Investment Rating - The report assigns an "Accumulate" rating for New Oriental-S (9901) [2][5]. Core Views - Short-term profit margins are impacted by increased compensation expenses, investments in cultural tourism, and the ramp-up of new stores. However, it is expected that FY25Q1 will stabilize expectations, with a focus on the recovery of the education segment's profit margins [5]. - The company has adjusted its FY2025-2026 and added FY2027 Non-GAAP net profit estimates to $537 million (-9%), $741 million (-5%), and $1,007 million, respectively, with EPS projected at $0.27, $0.39, and $0.54 [5]. - For FY24, the company achieved revenue of $4.314 billion (+44%), gross profit of $2.263 billion (+42%), and a gross margin of 52.45% (-1 percentage point) [5]. - The report highlights that the decline in profit margins is primarily due to accelerated store openings, increased cultural tourism investments, and rising employee compensation [5]. Financial Summary - FY24 revenue was $4.314 billion, with a year-on-year growth of 44%. The gross profit was $2.263 billion, with a gross margin of 52.45% [7]. - FY24Q4 revenue reached $1.137 billion (+32%), aligning with Bloomberg consensus expectations, while gross profit was $594 million (+27%) [5]. - The company’s operating profit for FY24 was $350 million (+84%), with a margin of 8% (+2 percentage points) [5]. - Non-GAAP net profit for FY24 was $381 million (+47%), with a margin of 8.84% [5].

Investment Rating - The report maintains a "Buy" rating for New Oriental [5][13][14] Core Views - New Oriental's revenue for Q4 FY24 was $1.14 billion, a year-on-year increase of 32.1%, while Non-GAAP net profit attributable to the parent company was $37 million, a decrease of 40.5% year-on-year [9][12] - The full-year revenue for FY24 reached $4.31 billion, up 43.9% year-on-year, driven by strong growth in non-academic training and overseas study businesses [5][9] - The company is experiencing robust growth in non-academic training, with Q4 revenue from new business reaching $232 million, a 50% increase year-on-year [10][11] - The number of learning centers increased to 1,025 in Q4, representing a 37% year-on-year growth, indicating strong demand in the market [11][12] - The overseas test preparation and consulting business contributed $284 million in revenue for Q4, a 17.4% increase year-on-year, reflecting the recovery of the overseas study market [12][14] Summary by Sections Financial Performance - Q4 FY24 revenue was $1.14 billion, with a 32.1% year-on-year growth; full-year revenue was $4.31 billion, up 43.9% [5][9] - Non-GAAP net profit for FY24 was $381 million, a 47.2% increase year-on-year [5][9] Business Segments - Non-academic training showed strong growth, with Q4 revenue of $232 million, a 50% increase year-on-year; enrollment in non-academic training reached 875,000, up 39.1% [10][11] - The overseas study business generated $284 million in Q4, a 17.4% increase year-on-year, with annual revenue of $993 million, up 35% [12][14] Expansion and Market Position - The number of learning centers increased to 1,025, a 37% year-on-year growth, with expectations of continued expansion at 20-25% in FY25 [11][12] - The company is well-positioned to capture market share in the non-academic training sector due to its brand and operational experience [10][11]

Investment Rating - Maintains a **Buy** rating with a revised target price of **$95.0** (previously $102.5) [2][3] Core Views - New Oriental's core education business continues to show strong momentum, with FY24 revenue growing 44% YoY to $4.314 billion and non-GAAP net income up 47% YoY to $381.1 million [2] - The company's overseas test preparation and study consulting revenues grew 17.7% and 17.3% YoY, respectively, contributing approximately 11% and 15% of total revenue in 4QFY24 [2] - Domestic test preparation revenue increased 16.4% YoY, accounting for about 4% of total revenue in 4QFY24 [2] - New education initiatives grew 50.3% YoY, contributing approximately 20% of total revenue in 4QFY24 [2] - East Buy's revenue is expected to decline 20% YoY in FY25E to $741 million due to business adjustments [2] Business Performance and Outlook - For 1QFY25E, management guides total revenue growth of 31-34% YoY, reaching $1.255-1.284 billion, with OPM improving by 200 bps YoY [2] - The company expects overseas test preparation, overseas consulting, new education, and high school tutoring revenues to grow 25%, 15%, 50%, and 30% YoY, respectively, in FY25E [2] - Non-GAAP operating margin declined 5.9 percentage points YoY to 3.2% in 4QFY24, primarily due to capacity expansion and increased investments in live-streaming e-commerce [2] - The total number of schools and learning centers increased 37% YoY to 1,025 by the end of 4QFY24 [2] - Management expects capacity to grow 20-25% YoY in FY25E, with most new openings in cities with better unit economics [2] Financial Projections - FY25E revenue is projected at $5.267 billion, with non-GAAP net income of $571.7 million [3] - FY26E revenue is expected to reach $6.258 billion, with non-GAAP net income of $791.4 million [3] - Non-GAAP EPS for FY25E and FY26E is forecasted at $3.45 and $4.78, respectively [3] - Gross margin is expected to improve to 53.6% in FY25E and 54.8% in FY26E [6] - Operating margin is projected to increase to 11.1% in FY25E and 13.3% in FY26E [6] Valuation - The SOTP valuation method is used, with a 10% holdco discount, resulting in a target price of $95.0 per ADS [7] - Education and consulting business is valued at $89.9 (95% of total valuation), based on 30x FY25E PE [7] - East Buy is valued at $1.7 (2% of total valuation), based on 7x FY25E PE [7] - Travel and other businesses are valued at $3.3 (4% of total valuation), based on 15x FY25E PE [7] Industry Comparison - New Oriental's FY25E PE of 24.6x is higher than the education industry average of 22.4x, reflecting its strong leadership in China's education services market [7][9] - The company's FY25E PS of 2.2x is in line with the education industry average [9]

Investment Rating - The report maintains a BUY rating for New Oriental with a target price of US$95.00, down from the previous target of US$102.50, indicating a potential upside of 37.2% from the current price of US$69.25 [2][3]. Core Insights - New Oriental's core educational business has shown strong momentum, with a 32% year-over-year increase in net revenue for 4QFY24, reaching US$1,137 million, aligning with estimates [2]. - Non-GAAP net income for 4QFY24 declined by 41% year-over-year to US$36.9 million, primarily due to accelerated capacity expansion and increased investment in live streaming e-commerce [2]. - For FY24, total revenue and non-GAAP net income grew by 44% and 47% year-over-year, reaching US$4,314 million and US$381 million, respectively [2]. - Management expects total revenue for 1QFY25E to grow by 31-34% year-over-year, projecting a range of US$1,255-1,284 million [2]. Financial Performance Summary - FY23A revenue was US$2,998 million, increasing to US$4,314 million in FY24A, with projections of US$5,267 million for FY25E and US$6,258 million for FY26E [3][11]. - Adjusted net profit rose from US$258.9 million in FY23A to US$381.1 million in FY24A, with forecasts of US$571.7 million for FY25E and US$791.4 million for FY26E [3][11]. - The adjusted EPS is projected to increase from US$2.30 in FY24A to US$3.45 in FY25E and US$4.78 in FY26E [3][11]. Business Segments - The educational business has shown steady recovery, with overseas test prep and study consulting revenues growing by 17.7% and 17.3% year-over-year, respectively, in 4QFY24 [2]. - New educational initiatives reported a revenue increase of 50.3% year-over-year in 4QFY24, contributing approximately 20% to total revenue [2]. - East Buy is undergoing business adjustments, with revenue expected to decline by 20% year-over-year to US$741 million in FY25E due to management changes [2]. Valuation Methodology - The report employs a sum-of-the-parts (SOTP) valuation, estimating the educational and consulting business at US$89.9 per share based on a 30x FY25E PE, reflecting New Oriental's strong market position [8]. - East Buy is valued at US$1.7 per share based on a 7x FY25E PE, while the tourism segment is valued at US$3.3 per share based on a 15x FY25E PE [8].

Financial Data and Key Metrics Changes - The company achieved a solid topline growth of 32.1% for the fiscal quarter, with operating margin and non-GAAP operating margin reaching 0.9% and 3.2% respectively [8][9] - Operating income decreased by 78.1% year-over-year to $10.5 million, while non-GAAP income from operations fell by 53.8% to $36.3 million [18] - Net income attributable to New Oriental was $27 million, a 6.9% decrease year-over-year, with basic and diluted net income per ADS at $0.16 [18][19] - Cash and cash equivalents, term deposits, and short-term investments totaled approximately $4.9 billion [15] Business Line Data and Key Metrics Changes - The overseas test-prep business recorded a revenue increase of 18% in dollar terms, or 23% in RMB terms year-over-year [10] - The overseas study consulting business saw a revenue increase of about 17% in dollar terms, or 23% in RMB terms year-over-year [10] - The adults and university students' business recorded a revenue increase of 16% in dollar terms, or 21% in RMB terms year-over-year [10] - New educational business initiatives reported a revenue increase of 50% in dollar terms, or 57% in RMB terms year-over-year [12] Market Data and Key Metrics Changes - Deferred revenue at the end of the fourth quarter was $1,780.1 million, an increase of 33.1% compared to the previous year [20] - The company plans to increase capacity by around 20% to 25% for fiscal year 2025, focusing on cities with better topline and bottom line performance [22] Company Strategy and Development Direction - The company is pivoting to expand its multi-pronged presence and will leverage East Buy for knowledge sharing and product dissemination [7] - A strategic focus on enhancing the OMO (Online-Merge-Offline) system is underway, with a total investment of $30.5 million in the teaching platform [14] - The company aims to integrate new technologies such as AI and ChatGPT into educational offerings to improve growth and efficiency [23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving margin expansion for the educational business in the first quarter of 2025, excluding East Buy [21] - The company anticipates strong demand for its educational services and expects to achieve revenue growth of 31% to 34% in the first quarter of fiscal year 2025 [22] - Management noted that the regulatory environment is expected to stabilize, allowing for more predictable operations moving forward [55] Other Important Information - The company completed the acquisition of East Buy's online education business for RMB1.5 billion, which will now be recorded under educational services [16] - A share repurchase program was approved, allowing for the repurchase of up to $400 million of the company's ADS or common shares [15] Q&A Session Summary Question: Growth strategy and room for growth in existing locations - Management plans to increase capacity by 20% to 25% in existing cities, focusing on areas with better performance [27] Question: Margin decline analysis - The margin decline was attributed to accelerated learning center expansion, new tourism business investments, and additional incentives for management and staff [30] Question: Margin expansion expectations - Management expects margin expansion in Q1 and throughout the year, driven by operating leverage and strong market demand [36] Question: Enrollment growth versus capacity expansion - The difference in growth rates is partly due to timing, with expectations for revenue growth to cover incremental costs [39] Question: Revenue outlook for different segments - Revenue growth expectations include 20% to 25% for overseas test-prep, 15% for consulting, and 45% to 50% for new business initiatives [44] Question: Competitive landscape and summer enrollment growth - Competition has intensified, but management believes they will capture more market share due to strong demand and less competition compared to previous years [47] Question: Shareholder return and potential for increased buyback - Management is open to discussing further capital allocation to shareholders after completing the current buyback program [49] Question: Revenue contribution from tourism business - Expected revenue for the tourism business in fiscal year 2025 is around RMB1.2 billion, with anticipated losses in the first year of operation [52]

交银国际研究 公司更新 收盘价 目标价 潜在涨幅 港元 54.75 港元 80.00↓ +46.1% 新东方教育科技 (9901 HK) 2024 财年 4 季度利润率不及预期，教学点扩张稳定推进 2024 财年 4 季度业绩：收入 11 亿美元，基本符合预期，同比增 32%，主 要受教育新业务增长拉动。调整后运营利润 3600 万美元，同比降 54%， 不及我们预期的6900 万美元，对应调整后运营利润率3.2%，同比降5.9 个 百分点，主要因加速教学点拓展、文旅业务投入及提升员工薪酬奖励带来 短期影响。调整后归母净利润 3700 万美元，低于我们/彭博一致预期的 7700 万美元/7200 万美元，对应调整后净利率 3.2%，同比降 4 个百分点。 核心教育业务概览：教学点加速扩张，教育新业务维持高速增长。1）传 统 业 务 ： 留 学 备 考 / 出 国 咨 询 / 成 人 及 大 学 生 / 高 中 收 入 同 比 增 17.7%/17.3%/16.4%/25%，贡献收入约55%。2）新业务：收入同比增50%， 收入贡献约 20%，较去年同期提升 2 个百分点，非学科培训季度招生同比 增 39%至 ...

Financial Performance - For the fourth quarter of fiscal year 2024, net revenue increased by 32.1% year-over-year to $1,136.7 million[3]. - Operating profit for the fourth quarter decreased by 78.1% year-over-year to $10.5 million[3]. - Net profit attributable to New Oriental shareholders for the fourth quarter decreased by 6.9% year-over-year to $27.0 million[3]. - For the full fiscal year 2024, net revenue was $4,313.6 million, representing a 43.9% increase from $2,997.8 million in fiscal year 2023[5]. - Full year operating profit increased by 84.4% to $350.4 million compared to $190.0 million in the previous year[5]. - The company reported a total current asset value of $5.39 billion, up from $4.41 billion, marking an increase of approximately 22.2%[23]. - For the fiscal year ended May 31, 2024, net revenue was $4,313,586, an increase of 43.8% from $2,997,760 in the fiscal year 2023[31]. - Operating profit for the fiscal year ended May 31, 2024, was $350,425, an increase of 84.5% compared to $190,046 in the fiscal year 2023[31]. - Net profit attributable to shareholders for the fiscal year ended May 31, 2024, was $309,591, an increase of 74.5% from $177,341 in the fiscal year 2023[31]. Revenue Growth - The company reported a 50.3% year-over-year revenue growth in its new education businesses during the fourth quarter[8]. - In Q4 FY2024, the company's net revenue was $1,136.7 million, a year-over-year increase of 32.1% driven by new educational services and the growth of self-operated products and live e-commerce business[11]. - The company expects Q1 FY2025 net revenue (excluding live e-commerce business) to be between $1,254.7 million and $1,283.5 million, reflecting a year-over-year growth rate of 31% to 34%[17]. Operating Expenses - Operating costs and expenses for the quarter were $1,126.2 million, a year-over-year increase of 38.6%, with Non-GAAP operating costs rising 40.7% to $1,100.4 million[12]. - Total operating expenses for the three months ended May 31, 2024, were $1,126,152, an increase of 38.7% from $812,517 in the same period of 2023[25]. - The total operating expenses, excluding stock-based compensation, were $3,840,703,000 for the period, up from $2,717,926,000 in 2023, indicating a rise of 41.2%[33]. Profit Margins - The company's GAAP operating profit margin for the quarter was 0.9%, while the Non-GAAP operating profit margin was 3.2%[8]. - The company's operating profit for the quarter was $10.5 million, a decline of 78.1% year-over-year, resulting in an operating profit margin of 0.9% compared to 5.6% in the same quarter last year[12]. - The non-GAAP operating profit margin improved to 11.0% for the period ending May 31, 2024, up from 9.3% in the previous year[33]. Cash and Assets - Cash and cash equivalents as of May 31, 2024, were $1,389.4 million, with short-term investments amounting to $2,065.6 million[14]. - Cash and cash equivalents decreased to $1.39 billion from $1.66 billion, a decline of about 16.4% year-over-year[23]. - As of May 31, 2024, total assets amounted to $7.53 billion, an increase from $6.39 billion as of May 31, 2023, representing a growth of approximately 17.7%[23][24]. - The company reported a net cash provided by operating activities of $1,122,643,000 for the period, compared to $971,008,000 in 2023, an increase of 15.6%[36]. Shareholder Returns - The company has authorized a share repurchase plan of up to $400 million, with approximately 7.3 million ADS repurchased for about $296.1 million as of July 30, 2024[10]. - Basic and diluted earnings per American Depositary Share (ADS) for the three months ended May 31, 2024, were $0.16, compared to $0.18 for the same period in 2023[28]. - Basic earnings per American Depositary Share (ADS) increased to $2.30 for the period, compared to $1.54 in 2023, representing a growth of 49.4%[34]. User Growth - The number of active paying users for the smart learning system reached 188,000 in the fourth quarter[8]. - Total number of schools and learning centers increased to 1,025, up from 911 in the previous quarter and 748 a year ago[7]. Deferred Revenue - The deferred revenue balance at the end of Q4 FY2024 was $1,780.1 million, a 33.1% increase from $1,337.6 million at the end of Q4 FY2023[14].

Core Viewpoint - New Oriental Education & Technology Group Inc. reported strong revenue growth for the fourth fiscal quarter and fiscal year ended May 31, 2024, despite a significant decline in operating income and net income due to increased operating costs and expenses. Financial Highlights - Total net revenues for the fourth fiscal quarter increased by 32.1% year over year to US$1,136.7 million [2][8] - Operating income decreased by 78.1% year over year to US$10.5 million [2][11] - Net income attributable to New Oriental decreased by 6.9% year over year to US$27.0 million [2][12] - For the fiscal year 2024, net revenues reached US$4,313.6 million, a 43.9% increase year over year [16][36] - Operating income for the fiscal year was US$350.4 million, an 84.4% increase year over year [16][36] Operating Highlights - The total number of schools and learning centers increased to 1,025 as of May 31, 2024, up from 911 as of February 29, 2024 [4] - The overseas test preparation and overseas study consulting businesses grew by approximately 17.7% and 17.3% year over year, respectively [5] - New educational business initiatives recorded a revenue growth of 50.3% year over year [5] Cost and Expenses - Operating costs and expenses for the fourth quarter were US$1,126.2 million, a 38.6% increase year over year [9][10] - Cost of revenues increased by 38.5% year over year to US$542.4 million [10] - Selling and marketing expenses rose by 40.9% year over year to US$208.2 million [10] Cash Flow and Balance Sheet - Net operating cash inflow for the fourth fiscal quarter was approximately US$376.8 million [14] - As of May 31, 2024, cash and cash equivalents totaled US$1,389.4 million [15] - Deferred revenue increased by 33.1% year over year to US$1,780.1 million [15] Recent Developments - The company completed the acquisition of East Buy's online education business for RMB1.5 billion [6] - A share repurchase program was extended to May 31, 2025, with approximately 7.3 million ADSs repurchased for about US$296.1 million as of July 30, 2024 [7] Outlook - New Oriental expects total net revenues for the first quarter of fiscal year 2025 to be in the range of US$1,254.7 million to US$1,283.5 million, representing a year-over-year increase of 31% to 34% [18]

社会服务 2024 年 07 月 26 日 新东方-S (09901) ——电商业务下滑影响有限，聚焦教育业务高增长 报告原因：强调原有的投资评级 | --- | --- | |------------------------|---------------------| | 市场数据： | 2024 年 07 月 25 日 | | 收盘价（港币） | 57.50 | | 恒生中国企业指数 | 6016.51 | | 52 周最高/最低（港币） | 77.05/38.85 | | H 股市值（亿港币） | 951.7 | | 流通 H 股（百万股） | 1655.12 | | 汇率（人民币/港币） | 1.0948 | 一年内股价与基准指数对比走势： 资料来源：Bloomberg 证券分析师 黄哲 A0230513030001 huangzhe@swsresearch.com 联系人 黄哲 (8621)23297818× huangzhe@swsresearch.com 买入（维持）投资要点： 电商业务拖累有限。新东方控股子公司东方甄选人事变动，头部主播董宇辉离职。我们预计东方 甄选 25,26 财年收入下滑 ...

社会服务 2024 年 07 月 14 日 新东方-S (09901) —— 电商拖累逐步淡出,教育业务强势增长 报告原因:强调原有的投资评级 上 市 公 司 证 券 研 究 报 告 | --- | --- | |----------------------|---------------------| | 市场数据: | 2024 年 07 月 12 日 | | 收盘价(港币) | 60.45 | | 恒生中国企业指数 | 6532.63 | | 52 周最高/最低(港币) | 77.05/33.85 | | H 股市值(亿港币) | 1000.52 | | 流通 H 股(百万股) | 1655.12 | | 汇率(人民币/港币) | 1.0948 | 一年内股价与基准指数对比走势: 资料来源:Bloomberg 证券分析师 黄哲 A0230513030001 huangzhe@swsresearch.com 联系人 黄哲 (8621)23297818× huangzhe@swsresearch.com 买入(维持)投资要点: 我们预计新东方 24 财年第四季度(4QFY24,2024.3-2024.5)收 ...