- Fourth Quarter 2020 Net Revenue was $65.5
Million, Exceeding Guidance -
- Fourth Quarter
2020 Gross Profit was $36.7 Million,
with Gross Margin of 56.0% -
- Fourth Quarter 2020
Operating Income was $12.9 Million,
with Operating Margin of 19.7% -
- Fourth Quarter
2020 Net Income Attributable to CDEL was $4.9 Million, with Net Income Margin of 7.4%
-
BEIJING, Dec. 16, 2020 /PRNewswire/ -- China Distance
Education Holdings Limited (NYSE: DL) ("CDEL", or the "Company"), a
leading provider of online education and value-added services for
professionals and corporate clients in China, today announced unaudited financial
results for the fourth quarter and fiscal year 2020 ended
September 30, 2020.
Fourth Quarter Fiscal 2020 Financial and Operational
Highlights
- Net revenue decreased by 4.6% to $65.5
million from $68.7 million in
the prior year period.
- Total course enrollments were 931,500, a decrease of 17.7% from
the fourth quarter of fiscal 2019.
- Cash receipts from online course registration were $38.2 million, a 12.8% decrease from the fourth
quarter of fiscal 2019.
- Gross profit decreased by 15.4% to $36.7
million from $43.4 million in
the prior year period.
- Non-GAAP[1] gross
profit decreased by 15.3% to $36.8
million from $43.4 million in
the prior year period.
- Gross margin was 56.0%, compared with 63.2% in the prior year
period. Non-GAAP[1]
gross margin was 56.1%, compared with 63.2% in the prior year
period.
- Operating income decreased by 32.9% to $12.9 million from $19.2
million in the prior year period.
- Non-GAAP[1]
operating income decreased by 36.0% to $13.6
million from $21.2 million in
the prior year period.
- Net income attributable to CDEL was $4.9
million, compared with net income attributable to CDEL of
$13.8 million in the prior year
period.
- Non-GAAP[1] net
income attributable to CDEL was $6.2
million, compared with non-GAAP[1] net income attributable to CDEL of
$18.6 million in the prior year
period.
- Basic and diluted net income per American Depositary Share
("ADS") attributable to CDEL were $0.144 and $0.143,
respectively, compared with both basic and diluted net income per
ADS attributable to CDEL of $0.411,
for the fourth quarter of fiscal 2019. Each ADS represents four
ordinary shares.
- Basic and diluted non-GAAP[1] net income per ADS
attributable to CDEL were $0.185 and
$0.184, respectively, compared with
basic and diluted non-GAAP[1] net income per ADS attributable to
CDEL of $0.558 and $0.554, respectively, for the fourth quarter of
fiscal 2019.
- Cash outflow from operations was $1.7
million, compared with cash inflow from operations of
$20.0 million in the fourth quarter
of fiscal 2019.
Fiscal Year 2020 Financial and Operational Highlights
- Net revenue decreased by 1.1% to $209.6
million from $211.8 million in
fiscal year 2019.
- Total course enrollments were 4,255,000, an increase of 12.2%
from fiscal year 2019.
- Cash receipts from online course registration were $179.0 million, a 15.4% decrease from fiscal year
2019.
- Gross profit increased by 0.8% to $108.0
million from $107.1 million in
fiscal year 2019.
- Non-GAAP[1] gross
profit increased by 0.9% to $108.1
million from $107.1 million in
fiscal year 2019.
- Gross margin was 51.5%, compared with 50.6% in fiscal year
2019. Non-GAAP[1] gross
margin was 51.6%, compared with 50.6% in fiscal year 2019.
- Operating income decreased by 17.8% to $18.8 million from $22.8
million in fiscal year 2019.
- Non-GAAP[1]
operating income decreased by 18.8% to $21.4
million from $26.4 million in
fiscal year 2019.
- Net income attributable to CDEL decreased by 50.9% to
$10.4 million from $21.3 million in fiscal year 2019.
- Non-GAAP[1] net
income attributable to CDEL decreased by 50.3% to $13.7 million from $27.6
million in fiscal year 2019.
- Both basic and diluted net income per ADS attributable to CDEL
were $0.309, compared with both basic
and diluted net income per ADS attributable to CDEL of $0.635 for fiscal year 2019.
- Basic and diluted non-GAAP[1] net income per ADS
attributable to CDEL were $0.410 and
$0.406, respectively, compared with
basic and diluted non-GAAP[1] net income per ADS
attributable to CDEL of $0.830 and
$0.823, respectively, for the fiscal
year 2019.
- Cash flow from operations decreased by 51.1% to $40.0 million from $81.8
million in the fiscal year 2019.
Mr. Zhengdong Zhu, Chairman and
CEO of CDEL, said, "We concluded fiscal 2020 with
fourth-quarter revenue of $65.5
million, exceeding the upper end of our guidance range. This
quarter's revenue outperformance was primarily driven by a
less-severe than previously expected impact from the
pandemic-related postponement or suspension of certain professional
certification examinations. The appreciation of the Renminbi
against U.S. dollar also contributed to the fourth quarter revenue
performance. However, our cash receipts from online course
registration have declined year-over-year for the past three
consecutive quarters due to the COVID-19 pandemic."
"We believe in the long-term growth prospects of China's online education industry and are well
prepared to serve a growing student demographic. We remain
dedicated to consistently delivering knowledge to an even broader
student constituency and extending convenience, flexibility and
engagement to their learning experiences. Meanwhile, we will
continue to integrate cutting-edge technologies into our
educational solutions, and diversify our course offerings to
fulfill the needs of students at different stages of their study
and career development. With our 20-year track record and an
unwavering commitment to education, we have proven to be the
premier partner of choice for students in their journey of lifelong
learning," Mr. Zhu concluded.
Mr. Mark Marostica, Co-Chief
Financial Officer of CDEL, added, "Despite our efforts to
control costs amid revenue weakness stemming from the COVID-19
pandemic, our fourth quarter non-GAAP operating profit declined
year-over-year. With fiscal 2021 well underway, we remain committed
to our balanced growth strategy, and deeply focused on improving
both revenue growth and profitability."
Fourth Quarter Fiscal 2020 Financial Results
Net Revenue. Total net revenue decreased by
4.6% to $65.5 million in the fourth
quarter of fiscal 2020 from $68.7
million in the fourth quarter of fiscal 2019. Net revenue
from online education services, books and reference materials, and
other sources contributed 78.4%, 9.6% and 12.0%, respectively, of
total net revenues for the fourth quarter of fiscal 2020.
Online education services. Net revenue from online
education services increased by 3.9% to $51.4 million in the fourth quarter of fiscal
2020 from $49.5 million in the fourth
quarter of fiscal 2019, mainly due to the revenue growth from the
accounting vertical.
Books and reference materials. Net revenue from books and
reference materials increased by 9.9% to $6.3 million in the fourth quarter of fiscal 2020
from $5.7 million in the fourth
quarter of fiscal 2019, primarily attributable to the publication
of certain Legal Professional Qualification Examination books in
the fourth quarter of fiscal 2020, which were previously expected
to be published in the third quarter of fiscal 2020.
Others. Net revenue from other sources decreased by 41.9%
to $7.8 million in the fourth quarter
of fiscal 2020 from $13.5 million in
the fourth quarter of fiscal 2019, primarily due to the significant
decrease in revenue from the sale of college-related learning
simulation software, and the significant decrease in the provision
of offline training courses due to COVID-19.
Cost of Sales. Cost of sales increased by 14.0% to
$28.8 million in the fourth quarter
of fiscal 2020, from $25.3 million in
the fourth quarter of fiscal 2019. Non-GAAP[1] cost of sales increased by 13.8%
to $28.8 million in the fourth
quarter of fiscal 2020, from $25.3
million in the fourth quarter of fiscal 2019. The increase
in cost of sales was mainly due to the increase in cost of books
and reference materials, and salaries. This increase was partially
offset by the decrease in rental and related expenses, and lecture
fees.
Gross Profit and Gross
Margin. Gross profit was
$36.7 million in the fourth quarter
of fiscal 2020, a decrease of 15.4% from $43.4 million in the prior year period.
Non-GAAP[1] gross profit
was $36.8 million, decreasing by
15.3% from $43.4 million in the prior
year period. Gross margin was 56.0% in the fourth quarter of fiscal
2020, compared with 63.2% in the fourth quarter of fiscal 2019.
Non-GAAP[1] gross margin
was 56.1% in the fourth quarter of fiscal 2020, compared with 63.2%
in the fourth quarter of fiscal 2019.
Operating Expenses. Total operating expenses
increased by 5.3% to $26.0 million in
the fourth quarter of fiscal 2020, from $24.7 million in the prior year period.
Non-GAAP[1] total
operating expenses increased by 11.8% to $25.4 million in the fourth quarter of fiscal
2020, from $22.7 million in the prior
year period.
Selling expenses. Selling expenses increased by 8.9% to
$17.6 million in the fourth quarter
of fiscal 2020 from $16.1 million in
the prior year period. Non-GAAP[1] selling expenses increased by 8.8%
to $17.6 million in the fourth
quarter of fiscal 2020, from $16.1
million in the prior year period. The increase was primarily
driven by higher advertising and promotional expenses, and the
increase in commission to agents. This increase was partially
offset by the decrease in rental and related expenses.
General and administrative expenses. General and
administrative expenses increased by 19.8% to $8.5 million in the fourth quarter of fiscal 2020
from $7.1 million in the prior year
period. Non-GAAP[1]
general and administrative expenses increased by 19.2% to
$7.8 million in the fourth quarter of
fiscal 2020, from $6.6 million in the
prior year period. The increase was mainly due to the professional
fees associated with the Company's going private transaction. This
increase was partially offset by the significant decrease in
provision for doubtful debts, compared with the prior year period.
In the prior year period, significant provision for doubtful debts
was made mainly associated with the Company's investee company,
Hangzhou Wanting Technology Co., Ltd., and the sale of learning
simulation software.
Impairment loss from long-term investments.
Impairment loss from long-term investments in the fourth quarter of
fiscal 2020 was $0.9 million,
compared with $6.9 million in the
prior year period, due to impairment of the value of the investee
company, Beijing Xinrui Education Technology Co., Ltd.
Income Tax Expenses. Income tax
expense decreased by 30.5% to $4.2
million in the fourth quarter of fiscal 2020 from
$6.0 million in the prior year
period, primarily due to the decrease in taxable income in the
fourth quarter of fiscal 2020.
Net Income Attributable to CDEL. As a result of
the foregoing, net income attributable to CDEL was $4.9 million in the fourth quarter of fiscal
2020, compared with net income attributable to CDEL of $13.8 million in the prior year period.
Non-GAAP[1] net income
attributable to CDEL was $6.2 million
in the fourth quarter of fiscal 2020, compared with
non-GAAP[1] net income
attributable to CDEL of $18.6 million
in the prior year period.
Operating Cash Flow. Net operating
cash outflow was $1.7 million in the
fourth quarter of fiscal 2020, compared with net operating cash
inflow of $20.0 million in the prior
year period. The operating cash outflow was mainly attributable to
the decrease in deferred revenue, and partially due to the decrease
in cash receipts from online course registration, lease liability,
and the decrease/increase in amount due to/from related parties.
The operating cash outflow was partially offset by net income
before non-cash items generated in the fourth quarter of fiscal
2020, the decrease in inventories, and the increase in accrued
expenses and other liabilities, and income tax payable.
Cash and Cash Equivalents, Term Deposits,
Restricted Cash and Short-term Investments. Cash and cash
equivalents, term deposits, restricted cash and short-term
investments as of September 30, 2020
increased by 0.9% to $134.9 million
from $133.7 million as of
June 30, 2020, mainly due to the
appreciation of the Renminbi against the U.S. dollar. The increase
was partially offset by (i) the operating cash flow used in the
fourth quarter of fiscal 2020, (ii) the capital expenditure of
$1.9 million, (iii) the repayment of
an onshore loan of $3.3 million, and
(iv) the dividend distribution by an affiliated entity to its
noncontrolling interests' shareholders of $1.7 million.
Fiscal Year 2020 Financial Results
Net Revenue. Total net revenue decreased by
1.1% to $209.6 million in fiscal year
2020 from $211.8 million in fiscal
year 2019. Net revenue from online education services, books and
reference materials, and other sources contributed 76.0%, 10.6% and
13.4%, respectively, of total net revenues for fiscal year
2020.
Online education services. Net revenue from online
education services increased by 9.2% to $159.3 million in fiscal year 2020 from
$145.9 million in fiscal year
2019.
Books and reference materials. Net revenue from books and
reference materials decreased by 19.4% to $22.1 million in fiscal year 2020 from
$27.4 million in fiscal year
2019.
Others. Net revenue from other sources decreased by 26.9%
to $28.2 million in fiscal year 2020
from $38.5 million in fiscal year
2019.
Cost of Sales. Cost of sales decreased by 3.0% to
$101.6 million in fiscal year 2020
from $104.7 million in fiscal year
2019. Non-GAAP[1] cost
of sales decreased by 3.1% to $101.5
million in fiscal year 2020, from $104.7 million in fiscal year 2019.
Gross Profit and Gross
Margin. Gross profit was
$108.0 million in fiscal year 2020,
up 0.8% from $107.1 million in fiscal
year 2019. Non-GAAP[1]
gross profit was $108.1 million,
increasing by 0.9% from $107.1
million in fiscal year 2019. Gross margin was 51.5% in
fiscal year 2020, compared with 50.6% in fiscal year 2019.
Non-GAAP[1] gross margin
was 51.6% in fiscal year 2020, compared with 50.6% in fiscal year
2019.
Operating Expenses. Total operating expenses
increased by 8.5% to $95.3 million in
fiscal year 2020, from $87.9 million
in fiscal year 2019. Non-GAAP[1] total operating expenses increased
by 10.0% to $92.8 million in fiscal
year 2020, from $84.4 million in
fiscal year 2019.
Selling expenses. Selling expenses increased by 13.6% to
$69.8 million in fiscal year 2020
from $61.5 million in fiscal year
2019. Non-GAAP[1]
selling expenses increased by 13.6% to $69.8
million in fiscal year 2020, from $61.5 million in fiscal year 2019.
General and administrative expenses. General and
administrative expenses increased by 2.2% to $25.5 million in fiscal year 2020 from
$24.9 million in fiscal year 2019.
Non-GAAP[1] general and
administrative expenses increased by 0.5% to $23.1 million in fiscal year 2020, from
$22.9 million in fiscal year
2019.
Impairment loss from long-term investments.
Impairment loss from long-term investments in fiscal 2020 was
$0.9 million, compared with
$6.9 million in fiscal year 2019, due
to impairment of the value of the investee company, Beijing
Xinrui Education Technology Co., Ltd.
Income Tax Expenses. Income tax expense was
$5.5 million in fiscal year 2020,
compared with income tax expense of $8.1
million in fiscal year 2019.
Net Income Attributable to CDEL. As a result of
the foregoing, net income attributable to CDEL was $10.4 million in fiscal year 2020, compared with
net income attributable to CDEL of $21.3
million in fiscal year 2019. Non-GAAP[1] net income attributable to CDEL
was $13.7 million in fiscal year
2020, compared with non-GAAP[1] net income attributable to CDEL of
$27.6 million in fiscal year
2019.
Operating Cash Flow. Net operating
cash inflow decreased by 51.1% to $40.0
million in fiscal year 2020 from $81.8 million in fiscal year 2019.
China Distance Education Holdings Limited Enters into
Definitive Merger Agreement for Going Private Transaction
On December 1, 2020, the Company
announced that it had entered into a definitive Agreement and Plan
of Merger (the "Merger Agreement") with Champion Distance Education
Investments Limited ("Parent") and China Distance Learning
Investments Limited ("Merger Sub"), a wholly owned subsidiary of
the Parent, pursuant to which, subject to the terms and conditions
thereof, Merger Sub will merge with and into the Company, with the
Company continuing as the surviving entity and becoming a
wholly-owned subsidiary of Parent (the "Merger"), in a transaction
in which the Company will be acquired by a group of certain of the
Company's existing shareholders (including Mr. Zhu, Ms.
Baohong Yin, co-founder of the
Company, deputy chairman of the Board and the spouse of Mr. Zhu,
and their affiliated entity) and certain other existing
shareholders of the Company and equity investors. Upon the
effectiveness of the Merger, all outstanding ordinary shares of the
Company (each, an "Ordinary Share"), including Ordinary Shares
represented by American depositary shares, each representing four
Ordinary Shares ("ADSs"), other than Excluded Shares (as defined in
the Merger Agreement) and ADSs representing Excluded Shares, will
be cancelled in exchange for the right of the holders thereof to
receive $2.45 in cash per Ordinary
Share, or $9.80 in cash per ADS.
The Company cautions its shareholders and others considering
trading in its securities that there remain risks and uncertainties
with respect to the Merger, including the possibility that the
Merger will not occur as planned if events arise that result in the
termination of the Merger Agreement, or if one or more of the
various closing conditions to the Merger are not satisfied or
waived or if requisite shareholder approval is not obtained, and
other risks and uncertainties regarding the Merger Agreement and
the Merger.
[1] For
more information about the non-GAAP financial measures contained in
this press release, please see "Use of Non-GAAP Financial Measures"
below.
|
About China Distance Education Holdings Limited
China Distance Education Holdings Limited is a leading provider
of online education and value-added services for professionals and
corporate clients in China. The
courses offered by the Company through its websites are designed to
help professionals seeking to obtain and maintain professional
licenses and to enhance their job skills through our professional
development courses in China in
the areas of accounting, healthcare, engineering &
construction, legal and other industries. The Company also offers
online test preparation courses for self-taught learners pursuing
higher education diplomas or degrees, and practical accounting
training courses for college students and working professionals. In
addition, the Company provides business services to corporate
clients, including but not limited to tax advisory and accounting
outsourcing services. For further information, please
visit http://ir.cdeledu.com.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "may," "should," "potential," "continue," "expect,"
"predict," "anticipate," "future," "intend," "plan," "believe,"
"is/are likely to," "estimate" and similar statements. Among other
things, quotations from management in this announcement, the
Company's strategic and operational plans (in particular, the
impact of COVID-19 on our businesses including the postponement or
suspension of certain professional certification examinations;
balancing growth and profitability; the growth prospects of online
professional education in China;
as well as the anticipated benefits of our strategic growth
initiatives, including the promotion of the Company's life-long
learning ecosystem) as well as the risks and uncertainties of the
Merger, contain forward-looking statements. The Company may also
make written or oral forward-looking statements in its periodic and
annual reports to the SEC, in press releases and other written
materials and in oral statements made by its officers, directors or
employees to third parties. Statements that are not historical
facts, including statements about the Company's beliefs and
expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. A number of
factors could cause actual results to differ materially from those
contained in any forward-looking statement, including but not
limited to the following: the impact of COVID-19, together with the
postponement or suspension of certain professional certification
examinations; the results and impact of the Merger; our goals and
growth strategies; future prospects and market acceptance of our
courses and other products and services; our future business
development and results of operations; projected revenues, profits,
earnings and other estimated financial information; projected
enrollment numbers; our plans to expand and enhance our courses and
other products and services; anticipated benefits of acquisition or
disposal of businesses, competition in the education and test
preparation markets; and Chinese laws, regulations and policies,
including those applicable to the Internet, Internet content
providers, the education and telecommunications industries, mergers
and acquisitions, taxation and foreign exchange.
Further information regarding these and other risks is included
in the Company's annual report on Form 20-F and other documents
filed or furnished with the SEC. All information provided in this
press release is as of the date of this press release. The Company
does not undertake any obligation to update any forward-looking
statement, except as required under applicable law.
Statement Regarding Unaudited Financial Information
The unaudited financial information set forth in this press
release is preliminary and subject to adjustments. Adjustments to
the financial statements may be identified when audit work is
performed for the year-end audit, which could result in significant
differences from this preliminary unaudited financial
information.
Use of Non-GAAP Financial Measures
To supplement the Company's consolidated financial results
presented in accordance with U.S. generally accepted accounting
principles, or GAAP, the Company uses the following measures
defined as non-GAAP financial measures: non-GAAP net income
attributable to CDEL, operating income, gross profit, cost of
sales, selling expenses, general and administrative expenses, net
income margin attributable to CDEL, operating margin, gross profit
margin, and basic and diluted earnings per ADS and per share
attributable to CDEL. The presentation of these non-GAAP financial
measures is not intended to be considered in isolation or as a
substitute for the financial information prepared and presented in
accordance with GAAP. For more information on these non-GAAP
financial measures, please see the table captioned "Reconciliations
of non-GAAP measures to comparable GAAP measures" set forth at the
end of this release.
The Company believes that these non-GAAP financial measures
provide meaningful supplemental information regarding its
performance by excluding share-based compensation expenses,
impairment loss from long-term investments net of noncontrolling
interests and taxes calculated using specific tax treatments
applicable to the adjustments based on their respective
jurisdictions, and impairment of goodwill. However, non-GAAP
financial measures may not be indicative of the Company's operating
performance from a cash perspective. The Company believes that both
management and investors benefit from these non-GAAP financial
measures in assessing its performance and when planning and
forecasting future periods. These non-GAAP financial measures also
facilitate management's internal comparisons to the Company's
historical performance and liquidity. The Company computes its
non-GAAP financial measures using the same consistent method from
quarter to quarter. The Company believes these non-GAAP financial
measures are useful to investors in allowing for greater
transparency with respect to supplemental information used by
management in its financial and operational decision making. A
limitation of excluding share-based compensation expenses,
impairment loss from long-term investments net of noncontrolling
interests and taxes calculated using specific tax treatments
applicable to the adjustments based on their respective
jurisdictions, and impairment of goodwill from the above-mentioned
line items and presenting these non-GAAP measures is that such
items may continue to be for the foreseeable future a significant
recurring expense in our business. Management compensates for this
limitation by providing specific information regarding the GAAP
amounts excluded from each non-GAAP measure. The accompanying table
at the end of this release provides more detail on the
reconciliations between GAAP financial measures that are most
directly comparable to non-GAAP financial measures.
Contacts:
In China:
China Distance Education Holdings Limited
Jiao Jiao
Tel: +86-10-8231-9999 ext. 1826
Email: IR@cdeledu.com
The Piacente Group, Inc.
Jenny Cai
Tel: +86-10-6508-0677
E-mail: dl@tpg-ir.com
In the United States:
The Piacente Group, Inc.
Brandi Piacente
Tel: +1 212-481-2050
Email: dl@tpg-ir.com
(Financial Tables on Following Pages)
China Distance
Education Holdings Limited
|
Unaudited
Condensed Consolidated Balance Sheets
|
(in thousands of
US Dollars, except number of shares and per share
data)
|
|
|
|
|
|
|
|
|
September 30,
2019
|
|
September 30,
2020
|
|
|
(Derived from
Audited)
|
|
(Unaudited)
|
|
Assets:
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
67,977
|
|
80,056
|
|
|
Term
deposits
|
-
|
|
13,440
|
|
|
Restricted
cash
|
38,358
|
|
4,212
|
|
|
Short term
investments
|
22,118
|
|
20,343
|
|
|
Accounts receivable,
net of allowance for doubtful accounts of US$1,864 and
US$1,282 as of September 30, 2020 and 2019, respectively
|
7,330
|
|
6,154
|
|
|
Inventories
|
4,232
|
|
4,863
|
|
|
Prepayment and other
current assets
|
26,732
|
|
31,316
|
|
|
Amounts due from
related parties
|
515
|
|
3,580
|
|
|
Deferred
costs
|
1,427
|
|
1,657
|
|
|
Total current
assets
|
168,689
|
|
165,621
|
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
Restricted
cash
|
-
|
|
16,849
|
|
|
Property, plant and
equipment, net
|
37,935
|
|
42,331
|
|
|
Operating lease right
of use asset
|
-
|
|
30,029
|
|
|
Goodwill,
net
|
74,829
|
|
78,966
|
|
|
Long term
investments
|
25,379
|
|
26,324
|
|
|
Other intangible
assets, net
|
30,113
|
|
23,161
|
|
|
Deposit for purchase
of non-current assets
|
4,448
|
|
2,186
|
|
|
Deferred tax
assets
|
3,865
|
|
5,690
|
|
|
Other non-current
assets
|
10,092
|
|
7,490
|
|
|
Total non-current
assets
|
186,661
|
|
233,026
|
|
|
|
|
|
|
|
|
Total
assets
|
355,350
|
|
398,647
|
|
|
|
|
|
|
|
Liabilities and
equity:
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Bank
borrowings
|
38,502
|
|
4,012
|
|
|
Accrued expenses and
other liabilities (including accrued expenses and other
liabilities of the consolidated VIE without recourse to China
Distance Education
Holdings Limited of US$49,232 and US$35,491 as of September 30,
2020 and 2019,
respectively)
|
38,267
|
|
55,454
|
|
|
Amount due to related
parties
|
600
|
|
1,309
|
|
|
Income tax payable
(including income tax payable of the consolidated VIE without
recourse to China Distance Education Holdings Limited of US$14,451
and
US$8,188 as of September 30, 2020 and 2019,
respectively)
|
10,899
|
|
17,378
|
|
|
Deferred revenue -
current portion (including deferred revenue of the consolidated
VIE without recourse to China Distance Education Holdings Limited
of US$104,929
and US$93,364 as of September 30, 2020 and 2019,
respectively)
|
94,202
|
|
105,953
|
|
|
Refundable fees -
current portion (including refundable fees of the consolidated
VIE
without recourse to China Distance Education Holdings Limited of
US$1,729 and
US$435 as of September 30, 2020 and 2019, respectively)
|
435
|
|
1,729
|
|
|
Operating lease
liability - current portion (including operating lease liability of
the
consolidated VIE without recourse to China Distance Education
Holdings Limited
of US$3,835 and nil as of September 30, 2020 and 2019,
respectively)
|
-
|
|
4,160
|
|
|
Total current
liabilities
|
182,905
|
|
189,995
|
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
Deferred revenue -
non-current portion (including deferred revenue of the
consolidated VIE without recourse to China Distance Education
Holdings Limited
of US$33,928 and US$33,564 as of September 30, 2020 and 2019,
respectively)
|
33,564
|
|
33,928
|
|
|
Refundable fees -
non-current portion (including refundable fees of the
consolidated
VIE without recourse to China Distance Education Holdings Limited
of US$2,602
and US$2,440 as of September 30, 2020 and 2019,
respectively)
|
2,440
|
|
2,602
|
|
|
Deferred tax
liabilities
|
12,695
|
|
6,088
|
|
|
Long-term bank
borrowing
|
-
|
|
16,000
|
|
|
Operating lease
liability - non-current portion (including operating lease
liability of
the consolidated VIE without recourse to China Distance Education
Holdings
Limited of US$22,749 and nil as of September 30, 2020 and 2019,
respectively)
|
-
|
|
23,089
|
|
|
Total
non-current liabilities
|
48,699
|
|
81,707
|
|
|
Total
liabilities
|
231,604
|
|
271,702
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
Ordinary shares (par
value of US$0.0001 per share; 500,000,000 shares authorized;
135,320,433 and 134,210,745 shares issued and outstanding at
September 30, 2020
and 2019, respectively)
|
13
|
|
14
|
|
|
Additional paid-in
capital
|
24,507
|
|
27,318
|
|
|
Accumulated other
comprehensive loss
|
(12,357)
|
|
(833)
|
|
|
Retained
Earnings
|
60,668
|
|
51,477
|
|
|
Total China
Distance Education Holdings Limited shareholder's
equity
|
72,831
|
|
77,976
|
|
|
Noncontrolling
interests
|
50,915
|
|
48,969
|
|
|
Total
equity
|
123,746
|
|
126,945
|
|
|
Total liabilities
and equity
|
355,350
|
|
398,647
|
|
|
|
|
|
|
|
China Distance
Education Holdings Limited
|
Unaudited
Condensed Consolidated Statements Of
Operations
|
(in
thousands of US dollars, except number of shares, per share and per
ADS data)
|
|
|
Three Months
Ended September 30,
|
|
2019
|
|
2020
|
|
|
|
|
Sales, net of
value-added tax and related surcharges:
|
|
|
|
|
Online education
services
|
49,467
|
|
51,399
|
|
Books and reference
materials
|
5,740
|
|
6,310
|
|
Others
|
13,484
|
|
7,837
|
|
- Sale of
learning simulation software
|
3,366
|
|
2,225
|
|
- Business
start-up training services
|
483
|
|
331
|
|
-
Others
|
9,635
|
|
5,281
|
|
Total net
revenues
|
68,691
|
|
65,546
|
|
|
|
|
|
Cost of
sales
|
|
|
|
|
Cost of services and
others
|
(22,791)
|
|
(24,080)
|
|
Cost of tangible
goods sold
|
(2,492)
|
|
(4,740)
|
|
Total cost of
sales
|
(25,283)
|
|
(28,820)
|
|
|
|
|
|
Gross
profit
|
43,408
|
|
36,726
|
|
|
|
|
Operating
expenses
|
|
|
|
|
Selling
expenses
|
(16,133)
|
|
(17,574)
|
|
General and
administrative expenses
|
(7,064)
|
|
(8,462)
|
|
Impairment of
goodwill
|
(1,517)
|
|
-
|
|
Total operating
expenses
|
(24,714)
|
|
(26,036)
|
Other operating
income
|
535
|
|
2,222
|
|
|
|
|
|
Operating
income
|
19,229
|
|
12,912
|
|
|
|
|
Impairment loss from
long-term investments
|
(6,920)
|
|
(910)
|
Interest
income
|
493
|
|
603
|
Interest
expense
|
(525)
|
|
(120)
|
Exchange gain
(loss)
|
3,399
|
|
(4,107)
|
|
|
|
|
|
Income
before income taxes
|
15,676
|
|
8,378
|
Income tax
expense
|
(6,044)
|
|
(4,201)
|
(Loss) gain from
equity method investments
|
(465)
|
|
292
|
|
|
|
|
Net
income
|
9,167
|
|
4,469
|
Net loss
attributable to noncontrolling interests
|
(4,602)
|
|
(396)
|
Net
income attributable to China Distance Education
Holdings Limited
|
13,769
|
|
4,865
|
Net income
per share attributable to China Distance Education
Holdings
Limited:
|
|
|
|
Net income
attributable to China Distance Education Holdings
Limited
shareholders
|
|
|
|
|
Basic
|
0.103
|
|
0.036
|
|
Diluted
|
0.103
|
|
0.036
|
Net income
per ADS attributable to China Distance Education
Holdings
Limited:
|
|
|
|
Net income
attributable to China Distance Education Holdings
Limited
shareholders
|
|
|
|
|
Basic
|
0.411
|
|
0.144
|
|
Diluted
|
0.411
|
|
0.143
|
|
|
|
|
Weighted average
shares used in calculating net income per share
attributable to China Distance Education Holdings
Limited:
|
|
|
|
|
Basic
|
133,399,392
|
|
134,510,192
|
|
Diluted
|
134,333,486
|
|
135,537,758
|
China Distance
Education Holdings Limited
|
Unaudited
Condensed Consolidated Statements Of
Operations
|
(in
thousands of US dollars, except number of shares, per share and per
ADS data)
|
|
|
Year
Ended September 30,
|
|
2019
|
|
2020
|
|
|
|
|
Sales, net of
value-added tax and related surcharges:
|
|
|
|
|
Online education
services
|
145,917
|
|
159,338
|
|
Books and reference
materials
|
27,372
|
|
22,061
|
|
Others
|
38,533
|
|
28,159
|
|
- Sale of
learning simulation software
|
12,996
|
|
9,520
|
|
- Business
start-up training services
|
2,741
|
|
2,158
|
|
-
Others
|
22,796
|
|
16,481
|
|
Total net
revenues
|
211,822
|
|
209,558
|
|
|
|
|
|
Cost of
sales
|
|
|
|
|
Cost of services and
others
|
(85,252)
|
|
(81,976)
|
|
Cost of tangible
goods sold
|
(19,489)
|
|
(19,622)
|
|
Total cost of
sales
|
(104,741)
|
|
(101,598)
|
|
|
|
|
|
Gross
profit
|
107,081
|
|
107,960
|
|
|
|
|
Operating
expenses
|
|
|
|
|
Selling
expenses
|
(61,460)
|
|
(69,848)
|
|
General and
administrative expenses
|
(24,919)
|
|
(25,478)
|
|
Impairment of
goodwill
|
(1,517)
|
|
-
|
|
Total operating
expenses
|
(87,896)
|
|
(95,326)
|
Change in fair value
in connection with business combination
|
695
|
|
-
|
Other operating
income
|
2,968
|
|
6,155
|
|
|
|
|
|
Operating
income
|
22,848
|
|
18,789
|
|
|
|
|
Impairment loss from
long-term investments
|
(6,920)
|
|
(910)
|
Interest
income
|
2,207
|
|
2,555
|
Interest
expense
|
(2,819)
|
|
(1,021)
|
Gain from disposal of
an investment
|
318
|
|
-
|
Gain from
deconsolidation of a subsidiary
|
6,869
|
|
-
|
Exchange gain
(loss)
|
3,296
|
|
(5,261)
|
|
|
|
|
|
Income
before income taxes
|
25,799
|
|
14,152
|
Income tax
expense
|
(8,121)
|
|
(5,460)
|
Loss from equity method
investments
|
(1,484)
|
|
(555)
|
|
|
|
|
Net
income
|
16,194
|
|
8,137
|
Net loss
attributable to noncontrolling interests
|
(5,060)
|
|
(2,293)
|
Net income
attributable to China Distance Education Holdings
Limited
|
21,254
|
|
10,430
|
Net income
per share attributable to China Distance Education
Holdings
Limited:
|
|
|
|
Net income
attributable to China Distance Education Holdings
Limited
shareholders
|
|
|
|
|
Basic
|
0.159
|
|
0.077
|
|
Diluted
|
0.159
|
|
0.077
|
Net income
per ADS attributable to China Distance Education
Holdings
Limited:
|
|
|
|
Net income
attributable to China Distance Education Holdings
Limited
shareholders
|
|
|
|
|
Basic
|
0.635
|
|
0.309
|
|
Diluted
|
0.635
|
|
0.309
|
|
|
|
|
Weighted average
shares used in calculating net income per share
attributable to China Distance Education Holdings
Limited:
|
|
|
|
|
Basic
|
133,060,900
|
|
133,984,929
|
|
Diluted
|
134,138,117
|
|
135,232,224
|
|
|
|
|
|
China Distance
Education Holdings Limited
|
|
Reconciliations of
non-GAAP measures to comparable GAAP measures
|
|
(In thousands of
US Dollars, except number of shares, per share and per ADS
data)
|
|
|
|
Three Months
Ended September 30,
|
|
|
|
2019
|
|
2020
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Cost of
sales
|
|
25,283
|
|
28,820
|
|
Share-based
compensation expense in cost of sales
|
|
-
|
|
45
|
|
Non-GAAP cost of
sales
|
|
25,283
|
|
28,775
|
|
|
|
|
|
|
|
Selling
expenses
|
|
16,133
|
|
17,574
|
|
Share-based
compensation expense in selling expenses
|
|
-
|
|
18
|
|
Non-GAAP selling
expenses
|
|
16,133
|
|
17,556
|
|
|
|
|
|
|
|
General and
administrative expenses
|
|
7,064
|
|
8,462
|
|
Share-based
compensation expense in general and administrative
expenses
|
|
490
|
|
626
|
|
Non-GAAP general and
administrative expenses
|
|
6,574
|
|
7,836
|
|
|
|
|
|
|
|
Gross
profit
|
|
43,408
|
|
36,726
|
|
Share-based
compensation expenses
|
|
-
|
|
45
|
|
Non-GAAP gross
profit
|
|
43,408
|
|
36,771
|
|
|
|
|
|
|
|
Gross profit
margin
|
|
63.2%
|
|
56.0%
|
|
Non-GAAP gross profit
margin
|
|
63.2%
|
|
56.1%
|
|
|
|
|
|
|
|
Operating
income
|
|
19,229
|
|
12,912
|
|
Share-based
compensation expenses
|
|
490
|
|
689
|
|
Impairment of
goodwill
|
|
1,517
|
|
-
|
|
Non-GAAP operating
income
|
|
21,236
|
|
13,601
|
|
|
|
|
|
|
|
Operating
margin
|
|
28.0%
|
|
19.7%
|
|
Non-GAAP operating
margin
|
|
30.9%
|
|
20.8%
|
|
|
|
|
|
|
|
Net income
attributable to CDEL
|
|
13,769
|
|
4,865
|
|
Share-based
compensation expenses
|
|
490
|
|
689
|
|
Impairment loss from
long-term investments, net of tax effect of US$228 and nil
for the year ended September 30, 2020 and
2019, respectively
|
|
6,920
|
|
682
|
|
Impairment of
goodwill
|
|
1,517
|
|
-
|
|
Noncontrolling
interests impact on adjustments
|
|
(4,094)
|
|
-
|
|
Non-GAAP net income
attributable to CDEL
|
|
18,602
|
|
6,237
|
|
|
|
|
|
|
|
Net income margin
attributable to CDEL
|
|
20.0%
|
|
7.4%
|
|
Non-GAAP net income
margin attributable to CDEL
|
|
27.1%
|
|
9.5%
|
|
|
|
|
|
|
|
Net income per share
attributable to CDEL—basic
|
|
0.103
|
|
0.036
|
|
Net income per share
attributable to CDEL—diluted
|
|
0.103
|
|
0.036
|
|
Non-GAAP net income
per share attributable to CDEL—basic
|
|
0.139
|
|
0.046
|
|
Non-GAAP net income
per share attributable to CDEL—diluted
|
|
0.138
|
|
0.046
|
|
|
|
|
|
|
|
Net income per ADS
attributable to China Distance Education Holdings Limited
shareholders—basic (note 1)
|
|
0.411
|
|
0.144
|
|
Net income per ADS
attributable to China Distance Education Holdings Limited
shareholders—diluted (note 1)
|
|
0.411
|
|
0.143
|
|
Non-GAAP net income
per ADS attributable to China Distance Education
Holdings Limited shareholders—basic (note
1)
|
|
0.558
|
|
0.185
|
|
Non-GAAP net income
per ADS attributable to China Distance Education
Holdings Limited shareholders—diluted (note
1)
|
|
0.554
|
|
0.184
|
|
|
|
|
|
|
|
Weighted average
shares used in calculating basic net income per share
attributable to China Distance Education
Holdings Limited
|
|
133,399,392
|
|
134,510,192
|
|
Weighted average
shares used in calculating diluted net income per share
attributable to China Distance Education
Holdings Limited
|
|
134,333,486
|
|
135,537,758
|
|
Weighted average
shares used in calculating basic non-GAAP net income per
share attributable to China Distance Education
Holdings Limited
|
|
133,399,392
|
|
134,510,192
|
|
Weighted average
shares used in calculating diluted non-GAAP net income per
share attributable to China Distance Education
Holdings Limited
|
|
134,333,486
|
|
135,537,758
|
|
|
Note 1: Each ADS
represents four ordinary shares.
|
China Distance
Education Holdings Limited
|
Reconciliations of
non-GAAP measures to comparable GAAP measures
|
(In thousands of
US Dollars, except number of shares, per share and per ADS
data)
|
|
|
Year Ended September
30,
|
|
|
2019
|
|
2020
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
Cost of
sales
|
|
104,741
|
|
101,598
|
Share-based
compensation expense in cost of sales
|
|
23
|
|
139
|
Non-GAAP cost of
sales
|
|
104,718
|
|
101,459
|
|
|
|
|
|
Selling
expenses
|
|
61,460
|
|
69,848
|
Share-based
compensation expense in selling expenses
|
|
10
|
|
58
|
Non-GAAP selling
expenses
|
|
61,450
|
|
69,790
|
|
|
|
|
|
General and
administrative expenses
|
|
24,919
|
|
25,478
|
Share-based
compensation expense in general and administrative
expenses
|
|
1,972
|
|
2,421
|
Non-GAAP general and
administrative expenses
|
|
22,947
|
|
23,057
|
|
|
|
|
|
Gross
profit
|
|
107,081
|
|
107,960
|
Share-based
compensation expenses
|
|
23
|
|
139
|
Non-GAAP gross
profit
|
|
107,104
|
|
108,099
|
|
|
|
|
|
Gross profit
margin
|
|
50.6%
|
|
51.5%
|
Non-GAAP gross profit
margin
|
|
50.6%
|
|
51.6%
|
|
|
|
|
|
Operating
income
|
|
22,848
|
|
18,789
|
Share-based
compensation expenses
|
|
2,005
|
|
2,618
|
Impairment of
goodwill
|
|
1,517
|
|
-
|
Non-GAAP operating
income
|
|
26,370
|
|
21,407
|
|
|
|
|
|
Operating
margin
|
|
10.8%
|
|
9.0%
|
Non-GAAP operating
margin
|
|
12.4%
|
|
10.2%
|
|
|
|
|
|
Net income
attributable to CDEL
|
|
21,254
|
|
10,430
|
Share-based
compensation expenses
|
|
2,005
|
|
2,618
|
Impairment loss from
long-term investments, net of tax effect of US$228 and
nil for the year ended September 30, 2020
and 2019, respectively
|
|
6,920
|
|
682
|
Impairment of
goodwill
|
|
1,517
|
|
-
|
Noncontrolling
interests impact on adjustments
|
|
(4,094)
|
|
-
|
Non-GAAP net income
attributable to CDEL
|
|
27,602
|
|
13,730
|
|
|
|
|
|
Net income margin
attributable to CDEL
|
|
10.0%
|
|
5.0%
|
Non-GAAP net income
margin attributable to CDEL
|
|
13.0%
|
|
6.6%
|
|
|
|
|
|
Net income per share
attributable to CDEL—basic
|
|
0.159
|
|
0.077
|
Net income per share
attributable to CDEL—diluted
|
|
0.159
|
|
0.077
|
Non-GAAP net income
per share attributable to CDEL—basic
|
|
0.207
|
|
0.102
|
Non-GAAP net income
per share attributable to CDEL—diluted
|
|
0.206
|
|
0.102
|
|
|
|
|
|
Net income per ADS
attributable to China Distance Education Holdings
Limited shareholders—basic (note
1)
|
|
0.635
|
|
0.309
|
Net income per ADS
attributable to China Distance Education Holdings
Limited shareholders—diluted (note
1)
|
|
0.635
|
|
0.309
|
Non-GAAP net income
per ADS attributable to China Distance Education
Holdings Limited shareholders—basic (note
1)
|
|
0.830
|
|
0.410
|
Non-GAAP net income
per ADS attributable to China Distance Education
Holdings Limited shareholders—diluted
(note 1)
|
|
0.823
|
|
0.406
|
|
|
|
|
|
Weighted average
shares used in calculating basic net income per share
attributable to China Distance Education
Holdings Limited
|
|
133,060,900
|
|
133,984,929
|
Weighted average
shares used in calculating diluted net income per share
attributable to China Distance Education
Holdings Limited
|
|
134,138,117
|
|
135,232,224
|
Weighted average
shares used in calculating basic non-GAAP net income per
share attributable to China Distance
Education Holdings Limited
|
|
133,060,900
|
|
133,984,929
|
Weighted average
shares used in calculating diluted non-GAAP net income per
share attributable to China Distance
Education Holdings Limited
|
|
134,138,117
|
|
135,232,224
|
|
Note 1: Each ADS
represents four ordinary shares
|
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content:http://www.prnewswire.com/news-releases/china-distance-education-holdings-limited-reports-financial-results-for-fourth-quarter-and-fiscal-year-2020-301194362.html
SOURCE China Distance Education Holdings Ltd.