[Executive Summary](index=1&type=section&id=Executive%20Summary) [Interim Results Overview](index=1&type=section&id=Interim%20Results%20Overview) The Group reported unaudited interim consolidated financial results for H1 2023, with adjusted revenue up **7.3%** to **RMB 490,697 thousand** and profit for the period up **5.2%** Key Financial Data for the Six Months Ended June 30, 2023 | Metric | 2023 (RMB '000) | 2022 (RMB '000) | % Change | | :----------------- | :-------------- | :-------------- | :--------- | | Adjusted Revenue (1) | 490,697 | 457,295 | 7.3% | | Revenue | 351,075 | 333,473 | 5.3% | | Gross Profit | 234,822 | 221,856 | 5.8% | | Profit for the Period | 181,454 | 172,495 | 5.2% | | Adjusted Net Profit (2) | 218,904 | 219,417 | -0.2% | - Adjusted revenue includes the Group's revenue plus revenue from Clinical Medical College and Hongshan College, which is not an IFRS measure[101](index=101&type=chunk) [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2023, the Group's revenue was **RMB 351,075 thousand**, gross profit was **RMB 234,822 thousand**, profit for the period was **RMB 181,454 thousand**, and basic and diluted earnings per share were **RMB 11.3 cents** Consolidated Statement of Profit or Loss and Other Comprehensive Income (Summary) | Metric | Six Months Ended June 30, 2023 (RMB '000) | Six Months Ended June 30, 2022 (RMB '000) | | :------------------------- | :---------------------------------------- | :---------------------------------------- | | Revenue | 351,075 | 333,473 | | Cost of Sales | (116,253) | (111,617) | | Gross Profit | 234,822 | 221,856 | | Other Income | 24,725 | 37,817 | | Selling and Distribution Costs | (3,092) | (1,822) | | Administrative Expenses | (66,249) | (76,615) | | Operating Profit | 190,206 | 181,236 | | Finance Costs | (6,514) | (7,989) | | Profit Before Tax | 183,692 | 173,247 | | Income Tax | (2,238) | (752) | | Profit for the Period | 181,454 | 172,495 | Earnings Per Share | Metric | Six Months Ended June 30, 2023 (RMB cents) | Six Months Ended June 30, 2022 (RMB cents) | | :----------------- | :----------------------------------------- | :----------------------------------------- | | Basic EPS | 11.3 | 10.7 | | Diluted EPS | 11.3 | 10.7 | [Consolidated Statement of Financial Position](index=3&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2023, the Group's total non-current assets were **RMB 3,748,538 thousand**, net current assets increased **77.4%** to **RMB 47,004 thousand**, and net assets were **RMB 3,345,354 thousand** Consolidated Statement of Financial Position (Summary) | Metric | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :------------------------- | :----------------------- | :--------------------------- | | Total Non-Current Assets | 3,748,538 | 3,653,976 | | Total Current Assets | 315,688 | 537,936 | | Total Current Liabilities | 268,684 | 511,423 | | Net Current Assets | 47,004 | 26,513 | | Total Assets Less Current Liabilities | 3,795,542 | 3,680,489 | | Non-Current Liabilities | 450,188 | 446,096 | | Net Assets | 3,345,354 | 3,234,393 | | Total Equity | 3,345,354 | 3,234,393 | - Net current assets increased by **77.4%** during the reporting period, primarily due to a decrease in contract liabilities exceeding the decrease in current assets[65](index=65&type=chunk) [Notes to the Unaudited Interim Financial Report](index=5&type=section&id=Notes%20to%20the%20Unaudited%20Interim%20Financial%20Report) [1 Basis of Preparation](index=5&type=section&id=1%20Basis%20of%20Preparation) This interim financial report, prepared under HKEX Listing Rules and IAS 34, was approved for publication on August 30, 2023, explaining changes in financial position and performance since the 2022 annual financial statements - This interim financial report is prepared in accordance with the applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, including International Accounting Standard 34 Interim Financial Reporting issued by the International Accounting Standards Board[106](index=106&type=chunk) - The report was approved for publication on August 30, 2023, and contains condensed consolidated financial statements and selected explanatory notes to explain changes in financial position and performance since the 2022 annual financial statements[106](index=106&type=chunk)[139](index=139&type=chunk) [2 Changes in Accounting Policies](index=5&type=section&id=2%20Changes%20in%20Accounting%20Policies) This interim financial report is prepared using the same accounting policies as the 2022 annual financial statements, with no significant impact from new IFRS amendments on the Group's results or financial position - This interim financial report is prepared in accordance with the same accounting policies adopted in the 2022 annual financial statements, except for changes in accounting policies expected to be reflected in the 2023 annual financial statements[2](index=2&type=chunk) - The IASB has issued several amendments to IFRSs, including amendments to IFRS 12 (Income Taxes: International Tax Reform – Pillar Two Model Rules and Deferred Tax related to Assets and Liabilities arising from a Single Transaction), IFRS 8 (Accounting Policies, Changes in Accounting Estimates and Errors: Definition of Accounting Estimates), and IFRS 17 (Insurance Contracts)[3](index=3&type=chunk)[108](index=108&type=chunk)[140](index=140&type=chunk) - These developments have not had a significant impact on the way the Group's results and financial position for the current or prior periods are prepared or presented in this interim financial report[95](index=95&type=chunk) [3 Revenue and Segment Reporting](index=6&type=section&id=3%20Revenue%20and%20Segment%20Reporting) For the six months ended June 30, 2023, the Group's revenue, primarily from tuition and boarding fees, increased **5.3%** to **RMB 351,075 thousand**, with all revenue and non-current assets originating from China, operating as a single education services segment Revenue Sources | Revenue Source | Six Months Ended June 30, 2023 (RMB '000) | Six Months Ended June 30, 2022 (RMB '000) | | :------------- | :---------------------------------------- | :---------------------------------------- | | Tuition Fees | 323,909 | 306,960 | | Boarding Fees | 27,166 | 26,513 | | Total | 351,075 | 333,473 | - All of the Group's revenue is derived from the People's Republic of China, and all its non-current assets are located in China[96](index=96&type=chunk) - The Group has determined that it has only one operating segment, which is the provision of education services[141](index=141&type=chunk) [4 Other Income](index=6&type=section&id=4%20Other%20Income) Other income for the six months ended June 30, 2023, decreased **34.7%** to **RMB 24,725 thousand**, primarily due to reduced operating surplus from Hongshan College, comprising rental, service, government grants, interest, and college operating surpluses Other Income Details | Item | Six Months Ended June 30, 2023 (RMB '000) | Six Months Ended June 30, 2022 (RMB '000) | | :------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Rental and Property Management Income | 10,914 | 10,841 | | Service Income | 7,233 | 6,849 | | Government Grants | 798 | 1,097 | | Interest Income from Financial Assets Measured at Amortized Cost | 4,842 | 3,569 | | Operating Surplus from Clinical Medical College and Hongshan College (i) | 1,411 | 15,131 | | Others | (473) | 330 | | Total | 24,725 | 37,817 | - Other income decreased by **34.7%** from **RMB 37.8 million** for the six months ended June 30, 2022, to **RMB 24.7 million** for the reporting period, primarily due to the combined effect of a decrease in operating surplus from Hongshan College[170](index=170&type=chunk) - Operating surplus from Clinical Medical College and Hongshan College refers to the surplus or deficit to be absorbed by the Group, which is the recognized revenue less operating costs of the two colleges during the reporting period[98](index=98&type=chunk) [5 Profit Before Tax](index=7&type=section&id=5%20Profit%20Before%20Tax) For the six months ended June 30, 2023, the Group's profit before tax increased **6.1%** to **RMB 183,692 thousand**, after deducting items such as depreciation, amortization, and auditor's remuneration Items Deducted from Profit Before Tax | Item | Six Months Ended June 30, 2023 (RMB '000) | Six Months Ended June 30, 2022 (RMB '000) | | :--------------------------------- | :---------------------------------------- | :---------------------------------------- | | Depreciation of Property, Plant and Equipment | 31,164 | 30,167 | | Amortization of Intangible Assets | 1,554 | 2,480 | | Depreciation of Right-of-Use Assets | 1,278 | 1,278 | | Auditor's Remuneration | 1,000 | 1,612 | | Total | 34,996 | 35,537 | - The Group recognized a profit before income tax of **RMB 183.7 million** for the reporting period, an increase of **6.1%** compared to **RMB 173.2 million** for the six months ended June 30, 2022, primarily due to increased revenue[61](index=61&type=chunk) [6 Income Tax in the Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=8&type=section&id=6%20Income%20Tax%20in%20the%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) Income tax provision for the six months ended June 30, 2023, surged **175.0%** to **RMB 2,238 thousand** due to increased taxable income, with future tax treatment potentially affected by pending detailed policy instructions for non-profit private schools Current Tax Provision | Item | Six Months Ended June 30, 2023 (RMB '000) | Six Months Ended June 30, 2022 (RMB '000) | | :--------------------------------- | :---------------------------------------- | :---------------------------------------- | | PRC Income Tax Provision for the Period | 2,238 | 752 | - The Group's income tax increased by **175.0%** from **RMB 0.8 million** for the six months ended June 30, 2022, to **RMB 2.2 million** for the reporting period, primarily due to an increase in taxable income[175](index=175&type=chunk) - According to relevant provisions of the Implementation Rules for the Law for Promoting Private Education, private schools that do not require reasonable returns may enjoy the same tax preferential treatment as public schools; however, as of the date of this announcement, the Group has not yet initiated the registration process due to the lack of detailed instructions, and future tax treatment may be adversely affected[10](index=10&type=chunk)[116](index=116&type=chunk) [7 Earnings Per Share](index=8&type=section&id=7%20Earnings%20Per%20Share) For the six months ended June 30, 2023, profit attributable to shareholders was **RMB 181,454 thousand**. Basic and diluted earnings per share were **RMB 11.3 cents**, based on weighted average ordinary shares Earnings Per Share | Metric | Six Months Ended June 30, 2023 (RMB cents) | Six Months Ended June 30, 2022 (RMB cents) | | :----------------- | :----------------------------------------- | :----------------------------------------- | | Basic EPS | 11.3 | 10.7 | | Diluted EPS | 11.3 | 10.7 | - Basic earnings per share are calculated based on the profit attributable to shareholders of the Company of **RMB 181,454,000** for the six months ended June 30, 2023, and the weighted average number of ordinary shares in issue of **1,608,583,000** shares[117](index=117&type=chunk) - Diluted earnings per share are calculated based on the profit attributable to shareholders of the Company of **RMB 181,454,000** for the six months ended June 30, 2023, and the weighted average number of ordinary shares of **1,609,579,000** shares[149](index=149&type=chunk) [8 Other Non-Current Assets](index=9&type=section&id=8%20Other%20Non-Current%20Assets) As of June 30, 2023, total other non-current assets were **RMB 2,826,094 thousand**, mainly comprising investment prepayments for Hongshan College and campus construction payments to Clinical Medical College and Hongshan College Other Non-Current Assets Details | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :------------------- | :----------------------- | :--------------------------- | | Prepayments for Investments | 660,000 | 660,000 | | Other Receivables | 2,166,094 | 2,040,291 | | Total | 2,826,094 | 2,700,291 | - Other receivables refer to campus construction payments to Clinical Medical College amounting to **RMB 1,081,049,000** (December 31, 2022: **RMB 1,001,872,000**) and campus construction payments to Hongshan College amounting to **RMB 1,085,045,000** (December 31, 2022: **RMB 1,038,419,000**), all of which are unsecured, interest-free, and repayable on demand[119](index=119&type=chunk) [9 Trade Receivables](index=9&type=section&id=9%20Trade%20Receivables) As of June 30, 2023, the Group's trade receivables decreased to **RMB 574 thousand** from **RMB 2,639 thousand** as of December 31, 2022, with no bad debt provisions made at the period-end Trade Receivables | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :-------- | :----------------------- | :--------------------------- | | Within One Year | 574 | 2,639 | - As of the end of the reporting period, no provision for doubtful debts was made[120](index=120&type=chunk) [10 Prepayments, Deposits, and Other Receivables](index=9&type=section&id=10%20Prepayments,%20Deposits,%20and%20Other%20Receivables) As of June 30, 2023, prepayments, deposits, and other receivables totaled **RMB 211,681 thousand**, primarily including a **RMB 200,000 thousand** balance due from Hongshan College Prepayments, Deposits, and Other Receivables | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :------------------- | :----------------------- | :--------------------------- | | Prepayments and Deposits | 201,299 | 205,089 | | Other Receivables | 10,382 | 8,140 | | Total | 211,681 | 213,229 | - As of June 30, 2023, prepayments and deposits primarily included a balance due from Hongshan College amounting to **RMB 200,000,000**[15](index=15&type=chunk)[120](index=120&type=chunk) [11 Long-Term Bank Deposits, Cash, and Bank Balances](index=10&type=section&id=11%20Long-Term%20Bank%20Deposits,%20Cash,%20and%20Bank%20Balances) As of June 30, 2023, the Group's long-term bank deposits, cash, and bank balances totaled **RMB 283,433 thousand**, a decrease from **RMB 502,068 thousand** as of December 31, 2022, with bank deposits earning **3.10% to 3.70%** annual interest Long-Term Bank Deposits, Cash, and Bank Balances | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :----------------------- | :----------------------- | :--------------------------- | | Long-Term Bank Deposits | 180,000 | 180,000 | | Cash and Bank Balances | | | | - Bank Term Deposits | 60,000 | 130,000 | | - Cash and Cash Equivalents | 43,433 | 192,068 | | Total | 283,433 | 502,068 | - As of June 30, 2023, bank term deposits bore interest at annual rates ranging from **3.10% to 3.70%** (December 31, 2022: **2.96% to 3.70%**)[152](index=152&type=chunk) [12 Loans and Borrowings](index=10&type=section&id=12%20Loans%20and%20Borrowings) As of June 30, 2023, the Group's total loans and borrowings were **RMB 500,208 thousand**, including **RMB 207,940 thousand** in unsecured bank loans at **3.90%** annual interest and **RMB 292,268 thousand** from related parties at **2.00%** annual interest, with the latter extended to June 21, 2027 Loans and Borrowings Details | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :------------------- | :----------------------- | :--------------------------- | | Unsecured Bank Loans | 207,940 | 212,940 | | Loans from Related Parties | 292,268 | 283,176 | | Total | 500,208 | 496,116 | - As of June 30, 2023, unsecured bank loans bore interest at an annual rate of **3.90%**[17](index=17&type=chunk) - The Group entered into a loan agreement with its related party, Wu Junbao Co., Ltd., at an annual interest rate of **2.00%**, and a loan extension agreement was signed during the reporting period, extending the maturity date from June 21, 2024, to June 21, 2027[153](index=153&type=chunk) [13 Contract Liabilities](index=11&type=section&id=13%20Contract%20Liabilities) As of June 30, 2023, the Group's contract liabilities significantly decreased to **RMB 14,784 thousand** from **RMB 329,549 thousand** as of December 31, 2022, primarily comprising tuition and boarding fees Contract Liabilities Details | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :------------ | :----------------------- | :--------------------------- | | Tuition Fees | 5,797 | 296,718 | | Boarding Fees | 8,987 | 32,831 | | Total | 14,784 | 329,549 | [14 Other Payables](index=11&type=section&id=14%20Other%20Payables) As of June 30, 2023, the Group's other payables increased to **RMB 201,642 thousand**, primarily including amounts due to suppliers, dividends payable, and accrued staff costs, all expected to be settled within one year Other Payables Details | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :----------------------- | :----------------------- | :--------------------------- | | Amounts Due to Suppliers | 57,007 | 68,103 | | Miscellaneous Expenses Collected from Students | 8,988 | 16,491 | | Accrued Staff Costs | 19,687 | 27,421 | | Accrued Expenses | 7,198 | 8,175 | | Dividends Payable | 97,290 | – | | Interest Payable | 10,712 | 7,567 | | Others | 760 | 760 | | Total | 201,642 | 128,517 | - All other payables are expected to be settled within one year[155](index=155&type=chunk) [15 Share Capital, Reserves, and Dividends](index=11&type=section&id=15%20Share%20Capital,%20Reserves,%20and%20Dividends) As of June 30, 2023, the Company's share capital was **RMB 12,952 thousand** and reserves were **RMB 3,332,402 thousand**, with no interim dividend recommended and **71,900,000** share options granted at **HKD 0.764** per share Share Capital and Reserves | Item | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :-------- | :----------------------- | :--------------------------- | | Share Capital | 12,952 | 12,952 | | Reserves | 3,332,402 | 3,221,441 | | Total Equity | 3,345,354 | 3,234,393 | - The Company's directors do not recommend the payment of an interim dividend for the six months ended June 30, 2023[156](index=156&type=chunk) - On June 5, 2023, the Company granted **71,900,000** share options to certain employees (including three executive directors, Zhang Ming, Lu Zhen, and Wang Yongkai) under the Employee Share Option Scheme, with an exercise price of **HKD 0.764** per share[129](index=129&type=chunk) [Capital Management](index=12&type=section&id=Capital%20Management) The Group monitors its capital structure using the asset-liability ratio to ensure going concern and shareholder returns, with the ratio decreasing to **18%** as of June 30, 2023, from **23%** as of December 31, 2022 - The Group's primary objective of capital management is to ensure its ability to continue as a going concern, so that it can continue to generate returns for shareholders and benefits for other stakeholders through pricing products and services commensurate with the level of risk and by obtaining financing at a reasonable cost[130](index=130&type=chunk) Asset-Liability Ratio | Metric | June 30, 2023 (RMB '000) | December 31, 2022 (RMB '000) | | :----------------- | :----------------------- | :--------------------------- | | Total Liabilities | 718,872 | 957,519 | | Total Assets | 4,064,226 | 4,191,912 | | Asset-Liability Ratio | 18% | 23% | - As of June 30, 2023, the ratio was **17.7%**, a slight decrease during the reporting period compared to **22.8%** as of December 31, 2022[45](index=45&type=chunk) [Management Discussion and Analysis](index=13&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Operational Updates](index=13&type=section&id=Business%20Review%20and%20Operational%20Updates) The Group invests in and operates four educational institutions, all of which made significant progress in professional development, faculty, industry-academia collaboration, and digital campus construction to meet national demand for high-quality applied talents - The Group invests in and operates four educational institutions: Anhui Xinhua University, Clinical Medical College of Anhui Medical University, Hongshan College of Nanjing University of Finance and Economics, and Anhui Xinhua School[187](index=187&type=chunk) - The Group closely aligns with the needs of emerging industries and the transformation and upgrading of traditional industries, continuously strengthening professional development, with its colleges currently having a total of **4** national-level first-class undergraduate programs and **14** provincial-level first-class undergraduate programs[192](index=192&type=chunk) - The Group actively promotes industry-academia and local government cooperation, deepens international exchanges and cooperation, establishes an international exchange cloud platform, and introduces curriculum resources from renowned universities such as Harvard University and Oxford University[52](index=52&type=chunk) [Our Schools](index=13&type=section&id=Our%20Schools) Xinhua College offers 59 undergraduate programs and added a national-level first-class course, Clinical Medical College saw a **40.6%** increase in enrollment to **5,991** students, Hongshan College's Gaocun campus is ready for use, and Xinhua School was recognized as a national key secondary vocational school - Xinhua College has **10** secondary colleges and **2** teaching departments, offering a total of **59** undergraduate programs, with **4** national-level first-class undergraduate programs in Communication Engineering, Financial Management, Economics and Finance, and Software Engineering, and **1** new national-level first-class undergraduate course ("Digital Circuits")[47](index=47&type=chunk) - In the 2022/2023 academic year, Clinical Medical College's enrollment reached **5,991** students, a year-on-year increase of **40.6%**, and it added **1** provincial-level high-level public health college, with scientific research projects doubling compared to the same period last year[48](index=48&type=chunk) - Hongshan College's Gaocun campus is fully equipped, functionally complete, and offers excellent conditions, and is about to be put into use[137](index=137&type=chunk) Student Enrollment | School | June 30, 2023 | June 30, 2022 | | :--------------------- | :------------ | :------------ | | Xinhua College | | | | Full-time Students | 24,092 | 24,476 | | Continuing Education | 15,586 | 12,296 | | Subtotal | 39,678 | 36,772 | | Clinical Medical College (1) | | | | Full-time Students | 5,991 | 4,261 | | Hongshan College (1) | | | | Full-time Students | 9,820 | 10,213 | | Xinhua School | | | | Full-time Students | 4,374 | 6,288 | | Total Full-time Students | 44,277 | 45,238 | | Total Students | 59,863 | 57,534 | [Operational Updates and Highlights](index=15&type=section&id=Operational%20Updates%20and%20Highlights) The Group actively aligns with emerging industry demands, strengthens professional and curriculum development, recruits high-caliber faculty, deepens industry-academia cooperation, and invests in modern digital campus construction to cultivate high-quality applied talents - Significant achievements in professional and curriculum development, aligning with emerging industry demands, with affiliated colleges having a total of **4** national-level first-class undergraduate programs and **14** provincial-level first-class undergraduate programs[192](index=192&type=chunk) - Strengthened talent recruitment and cultivation to build a high-level faculty team, continuously attracting doctoral, associate senior professional title and above talents, and enriching the "dual-qualified" teacher team[166](index=166&type=chunk) - Deepened exchanges and cooperation, effectively leveraging collaborative education, actively promoting industry-academia and local government cooperation, enhancing international exchanges and cooperation, and introducing curriculum resources from renowned universities such as Harvard University and Oxford University[52](index=52&type=chunk) - Increased investment, with modern campus construction reaching new heights, including the construction or renovation of **32** experimental training centers, strengthening campus informatization, and promoting educational digitalization[137](index=137&type=chunk) [Financial Review](index=18&type=section&id=Financial%20Review) The Group achieved revenue and gross profit growth, but other income and adjusted net profit slightly decreased, while operating costs, selling and distribution costs, administrative expenses, and finance costs saw varied changes, leading to increased profit for the period and improved net current assets and asset-liability ratio [Revenue](index=18&type=section&id=Revenue) The Group's revenue increased **5.3%** to **RMB 351.1 million** for the period, primarily due to higher average tuition fees, with adjusted revenue (including Clinical Medical College and Hongshan College) growing **7.3%** to **RMB 490,697 thousand** - The Group's revenue increased by **5.3%** from **RMB 333.5 million** for the six months ended June 30, 2022, to **RMB 351.1 million** for the reporting period, primarily due to an increase in the average tuition fees charged to students[196](index=196&type=chunk) Revenue and Adjusted Revenue | Item | Six Months Ended June 30, 2023 (RMB '000) | Six Months Ended June 30, 2022 (RMB '000) | | :--------------------------------- | :---------------------------------------- | :---------------------------------------- | | Revenue | 351,075 | 333,473 | | Add: Revenue from Clinical Medical College and Hongshan College | 139,622 | 123,822 | | Adjusted Revenue | 490,697 | 457,295 | [Other Income](index=18&type=section&id=Other%20Income) Other income decreased **34.7%** to **RMB 24.7 million** for the period, primarily due to the reduced operating surplus from Hongshan College - Other income decreased by **34.7%** from **RMB 37.8 million** for the six months ended June 30, 2022, to **RMB 24.7 million** for the reporting period, primarily due to the combined effect of a decrease in operating surplus from Hongshan College[170](index=170&type=chunk) [Cost of Sales](index=18&type=section&id=Cost%20of%20Sales) Cost of sales increased **4.2%** to **RMB 116.3 million** for the period, mainly due to the expanded school scale and increased ongoing teaching investment - Cost of sales increased by **4.2%** from **RMB 111.6 million** for the six months ended June 30, 2022, to **RMB 116.3 million** for the reporting period, primarily due to the expanded school scale and increased ongoing teaching investment[37](index=37&type=chunk) [Gross Profit](index=18&type=section&id=Gross%20Profit) Gross profit increased **5.8%** to **RMB 234.8 million** for the period, driven by continuous optimization of management and economies of scale from resource integration, aligning with business growth - Gross profit increased by **5.8%** from **RMB 221.9 million** for the six months ended June 30, 2022, to **RMB 234.8 million** for the reporting period, primarily due to the continuous optimization of our management and economies of scale brought about by resource integration, consistent with our business growth[58](index=58&type=chunk) [Selling and Distribution Costs](index=19&type=section&id=Selling%20and%20Distribution%20Costs) Selling and distribution costs increased **72.2%** to **RMB 3.1 million** for the period, primarily due to increased recruitment activities in H1 2023 to boost student enrollment - Selling and distribution costs increased by **72.2%** from **RMB 1.8 million** for the six months ended June 30, 2022, to **RMB 3.1 million** for the reporting period, primarily due to increased recruitment activities in the first half of 2023 to improve student enrollment rates[59](index=59&type=chunk) [Administrative Expenses](index=19&type=section&id=Administrative%20Expenses) Administrative expenses decreased **13.6%** to **RMB 66.2 million** for the period, mainly due to a reduction in exchange losses - Administrative expenses decreased by **13.6%** from **RMB 76.6 million** for the six months ended June 30, 2022, to **RMB 66.2 million** for the reporting period, primarily due to a decrease in exchange losses[173](index=173&type=chunk) [Finance Costs](index=19&type=section&id=Finance%20Costs) Finance costs decreased to **RMB 6.5 million** for the period, primarily due to a reduction in total loan amounts and interest rates - Finance costs decreased from **RMB 8 million** for the six months ended June 30, 2022, to **RMB 6.5 million** for the reporting period, primarily due to a decrease in total loan amounts and interest rates[40](index=40&type=chunk) [Profit Before Tax](index=19&type=section&id=Profit%20Before%20Tax) The Group's profit before tax increased **6.1%** to **RMB 183.7 million** for the period, primarily driven by increased revenue - The Group recognized a profit before income tax of **RMB 183.7 million** for the reporting period, an increase of **6.1%** compared to **RMB 173.2 million** for the six months ended June 30, 2022, primarily due to increased revenue[61](index=61&type=chunk) [Income Tax](index=19&type=section&id=Income%20Tax) The Group's income tax increased **175.0%** to **RMB 2.2 million** for the period, primarily due to an increase in taxable income - The Group's income tax increased by **175.0%** from **RMB 0.8 million** for the six months ended June 30, 2022, to **RMB 2.2 million** for the reporting period, primarily due to an increase in taxable income[175](index=175&type=chunk) [Profit for the Period](index=19&type=section&id=Profit%20for%20the%20Period) Due to the combined impact of revenue and cost changes, the Group recorded a profit of **RMB 181.5 million** for the period, an increase of **5.2%** - Due to the combined impact of the aforementioned revenue and cost changes, the Group recorded a profit of **RMB 181.5 million** for the reporting period, an increase of **5.2%** compared to **RMB 172.5 million** for the six months ended June 30, 2022[42](index=42&type=chunk) [Adjusted Net Profit](index=20&type=section&id=Adjusted%20Net%20Profit) Adjusted net profit slightly decreased **0.2%** to **RMB 218,904 thousand**, after adjusting for exchange gains or losses and share-based payment expenses unrelated to the Group's operating performance Adjusted Net Profit Calculation | Item | Six Months Ended June 30, 2023 (RMB '000) | Six Months Ended June 30, 2022 (RMB '000) | | :--------------------------------- | :---------------------------------------- | :---------------------------------------- | | Profit for the Period | 181,454 | 172,495 | | Add: Exchange Losses | 35,009 | 43,580 | | Add: Share-Based Payment Expenses | 2,441 | 3,342 | | Adjusted Net Profit | 218,904 | 219,417 | - Adjusted net profit is the profit for the period adjusted for exchange gains or losses and share-based payment expenses unrelated to the Group's operating performance, and it is not an IFRS measure[43](index=43&type=chunk) [Working Capital and Capital Resources](index=20&type=section&id=Working%20Capital%20and%20Capital%20Resources) The Group primarily funds its operations through cash and cash equivalents from operations, with net current assets increasing **77.4%** to **RMB 47 million** and total bank and related party loans amounting to **RMB 500.2 million** - The Group primarily funds its operations through cash and cash equivalents generated from operations[43](index=43&type=chunk) - As of June 30, 2023, the Group recorded net current assets of **RMB 47 million**, an increase of **77.4%** compared to **RMB 26.5 million** as of December 31, 2022, primarily due to a decrease in contract liabilities exceeding the decrease in current assets[65](index=65&type=chunk) - As of June 30, 2023, the Group's bank loans and loans from related parties amounted to **RMB 500.2 million**[67](index=67&type=chunk) [Capital Expenditure](index=20&type=section&id=Capital%20Expenditure) Capital expenditure for the period significantly increased to **RMB 126.1 million**, primarily related to the construction of buildings and school facilities, and the purchase of equipment and software, funded mainly by cash from operations - For the reporting period, the Group's capital expenditure was **RMB 126.1 million** (June 30, 2022: **RMB 14.3 million**), primarily related to the construction of buildings and school facilities and the purchase of equipment and software[179](index=179&type=chunk) - As Clinical Medical College and Hongshan College are not yet consolidated, capital expenditure does not include these two schools for now[179](index=179&type=chunk) [Asset-Liability Ratio](index=21&type=section&id=Asset-Liability%20Ratio) As of June 30, 2023, the Group's asset-liability ratio slightly decreased to **17.7%**, indicating improved financial leverage - The Group's asset-liability ratio is calculated as total liabilities divided by total assets; as of June 30, 2023, the ratio was **17.7%**, a slight decrease during the reporting period compared to **22.8%** as of December 31, 2022[45](index=45&type=chunk) Asset-Liability Ratio | Metric | June 30, 2023 | December 31, 2022 | | :----------------- | :------------ | :---------------- | | Asset-Liability Ratio | 18% | 23% | [Future Plans for Material Investments and Capital Assets](index=21&type=section&id=Future%20Plans%20for%20Material%20Investments%20and%20Capital%20Assets) The Group had no other plans for material investments and capital assets as of June 30, 2023, and up to the date of this announcement - The Group had no other plans for material investments and capital assets as of June 30, 2023, and up to the date of this announcement[68](index=68&type=chunk) - During the reporting period, the Group did not hold any material investments[181](index=181&type=chunk) [Material Acquisitions and Disposals of Subsidiaries and Associates](index=21&type=section&id=Material%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%20and%20Associates) The Company had no material acquisitions or disposals of subsidiaries and associates during the reporting period - The Company had no material acquisitions or disposals of subsidiaries and associates during the reporting period[69](index=69&type=chunk) [Foreign Exchange Risk Management](index=21&type=section&id=Foreign%20Exchange%20Risk%20Management) The Group's functional currency is RMB, with most income and expenses denominated in RMB, and while some bank balances are in USD or HKD, no hedging instruments are currently in place, but management continuously monitors foreign exchange risk - The Group's functional currency is RMB, and most of its income and expenses are denominated in RMB; as of June 30, 2023, certain bank balances were denominated in USD or HKD[76](index=76&type=chunk) - The Group has not entered into any financial instruments for hedging purposes at present, and management continuously monitors foreign exchange risk and will consider using financial instruments to hedge significant foreign currency risks when necessary[76](index=76&type=chunk) [Pledge of Assets](index=21&type=section&id=Pledge%20of%20Assets) As of June 30, 2023, the Group had no assets pledged - As of June 30, 2023, the Group had no assets pledged[70](index=70&type=chunk) [Human Resources](index=21&type=section&id=Human%20Resources) As of June 30, 2023, the Group had approximately **2,576** employees, an increase from the prior year, participating in local government social security plans, maintaining good employee relations with no significant labor disputes - As of June 30, 2023, the Group had approximately **2,576** employees (June 30, 2022: **2,057**)[182](index=182&type=chunk) - In accordance with applicable laws and regulations, the Group participates in employee social security schemes managed by local governments, including housing, pension, medical insurance, maternity insurance, and unemployment insurance[182](index=182&type=chunk) - The Board believes that the Group maintains good working relationships with its employees, and we did not experience any significant labor disputes during the reporting period[182](index=182&type=chunk) [Off-Balance Sheet Commitments and Arrangements](index=22&type=section&id=Off-Balance%20Sheet%20Commitments%20and%20Arrangements) As of June 30, 2023, the Group had no off-balance sheet transactions, unrecorded material contingent liabilities, guarantees, or lawsuits against it - As of June 30, 2023, the Group had not entered into any off-balance sheet transactions[183](index=183&type=chunk) - As of June 30, 2023, the Group had no unrecorded material contingent liabilities, guarantees, or any lawsuits against it[180](index=180&type=chunk) [Events After Reporting Period](index=22&type=section&id=Events%20After%20Reporting%20Period) No events with a material impact on the Group occurred after the reporting period and up to the date of this announcement - No events with a material impact on the Group occurred after the reporting period and up to the date of this announcement[78](index=78&type=chunk) [Interim Dividend](index=22&type=section&id=Interim%20Dividend) The Board does not recommend the payment of an interim dividend for the reporting period - The Board does not recommend the payment of an interim dividend for the reporting period[72](index=72&type=chunk) [Review of Interim Results](index=22&type=section&id=Review%20of%20Interim%20Results) KPMG, the Company's independent auditor, reviewed the unaudited interim consolidated financial statements, and the Audit Committee discussed accounting standards, policies, internal controls, and financial reporting with management and the auditor - The Company's independent auditor, KPMG, has reviewed the unaudited interim consolidated financial statements for the reporting period in accordance with Hong Kong Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Hong Kong Institute of Certified Public Accountants[185](index=185&type=chunk) - The Audit Committee has reviewed the accounting standards and policies adopted by the Company with management and the Company's independent auditor, and has discussed matters relating to the Group's internal controls and financial reporting, including the review of the unaudited interim results for the reporting period[185](index=185&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=22&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the reporting period - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the reporting period[184](index=184&type=chunk) [Corporate Governance](index=23&type=section&id=Corporate%20Governance) [Corporate Governance Code](index=23&type=section&id=Corporate%20Governance%20Code) The Group is committed to high corporate governance standards, adhering to the HKEX Listing Rules' Corporate Governance Code throughout the reporting period to protect shareholder interests and enhance corporate value - The Group is committed to maintaining a high level of corporate governance to protect the interests of the Company's shareholders and enhance corporate value and accountability[74](index=74&type=chunk) - The Company has adopted the Corporate Governance Code set out in Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited as its own corporate governance code[74](index=74&type=chunk) - The Company has complied with all applicable code provisions under the Corporate Governance Code throughout the reporting period[74](index=74&type=chunk) [Standard Code for Securities Transactions by Directors](index=23&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company adopted the Standard Code for Securities Transactions by Directors of Listed Issuers, and all directors confirmed compliance during the reporting period - The Company has adopted the Standard Code for Securities Transactions by Directors of Listed Issuers set out in Appendix 10 to the Listing Rules as its code of conduct for directors' securities transactions[80](index=80&type=chunk) - Following specific enquiries made to the Board, all directors confirmed that they had complied with the Standard Code during the reporting period[80](index=80&type=chunk) [Publication of Interim Results and Interim Report](index=23&type=section&id=Publication%20of%20Interim%20Results%20and%20Interim%20Report) This announcement is published on the HKEX and Company websites, and the interim report for the period will be dispatched to shareholders and published on these websites by the end of September 2023 - This announcement is published on the website of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) and the Company's website (www.chinaxhedu.com)[81](index=81&type=chunk) - The Company's interim report for the reporting period will be dispatched to shareholders and published on the aforementioned websites by the end of September 2023[81](index=81&type=chunk)

Enrollment and Academic Programs - The total number of enrolled students increased from 56,518 as of December 31, 2021, to 60,510 as of December 31, 2022, representing a growth of approximately 6%[8]. - The Clinical Medicine College saw an enrollment increase to 5,993 students as of December 31, 2022, which is a year-on-year growth of 40.65%[12]. - The new undergraduate programs approved for Xinhua College include Financial Technology and Artificial Intelligence, contributing to a total of 57 undergraduate programs offered[11]. - The Clinical Medicine College has added three new undergraduate programs: Preventive Medicine, Intelligent Medical Engineering, and Biomedical Data Science[12]. - The group added new undergraduate programs in financial technology, artificial intelligence, preventive medicine, intelligent medical engineering, and biomedical data science, totaling 4 national-level first-class undergraduate programs and 14 provincial-level first-class undergraduate programs[18]. Financial Performance - Revenue rose from RMB 565.4 million for the year ended December 31, 2021, to RMB 625.5 million for the year ended December 31, 2022, marking an increase of about 10.6%[8]. - The group's revenue increased by 10.6% from RMB 565.4 million for the year ended December 31, 2021, to RMB 625.5 million for the year ended December 31, 2022, primarily due to an increase in student enrollment and average tuition fees[24]. - Adjusted revenue for 2022 was RMB 860,098,000, an increase of 11.1% from RMB 774,046,000 in 2021[25]. - The company reported a revenue of 1.2 billion RMB for the fiscal year 2022, representing a year-over-year increase of 15%[76]. - The gross margin for the year was reported at 40%, a slight improvement from 38% in the previous year[76]. Costs and Expenses - Main operating costs rose by 31.5% to RMB 256,800,000 in 2022 from RMB 195,300,000 in 2021, driven by increased educational investments[27]. - Administrative expenses surged by 147.1% to RMB 158,400,000 in 2022 from RMB 64,100,000 in 2021, largely due to increased foreign exchange losses[31]. - Profit before tax fell by 33.0% to RMB 239,400,000 in 2022 from RMB 357,300,000 in 2021, primarily due to increased foreign exchange losses[33]. - Net profit for the year was RMB 235,500,000, a decline of 33.6% from RMB 354,500,000 in 2021[36]. - Current assets decreased significantly by 77.0% to RMB 537,936,000 in 2022 from RMB 2,338,874,000 in 2021, mainly due to reclassification of other receivables[39]. Investments and Capital Expenditures - Capital expenditures for the group amounted to RMB 436.7 million in 2022, a decrease from RMB 997.7 million in 2021, primarily related to the construction of buildings and school facilities[49]. - The group has invested significantly in modernizing campus facilities, including the construction and renovation of 80 experimental training centers and 3 academic report centers[18]. Employment and Workforce - The workforce increased to approximately 2,297 employees as of December 31, 2022, compared to 1,995 in the previous year[63]. - The group conducted 680 training sessions to enhance the skills of its faculty, focusing on attracting high-level talent, including PhDs and senior professionals[18]. Strategic Initiatives and Future Plans - The company aims to enhance the management level of existing schools and improve the quality of educational services to increase student competitiveness in the job market[9]. - The company is focused on integrating education with industry and strengthening school-enterprise cooperation to leverage market potential in higher education[9]. - The company plans to leverage favorable policies to enhance educational services and contribute to the modernization of education in China, as outlined in the "Strategic Plan for Expanding Domestic Demand (2022-2035)"[20]. - The company expects a revenue growth of 10-15% for the next fiscal year, driven by new product launches and market expansion[76]. Risk Management - The company faces operational risks including changes in the private education market, regulatory environment, and competition from other educational institutions[107]. - The company has a risk management structure in place to address various risks, including credit and liquidity risks[111]. Shareholder and Governance - The board of directors has approved a dividend payout of 0.2 RMB per share, reflecting a commitment to returning value to shareholders[76]. - The company has established a dividend policy that allows the board to decide on dividend distribution based on financial performance, working capital needs, and future plans[101]. - The controlling shareholder has committed to a non-competition agreement, ensuring no direct or indirect competition with the group's business during the restricted period[167]. - The company has confirmed the independence of its independent non-executive directors as per the listing rules[133]. Compliance and Legal Structure - The group operates private higher education businesses in China through structured contracts due to restrictions on foreign ownership in the sector[173]. - The company has established a second structured contract, which is substantially similar to the first, ensuring the flow of economic benefits from Chinese operating schools to the company[176]. - The agreements are designed to protect the company's interests and ensure the sustainability of its educational services[182].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性 或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部份內容而產生或因依賴 該等內容而引致的任何損失承擔任何責任。 China Xinhua Education Group Limited 中 國 新 華 教 育 集 團 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：2779） 截至2022年12月31日止年度 全年業績公告 財務摘要 截至12月31日止年度 2022年 2021年 變動百分比 人民幣千元 人民幣千元 經調整收入(1) 860,098 774,046 11.1% 收入 625,476 565,386 10.6% 毛利 368,705 370,132 -0.4% 年度溢利 235,511 354,482 -33.6% 經調整淨溢利(2) 330,788 341,393 -3.1% 附註： (1) 經調整收入包括本集團的收入加上臨床醫學院及紅山學院的收入。其並非一項國際財務報 告準則計量。有關詳情，請參閱本公告「管理層討論與分析－財務回顧」一節。 (2) 本集團將經調整淨溢利定義為就與本集團 ...

Financial Performance - Adjusted revenue for the six months ended June 30, 2022, was RMB 457.3 million, an increase of 14.8% compared to RMB 398.3 million in the same period of 2021[8]. - Total revenue for the same period was RMB 333.5 million, reflecting a growth of 15.0% from RMB 290.0 million year-on-year[8]. - Gross profit reached RMB 221.9 million, up 7.6% from RMB 206.1 million in the previous year[8]. - Net profit for the period was RMB 172.5 million, a decrease of 16.9% compared to RMB 207.7 million in the prior year[8]. - Revenue for the six months ended June 30, 2022, was RMB 333,473,000, an increase from RMB 290,014,000 for the same period in 2021, representing a growth of approximately 15%[90]. - Gross profit for the same period was RMB 221,856,000, compared to RMB 206,105,000 in 2021, reflecting a gross margin improvement[90]. - Operating profit decreased to RMB 181,236,000 from RMB 215,851,000 year-over-year, indicating a decline of about 16%[90]. - Profit before tax was RMB 173,247,000, down from RMB 208,152,000 in the previous year, a decrease of approximately 17%[90]. - Net profit for the period was RMB 172,495,000, compared to RMB 207,692,000 in 2021, representing a decline of around 17%[90]. - Total comprehensive income for the period was RMB 212,337,000, an increase from RMB 196,969,000 in the prior year, showing a growth of about 7.0%[90]. Student Enrollment and Educational Offerings - The number of full-time students as of June 30, 2022, was approximately 45,238, representing a 6.3% increase year-on-year[10]. - The group operates four educational institutions, including Xinhua College and Clinical Medical College, enhancing its educational offerings[12]. - New undergraduate programs in Financial Technology and Artificial Intelligence were recently approved, expanding the curriculum[14]. - The number of full-time students at Clinical Medicine College rose to 4,261, a significant increase of 50.5% year-on-year[18]. - The number of full-time students at Hongshan College increased to 10,213, up from 9,945, reflecting a growth of approximately 2.7%[18]. - The group aims to improve educational quality and employability, with overall graduate employment rates exceeding local averages[11]. - The group has received over 400 provincial and national awards in the 2021/2022 academic year, with a 43% increase in national-level awards for students[14]. - The group plans to enhance its professional construction and improve educational quality by adding new first-class undergraduate programs, including Economics and Finance, and Software Engineering[19]. - The group aims to leverage favorable policies in vocational education to expand its business network and enhance the effectiveness of industry-education integration[23]. - The group is committed to enhancing its influence in the Yangtze River Delta region through strategic educational initiatives[10]. Financial Position and Cash Flow - Cash and cash equivalents as of June 30, 2022, were RMB 347.3 million, down from RMB 645.9 million as of December 31, 2021[38]. - Current assets net increased by 10.3% from RMB 1,848.7 million to RMB 2,038.2 million, mainly due to a decrease in contract liabilities and an increase in other receivables[39]. - Capital expenditures for the period were RMB 14.3 million, slightly down from RMB 14.7 million in the previous period[40]. - The debt-to-asset ratio decreased from 22.6% as of December 31, 2021, to 20.5% as of June 30, 2022, due to a reduction in contract liabilities[42]. - The company reported other income of RMB 37,817,000, a decrease from RMB 48,514,000 in the same period last year, indicating a decline of about 22%[90]. - Net cash used in operating activities was RMB (62,352) thousand, compared to RMB (31,789) thousand in the previous year, reflecting a significant increase in cash outflow[101]. - Net cash used in investing activities was RMB (178,956) thousand, a decrease from RMB (436,823) thousand in the same period last year, indicating improved cash management[101]. - Net cash generated from financing activities was RMB 57,521 thousand, down from RMB 231,441 thousand in the previous year, showing a reduction in financing inflows[101]. - Cash and cash equivalents decreased by RMB 183,787 thousand, compared to a decrease of RMB 237,171 thousand in the same period of 2021[101]. Shareholder and Corporate Governance - The company has a significant shareholder, Mr. Wu Junbao, holding 71.77% of the shares[59]. - Mr. Wu Junbao is also the beneficial owner of RMB 100 million in registered share capital, representing 95.70% of the group's equity[60]. - The company has adopted a share option scheme to incentivize qualified individuals and retain talent[66]. - The company has appointed a new company secretary, Ms. Yu Anni, effective August 30, 2022[55]. - The company maintained compliance with corporate governance codes and standards throughout the reporting period[84]. - The independent auditor's review confirmed that the interim financial report complied with applicable accounting standards and regulations[89]. Dividends and Share Options - The company approved a dividend of RMB 148,237 thousand for the previous year, which was a decrease compared to the previous year's dividend[98]. - The total number of shares that may be issued under the stock option plan cannot exceed 10% of the issued shares as of the listing date, which is 160,000,000 shares[67]. - As of the report date, the total number of shares available for issuance under the stock option plan is 92,100,000 shares, accounting for approximately 5.73% of the total issued share capital[67]. - The stock option plan will remain valid for 10 years from the date it becomes unconditional, after which no further options will be granted[69]. - The total number of stock options granted on July 15, 2019, is 52,900,000, with specific vesting schedules for different groups of options[71]. - There were no other stock options granted, exercised, expired, or canceled during the reporting period apart from those disclosed[75]. Operating Segments and Market Focus - The company has identified only one operating segment, which is the provision of educational services, as per IFRS 8[112]. - The company is focused on the Yangtze River Delta region, which includes Jiangsu, Zhejiang, Anhui provinces, and Shanghai[142].

Enrollment and Student Growth - The total number of students enrolled in the schools operated by the company increased from 46,415 as of December 31, 2020, to 56,518 as of December 31, 2021, representing a growth of 21.7%[7] - The number of full-time students reached 45,121 as of December 31, 2021, which is a 6.1% increase compared to the previous year[9] - Xinhua College enrolled 7,070 new undergraduate students in the 2021/2022 academic year, representing a year-on-year growth of 10.5%[13] - The total number of full-time students at Xinhua College reached 24,461 as of December 31, 2021, an increase from 23,755 in the previous year[21] - The Clinical Medicine College saw a 50.5% year-on-year increase in full-time students, reaching 4,261 in the 2021/2022 academic year[14] - The total number of full-time students across all institutions increased to 45,121, up from 42,541 the previous year[21] Financial Performance - The company's revenue rose from RMB 478.8 million for the year ended December 31, 2020, to RMB 565.4 million for the year ended December 31, 2021, marking an increase of 18.1%[7] - The annual profit increased from RMB 325.3 million for the year ended December 31, 2020, to RMB 354.5 million for the year ended December 31, 2021, reflecting a growth of 9.0%[7] - Adjusted revenue increased by 18.1% from RMB 478.8 million in 2020 to RMB 565.4 million in 2021[35] - Total revenue rose to RMB 565.4 million in 2021, with tuition fees increasing by 14.7% to RMB 514.4 million[35] - Gross profit grew by 19.0% to RMB 370.1 million in 2021, driven by increased revenue[40] - Operating profit for 2021 was RMB 374.8 million, up from RMB 340.5 million in 2020, reflecting a 10.1% increase[32] - Net profit for the year reached RMB 354.5 million, a 9.0% increase compared to RMB 325.3 million in 2020[47] Strategic Initiatives and Future Plans - The company aims to enhance the management level of its existing institutions and provide quality educational services to improve students' competitiveness in the labor market[8] - The company plans to continue expanding its influence in the education sector, particularly in the Yangtze River Delta region, through strategic initiatives[9] - The company is committed to developing high-end applied talents and strengthening industry-education integration and school-enterprise cooperation[8] - The company plans to enhance its competitive edge in higher education by focusing on high-quality applied education and resource sharing[29] - The group aims to explore new growth points in vocational education, leveraging favorable policies to expand its business network[29] Employment and Graduate Success - The company has a high overall employment rate for its graduates, which exceeds the average employment rate in the region[10] - The employment rate for graduates from Xinhua College in 2021 was 93.6%, ranking third among universities in Anhui Province[25] Research and Development - The group achieved a 15.6% year-on-year growth in provincial and ministerial-level research projects, totaling 646 projects[23] - The group launched two new undergraduate programs in Financial Technology and Artificial Intelligence in 2021[13] - Research and development investments increased by 18%, focusing on innovative educational technologies[104] Financial Position and Assets - Total current assets increased to RMB 2,338.9 million in 2021 from RMB 1,800.6 million in 2020, representing a growth of 30.0%[50] - Current liabilities rose to RMB 490.2 million in 2021, compared to RMB 463.9 million in 2020, an increase of 5.7%[50] - The net current assets as of December 31, 2021, were RMB 1,848.7 million, up from RMB 1,336.7 million in 2020, marking a significant increase of 38.3%[51] - Cash and cash equivalents and time deposits totaled RMB 645.9 million as of December 31, 2021, down from RMB 1,004.3 million in 2020[58] Shareholder and Governance Matters - The company proposed a final dividend of HKD 0.1078 per share for the year ended December 31, 2021, compared to HKD 0.0723 per share in 2020, representing an increase of approximately 49.1%[120] - The independent board members emphasized the importance of compliance and governance, ensuring adherence to regulatory standards[106] - The company has a risk management structure in place, including board oversight for major business decisions affecting risk exposure[129] Operational Risks and Compliance - The company faces various operational risks, including changes in the regulatory environment and competition from other educational institutions[124] - The company continues to monitor foreign exchange risks and may consider using financial instruments to hedge significant foreign currency risks[74] - The company has implemented health and safety measures across its schools to protect students from physical harm and health risks[130] - The company has not reported any significant incidents related to student safety or health as of the report date[131] Capital Expenditures and Investments - Capital expenditures for the year ended December 31, 2021, were RMB 997.7 million, significantly higher than RMB 482.6 million in 2020[59] - The company has not entered into any significant acquisitions or disposals of subsidiaries or associates during the year ending December 31, 2021[72] Stock Options and Employee Benefits - The company adopted a share option scheme on March 8, 2018, to incentivize eligible individuals and retain talent[168] - The total number of shares that may be issued under the stock option plan cannot exceed 10% of the shares issued as of the listing date, which is 160,000,000 shares[169] - The total number of stock options granted during the reporting period is detailed in the report, indicating the company's commitment to incentivizing key personnel[173] Structured Contracts and Tax Exemptions - The company operates through structured contracts to control Chinese operating schools, ensuring compliance with local laws and regulations[189] - New Hua Xinjiang was fully exempt from corporate income tax from January 1, 2018, to December 31, 2020, under local tax policies[192]

Financial Performance - Adjusted revenue for the six months ended June 30, 2021, was RMB 398.31 million, an increase of 20.2% compared to RMB 331.25 million in the same period of 2020[8]. - Total revenue for the same period was RMB 290.01 million, reflecting an 18.5% increase from RMB 244.82 million year-on-year[8]. - Gross profit reached RMB 206.11 million, up 18.5% from RMB 173.94 million in the previous year[8]. - Net profit for the period was RMB 207.69 million, a significant increase of 36.0% compared to RMB 152.73 million in 2020[8]. - Adjusted net profit was RMB 205.15 million, representing a 13.8% increase from RMB 180.29 million year-on-year[8]. - Operating profit before tax rose by 36.3% to RMB 208.2 million, influenced by gross profit growth and reduced administrative expenses[34]. - The group recorded a net profit of RMB 207.7 million, up 36.0% from RMB 152.7 million in the previous period[36]. - Total comprehensive income for the period amounted to RMB 196,969 thousand, compared to RMB 174,224 thousand in the same period of 2020, marking a 13.1% increase[84]. - Basic and diluted earnings per share were RMB 12.9, an increase from RMB 9.5 in the previous year[84]. Student Enrollment and Educational Expansion - The number of enrolled students as of June 30, 2021, was 48,554, marking a 10.54% increase from 43,923 in the previous year[8]. - The Clinical Medical College saw a 61.7% increase in student enrollment, reaching 2,831 students in the 2020/2021 academic year[14]. - The approved undergraduate enrollment plan for the Clinical Medical College for the 2021/2022 academic year increased by 44.8% compared to the previous year[14]. - Total number of full-time students increased to 42,550 as of June 30, 2021, up from 39,879 in the previous year, representing a growth of approximately 4.2%[17]. - The group plans to enroll 11,330 undergraduate students for the 2021/2022 academic year, reflecting a year-on-year increase of about 5.2%[19]. - The proportion of undergraduate students in the total full-time student population reached approximately 77.7%[19]. Campus Development - The new campus construction for the Clinical Medical College is progressing well, with the first phase nearly completed and set to meet the requirements for independent college status[14]. - The new campus construction for Hongshan College is progressing smoothly, with an area of approximately 235,000 square meters, expected to accommodate an additional 9,000 students upon completion[19]. - The new campus for the Clinical Medicine College will cover about 185,000 square meters, adding capacity for 5,000 students[19]. Partnerships and Strategic Initiatives - The group has established partnerships with well-known companies such as JD.com and Youfu New Road to enhance talent cultivation and research[20]. - The group aims to leverage favorable policies to expand its school network and student numbers through mergers and acquisitions of quality schools[22]. - The group is focused on enhancing educational quality and expanding its influence in the higher education sector through independent college transformation[21]. - The company has established partnerships with universities to operate clinical medical colleges, which are expected to enhance revenue streams in the future[113]. - The company is committed to expanding its educational offerings and enhancing its operational capabilities through strategic partnerships[164]. Financial Position and Assets - Cash and cash equivalents decreased to RMB 487.9 million as of June 30, 2021, from RMB 736.3 million at the end of 2020[39]. - Net current assets increased by 40.7% to RMB 1,880.6 million, mainly due to a decrease in contract liabilities and an increase in other receivables[40]. - Total assets as of June 30, 2021, were RMB 2,264,121 thousand, compared to RMB 1,800,579 thousand at the end of 2020, indicating a significant increase[87]. - Total equity increased to RMB 2,927,933 thousand as of June 30, 2021, from RMB 2,820,769 thousand at the end of 2020, reflecting a growth of 3.8%[88]. - The company reported a total cash and cash equivalents of RMB 487.89 million as of June 30, 2021, down from RMB 726.28 million as of December 31, 2020, indicating a decrease of approximately 33%[135]. Liabilities and Debt - As of June 30, 2021, the group's bank loans and loans from related parties amounted to RMB 555.2 million[42]. - The group's debt-to-asset ratio increased from 21% as of December 31, 2020, to 22% as of June 30, 2021, primarily due to an increase in dividends payable and loans[44]. - The total liabilities amounted to RMB 841,724 thousand, compared to RMB 729,880 thousand as of December 31, 2020, reflecting an increase of approximately 15.3%[151]. - The group had no significant contingent liabilities, guarantees, or lawsuits as of June 30, 2021[43]. Stock Options and Corporate Governance - The stock option plan adopted on March 8, 2018, allows for a maximum issuance of 160,000,000 shares, which is 10% of the total shares issued at the time of listing[61]. - As of the report date, a total of 92,100,000 shares are available for issuance under the stock option plan, accounting for about 5.73% of the company's total issued share capital[62]. - The stock options granted to directors and employees are subject to a vesting schedule, with 20% vesting on each of the five specified dates from April 30, 2020, to April 30, 2024[66]. - The company has adopted a corporate governance code and has complied with all applicable provisions during the reporting period[78]. - The independent auditor has reviewed the interim financial report and found no significant issues regarding compliance with International Accounting Standard 34[83]. Future Outlook - The board believes that the implementation of the new Private Education Promotion Law will positively impact the group's operations and growth prospects[164]. - The group aims to strengthen its market position through potential mergers and acquisitions in the education sector[164].

Enrollment and Student Growth - The total number of students enrolled in the group increased from 45,244 as of December 31, 2019, to 46,415 as of December 31, 2020, representing a growth of 2.6%[7] - The number of full-time students as of December 31, 2020, was 42,541, which is a 6.8% increase compared to the previous year[9] - Xin Hua College enrolled 6,042 new undergraduate students in the 2020/2021 academic year, representing a year-on-year growth of 21%[11] - The total number of full-time students reached 42,541, an increase of 6.8% year-over-year[22] - The group plans to enroll 10,789 new full-time students for the 2020/2021 academic year, representing a 19.2% increase compared to the previous year[22] - The group plans to increase its enrollment for the 2020/21 academic year by over 1,500 students, representing a growth of over 290% compared to the 2019/20 academic year, exceeding the average level of private higher education institutions in China[29] Financial Performance - The group's revenue rose from RMB 437.5 million for the year ended December 31, 2019, to RMB 478.8 million for the year ended December 31, 2020, an increase of 9.4%[7] - The annual profit increased from RMB 270.7 million for the year ended December 31, 2019, to RMB 325.3 million for the year ended December 31, 2020, reflecting a growth of 20.2%[7] - Total revenue increased by 9.4% from RMB 437.7 million in 2019 to RMB 478.8 million in 2020, primarily due to a 14.4% rise in tuition fees[40] - Comprehensive income rose significantly to RMB 650.1 million in 2020 from RMB 514.1 million in 2019, driven by increased revenue from the clinical medical college and Hongshan College[41] - Gross profit increased by 19.1% to RMB 311.1 million in 2020, compared to RMB 261.2 million in 2019, due to higher revenue and reduced operating costs[44] - Operating profit for 2020 was RMB 340.5 million, up from RMB 274.6 million in 2019, reflecting improved operational efficiency[50] - Adjusted net profit for 2020 was RMB 320.8 million, compared to RMB 296.0 million in 2019, indicating a solid performance despite external challenges[54] - Normalized net profit reached RMB 342.2 million in 2020, benefiting from a one-time refund of accommodation fees due to COVID-19[54] Strategic Plans and Expansion - The group aims to expand its network of schools and student enrollment through mergers and acquisitions of quality undergraduate and vocational schools[8] - The group plans to enhance the management level of its existing institutions and continue providing quality services and educational support to improve students' competitiveness in the job market[8] - The group is focused on improving educational quality and expanding its influence through the successful transition of independent colleges[23] - The group aims to expand its school network and educational scale through mergers and acquisitions, focusing on high-quality independent colleges and institutions located in regions with strong talent attraction or low gross enrollment rates[32] - The group is actively promoting the transformation of two independent colleges, with expectations to complete the transition by 2021, which will likely lead to significant increases in enrollment plans and tuition levels[34] Operational Developments - The new campus construction for Clinical Medicine College is progressing well, with an area of approximately 185,000 square meters, expected to accommodate an additional 5,000 students by September 2021[22] - The new campus for Hongshan College is also on track, covering about 235,000 square meters, which will add 9,000 student capacity, anticipated to be operational by September 2021[22] - The transition of Clinical Medicine College and Hongshan College to independent colleges is advancing smoothly, with Clinical Medicine College already receiving approval from the Anhui Provincial Education Department[23] - The group has established partnerships with well-known companies like JD.com and Youfu New Road to create modern industry colleges, enhancing talent cultivation and innovation[25] Quality of Education and Employment - The group is committed to providing high-quality applied education services, covering various popular subjects and employment fields[9] - The overall employment rate of the group's graduates is higher than the average employment rate in their respective regions[9] Financial Position and Assets - Current assets decreased to RMB 1.8 billion in 2020 from RMB 1.9 billion in 2019, while current liabilities significantly reduced to RMB 463.9 million from RMB 675.4 million[57] - As of December 31, 2020, the net current assets of the group were RMB 1,336.7 million, an increase from RMB 1,198.6 million as of December 31, 2019, primarily due to a decrease in short-term loans and borrowings[58] - Cash and cash equivalents and bank deposits amounted to RMB 1,004.3 million as of December 31, 2020, down from RMB 1,383.0 million as of December 31, 2019[66] COVID-19 Impact and Response - The company reported a total refund of approximately RMB 21.39 million for student accommodation fees due to COVID-19 related guidelines[89] - The company established a four-level prevention and control system to ensure the effective operation of online courses during the pandemic[89] - The company actively fulfilled its social responsibility by donating several million RMB in cash and materials to combat COVID-19[89] - The company has not experienced any significant adverse impact on its operations or finances due to COVID-19, aside from the mandated accommodation fee refunds[89] Shareholder and Management Information - As of December 31, 2020, the major shareholder, Mr. Wu Junbao, holds 1,152,618,879 shares, representing 71.65% of the company's equity[180] - Mr. Wu Junbao is the sole shareholder of Wu Junbao Company, which also holds 1,152,618,879 shares, accounting for 71.65% of the company's equity[184] - The company has established a credit policy to manage credit risk associated with trade receivables and financial assets[142] - The company has implemented measures to ensure sufficient liquidity to meet financial obligations and avoid reputational damage[145] Stock Options and Incentives - The company has adopted a share option scheme on March 8, 2018, to incentivize eligible individuals and retain talent[188] - The total number of shares that may be issued under the stock option plan cannot exceed 10% of the shares issued as of the listing date, which is 160,000,000 shares[189] - As of the report date, the total number of shares available for issuance under the stock option plan is 92,100,000 shares, accounting for approximately 5.73% of the company's issued share capital[189] - The stock options granted on April 30, 2019, have an exercise price of HKD 2.69, with 15,000,000 options remaining unexercised as of December 31, 2020[194] - The stock options granted on July 15, 2019, have an exercise price of HKD 2.82, with a total of 52,900,000 options granted, of which 40,900,000 remain unexercised[194]

Financial Performance - Total revenue for the six months ended June 30, 2020, was RMB 292,989,000, an increase of 8.8% compared to RMB 269,265,000 for the same period in 2019[7] - Revenue for the same period was RMB 244,819,000, reflecting a growth of 7.6% from RMB 227,596,000 in 2019[7] - Gross profit increased by 18.9% to RMB 173,939,000, up from RMB 146,258,000 year-on-year[7] - Adjusted net profit for the period was RMB 180,285,000, representing a 16.9% increase from RMB 154,246,000 in 2019[7] - Revenue increased by 7.6% from RMB 227.6 million to RMB 244.8 million, driven by higher tuition and accommodation fees as well as an increase in full-time student numbers[25] - Other income rose by 15.6% from RMB 41.7 million to RMB 48.2 million, primarily due to operational revenue from the Clinical Medical College and Hongshan College[26] - Gross profit increased by 18.9% from RMB 146.3 million to RMB 173.9 million, attributed to optimized management and reduced operating costs due to the pandemic[28] - Adjusted net profit rose to RMB 180.3 million, up 16.9% from RMB 154.2 million, after accounting for foreign exchange losses and share-based payment expenses[36] - EBITDA increased from RMB 181.7 million to RMB 188.6 million, while adjusted EBITDA grew by 17.7% from RMB 183.6 million to RMB 216.1 million[37] - The company reported a total comprehensive income of RMB 174,224,000 for the period, which includes a profit of RMB 152,727,000[103] Student Enrollment and Capacity - The number of full-time students as of June 30, 2020, was 39,879, a 6.4% increase from 37,496 in the previous year[7] - The approved enrollment plan for the 2020/2021 academic year was 11,164 students, a year-on-year increase of approximately 7%[10] - The undergraduate enrollment plan for the same academic year was 10,764 students, reflecting a 19% increase compared to the previous year[10] - The group has initiated the construction of new campuses to increase student capacity, expecting to add at least 40,000 new student slots upon completion[10] - The enrollment in the Clinical Medicine College reached 1,751 full-time students, significantly up from 575 the previous year, marking an increase of 204.3%[17] - The Hongshan College added a new enrollment plan for 830 students for the 2020/21 academic year, reflecting a strategic expansion in its academic offerings[15] - The new campus of the Clinical Medicine College is under construction and is expected to be operational by September 1, 2021, which will significantly enhance the college's capacity[14] - The group plans to increase its enrollment for the 2020/21 academic year by over 1,500 students, a growth of more than 290% compared to the previous year, exceeding the national average for private higher education institutions[21] Financial Position - As of June 30, 2020, the group reported cash and cash equivalents of approximately RMB 1 billion[7] - Cash and cash equivalents amounted to RMB 1,101.0 million as of June 30, 2020, down from RMB 1,383.0 million at the end of 2019[38] - Current assets net increased by 35.6% to RMB 1,625.6 million, mainly due to a reduction in short-term bank loan balances[39] - Capital expenditures for the period were RMB 25.6 million, up from RMB 21.5 million, primarily related to building construction and equipment purchases[40] - The debt-to-equity ratio decreased from 25.8% to 20.4%, mainly due to the amortization of contract liabilities from tuition and accommodation fees[43] - The company's total assets as of June 30, 2020, were RMB 3,038,480,000, compared to RMB 2,618,280,000 at the end of 2019, reflecting a significant growth[95] - The net asset value increased to RMB 2,727,500,000 from RMB 2,618,280,000, indicating a rise of 4.2%[97] - Total liabilities as of June 30, 2020, were RMB 557,382 thousand, resulting in a debt-to-asset ratio of 17%, down from 21% as of December 31, 2019[144] Corporate Governance and Compliance - The independent auditor has reviewed the interim financial statements in accordance with the relevant auditing standards[85] - The company has complied with all applicable corporate governance codes during the reporting period[86] - The board does not recommend the distribution of an interim dividend for the reporting period[54] - There have been no significant events after June 30, 2020, that would impact the group[50] Impact of COVID-19 - The impact of the COVID-19 pandemic on the company's financial condition and operating performance was deemed not significant, with measures taken including the launch of an online education platform[156] - The company actively fulfilled its social responsibility by donating several million RMB in cash and materials to combat COVID-19[53] - The company has implemented emergency measures in response to the pandemic, including scientific planning and active epidemic prevention efforts[156] - The group has refunded approximately RMB 20 million in accommodation fees to students due to COVID-19 pandemic-related guidelines[53] Share Options and Equity - As of June 30, 2020, Wu Junbao Company holds 1,152,618,879 shares, representing approximately 71.65% of the company's equity[67] - The company has adopted a share option scheme allowing for the issuance of up to 160,000,000 shares, which is 10% of the total issued shares as of the listing date[70] - The total number of shares available for issuance under the share option scheme is 92,100,000, accounting for approximately 5.73% of the company's total issued share capital[70] - No options have been granted to any individual that would result in the total shares issued exceeding 1% of the company's issued share capital within any 12-month period[71] - The share option plan is valid for 10 years from the adoption date, with a remaining term of approximately seven years and seven months[72] - A total of 52,900,000 stock options were granted on July 15, 2019, with 33,000,000 options (Group A) vesting over a specified schedule[76] - The exercise price for the stock options granted to directors ranges from HKD 2.69 to HKD 2.82, with a total of 15,000,000 options for Zhang Ming and 6,000,000 options each for Lu Zhen and Wang Yongkai[74] - 40,900,000 stock options were granted to employees on July 15, 2019, with no options exercised or expired during the reporting period[74] Other Financial Information - The company reported a foreign exchange gain of RMB 21,497,000 for the period, compared to RMB 4,479,000 in the previous year, marking a substantial increase[93] - Basic and diluted earnings per share remained stable at RMB 9.5 for both periods[93] - The net cash used in operating activities was RMB (142,375,000), compared to RMB (45,752,000) in the previous year, reflecting a significant increase in cash outflow[107] - The company incurred a loss of RMB 140,856,000 in income tax payments during the reporting period, compared to RMB 43,710,000 in the previous year[107] - The company has not reported any significant new products or technologies during this period[116] - There were no acquisitions or major market expansions disclosed in the report[116] - The company continues to operate under a single business segment, which is the provision of educational services[118]

Enrollment and Student Growth - The total number of students enrolled in the schools operated by the company increased from 34,756 as of December 31, 2018, to 45,244 as of December 31, 2019[13]. - As of December 31, 2019, the total number of enrolled students reached 45,244, representing a growth of 30.2% compared to December 31, 2018[16]. - Xinhua College, the largest private higher education institution in the Yangtze River Delta, had 28,856 students enrolled as of December 31, 2019, with 82 full-time higher education programs offered[18]. - Xinhua School achieved a new enrollment of 2,244 students for the 2019/20 academic year, marking a year-on-year growth of 9.6% and a two-year compound annual growth rate of 25.7%[19]. - The Clinical Medical College has seen strong student enrollment interest, with the lowest admission score ranking among the top in similar institutions in Anhui Province[21]. - The total number of full-time students across all institutions increased from 34,756 in 2018 to 45,244 in 2019[26]. - The Clinical Medical College has been approved to add a new program for upgrading from associate to bachelor's degree, enhancing its enrollment capabilities[21]. - In the 2019/2020 academic year, the group enrolled 12,493 full-time students, a 41.1% increase from 2018. Excluding the impact of the newly acquired Hongshan College, the original schools enrolled 10,202 full-time students, a 15.3% increase[32]. Financial Performance - Revenue rose from RMB 386.1 million for the year ended December 31, 2018, to RMB 437.7 million for the year ended December 31, 2019, representing an increase of approximately 13.3%[13]. - Annual profit increased from RMB 256.0 million for the year ended December 31, 2018, to RMB 270.7 million for the year ended December 31, 2019, reflecting a growth of about 5.5%[13]. - The company's gross profit for 2019 was RMB 261.2 million, compared to RMB 230.4 million in 2018, indicating a year-over-year increase of approximately 13.3%[7]. - Revenue increased by 13.4% from RMB 386.1 million in 2018 to RMB 437.7 million in 2019, primarily due to an increase in student enrollment and average tuition fees[46]. - Other income rose by 25.7% from RMB 91.8 million in 2018 to RMB 115.4 million in 2019, driven by increased campus utilization and higher earnings from the operation of Hongshan College[47]. - Gross profit increased by 13.4% from RMB 230.4 million in 2018 to RMB 261.2 million in 2019, in line with revenue growth[49]. - Operating profit for 2019 was RMB 274.6 million, compared to RMB 258.1 million in 2018, reflecting a growth of 6.4%[44]. - Adjusted net profit rose to RMB 296.0 million in 2019 from RMB 258.7 million in 2018, representing an increase of 14.4%[58]. Assets and Liabilities - The company's current assets totaled RMB 1,873.96 million in 2019, a decrease from RMB 1,935.22 million in 2018[8]. - The current ratio decreased from 6.1 in 2018 to 2.8 in 2019, indicating a decline in short-term financial health[9]. - The total equity increased from RMB 2,384.53 million in 2018 to RMB 2,618.28 million in 2019, showing a growth of approximately 9.8%[8]. - The net profit margin decreased from 66.3% in 2018 to 61.8% in 2019, indicating a decline in profitability[9]. - Net current assets decreased to RMB 1,198.6 million as of December 31, 2019, down from RMB 1,616.4 million in 2018, primarily due to capital investments in newly acquired schools[61]. - The company's cash and cash equivalents as of December 31, 2019, were RMB 1,383.0 million, down from RMB 1,861.7 million in 2018[71]. - The debt-to-asset ratio increased from 12% in 2018 to 21% in 2019, attributed to new bank loans[80]. Strategic Plans and Acquisitions - The company plans to expand its network of schools and increase student enrollment through mergers and acquisitions of quality undergraduate and vocational schools[14]. - The company aims to enhance the management level of its existing institutions and continue providing quality services to improve student competitiveness in the job market[14]. - The acquisition of Hongshan College was completed on April 29, 2019, with plans for a new campus supported by a land acquisition of approximately 950 acres[22]. - The company has agreed to acquire a 60% stake in Haiyuan College and Kunming Health School for a total consideration of RMB 918 million[23]. - The group aims to expand its school network and enrollment scale by leveraging favorable policies and pursuing mergers and acquisitions of quality educational institutions[38]. - The group added 14 new undergraduate programs, including preschool education and big data management, enhancing its academic offerings[32]. Governance and Leadership - The company has a strong leadership team with diverse backgrounds in finance, education, and strategic management, enhancing its operational capabilities[125]. - The management team includes professionals with significant experience in both domestic and international markets, which supports the company's growth strategy[125]. - The company is committed to maintaining high standards of corporate governance through its experienced board of directors[116]. - The independent directors bring valuable insights and governance to the company's strategic direction[116]. Risk Management - The company faces operational risks related to the private education sector's market conditions, regulatory changes, and competition from other educational institutions[143]. - The company has implemented risk management measures to ensure sufficient liquidity to meet financial obligations[146]. - The company is closely monitoring the developments of the revised draft of the Private Education Promotion Law and the Foreign Investment Law, which have not yet impacted its operations as of the report date[93][94]. Dividend Policy - The company reported a final dividend of HKD 0.0553 per share for the year ended December 31, 2019, compared to HKD 0.0559 per share in 2018[138]. - The company has established a dividend policy that allows the board to decide on dividend distribution based on financial performance, working capital needs, and future plans[136]. Employee Relations - The group has maintained good relationships with employees, suppliers, and customers, with no significant disputes reported during the reporting period[156]. - The company had approximately 1,621 employees as of December 31, 2019, with no significant labor disputes reported during the reporting period[89].

China Xinhua Edu cation Group Limit e d 中國新華教育集團有限公司 CHINA XINHUA EDUCATION GROUP LIMITED 中國新華教育集團有限公司 Interim Report 2019 中期報告 (Incorporated in the Cayman Islands with limited liability) (於開曼群島註冊成立之有限公司) Stock Code 股份代號 : 02779 | --- | --- | --- | --- | --- | --- | |-------|-------|-------|-------|----------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Interim | | | | | | | Report | | | | | | | 2019 | | | | | | | 中期報告 | | 目錄 公司資料 2 摘要 3 管理層討論與分析 4 其 ...