the favorable impact, basic net income per ADS attributable to ordinary shareholders for 2021 was RMB4.33(US$0.68) and non-GAAP basic net income ADS attributable to ordinary shareholders for 2021 was RMB5.57(US$0.87), respectively. Excluding the favorable impact, diluted net income ADS attributable to ordinary shareholders for 2021 was RMB4.19(US$0.66) and non-GAAP diluted net income per American depositary share (“ADS”) attributable to ordinary shareholders for 2020 was RMB5.38(US$0.84), respectively.
Outlook
For the first quarter of 2022, the Company currently expects net gross billings of oversea business to be between $4.4 million and $4.6 million,representing sequential growth of 51.7 {ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550} to 58.6{ac23b82de22bd478cde2a3afa9e55fd5f696f5668b46466ac4c8be2ee1b69550}
The above outlook is based on current market conditions and reflects the Company’s current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.
In addition, the Company’s future operational and financial performance depends on the future development of the implementation of the Opinion and the success of the Company’s business adjustment plans, which is subject to inherent uncertainties at this time.
Conference Call
The Company’s management will host an earnings conference call at 8:30 AM U.S. Eastern Time on March 24, 2022 (8:30 PM Beijing/Hong Kong time on March 24, 2022).
Dial-in details for the earnings conference call are as follows:
United States (toll free):
1-800-239-9838
International:
1-323-794-2551
Mainland China:
400-120-9101
Hong Kong (toll free):
800-961-105
Hong Kong:
852-3008-1527
Participants should dial-in at least 5 minutes before the scheduled start time and ask to be connected to the call for “China Online Education Group.”
Additionally, a live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.51talk.com.
A replay of the conference call will be accessible until December3, 2021, by dialing the following telephone numbers:
United States (toll free):
1-888-203-1112
International:
1-719-457-0820
Replay Access Code:
8412792
About China Online Education Group
China Online Education Group (NYSE: COE) is a leading online education platform in China, with core expertise in English education. The Company’s mission is to make quality education accessible and affordable. The Company’s online and mobile education platforms enable students to take live interactive English lessons, on demand. The Company connects its students with a large pool of highly qualified teachers that it assembled using a shared economy approach, and employs student and teacher feedback and data analytics to deliver a personalized learning experience to its students.
Use of Non-GAAP Financial Measures
In evaluating its business, 51Talk considers and uses the following measures defined as non-GAAP financial measures by the SEC as supplemental metrics to review and assess its operating performance: non-GAAP sales and marketing expenses, non-GAAP product development expenses, non-GAAP general and administrative expenses, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, non-GAAP net income attributable to ordinary shareholders, and non-GAAP net income attributable to ordinary shareholders per share and per ADS. To present each of these non-GAAP measures, the Company excludes share-based compensation expenses. 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 the most comparable GAAP measures” set forth at the end of this press release.
51Talk believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance by excluding share-based compensation expenses that may not be indicative of its operating performance from a cash perspective. 51Talk 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 51Talk’s historical performance. 51Talk computes its non-GAAP financial measures using the same consistent method from quarter to quarter and from period to period. 51Talk 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 using non-GAAP measures is that these non-GAAP measures exclude share-based compensation expenses that have been and will continue to be for the foreseeable future a significant recurring expense in the 51Talk’s business. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying table at the end of this press release provides more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.
Exchange Rate Information
This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB6.3726 to US$1.00, the rate in effect as of December 31, 2021 as certified for customs purposes by the Federal Reserve Bank of New York.
Safe Harbor Statement
This press release contains statements that may constitute “forward-looking” statements pursuant to 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”, “aims”, “future”, “intends”, “plans”, “believes”, “estimates”, “likely to” and similar statements. Among other things, 51Talk’s quotations from management in this announcement, as well as 51Talk’s strategic and operational plans, contain forward-looking statements. 51Talk may also make written or oral forward-looking statements in its periodic reports to the Securities and Exchange Commission (“SEC”), 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 fourth parties. Statements that are not historical facts, including statements about 51Talk’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: 51Talk’s goals and strategies; 51Talk’s expectations regarding demand for and market acceptance of its brand and platform; 51Talk’s ability to retain and increase its student enrollment; 51Talk’s ability to offer new courses; 51Talk’s ability to engage, train and retain new teachers; 51Talk’s future business development, results of operations and financial condition; 51Talk’s ability to maintain and improve infrastructure necessary to operate its education platform; competition in the online education industry in China; the expected growth of, and trends in, the markets for 51Talk’s course offerings in China; relevant government policies and regulations relating to 51Talk’s corporate structure, business and industry; general economic and business condition in China, the Philippines and elsewhere and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in 51Talk’s filings with the SEC. All information provided in this press release is as of the date of this press release, and 51Talk does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
CHINA ONLINE EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
As of
Dec. 31,
Sep.30,
Dec. 31,
Dec. 31,
2020
2021
2021
2021
RMB
RMB
RMB
US$
ASSETS
Current assets
Cash and cash equivalents
326,647
412,462
214,732
33,696
Restricted cash
–
–
50,550
7,932
Time deposits
477,408
212,436
48,437
7,601
Short-term investments
509,636
610,843
577,970
90,696
Inventory
1,935
1,656
1,080
169
Prepaid expenses and other current assets
302,057
295,309
72,450
11,369
Total current assets
1,617,683
1,532,706
965,219
151,463
Non-current assets
Property and equipment, net
21,175
28,973
17,017
2,670
Intangible assets, net
20,302
12,187
11,211
1,759
Goodwill
4,223
–
–
–
Right-of-use assets
98,001
57,312
36,907
5,792
Time deposits
414,000
30,000
100,868
15,828
Deferred tax assets
10,268
23,694
56,868
8,924
Other non-current assets
23,896
17,572
5,496
862
Total non-current assets
591,865
169,738
228,367
35,835
Total assets
2,209,548
1,702,444
1,193,586
187,298
LIABILITIES
AND SHAREHOLDERS’ DEFICIT
Current liabilities
Advances from students
2,718,776
2,261,052
1,766,032
277,129
Accrued expenses and other current liabilities
237,101
139,860
96,205
15,097
Lease liability
42,949
25,680
19,400
3,044
Taxes payable
19,288
26,001
28,027
4,398
Total current liabilities
3,018,114
2,452,593
1,909,664
299,668
Non-current liabilities
Advances from students
2,270
1,438
1,126
177
Lease liability
53,594
33,894
19,340
3,035
Other non-current liabilities
2,508
2,723
1,547
243
Total non-current liabilities
58,372
38,055
22,013
3,455
Total liabilities
3,076,486
2,490,648
1,931,677
303,123
Total shareholders’ deficit
(866,938)
(788,204)
(738,091)
(115,825)
Total liabilities and shareholders’ deficit
2,209,548
1,702,444
1,193,586
187,298
CHINA ONLINE EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands except for number of shares and per share data)
For the three months ended
For the year ended
Dec. 31,
Sep. 30,
Dec. 31,
Dec. 31,
Dec. 31,
Dec. 31,
Dec. 31,
2020
2021
2021
2021
2020
2021
2021
RMB
RMB
RMB
US$
RMB
RMB
US$
Net revenues
535,074
573,621
412,773
64,773
2,054,095
2,166,549
339,979
Cost of revenues
(146,134)
(151,852)
(88,276)
(13,852)
(580,417)
(557,974)
(87,558)
Gross profit
388,940
421,769
324,497
50,921
1,473,678
1,608,575
252,421
Operating expenses
Sales and marketing expenses
(284,493)
(191,909)
(235,838)
(37,008)
(1,035,620)
(1,062,523)
(166,733)
Product development expenses
(44,577)
(40,735)
(15,260)
(2,395)
(162,829)
(178,750)
(28,050)
General and administrative expenses
(56,626)
(104,907)
(69,681)
(10,934)
(214,224)
(323,968)
(50,838)
Goodwill and intangibles impairment
–
(31,780)
(396)
(62)
–
(32,176)
(5,049)
Total operating expenses
(385,696)
(369,331)
(321,175)
(50,399)
(1,412,673)
(1,597,417)
(250,670)
Other income
7,766
5,962
552
87
43,414
23,223
3,644
Income from operations
11,010
58,400
3,874
609
104,419
34,381
5,395
Interest income
11,711
(6,972)
5,735
900
38,508
21,120
3,314
Interest expense and other expenses, net
193
785
7,683
1,206
(66)
4,014
630
Income before income tax expenses
22,914
52,213
17,292
2,715
142,861
59,515
9,339
Income tax benefits
8,905
20,452
34,691
5,444
4,101
46,139
7,240
Net income attributable to ordinary shareholders
31,819
72,665
51,983
8,159
146,962
105,654
16,579
Weighted average number of ordinary shares used in computing basic income per share
