TAL Education Group Announces Unaudited Financial Results for the Fourth Fiscal Quarter and the Fiscal Year Ended February 29, 2016
- Quarterly Net Revenues up by 42.1% Year-Over-Year
- Quarterly Non-GAAP Income from Operations up by 25.2% Year-Over-Year
- Fiscal Year Net Revenues up by 42.9%
- Fiscal Year Non-GAAP Income from Operations up by 29.4% Year-Over-Year
- Fiscal Year Net Income Attributable to TAL up by 53.2%
BEIJING, April 28, 2016 /PRNewswire/ -- TAL Education Group (NYSE: XRS) ("TAL" or the "Company"), a leading K-12 after-school tutoring services provider in China, today announced its unaudited financial results for the fourth quarter and the fiscal year ended February 29, 2016.
Highlights for the Fourth Quarter of Fiscal Year 2016
- Net revenues increased by 42.1% year-over-year to US$175.0 million from US$123.2 million in the same period of the prior year.
- Income from operations increased by 12.1% to US$16.6 million from US$14.9 million in the same period of the prior year.
- Non-GAAP income from operations increased by 25.2% to US$25.2 million from US$20.2 million in the same period of the prior year.
- Net income attributable to TAL was US$10.9 million, compared to US$13.7 million in the same period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, was US$19.5 million, compared to US$19.0 million in the same period of the prior year.
- Basic and diluted net income per American Depositary Share ("ADS") were US$0.14 and US$0.13, respectively. Non-GAAP basic and diluted net income per ADS, which excluded share-based compensation expenses, were US$0.24 and US$0.23, respectively. Each ADS represents two Class A common shares.
- Total student enrollments increased by 56.9% year-over-year to approximately 788,320 from approximately 502,350 in the same period of the prior year.
- Total physical network increased from 301 in 24 cities as of November 30, 2015 to 363 learning centers in 25 cities as of February 29, 2016, including 41 learning centers in 5 cities from the new business acquisition of Firstleap Education ("Firstleap").
Highlights for the Fiscal Year Ended February 29, 2016
- Net revenues increased by 42.9% year-over-year to US$619.9 million from US$434.0 million in fiscal year 2015.
- Income from operations increased by 26.5% to US$85.1 million from US$67.2 million in fiscal year 2015.
- Non-GAAP income from operations increased by 29.4% to US$110.9 million from US$85.7 million in fiscal year 2015.
- Net income attributable to TAL increased by 53.2% year-over-year to US$102.9 million from US$67.2 million in fiscal year 2015.
- Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, increased by 50.4% year-over-year to US$128.7 million from US$85.6 million in fiscal year 2015.
- Basic and diluted net income per ADS were US$1.29 and US$1.21, respectively. Non-GAAP basic and diluted net income per ADS, excluding share-based compensation expenses, were US$1.61 and US$1.49, respectively.
- Total student enrollments in fiscal year 2016 increased by 54.6% year-over-year to 2,309,830 from approximately 1,494,430 in the same period of the prior year.
- Total physical network increased from 289 learning centers in 19 cities as of February 28, 2015 to 363 learning centers in 25 cities as of February 29, 2016, including 41 learning centers in 5 cities from the new business acquisition of Firstleap.
Financial and Operating Data -- Fourth Quarter and Fiscal Year 2016
(In US$ thousands, except per ADS data, student enrollments and percentages)
| Three Months Ended |
|||
| February 28/29, |
|||
| 2015 |
2016 |
Pct. Change |
|
| Net revenues |
123,205 |
175,049 |
42.1% |
| Net income attributable to TAL |
13,729 |
10,859 |
-20.9% |
| Non-GAAP net income attributable to |
19,037 |
19,455 |
2.2% |
| Operating income |
14,855 |
16,647 |
12.1% |
| Non-GAAP operating income |
20,162 |
25,243 |
25.2% |
| Net income per ADS attributable to |
0.17 |
0.14 |
-21.7% |
| Net income per ADS attributable to |
0.17 |
0.13 |
-22.8% |
| Non-GAAP net income per ADS |
0.24 |
0.24 |
1.2% |
| Non-GAAP net income per ADS |
0.23 |
0.23 |
-0.1% |
| Total student enrollments in small |
502,350 |
788,320 |
56.9% |
| Fiscal Year Ended |
|||
| February 28/29, |
|||
| 2015 |
2016 |
Pct. Change |
|
| Net revenues |
433,970 |
619,949 |
42.9% |
| Net income attributable to |
67,157 |
102,879 |
53.2% |
| Non-GAAP net income attributable to |
85,598 |
128,726 |
50.4% |
| Operating income |
67,248 |
85,052 |
26.5% |
| Non-GAAP operating income |
85,689 |
110,899 |
29.4% |
| Net income per ADS attributable to |
0.85 |
1.29 |
51.5% |
| Net income per ADS attributable to |
0.82 |
1.21 |
46.9% |
| Non-GAAP net income per ADS |
1.08 |
1.61 |
48.8% |
| Non-GAAP net income per ADS |
1.03 |
1.49 |
44.3% |
| Total student enrollments in small |
1,494,430 |
2,309,830 |
54.6% |
"We are pleased with our fourth quarter and full fiscal year results, which reflect the continuous strong growth momentum for small class in the outer cities. Due to high demand for our tutoring services, we expanded small class classroom capacity by over 50% in fiscal year 2016 compared to the previous year and managed higher utilization rates throughout the year," said Mr. Rong Luo, TAL's Chief Financial Officer.
"During fiscal year 2016, we continued to make solid progress in bringing together the technology, community and education resources to become a leading technology-focused education services provider in China, through both in-house development and strategic investments." Mr. Luo added, "Our outlook for further enrollment-driven growth in fiscal year 2017 is positive. We plan to maintain a healthy pace of demand-based expansion of our learning center network while we continue to invest in O2O business and other new initiatives."
Financial Results for the Fourth Quarter of Fiscal Year 2016
Net Revenues
In the fourth quarter of fiscal year 2016, TAL reported net revenues of US$175.0 million, representing a 42.1% increase from US$123.2 million in the fourth quarter of fiscal year 2015. The increase was mainly driven by an increase in total student enrollments, which increased by 56.9% to approximately 788,320 from approximately 502,350 in the same period of the prior year. The increase in total student enrollments was driven primarily by increases of enrollments in the small class offerings and online courses. Average selling price (ASP) decreased by 9.4% from US$245 in the fourth quarter of fiscal year 2015 to US$222 in the same quarter of fiscal year 2016. The decrease in ASP was mainly attributable to more enrollment contribution from small class and online courses offerings, as well as foreign exchange rate fluctuation.
Operating Costs and Expenses
In the fourth quarter of fiscal year 2016, operating costs and expenses were US$158.5 million, a 45.9% increase from US$108.6 million in the fourth quarter of fiscal year 2015. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$149.9 million, a 45.1% increase from US$103.3 million in the fourth quarter of fiscal year 2015.
Cost of revenues increased by 50.0% to US$88.8 million, from US$59.2 million in the fourth quarter of fiscal year 2015. The increase in cost of revenues was mainly due to an increase in teacher compensation and rental costs, as well as increases in wages and teacher fees. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 50.0% to US$88.8 million from US$59.2 million in the fourth quarter of fiscal year 2015.
Selling and marketing expenses increased by 41.1% to US$22.3 million from US$15.8 million in the fourth quarter of fiscal year 2015. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 40.5% to US$21.5 million from US$15.3 million in the fourth quarter of fiscal year 2015. The increase of selling and marketing expenses in the fourth quarter of fiscal year 2016 was primarily a result of an increase in compensation to sales and marketing staff to support a greater number of programs and service offerings versus the year-ago period.
General and administrative expenses increased by 40.9% to US$47.4 million from US$33.6 million in the fourth quarter of fiscal year 2015. The increase in general and administrative expenses was mainly due to an increase in the number of our general and administrative personnel compared to the year-ago period and an increase in compensation to our general and administrative personnel, in particular such personnel supporting our online education initiatives among other new programs and service offerings. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 37.4% to US$39.6 million from US$28.8 million in the fourth quarter of fiscal year 2015.
Total share-based compensation expenses allocated to the related operating costs and expenses increased by 62.0% to US$8.6 million in the fourth quarter of fiscal year 2016 from US$5.3 million in the same period of fiscal year 2015. The increase was mainly due to new grants of non-vested shares and options to directors and employees by the Company in fiscal year 2016.
Gross Profit
Gross profit increased by 34.8% to US$86.3 million from US$64.0 million in the fourth quarter of fiscal year 2015.
Income from Operations
Income from operations increased by 12.1% to US$16.6 million from US$14.9 million in the fourth quarter of fiscal year 2015. Non-GAAP income from operations, which excluded share-based compensation expenses, increased by 25.2% to US$25.2 million from US$20.2 million in the fourth quarter of fiscal year 2015.
Other (expenses)/income
Other income was US$0.2 million in the fourth quarter of fiscal year 2016, compared to other expense of US$2.9 million in the fourth quarter of fiscal year 2015. Other income for the fourth quarter of fiscal year 2016 was mainly due to a gain from transfer of a nonfinancial asset and a gain on re-measurement of fair value of a noncontrolling equity investment in connection with a business acquisition, partially offset by realized exchange losses arising from the conversion of the majority of the holding company's cash denominated in RMB into cash in U.S. Dollars.
Net Income Attributable to TAL Education Group
Net income attributable to TAL decreased by 20.9% to US$10.9 million from US$13.7 million in the fourth quarter of fiscal year 2015. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, increased by 2.2% to US$19.5 million from US$19.0 million in the fourth quarter of fiscal year 2015.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were US$0.14 and US$0.13, respectively, in the fourth quarter of fiscal year 2016. Non-GAAP basic and Non-GAAP diluted net income per ADS, which excluded share-based compensation expenses, were US$0.24 and US$0.23, respectively.
Capital Expenditures
Capital expenditures for the fourth quarter of fiscal year 2016 were US$11.6 million, an increase of US$1.5 million from US$10.1 million in the fourth quarter of fiscal year 2015. The increase was mainly due to leasehold improvements and the purchase of servers, computers, software systems and other hardware for the Company's teaching facilities and mobile network research and development.
Financial Results for the Fiscal Year Ended February 29, 2016
Net Revenues
For fiscal year 2016, TAL reported net revenues of US$619.9 million, representing a 42.9% increase from US$434.0 million in fiscal year 2015. The increase was mainly driven by an increase in total student enrollments. Total student enrollments increased by 54.6% to approximately 2,309,830 from approximately 1,494,430 in the prior year. The increase in total student enrollments resulted primarily from increases of enrollments in the small class offerings and online courses. ASP was US$268 in fiscal year 2016, a decrease from US$290 in fiscal year 2015. The decrease of ASP was mainly due to more enrollment contribution from online courses and small class offerings and the foreign exchange rate fluctuation, and was partially offset by the increase in the hourly rate of the small class course offerings.
Operating Costs and Expenses
In fiscal year 2016, operating costs and expenses were US$538.2 million, a 46.6% increase from US$367.2 million in fiscal year 2015. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$512.4 million, a 46.9% increase from US$348.7 million in fiscal year 2015.
Cost of revenues increased by 49.5% to US$303.6 million from US$203.1 million in fiscal year 2015. The increase in cost of revenues was mainly due to an increase in teacher compensation and rental costs, as well as increases in wages and teacher fees. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 49.5% to US$303.6 million from US$203.0 million in fiscal year 2015.
Selling and marketing expenses increased by 36.5% to US$73.6 million from US$53.9 million in fiscal year 2015. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 37.2% to US$71.1 million from US$51.8 million in fiscal year 2015. The increase of selling and marketing expenses in fiscal year 2016 was primarily a result of an increase in compensation to sales and marketing staff to support a greater number of programs and service offerings versus the year-ago period.
General and administrative expenses increased by 46.1% to US$161.0 million from US$110.2 million in fiscal year 2015. The increase in general and administrative expenses was mainly due to an increase in the number of our general and administrative personnel compared to the year-ago period and an increase in compensation to our general and administrative personnel, in particular such personnel supporting our online education initiatives among other new programs and service offerings. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 46.6% to US$137.7 million from US$93.9 million in fiscal year 2015.
Total share-based compensation expenses allocated to the related operating costs and expenses increased by 40.2% to US$25.8 million in fiscal year 2016 from US$18.4 million in fiscal year 2015. The increase was mainly due to new grants of non-vested shares and options to directors and employees by the Company in fiscal year 2016.
Gross Profit
Gross profit increased by 37.0% to US$316.3 million from US$230.9 million in fiscal year 2015.
Income from Operations
Income from operations increased by 26.5% to US$85.1 million from US$67.2 million in fiscal year 2015. Non-GAAP income from operations, which excluded share-based compensation expenses, increased by 29.4% to US$110.9 million from US$85.7 million in fiscal year 2015.
Other (expenses)/income
Other expense was US$2.5 million for fiscal year 2016, compared to US$2.0 million for fiscal year 2015. The increase was mainly due to the increase in exchange losses arising from the more significant depreciation of RMB against U.S. Dollar in fiscal year 2016, partially offset by a gain from transfer of a nonfinancial asset and a gain on re-measurement of fair value of a noncontrolling equity investment in connection with a business acquisition. As the holding company had been holding a significant portion of cash balance denominated in RMB and reported in US Dollars, until the majority of the cash in RMB were converted into U.S. Dollar in the fourth quarter of fiscal year 2016, it had been benefiting from exchange gains in times of relative strength of the RMB and incurring exchange losses in times of relative strength of the U.S. Dollar.
Impairment loss on long-term investments
Impairment loss on long-term investments was US$7.5 million, because there were other-than-temporary declines in the value of long-term investments in several investees, primarily due to significant deteriorations in their operations, earnings performance and abilities to continue as a going concern.
Gain from disposal of components
Gain from disposal of components were US$50.4 million, which was mainly derived from a transaction in which the Company transferred its one-on-one business component in Guangzhou in exchange for noncontrolling equity interest in a third party. US$12.6 million of income tax expense was accrued in connection to the gain from disposal of components by applying applicable Enterprise Income Tax ("EIT") rates.
Income Tax Expense
Income tax expense was US$33.5 million in fiscal year 2016, compared to US$9.4 million in fiscal year 2015. The increase was mainly due to accrued one-off income tax expense of US$12.5 million related to gain from disposal of one-on-one business in Guangzhou and an increase of US$7.3 million in income tax expense due to the expiration of an EIT exemption period for one of TAL's subsidiaries, Beijing Xintang Sichuang Education Technology Co., Ltd., upon which the subsidiary became subject to an EIT rate of 12.5%.
Net Income Attributable to TAL Education Group
Net income attributable to TAL increased by 53.2% to US$102.9 million from US$67.2 million in fiscal year 2015. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, increased by 50.4% to US$128.7 million from US$85.6 million in fiscal year 2015.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were US$1.29 and US$1.21, respectively, in fiscal year 2016. Non-GAAP basic and Non-GAAP diluted net income per ADS, which excluded share-based compensation expenses, were US$1.61 and US$1.49, respectively.
Capital Expenditures
Capital expenditures for fiscal year 2016 were US$35.1 million, an increase of US$4.5 million from US$30.6 million in fiscal year 2015. The increase was mainly due to leasehold improvements and the purchase of servers, computers, software systems and other hardware for the Company's teaching facilities and mobile network research and development.
Cash, Cash Equivalents, and Term Deposits
As of February 29, 2016, the Company had US$434.0 million of cash and cash equivalents and US$17.3 million of term deposits, compared to US$470.2 million of cash and cash equivalents and US$21.2 million of term deposits as of February 28, 2015.
Deferred Revenue
As of February 29, 2016, the Company's deferred revenue balance was US$289.3 million, compared to US$177.6 million as of February 28, 2015, representing a year-over-year increase of approximately 62.8%, mainly due to the acquisition of Firstleap.
Business Outlook
Taking into consideration the recent significant change in RMB exchange rate against the U.S. dollar, based on the Company's current estimates, total net revenues for the first quarter of fiscal year 2017 are expected to be between US$181.1 million and US$183.2 million, representing an increase of 40% to 42% on a year-over-year basis. If not including the impact from the recent depreciation of RMB against the U.S. Dollar, the projected revenue growth rate is expected to be in the range of 45% to 47% for the first quarter of fiscal year 2017.
These estimates reflect the Company's current expectation, which is subject to change.
Conference Call
The Company will host a conference call and live webcast to discuss its financial results for the fourth fiscal quarter and the fiscal year ended February 29, 2016 at 8:00 a.m. Eastern Time on April 28, 2016 (8:00 p.m. Beijing time on April 28, 2016).
The dial-in details for the live conference call are as follows:
| - U.S. toll free: |
+1-866-519-4004 |
| - Hong Kong toll free: |
800-906-601 |
| - Mainland China toll free: |
400-620-8038 |
| - International toll: |
+65-6713-5090 |
| Conference ID: |
69723231 |
A live and archived webcast of the conference call will be available on the Investor Relations section of TAL's website at en.100tal.com.
A telephone replay of the conference call will be available through 11:59 p.m. U.S. Eastern time, May 6, 2016 (11:59 a.m. Beijing time, May 7, 2016).
The dial-in details for the replay are as follows:
| - U.S. toll free: |
+1-855-452-5696 |
| - Hong Kong toll free: |
800-963-117 |
| - Mainland China toll free: |
400-602-2065 |
| - International toll: |
+61-2-8199-0299 |
| Conference ID: |
69723231 |
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the outlook for the first quarter of fiscal year 2017 and the fiscal year ending February 28, 2017, quotations from management in this announcement, as well as TAL Education Group's strategic and operational plans, contain forward-looking statements. The Company may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports to shareholders, 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 Company's ability to continue to attract students to enroll in its courses; the Company's ability to continue to recruit, train and retain qualified teachers; the Company's ability to improve the content of its existing course offerings and to develop new courses; the Company's ability to maintain and enhance its brand; the Company's ability to maintain and continue to improve its teaching results; and the Company's ability to compete effectively against its competitors. Further information regarding these and other risks is included in the Company's reports filed with, or furnished to the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and TAL Education Group undertakes no duty to update such information or any forward-looking statement, except as required under applicable law.
About TAL Education Group
TAL Education Group is a leading K-12 after-school tutoring services provider in China. The acronym "TAL" stands for "Tomorrow Advancing Life," which reflects our vision to promote top learning opportunities for Chinese students through both high-quality teaching and content, as well as leading edge application of technology in the education experience. TAL Education Group offers comprehensive tutoring services to students from pre-school to the twelfth grade through three flexible class formats: small classes, personalized premium services, and online courses. Our tutoring services cover the core academic subjects in China's school curriculum including mathematics, English, Chinese, physics, chemistry, and biology. The Company's learning center network includes 363 physical learning centers as of February 29, 2016, located in 25 key cities in China: Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Wuhan, Xi`an, Chengdu, Nanjing, Hangzhou, Taiyuan, Zhengzhou, Chongqing, Suzhou, Shenyang, Jinan, Shijiazhuang, Qingdao, Changsha, Luoyang, Nanchang, Ningbo, Wuxi, Fuzhou and Hefei. We also operate www.jzb.com, a leading online education platform in China. Our ADSs trade on the New York Stock Exchange under the symbol "XRS."
About Non-GAAP Financial Measures
In evaluating its business, TAL considers and uses the following measures defined as non-GAAP financial measures by the U.S. Securities and Exchange Commission as supplemental metrics to review and assess its operating performance: non-GAAP operating costs and expenses, non-GAAP cost of revenues, non-GAAP selling and marketing expenses, non-GAAP general and administrative expenses, non-GAAP income from operations, non-GAAP net income attributable to TAL, non-GAAP basic and non-GAAP diluted net income 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 from 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 release.
TAL believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based expenses that may not be indicative of its operating performance from a cash perspective. TAL 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 TAL's historical performance and liquidity. TAL computes its non-GAAP financial measures using the same consistent method from quarter to quarter and from period to period. TAL 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 charges that have been and will continue to be for the foreseeable future a significant recurring expense in the Company's business. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables have more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.
For further information, please contact:
Mei Li
Investor Relations
TAL Education Group
Tel: +86 10 5292 6658
Email: [email protected]
Caroline Straathof
IR Inside
Tel: +31 6 5462 4301
Email: [email protected]
| TAL EDUCATION GROUP |
|||||
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||
| (In U.S. dollars) |
|||||
| As of February 28, |
As of February 29, |
||||
| ASSETS |
|||||
| Current assets |
|||||
| Cash and cash equivalents |
$ 470,157,430 |
$ 434,042,036 |
|||
| Term deposits |
21,229,763 |
17,292,636 |
|||
| Restricted cash-current |
606,169 |
1,083,787 |
|||
| Short-term investments |
765,611 |
27,470,431 |
|||
| Inventory |
544,085 |
600,441 |
|||
| Amounts due from related parties-current |
159,502 |
2,594,430 |
|||
| Deferred tax assets-current |
4,562,034 |
738,406 |
|||
| Income tax receivable |
3,222,529 |
- |
|||
| Prepaid expenses and other current assets |
38,185,411 |
32,037,407 |
|||
| Total current assets |
539,432,534 |
515,859,574 |
|||
| Restricted cash-non-current |
3,773,302 |
3,881,858 |
|||
| Property and equipment, net |
93,575,648 |
114,629,683 |
|||
| Deferred tax assets-non-current |
1,708,212 |
6,654,778 |
|||
| Rental deposit |
11,034,812 |
17,114,552 |
|||
| Intangible assets, net |
3,687,255 |
15,194,421 |
|||
| Goodwill |
12,330,326 |
87,022,517 |
|||
| Amounts due from related parties-non-current |
319,005 |
1,342,999 |
|||
| Long-term investments |
97,359,075 |
274,356,960 |
|||
| Long-term prepayments and other non-current assets |
9,194,468 |
25,321,691 |
|||
| Total assets |
$ 772,414,637 |
$ 1,061,379,033 |
|||
| LIABILITIES AND EQUITY |
|||||
| Current liabilities |
|||||
| Accounts payable (including accounts payable of the |
$ 4,705,492 |
$ 10,404,047 |
|||
| Deferred revenue-current (including deferred |
177,639,939 |
280,934,750 |
|||
| Amounts due to related parties (including amounts due to |
22,077 |
4,277,896 |
|||
| Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of the consolidated VIEs without recourse to TAL Education |
43,988,602 |
70,267,551 |
|||
| Income tax payable (including income tax payable of the |
6,136,813 |
17,187,453 |
|||
| Deferred tax liabilities-current (including deferred tax |
62,100 |
91,730 |
|||
| Total current liabilities |
232,555,023 |
383,163,427 |
|||
| Deferred revenue-non-current (including deferred |
- |
8,346,457 |
|||
| Deferred tax liabilities-non-current (including deferred tax |
226,792 |
1,304,361 |
|||
| Bond payable (including bond payable of the consolidated |
226,062,006 |
227,827,301 |
|||
| Total liabilities |
458,843,821 |
620,641,546 |
|||
| TAL Education Group Shareholders' Equity |
|||||
| Class A common shares |
88,372 |
90,310 |
|||
| Class B common shares |
71,456 |
71,456 |
|||
| Additional paid-in capital |
82,479,806 |
108,404,873 |
|||
| Statutory reserve |
18,961,627 |
22,981,900 |
|||
| Retained earnings |
207,522,766 |
306,381,011 |
|||
| Accumulated other comprehensive income |
4,168,548 |
(949,647) |
|||
| Total TAL Education Group's equity |
313,292,575 |
436,979,903 |
|||
| Noncontrolling interest |
278,241 |
3,757,584 |
|||
| Total equity |
313,570,816 |
440,737,487 |
|||
| Total liabilities and equity |
$ 772,414,637 |
$ 1,061,379,033 |
|||
| TAL EDUCATION GROUP |
|||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
| (In U.S. dollars, except share, ADS, per share and per ADS data) |
|||||||
| For the Three Months Ended February 28/29, |
For the Fiscal Year Ended February 28/29, |
||||||
| 2015 |
2016 |
2015 |
2016 |
||||
| Net revenues |
$ 123,204,551 |
$ 175,048,674 |
$ 433,969,569 |
$ 619,948,777 |
|||
| Cost of revenues (note 1) |
59,185,331 |
88,774,459 |
203,073,957 |
303,634,829 |
|||
| Gross profit |
64,019,220 |
86,274,215 |
230,895,612 |
316,313,948 |
|||
| Operating expenses (note 1) |
|||||||
| Selling and marketing |
15,796,961 |
22,295,986 |
53,881,815 |
73,567,617 |
|||
| General and administrative |
33,627,409 |
47,393,529 |
110,230,010 |
161,021,637 |
|||
| Total operating expenses |
49,424,370 |
69,689,515 |
164,111,825 |
234,589,254 |
|||
| Government subsidies |
260,002 |
62,535 |
464,327 |
3,327,169 |
|||
| Income from operations |
14,854,852 |
16,647,235 |
67,248,114 |
85,051,863 |
|||
| Interest income |
4,967,407 |
4,184,001 |
16,613,656 |
17,732,879 |
|||
| Interest expense |
(1,872,138) |
(1,886,730) |
(5,811,288) |
(7,499,323) |
|||
| Other (expenses)/income |
(2,856,183) |
247,820 |
(2,010,109) |
(2,522,253) |
|||
| Gain from disposal of components |
- |
- |
- |
50,377,126 |
|||
| Gain on fair value change |
199,000 |
134,852 |
1,202,000 |
1,265,852 |
|||
| Impairment loss on long-term |
- |
- |
- |
(7,503,944) |
|||
| Income before provision for |
15,292,938 |
19,327,178 |
77,242,373 |
136,902,200 |
|||
| Provision for income tax |
(1,129,266) |
(8,229,596) |
(9,368,541) |
(33,482,744) |
|||
| Loss from equity method investments |
(423,225) |
(342,325) |
(729,811) |
(663,256) |
|||
| Net income |
13,740,447 |
10,755,257 |
67,144,021 |
102,756,200 |
|||
| Add: Net (income)/loss |
(11,226) |
103,973 |
12,554 |
122,318 |
|||
| Total net income attributable |
$ 13,729,221 |
$ 10,859,230 |
$ 67,156,575 |
$ 102,878,518 |
|||
| Net income per common share |
|||||||
| Basic |
$ 0.09 |
$ 0.07 |
$ 0.42 |
$ 0.64 |
|||
| Diluted |
0.08 |
0.06 |
0.41 |
0.60 |
|||
| Net income per ADS (note 2) |
|||||||
| Basic |
$ 0.17 |
$ 0.14 |
$ 0.85 |
$ 1.29 |
|||
| Diluted |
0.17 |
0.13 |
0.82 |
1.21 |
|||
|
Weighted average shares used in calculating |
|||||||
| Basic |
159,085,889 |
160,693,380 |
158,381,576 |
160,109,169 |
|||
| Diluted |
164,156,582 |
168,185,267 |
163,589,649 |
183,056,255 |
|||
| Note1: Share-based compensation expenses are included in the operating costs and expenses as follows: |
|||||||
| For the Three Months |
For the Fiscal Year |
||||||
| Ended February 28/29, |
Ended February 28/29, |
||||||
| 2015 |
2016 |
2015 |
2016 |
||||
|
Cost of revenues |
$ 13,272 |
$ 9,414 |
$ 47,808 |
$ 42,679 |
|||
| Selling and marketing |
509,161 |
819,275 |
2,072,742 |
2,479,864 |
|||
| General and administrative |
4,784,931 |
7,766,622 |
16,320,526 |
23,324,954 |
|||
| Total |
$ 5,307,364 |
$ 8,595,311 |
$ 18,441,076 |
$ 25,847,497 |
|||
| Note 2: Each ADS represents two Class A common shares. |
|||||||
| TAL EDUCATION GROUP |
||||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
||||||||||
| (In U.S. dollars) |
||||||||||
| For the Three Months Ended February 28/29, |
For the Fiscal Year Ended February 28/29, |
|||||||||
| 2015 |
2016 |
2015 |
2016 |
|||||||
| Net income |
$ 13,740,447 |
$ 10,755,257 |
$ 67,144,021 |
$ 102,756,200 |
||||||
| Other comprehensive loss, |
(4,131,675) |
(4,589,245) |
(3,678,886) |
(5,116,019) |
||||||
| Comprehensive income |
9,608,772 |
6,166,012 |
63,465,135 |
97,640,181 |
||||||
| Add: Comprehensive |
(5,512) |
96,926 |
13,576 |
120,142 |
||||||
| Comprehensive income |
$ 9,603,260 |
$ 6,262,938 |
$ 63,478,711 |
$ 97,760,323 |
||||||
| TAL EDUCATION GROUP |
||||||||
| Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures |
||||||||
| (In U.S. dollars, except share, ADS, per share and per ADS data) |
||||||||
| For the Three Months Ended February 28/29, |
For the Fiscal Year |
|||||||
| 2015 |
2016 |
2015 |
2016 |
|||||
| Cost of revenues |
$ 59,185,331 |
$ 88,774,459 |
$ 203,073,957 |
$ 303,634,829 |
||||
| Share-based compensation |
13,272 |
9,414 |
47,808 |
42,679 |
||||
| Non-GAAP cost of revenues |
59,172,059 |
88,765,045 |
203,026,149 |
303,592,150 |
||||
| Selling and marketing expenses |
15,796,961 |
22,295,986 |
53,881,815 |
73,567,617 |
||||
| Share-based compensation |
509,161 |
819,275 |
2,072,742 |
2,479,864 |
||||
| Non-GAAP selling and |
15,287,800 |
21,476,711 |
51,809,073 |
71,087,753 |
||||
| General and administrative |
33,627,409 |
47,393,529 |
110,230,010 |
161,021,637 |
||||
| Share-based compensation |
4,784,931 |
7,766,622 |
16,320,526 |
23,324,954 |
||||
| Non-GAAP general and |
28,842,478 |
39,626,907 |
93,909,484 |
137,696,683 |
||||
| Operating costs and expenses |
108,609,701 |
158,463,974 |
367,185,782 |
538,224,083 |
||||
| Share-based compensation |
5,307,364 |
8,595,311 |
18,441,076 |
25,847,497 |
||||
| Non-GAAP operating costs and |
103,302,337 |
149,868,663 |
348,744,706 |
512,376,586 |
||||
| Income from operations |
14,854,852 |
16,647,235 |
67,248,114 |
85,051,863 |
||||
| Share based compensation |
5,307,364 |
8,595,311 |
18,441,076 |
25,847,497 |
||||
| Non-GAAP income from |
20,162,216 |
25,242,546 |
85,689,190 |
110,899,360 |
||||
| Net income attributable to TAL |
13,729,221 |
10,859,230 |
67,156,575 |
102,878,518 |
||||
| Share based compensation |
5,307,364 |
8,595,311 |
18,441,076 |
25,847,497 |
||||
| Non-GAAP net income |
$ 19,036,585 |
$ 19,454,541 |
$ 85,597,651 |
$ 128,726,015 |
||||
| Net income per ADS |
||||||||
| Basic |
$ 0.17 |
$ 0.14 |
$ 0.85 |
$ 1.29 |
||||
| Diluted |
0.17 |
0.13 |
0.82 |
1.21 |
||||
| Non-GAAP net income per |
||||||||
| Basic |
$ 0.24 |
$ 0.24 |
$ 1.08 |
$ 1.61 |
||||
| Diluted |
0.23 |
0.23 |
1.03 |
1.49 |
||||
| ADSs used in calculating net |
||||||||
| Basic |
79,542,945 |
80,346,690 |
79,190,788 |
80,054,585 |
||||
| Diluted |
82,078,291 |
84,092,634 |
81,794,824 |
91,528,128 |
||||
|
ADSs used in calculating |
||||||||
| Basic |
79,542,945 |
80,346,690 |
79,190,788 |
80,054,585 |
||||
| Diluted |
90,828,196 |
92,842,539 |
88,602,970 |
91,528,128 |
||||
SOURCE TAL Education Group
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