Business Expansion and Services - In fiscal year 2022, the company expanded its extracurricular personal quality courses for children and teenagers, covering sports, arts, and dance[8]. - The company opened a consultation center in Zhengzhou, Henan Province, to provide overseas education consulting services and acquired a school in the UK to enhance its overseas school network[8]. - Future plans include expanding overseas education consulting services to major cities in mainland China and Hong Kong through mergers, collaborations, and new establishments[8]. - The company aims to leverage its UK school network to promote Chinese students studying in the UK and explore overseas research and study programs[8]. - The company intends to expand dance training courses to Beijing and seek more business development opportunities[8]. - The company aims to create a one-stop service for Chinese students seeking international education opportunities[14]. - The company plans to enhance its market development efforts while maintaining service quality for existing clients and actively expanding its new client base[8]. - The company has shifted its focus from academic education to non-academic education and training consulting, which has begun to significantly contribute to its revenue[21]. Financial Performance - In the fiscal year 2022, the total revenue of the company was approximately RMB 27.7 million, a decrease of about 92.2% compared to RMB 352.9 million in fiscal year 2021, primarily due to the cessation of academic education business[21]. - The cost of sales and services for fiscal year 2022 was approximately RMB 18.7 million, a decrease of about 92.1% from RMB 235.4 million in fiscal year 2021, consistent with the revenue decline[22]. - The gross profit for fiscal year 2022 was approximately RMB 9.0 million, down about 92.3% from RMB 117.4 million in fiscal year 2021, with a stable gross margin of approximately 32.5%[23]. - Other income for the fiscal year 2022 was approximately RMB 2.5 million, a decrease of about 69.1% from RMB 8.1 million in 2021, primarily due to a reduction in bank interest income of approximately RMB 5.2 million[24]. - The net other income and losses for fiscal year 2022 was a loss of approximately RMB 2.7 million, a significant decrease of about 96.2% from a loss of approximately RMB 70.3 million in 2021, mainly due to a turnaround from a loss of RMB 48.5 million in property, plant, and equipment to a gain of RMB 0.4 million in 2022[25]. - The net loss for fiscal year 2022 was approximately RMB 31.4 million, a reduction of about 44.7% from a loss of approximately RMB 56.8 million in 2021, mainly due to reduced costs and expenses following the cessation of the academic education business[31]. - Basic and diluted loss per share for fiscal year 2022 was approximately RMB 3.96, compared to RMB 7.31 in 2021[32]. Operational Challenges and Investigations - The company has suspended trading since March 30, 2023, due to concerns raised by the previous auditor regarding various audit matters[10]. - A special investigation committee was established on April 19, 2023, to conduct an independent investigation into the audit issues[10]. - The independent investigation committee has appointed a risk assessment service firm to conduct a procedural investigation into the audit matters[10]. - The company is implementing all recommendations from the independent review to correct internal control deficiencies[11]. - The company faces significant operational risks, including regulatory challenges and competition in the education sector, which may impact its profitability[59]. Management and Governance - Zhang Hongjun appointed as Executive Director and CEO, responsible for overall operations and management since November 30, 2018[42]. - The board of directors consists of two executive directors, one non-executive director, and three independent non-executive directors, ensuring a high level of independence[164]. - The company has established four board committees: Audit Committee, Remuneration Committee, Nomination Committee, and Investment Management Committee, each with specific responsibilities[173]. - The independent non-executive directors have confirmed their independence according to the listing rules, ensuring adequate checks and balances within the board[170]. - The company has adopted a corporate governance code and believes it has complied with relevant provisions throughout the fiscal year 2022[164]. Employee and Shareholder Relations - The company emphasizes the importance of maintaining strong relationships with employees, customers, and suppliers to ensure business growth and success[62]. - As of December 31, 2022, the group had 383 employees, a decrease from 492 employees as of December 31, 2021[94]. - Total employee-related costs for the fiscal year 2022 were approximately RMB 23.1 million, down from RMB 135.0 million in the fiscal year 2021[94]. - The company has adopted a dividend policy aiming to distribute up to 30% of the distributable net profit to shareholders, subject to various conditions[186]. - The company emphasizes the importance of active communication with shareholders and investors, ensuring timely and accurate disclosure of significant matters[193]. Compliance and Regulatory Matters - The company has not reported any significant violations of applicable laws and regulations that would materially affect its operations during the fiscal year 2022[61]. - The company confirmed compliance with non-competition agreements established by the controlling shareholder during the fiscal year 2022[87]. - The company has received a waiver from the Stock Exchange regarding strict compliance with certain listing rules related to the structured contracts, allowing for continued operations without independent shareholder approval under specific conditions[151]. Strategic Acquisitions and Investments - The company acquired a 60% stake in Zhengzhou Zhongzhichuang Education Technology Co., Ltd. in May 2022, focusing on adult vocational training and technical education in computer science and information technology[15]. - The group plans to use the unutilized net proceeds by the end of 2025, extending the previous timeline due to a shift in business focus[64]. - The company plans to allocate about 30% of the net proceeds for strategic acquisitions of quality after-school education service companies in other regions of China[63]. Risk Management and Internal Controls - The company is committed to maintaining a robust risk management and internal control system to support long-term sustainable development[189]. - The company has established a risk management framework that includes risk identification, assessment, and mitigation strategies, ensuring effective monitoring and reporting to the board[190]. - The Audit Committee confirmed that there were no findings of fraud or significant internal control deficiencies within the group[178]. - The company has adopted all recommendations from an internal control review conducted by Zhongshen Zhonghuan, which identified several key internal control deficiencies[190].

Financial Performance - The company reported a total loss and comprehensive expenses of RMB 21,026 thousand during the period[5]. - The company's revenue for the six months ended June 30, 2023, was RMB 16,113,000, compared to RMB 8,603,000 for the same period in 2022, representing a growth of 87.5%[23]. - The pre-tax loss for the six months ended June 30, 2023, was RMB (12,232,000), an improvement from a loss of RMB (29,450,000) in the same period of 2022, indicating a reduction in losses by approximately 58.4%[23]. - The net loss for the period was approximately RMB 19.6 million, an increase of approximately RMB 18.3 million compared to a loss of RMB 1.3 million in the same period of 2022[130]. - For the six months ended June 30, 2023, the company reported a gross profit of RMB 9,831,000, compared to a loss of RMB 394,000 in the same period of 2022[198]. - The company incurred a pre-tax loss of RMB 19,874,000, significantly higher than the pre-tax loss of RMB 1,324,000 in the prior year[199]. Assets and Liabilities - As of June 30, 2023, non-current assets totaled RMB 125,411 thousand, a decrease of 1.03% from RMB 127,732 thousand as of December 31, 2022[1]. - Current assets amounted to RMB 154,863 thousand, an increase of 9.66% compared to RMB 141,302 thousand as of December 31, 2022[1]. - Inventory decreased to RMB 165 thousand, down 30.08% from RMB 236 thousand as of December 31, 2022[1]. - Trade receivables were RMB 4,224 thousand, a decline of 54.45% from RMB 9,278 thousand as of December 31, 2022[1]. - Cash and cash equivalents stood at RMB 80,317 thousand, a decrease of 15.53% from RMB 94,961 thousand as of December 31, 2022[1]. - Current liabilities increased to RMB 72,232 thousand, up 57.25% from RMB 45,947 thousand as of December 31, 2022[1]. - The net current assets amounted to RMB 82,631 thousand, a decrease of 13.36% from RMB 95,355 thousand as of December 31, 2022[1]. - Total assets less current liabilities were RMB 208,042 thousand, down 6.75% from RMB 223,087 thousand as of December 31, 2022[1]. - The capital debt ratio increased to approximately 14.9% as of June 30, 2023, compared to approximately 4.6% as of December 31, 2022[137]. - The current ratio decreased to approximately 2.1 times as of June 30, 2023, from approximately 3.1 times as of December 31, 2022[138]. Shareholder Information - The company has a significant ownership structure with the largest shareholder holding 34.01% of the issued share capital[21]. - As of June 30, 2023, the company had a total of 800,000,000 shares issued, with major shareholder Zhang Hongjun holding 34.01% of the shares through a controlled corporation[30][31]. - The company reported a basic and diluted loss per share of approximately RMB 2.73, compared to RMB 0.11 in the same period last year[156]. Corporate Governance - The company has established an audit committee to assist the board in reviewing and supervising the financial reporting process and internal control systems[33]. - The company has confirmed compliance with the standards set out in the code of conduct for securities transactions by directors during the reporting period[28]. - There were no significant competitive businesses or conflicts of interest involving directors as of the date of the interim report[29]. - The company has adhered to the corporate governance code during the reporting period, with the chairman and CEO roles held by the same individual, Zhang Hongjun, which the board believes is beneficial for management[40]. - The board consists of two executive directors, one non-executive director, and three independent non-executive directors, ensuring a high level of independence[40]. Business Transformation and Strategy - The company continues to focus on improving its financial performance and exploring new strategies for market expansion and product development[1]. - The company has shifted its focus from academic education services to non-academic education services and training and consulting services due to regulatory changes in China's education system[78]. - The company is actively transforming its existing business and exploring new opportunities in response to increasing disposable income and demand for international education among parents[80]. - The company plans to expand overseas education consulting services through acquisitions and partnerships to cover more study abroad groups and families[120]. - The group aims to leverage its accumulated teaching experience and resources to provide targeted training for teachers, enhancing its consulting services[100]. - The group is committed to developing a comprehensive ecosystem in international education, providing one-stop services for Chinese students seeking international education[115]. Regulatory and Audit Issues - The company is currently addressing audit concerns related to software development payments, training service effectiveness, and a loan granted to an entity[76]. - The company has established a special investigation committee to address audit issues and has engaged an independent risk consulting firm for an agreed-upon procedures investigation[90]. - The independent investigation report was released on May 29, 2024, confirming that the investigation results adequately address each audit issue[90]. - Deloitte resigned as the auditor on May 22, 2023, citing concerns over payments related to software development services totaling RMB 100,000,000[193]. - The company appointed Zhonghui Anda as the new auditor effective May 25, 2023, to fill the vacancy left by Deloitte[193]. Revenue and Expenses - The group recorded a tax credit of approximately RMB 257,000 during the reporting period, compared to RMB 11,000 in the same period last year[109]. - Sales and marketing expenses increased by approximately RMB 4.0 million to about RMB 4.6 million due to higher advertising and marketing expenditures for non-academic education services[106]. - Administrative expenses rose by approximately RMB 11.7 million to about RMB 22.0 million, primarily due to increased employee salaries and professional fees related to business transformation and expansion[106]. - Other income recorded was approximately RMB 1.0 million, an increase of approximately RMB 0.1 million compared to RMB 0.9 million in the same period of 2022[124]. - The company recorded other income of RMB 968,000, a decrease from RMB 901,000 in the previous year[198]. - The total employee-related costs during the reporting period were approximately RMB 147 million, compared to RMB 135 million for the same period last year[173]. Future Outlook - The company is committed to restoring trading as soon as possible and has taken appropriate measures to rectify the issues leading to the suspension of its shares[90]. - The group expects the demand for extracurricular courses to rise, aligning with market trends and regulatory requirements[100]. - The trend of younger students studying abroad is increasing at an annual rate of approximately 20% in first-tier cities in China[120]. - The company plans to extend the estimated use period of unutilized net proceeds to the end of 2025 due to a shift in business focus[183].

Financial Performance - In the fiscal year 2022, the total revenue of the company was approximately RMB 27.7 million, a decrease of about 92.2% compared to RMB 352.9 million in fiscal year 2021[109] - The significant revenue decline was primarily due to the cessation of academic education business, resulting in a loss of approximately RMB 338.7 million from that segment[109] - The cost of sales and services for the company in fiscal year 2022 was approximately RMB 18.7 million, a decrease of about 92.1% from RMB 235.4 million in fiscal year 2021[130] - The group's other income and loss net amount for the fiscal year 2022 was a loss of approximately RMB 2.7 million, a decrease of about 96.2% compared to a loss of approximately RMB 70.3 million in the fiscal year 2021[51] - The group's gross profit for fiscal year 2022 was approximately RMB 9.0 million, down about 92.3% from RMB 117.4 million in fiscal year 2021, with a gross profit margin of approximately 32.5% compared to 33.3% in fiscal year 2021[151] - The group recorded a loss of approximately RMB 31.4 million in fiscal year 2022, a decrease of about 44.7% compared to a loss of approximately RMB 56.8 million in fiscal year 2021, mainly due to reduced costs and expenses after ceasing academic education operations[134] Business Strategy and Operations - The group is actively exploring various business opportunities to broaden and deepen its operations, aiming to generate more returns for shareholders[24] - The group has closed its self-operated teaching centers and fully terminated its academic education business as of March 2022 to comply with imposed restrictions[100] - The group is focused on developing non-academic education services, including extracurricular personal quality courses for children and teenagers[10] - The company has shifted its focus to non-academic education and training services, which partially offset the revenue decrease[109] - The group plans to expand its overseas education consulting services to major cities in mainland China and Hong Kong through mergers, collaborations, and new establishments[93] - The group aims to leverage its network of schools in the UK to promote Chinese students studying or participating in short-term exchanges in the UK[106] - The group is committed to creating a one-stop service for international education for Chinese students[101] Financial Position and Management - The group has no interest-bearing borrowings as of December 31, 2022, consistent with the previous year[33] - The group has no significant contingent liabilities as of December 31, 2022, similar to the previous year[35] - The group's current ratio was approximately 3.1 times, down from approximately 4.1 times as of December 31, 2021[137] - The group's net current assets were approximately RMB 95.4 million, a decrease of about 52.2% from RMB 199.7 million as of December 31, 2021[158] - The group's bank balances and cash as of December 31, 2022, were approximately RMB 95.0 million, a decrease of about 63.4% from RMB 259.8 million as of December 31, 2021, mainly due to the utilization of part of the proceeds from the listing[159] - The group's capital debt ratio as of December 31, 2022, was approximately 4.6%, down from approximately 9.2% as of December 31, 2021[161] - The basic and diluted loss per share for fiscal year 2022 was approximately RMB 3.96, compared to RMB 7.31 for fiscal year 2021[157] Governance and Compliance - The group has initiated an independent investigation into audit matters and is taking appropriate measures to correct issues leading to trading suspension[97] - The group is focused on enhancing its internal controls based on the findings of the independent investigation[97] - The audit committee held three meetings in the fiscal year 2022 to review the group's risk management and internal control systems, as well as the annual performance for the fiscal year 2021[176] - The audit committee agreed with the accounting treatment adopted by the company and ensured that the financial information disclosed complies with applicable accounting standards[177] - The board of directors will recommend a maximum dividend payout of 30% of the distributable net profit attributable to shareholders, subject to the company's actual and expected operating performance and cash flow[187] - The board believes the group has sufficient resources to continue operating in the foreseeable future due to good liquidity and adequate cash reserves[188] - The risk management framework involves the management team identifying, assessing, and prioritizing significant risks, with regular reporting to the board[190] Market Trends and Opportunities - The international education market is expected to grow as more parents invest in their children's education, driven by rising disposable incomes and a focus on quality education[121] - The number of underage students studying abroad from first-tier cities in China is growing at an annual rate of approximately 20%[106] - The company aims to leverage its accumulated teaching experience and resources to provide targeted training for teachers in educational institutions[128] - The company is committed to providing high-quality, diversified services to meet the personalized needs of different customer groups in the international education ecosystem[126] Internal Committees and Board Composition - The remuneration committee held two meetings in the fiscal year 2022 to discuss the group's remuneration policies for directors and senior management[180] - The nomination committee evaluates candidates based on integrity, experience, skills, and ability to fulfill duties, with recommendations submitted to the board for decision[183] - The company emphasizes diversity in the composition of the board, considering various factors such as gender, age, and professional experience[186] - The board is responsible for maintaining an effective risk management and internal control system to support the group's long-term sustainable development[189] - The company has engaged Zhongchao Zhonghuan to conduct a comprehensive internal control review, identifying several key internal control deficiencies[191] - The board of directors emphasizes the importance of acting in the best interests of all shareholders and aims to maximize returns for them[194] - Shareholders holding at least 10% of the paid-up capital can request the board to convene a special general meeting within two months of submission[195] - The identity of shareholders and their requests will be verified by the Hong Kong share transfer registration office[198]

Financial Performance - Revenue for the six months ended June 30, 2022, was RMB 9,874,000, a decrease of 95.4% compared to RMB 216,144,000 in the same period of 2021[9]. - The company reported a loss before tax of RMB 1,324,000, compared to a profit of RMB 22,590,000 in the previous year[9]. - The total comprehensive loss attributable to owners of the company was RMB 1,313,000, a significant decline from a profit of RMB 18,665,000 in the prior year[9]. - Basic loss per share was RMB 0.11, down from earnings of RMB 2.41 per share in the same period last year[9]. - The group recorded a gross loss of approximately RMB 0.4 million for the six months ended June 30, 2022, with a gross loss margin of about 4.0%, compared to a gross profit of RMB 82.9 million and a gross profit margin of 38.4% for the same period in 2021[29]. - The group recorded a tax credit of approximately RMB 11,000 for the six months ended June 30, 2022, compared to a tax expense of approximately RMB 3.9 million for the same period in 2021, reflecting a significant change in pre-tax loss of approximately RMB 1.3 million in 2022 versus a profit of approximately RMB 22.6 million in 2021[36]. - The total comprehensive loss for the six months ended June 30, 2022, was approximately RMB 1.3 million, compared to a total comprehensive income of approximately RMB 18.7 million for the same period in 2021[37]. - The company reported a net loss attributable to the owners of the company for the period was RMB 827,000, contrasting with a profit of RMB 18,665,000 in the same period of 2021[86]. - The company incurred a pre-tax loss of RMB 1,324,000 for the six months ended June 30, 2022, compared to a pre-tax profit of RMB 22,590,000 in the prior year[86]. - The company reported total revenue of RMB 8,603,000 for the six months ended June 30, 2022, a significant decline from RMB 212,540,000 in the same period of 2021[100]. Business Strategy and Operations - The company has ceased all academic education operations since March 2022 in response to regulatory changes in China's education sector[10]. - The new business strategy focuses on providing extracurricular personal quality courses, vocational education, and overseas education consulting services in China[11]. - The company is no longer involved in academic-related tutoring services due to government regulations requiring such services to be provided by non-profit organizations[11]. - The management has conducted a thorough evaluation and adjustment of its business strategy to comply with the new regulations[11]. - The company aims to expand its non-academic education services in the Chinese market moving forward[11]. - The financial results reflect the significant impact of regulatory changes on the company's traditional business model[10]. - The group operates 9 self-operated teaching centers as of June 30, 2022, up from 5 centers on December 31, 2021, indicating an 80% increase in operational centers[14]. - The group completed the acquisition of 60% of Henan Zhongzhichuang Education Information Consulting Co., Ltd. on May 30, 2022, marking an expansion into vocational education[17]. - The group aims to provide flexible scheduling for courses to accommodate students' school commitments[13]. - The group plans to invest resources in developing non-academic education businesses to achieve higher enrollment rates in the second half of 2022[24]. - The company is actively exploring opportunities to expand its geographical and business scope to provide private education outside of China, including in popular study destinations like the UK and the US[24]. - The company aims to diversify its business portfolio to include extracurricular programs in arts, sports, and dance for children and teenagers[62]. Financial Position and Cash Flow - The group’s cash and bank balances decreased by approximately 27.0% to about RMB 189.8 million, primarily due to tuition refunds and net cash outflows from operations[45]. - The current ratio improved to approximately 10.0 times as of June 30, 2022, compared to approximately 4.1 times at the end of 2021[48]. - The capital-to-debt ratio was approximately 0.03 as of June 30, 2022, down from approximately 0.1 at the end of 2021[47]. - The company holds sufficient cash and bank resources to continue operations in the foreseeable future[97]. - The company’s cash and cash equivalents at the end of the period were RMB 189,765,000, down from RMB 262,801,000 at the end of the previous year[93]. - The company reported a net cash outflow from financing activities of RMB 201,000, down from RMB 60,467,000 in the previous year[93]. - The total cash and cash equivalents decreased by RMB 69,586,000, compared to a decrease of RMB 37,404,000 in the prior year[93]. - The company reported a decrease in trade payables from RMB 259 thousand to RMB 71 thousand, a decline of approximately 72.6%[87]. - The total amount of other receivables increased to RMB 23,007,000 as of June 30, 2022, compared to RMB 5,224,000 as of December 31, 2021[122]. Employee and Governance - The group has 45 staff members as of June 30, 2022, compared to no staff reported on December 31, 2021, reflecting a significant increase in personnel[15]. - The total employee cost was approximately RMB 14.6 million, a significant decrease from RMB 102.3 million for the same period in 2021[65]. - The total number of employees decreased from 492 as of December 31, 2021, to 374 as of June 30, 2022[65]. - The group’s short-term employee benefits for key management personnel decreased to RMB 1,470,000 for the six months ended June 30, 2022, from RMB 6,922,000 for the same period in 2021[156]. - The company has established an audit committee to oversee financial reporting, risk management, and internal controls[57]. - The board believes that reallocating the unused net proceeds aligns with the adjusted business strategy to navigate the challenging regulatory environment in China[64]. - The company emphasizes the importance of corporate governance and will continue to review and monitor its business practices to maintain high standards[74]. Shareholder and Investment Activities - The board did not recommend the distribution of an interim dividend for the reporting period[52]. - The company acquired a 60% stake in Henan Zhongzhichuang for RMB 1,000,000, completed on May 30, 2022[53]. - A cooperation agreement was signed on July 7, 2022, for the company to invest RMB 5,000,000 to acquire a 33.33% stake in Zhongshu Culture, targeting the NFT market[56]. - The total proceeds from the share sale amounted to HKD 250.0 million (approximately RMB 225.7 million), with a net amount of HKD 204.0 million after expenses[58]. - The company has revised the allocation of unutilized proceeds, with significant reductions in planned spending on geographic expansion and strategic acquisitions[60]. - The company aims to retain and attract talent through the share option and reward plans, which are designed to incentivize contributions to the group[142]. - The company did not purchase, sell, or redeem any of its listed securities during the reporting period[73]. - The company has not granted any stock options under the stock option plan as of June 30, 2022, maintaining the same status as the previous year[66]. - The company did not recognize any liabilities or expenses related to the share reward plan for the six months ended June 30, 2022, due to anticipated performance targets not being met[148].

Financial Performance - For the fiscal year 2021, the company reported revenue of RMB 352.9 million, an increase of 6.0% compared to RMB 333.0 million in the previous fiscal year[8]. - The company experienced a significant loss before tax of RMB (55.7) million, a decrease of RMB 60.4 million from a profit of RMB 4.7 million in the previous year, representing a decline of 1,291.6%[8]. - The net loss for the year was RMB (56.8) million, compared to a profit of RMB 2.1 million in the previous year, marking a decline of 2,866.5%[8]. - The total comprehensive loss for the year amounted to RMB (61.8) million, compared to a total comprehensive income of RMB 2.1 million in the previous year, reflecting a decline of 3,110.0%[8]. - Basic loss per share was RMB (7.31), a decrease of RMB 7.61 from earnings of RMB 0.30 per share in the previous year, representing a decline of 2,536.7%[8]. - Total revenue for the fiscal year 2021 was approximately RMB 352.9 million, an increase of about RMB 19.9 million or approximately 6.0% compared to RMB 333.0 million in fiscal year 2020[20]. - Tuition revenue from regular, premium, and VIP classes amounted to RMB 325.9 million, representing 92.3% of total revenue, compared to RMB 304.6 million or 91.5% in the previous year[22]. - Gross profit increased by approximately RMB 8.4 million or about 7.7% to RMB 117.4 million, with a gross margin rising from approximately 32.7% to 33.3%[24]. Operational Changes - The company strategically adjusted its operations in the second half of the fiscal year to explore new business opportunities and diversify its business portfolio[11]. - The company faced unprecedented challenges in the second half of the fiscal year due to regulatory changes and the resurgence of COVID-19, impacting its operations significantly[10]. - The company has shifted several in-person classes to online formats due to challenges posed by the COVID-19 pandemic and regulatory changes in the education sector[16]. - The company closed most of its self-operated teaching centers starting August 2021 due to regulatory compliance, impacting future revenue generation[20]. - The company has closed 10 existing self-operated teaching centers as part of a business restructuring plan, with agreements reached to terminate the lease agreements, resulting in partial refunds of existing deposits and rent prepayments[198]. Student Enrollment and Services - In the fiscal year 2021, the total number of enrolled students in regular, boutique, and VIP classes reached 281,765, with a total tutoring duration of 5,539,289 hours, 102,197 hours, and 504,271 hours respectively[15]. - The total tutoring hours for fiscal year 2021 reached 6,145,757, an increase from 5,769,582 hours in the previous year[22]. - As of December 31, 2021, the company had approximately 94,000 students, an increase from about 66,000 students as of December 31, 2020, reflecting a growth of approximately 42.4%[97]. Business Expansion Plans - The company plans to diversify its business portfolio to include three additional types of tutoring services: (i) extracurricular personal quality courses in arts, sports, and coding for children and teenagers; (ii) vocational education for high school students and adults; and (iii) overseas study consulting[12][17]. - The company plans to leverage its over 20 years of experience to maintain teaching quality and efficiency while enhancing its reputation and influence in tutoring services[10]. - The company aims to enhance training quality in vocational education and incorporate advanced technology subjects to support sustainable economic and social development[13]. - The company plans to acquire a 60% equity interest in a target company for a consideration of RMB 1,000,000, with the acquisition agreement signed on February 14, 2022[91]. Financial Position and Assets - Cash and bank balances were approximately RMB 259.8 million as of December 31, 2021, a decrease of approximately RMB 39.9 million or 13.3% from RMB 299.7 million on December 31, 2020[46]. - The company's capital-to-debt ratio was approximately 0.1 as of December 31, 2021, down from approximately 0.7 on December 31, 2020[54]. - The current ratio improved to approximately 4.1 times as of December 31, 2021, compared to approximately 1.7 times on December 31, 2020[55]. - The company has no outstanding loans or borrowings as of December 31, 2021[103]. Management and Shareholding - Zhang Hongjun holds 505,860,800 shares, representing approximately 63.23% of the total issued share capital of the company[60]. - The company has a significant management team with over 23 years of experience in the education industry, led by Zhang Hongjun[60]. - The shareholding structure indicates a strong commitment from the executive directors, with substantial ownership stakes[60][61][64]. - The company has established a remuneration committee to review its remuneration policy based on operational performance, individual performance of directors and senior management, and market practices[114]. Risks and Compliance - The company faces significant risks related to brand reputation, regulatory compliance, and competition in the education sector[79][80]. - The company will continue to closely monitor the regulatory environment that may significantly impact its operations and financial condition[18]. - Risks associated with structural contracts include potential non-compliance with Chinese laws, which could lead to severe consequences, including the invalidation of contracts[174]. - The company has taken steps to mitigate risks related to foreign investment laws, including hiring external legal advisors for compliance reviews[176]. Share Incentive Plans - The stock option plan allows for a maximum issuance of 80,000,000 shares, representing 10% of the issued share capital at the time of listing, subject to shareholder approval for any increase[123]. - A total of 30,000,000 reward shares were granted to 56 employees, including four directors, at a zero reward price during the fiscal year 2021[138]. - The total number of shares granted under the share award plan shall not exceed 10% of the issued shares as of December 14, 2020, which amounts to a maximum of 80,000,000 shares[131]. - The total percentage of shares granted to related parties is approximately 58.90% of the incentive shares[157]. Structural Contracts - The company operates in the Chinese education sector through a structured contract due to legal restrictions on foreign ownership in the industry[162]. - The exclusive business cooperation agreement grants the company proprietary rights to provide necessary technical services and management support to its consolidated affiliated entities[165]. - The structural contracts remain legally effective and binding, with no violations or non-compliance reported as of the report date[185]. - The company has implemented measures to ensure compliance with structural contracts and effective business operations, including annual reviews by the board of directors[176].

Financial Performance - Revenue for the six months ended June 30, 2021, was RMB 216,144,000, representing a 96.0% increase from RMB 110,284,000 in the same period of 2020[8]. - The profit before tax for the same period was RMB 22,590,000, compared to a loss of RMB 9,094,000 in 2020, marking a significant turnaround of 348.4%[8]. - Basic earnings per share for the six months ended June 30, 2021, was RMB 2.41, a significant increase from a loss of RMB 1.73 in the same period of 2020, reflecting a 239.3% improvement[8]. - The company recorded a profit of approximately RMB 18.7 million for the six months ended June 30, 2021, compared to a loss of approximately RMB 9.8 million for the same period in 2020[24]. - Gross profit increased by approximately RMB 63.7 million or 331.4% to approximately RMB 82.9 million for the six months ended June 30, 2021, with a gross margin rising from 17.4% to 38.4%[15]. - Total revenue for the six months ended June 30, 2021, was approximately RMB 216.1 million, an increase of approximately RMB 105.9 million or 96.0% compared to RMB 110.3 million for the same period in 2020[12]. - The company achieved a profit before tax of RMB 33,722,000 for the six months ended June 30, 2021, compared to a loss of RMB 17,465,000 in the prior year, indicating a turnaround in profitability[95]. - For the six months ended June 30, 2021, the company reported a profit of RMB 18,665,000 compared to a loss of RMB 9,834,000 for the same period in 2020, marking a significant turnaround[113]. Student Enrollment and Tutoring Services - Total student enrollments for regular, boutique, and VIP classes reached 179,389, with total tutoring hours provided being 3,079,427, 53,671, and 345,728 respectively[9]. - Total tutoring revenue for the six months ended June 30, 2021, was RMB 200.0 million, compared to RMB 102.6 million for the same period in 2020, reflecting a significant increase in student enrollments and tutoring hours[13]. - The number of tutoring sessions increased significantly, with a total of 3,478,826 hours for the six months ended June 30, 2021, compared to 1,832,627 hours for the same period in 2020[13]. Business Strategy and Regulatory Environment - The company plans to strategically close several self-operated teaching centers and integrate affected resources into nearby centers in response to new regulatory challenges[10]. - The company is adapting to new government regulations affecting the after-school tutoring industry, which poses unprecedented challenges to its existing business[10]. - The company is reviewing its business strategy and resource allocation to ensure sustainability in the new regulatory environment[11]. - The company believes that expanding its business will provide opportunities to broaden its service offerings and capture more market demand[11]. - The company aims to diversify its business portfolio to include four new types of tutoring services, targeting high school students, children, and adults[10]. Expenses and Financial Management - Sales and marketing expenses rose by approximately RMB 1.8 million or 44.3% to RMB 5.8 million for the six months ended June 30, 2021, primarily due to increased advertising and marketing expenditures[18]. - Administrative expenses increased by approximately RMB 17.5 million or 95.3% to RMB 35.8 million for the six months ended June 30, 2021, mainly due to higher employee costs and legal and professional fees[20]. - Employee costs increased due to the absence of classroom suspensions in the reporting period, leading to higher tutoring hours and teaching hours compared to the previous year[14]. - The company reported a current tax expense of RMB 3,803,000 for the six months ended June 30, 2021, compared to RMB 799,000 in the same period of 2020, indicating a substantial increase of 376.5%[108]. Assets and Liabilities - Total assets as of June 30, 2021, were RMB 487,961 thousand, slightly down from RMB 444,950 thousand at the end of 2020[84]. - Current liabilities increased to RMB 306,102 thousand from RMB 259,391 thousand at the end of 2020, primarily due to an increase in advance payments[84]. - The company's cash and bank balances as of June 30, 2021, were approximately RMB 262.8 million, a decrease of about 12.3% from RMB 299.7 million as of December 31, 2020[36]. - The company's net current assets as of June 30, 2021, were approximately RMB 181.9 million, down about 2.0% from RMB 185.6 million as of December 31, 2020[36]. - Deferred revenue increased by approximately RMB 40.1 million or about 20.8% to RMB 232.8 million as of June 30, 2021, driven by an increase in enrollment at self-operated teaching centers[34]. Share Capital and Governance - The company has a total of 800,000,000 shares issued, with major shareholders holding significant stakes: 瑞天国际 holds 62.01% (496,060,800 shares) and 百泰 holds 9.05% (72,360,000 shares)[69]. - The company has adopted a share incentive plan on December 14, 2020, granting a total of 30,000,000 reward shares to 56 employees, including four directors, at a zero reward price[72]. - The board structure includes three executive directors, one non-executive director, and four independent non-executive directors, ensuring a high level of independence[54]. - The company has established an audit committee to oversee financial reporting, risk management, and internal controls, composed entirely of independent non-executive directors[56]. - The company did not declare an interim dividend for the six months ended June 30, 2021, consistent with the previous year[58]. Future Plans and Investments - The company plans to allocate approximately 60.0% of the net proceeds from its IPO, amounting to about HKD 122.4 million, to expand its business and self-operated teaching center network[44]. - Approximately 30.0% of the net proceeds, amounting to about HKD 61.2 million, will be used to expand geographical presence and operational scale through strategic acquisitions of quality after-school education service companies in China[44]. - The company is exploring opportunities to expand its business to include preparatory courses for high school entrance exams and vocational education[157]. - The company is seeking opportunities through its wholly-owned subsidiary in Hong Kong to establish a private learning center, with an expected approval process of approximately six to seven months[78]. Financial Instruments and Valuation - The company has designated the convertible bonds as financial liabilities measured at fair value through profit or loss[138]. - The fair value of the convertible bonds was RMB 49,810,000 as of December 31, 2019, based on an independent valuation[139]. - The fair value of the convertible bonds decreased to RMB 35,639,000 by June 30, 2020, reflecting a loss of RMB 14,171,000[139]. - The company’s management believes that the carrying amounts of financial assets and liabilities approximate their fair values[149].

Financial Performance - The company reported revenue of RMB 333.0 million for the fiscal year 2020, a decrease of 13.2% compared to RMB 383.6 million in 2019[8]. - The profit before tax was RMB 4.7 million, down 91.8% from RMB 57.2 million in the previous year[8]. - The total comprehensive income for the year was RMB 2.1 million, a decline of 95.8% from RMB 49.0 million in 2019[8]. - The adjusted comprehensive income for the year, excluding listing expenses, was RMB 12.3 million, down 79.4% from RMB 59.5 million in 2019[8]. - Basic earnings per share decreased to RMB 0.30 from RMB 8.61, a drop of 96.5%[8]. - The diluted loss per share was RMB 1.75, compared to a profit of RMB 8.52 in the previous year, marking a 120.5% decline[8]. - Total revenue for the fiscal year 2020 was approximately RMB 333.0 million, a decrease of about RMB 50.6 million or 13.2% compared to RMB 383.6 million in fiscal year 2019[29]. - Tuition revenue from regular classes, premium classes, and VIP classes was RMB 304.6 million, accounting for 91.5% of total revenue, down from RMB 363.6 million or 94.8% in the previous year[32]. - Gross profit decreased to approximately RMB 109.0 million, a reduction of about RMB 60.6 million or 35.7% from RMB 169.7 million in fiscal year 2019, with a gross margin decline from 44.2% to 32.7%[36]. - The company recorded a net profit of approximately RMB 2.1 million, a decrease of about 95.8% or approximately RMB 46.9 million compared to RMB 49.0 million in fiscal year 2019[45]. Student Enrollment and Business Expansion - The number of enrolled students in the second half of fiscal year 2020 reached 116,989, representing a growth of approximately 1.2% compared to the same period in 2019[11]. - The total number of students enrolled in regular, boutique, and VIP classes reached 232,775, with a total tutoring duration of 5,769,582 hours in fiscal year 2020[20]. - The company established four new teaching centers in Zhengzhou during the fiscal year 2021, aiming to enhance its presence in urban clusters[14]. - The company signed lease agreements for 20 new self-operated teaching centers to expand its market presence in surrounding areas of Zhengzhou[11]. - The company anticipates continued expansion in urban clusters, with the penetration rate of after-school education services in Zhengzhou and Henan province still significantly lower than that of first-tier cities, which is between 50% to 60%[14]. Operational Adjustments and Recovery - The company experienced a V-shaped recovery in business performance in the second half of fiscal year 2020 after a significant impact from the COVID-19 pandemic[10]. - The group transitioned several in-person courses to online formats during the COVID-19 pandemic, minimizing operational impacts[22]. - The company is committed to enhancing its operational capabilities and adapting to the evolving educational landscape post-COVID-19, laying a solid foundation for sustainable growth in fiscal year 2021[18]. Investments and Future Plans - In the fiscal year 2020, the company invested approximately RMB 28.2 million in content and information technology research and training, accounting for about 8.5% of its revenue[13]. - The company plans to strengthen cooperation with other service providers (B-end) and develop integrated services to extend growth value in fiscal year 2021[15]. - The company aims to transition from data application to intelligent application on its OMO education platform, enhancing personalized learning experiences[16]. - The company plans to discuss future business development and performance analysis using key financial performance indicators in the annual report[81]. Shareholder and Governance Matters - The group adopted a share incentive plan on December 14, 2020, granting reward shares to 24 regional managers, aligning their interests with the company's[21]. - The company completed its IPO on July 15, 2020, issuing 200,000,000 shares at a price of HKD 1.25 per share, including 20,000,000 shares for public offering and 180,000,000 shares for placement[77]. - The company has established a remuneration committee to review its remuneration policy based on operational performance and market practices[115]. - The board of directors consists of 8 members, including 3 executive directors, 1 non-executive director, and 4 independent non-executive directors, ensuring a high level of independence[193]. - The company has arranged appropriate liability insurance for directors to cover legal liabilities arising from corporate activities, with annual reviews of coverage[192]. Compliance and Regulatory Matters - The company has not encountered any serious violations of applicable laws and regulations that would significantly impact its operations[85]. - The structural contracts carry risks, including potential invalidation if deemed non-compliant with Chinese laws, which could lead to significant consequences for the company[164]. - The company is subject to uncertainties regarding the interpretation and implementation of the Foreign Investment Law, which may impact its corporate structure and operational feasibility[165]. - The company commits to annual reviews of the overall performance and compliance of structural contracts to ensure effective business operations[165]. Employee and Management Information - As of December 31, 2020, the company had 1,433 employees, an increase from 1,393 in 2019, with total employee-related costs approximately RMB 122.1 million, down from RMB 128.8 million in 2019[118]. - The company provides comprehensive compensation packages, including salaries and performance bonuses, and participates in various employee social security plans[118]. - All independent non-executive directors confirmed their independence in accordance with the listing rules, ensuring compliance with governance standards[194].

Financial Performance - Revenue for the six months ended June 30, 2020, was RMB 110,284,000, a decrease of 36.7% compared to RMB 174,088,000 in 2019[9]. - The company reported a loss before tax of RMB (9,094,000) for the period, compared to a profit of RMB 24,759,000 in the same period last year, representing a decline of 136.7%[9]. - The net loss for the period was RMB (9,834,000), a significant decrease from a profit of RMB 20,076,000 in 2019, marking a 149.0% decline[9]. - The basic loss per share was RMB (1.73), compared to earnings of RMB 3.53 per share in the previous year, reflecting a 149.0% decrease[9]. - Total revenue for the six months ended June 30, 2020, was approximately RMB 110.3 million, a decrease of about RMB 63.8 million or 36.6% compared to RMB 174.1 million for the same period in 2019, primarily due to the impact of the COVID-19 pandemic[20]. - Gross profit for the six months ended June 30, 2020, was approximately RMB 19.2 million, a decrease of about RMB 57.9 million or 75.1% from RMB 77.1 million in the prior year, with a gross margin dropping to 17.4% from 44.3%[24]. - The company recorded a loss of approximately RMB 9.8 million for the six months ended June 30, 2020, compared to a profit of RMB 20.1 million for the same period in 2019[33]. - The company reported a net profit of RMB 46,416,000 for the six months ended June 30, 2020, compared to RMB 65,013,000 for the same period in 2019, indicating a decline of about 28.5%[119]. Operational Changes - The company transitioned several in-person courses to online formats via its proprietary platform "Learning 8" during the pandemic, minimizing operational impacts[11]. - As of mid-May 2020, the company resumed in-person classes, and student attendance rates at self-operated teaching centers gradually recovered[11]. - The proprietary online learning platform "Learning 8" was utilized to transition several in-person courses to online formats during the pandemic, minimizing operational impacts[17]. - The company implemented online courses in February 2020 in response to the COVID-19 pandemic, transitioning from in-person classes to online education[93]. - The company received rent concessions from several landlords during the reporting period, impacting its financial performance[93]. Market Position and Strategy - The company views increased regulatory scrutiny in the education sector as an opportunity to enhance its market position by raising entry barriers for competitors[12]. - The company aims to leverage its brand recognition and reputation following its successful listing to further expand its market presence[10]. - Future strategies include increasing market penetration, expanding geographical coverage, and selectively seeking strategic mergers or partnerships within the industry[19]. - The company aims to leverage technology innovation combined with offline tutoring to improve student engagement and efficiency[18]. - The company is positioned to benefit from the anticipated growth in demand for after-school education services due to the two-child policy in China[13]. Financial Position and Assets - Total assets as of June 30, 2020, were RMB 303,388,000, a slight decrease from RMB 305,958,000 as of December 31, 2019[86]. - Current liabilities increased to RMB 266,270,000 from RMB 231,651,000, indicating a rise in financial obligations[86]. - The company's cash and cash equivalents decreased to RMB 148,247,000 from RMB 176,939,000, reflecting a decline in liquidity[86]. - Non-current liabilities, specifically lease liabilities, increased to RMB 189,662,000 from RMB 168,227,000, indicating higher long-term financial commitments[88]. - The total equity decreased to RMB 78,087,000 from RMB 87,921,000, showing a decline in shareholder value[87]. Shareholder and Governance Information - The company successfully listed on the Hong Kong Stock Exchange on July 15, 2020, marking a significant milestone for its development[10]. - Major shareholders include 瑞天国际 with 496,060,800 shares, representing 62.00% of the issued share capital, and 百泰 with 72,360,000 shares, representing 9.05%[72]. - The audit committee, consisting of four independent non-executive directors, reviewed the unaudited consolidated financial information for the six months ended June 30, 2020[62]. - The company has adopted corporate governance codes post-listing and is committed to maintaining high standards of governance[59]. - The company did not recommend an interim dividend for the six months ended June 30, 2020, consistent with the previous year where no dividend was declared[64]. Employee and Operational Costs - As of June 30, 2020, the total employee-related costs amounted to approximately RMB 46.4 million, with 1,198 employees[52]. - The company’s employee costs for the six months ended June 30, 2020, were RMB 42,570,000, compared to RMB 56,154,000 in 2019, reflecting a reduction of about 24.3%[118]. - The company incurred significant marketing and administrative expenses, totaling RMB 42,355,000 for the six months ended June 30, 2020[85]. Debt and Liabilities - The debt-to-equity ratio was approximately 3.3 as of June 30, 2020, reflecting the total debt relative to equity[45]. - The current ratio was approximately 1.0, indicating the company's ability to cover its short-term liabilities with its short-term assets[45]. - Lease liabilities totaled approximately RMB 223.7 million, an increase of RMB 28.8 million or approximately 14.8% from RMB 194.9 million, due to new lease agreements for 11 self-operated teaching centers[39]. - Deferred revenue increased to approximately RMB 192.2 million, up by RMB 21.3 million or approximately 12.5% from RMB 170.9 million, mainly due to an increase in student enrollment at self-operated teaching centers[41]. Investments and Financial Products - The company entered into multiple financial product contracts with financial institutions in China, with guaranteed principal amounting to RMB 75,000,000 as of June 30, 2020[128]. - The company’s financial assets in wealth management products increased from RMB 55,000,000 on December 31, 2019, to RMB 80,000,000 by June 30, 2020[148]. Compliance and Regulatory Matters - The company has established a structured contract to comply with Chinese laws regarding foreign ownership in the education sector, controlling its consolidated affiliated entities through these contracts[75]. - There have been no changes to the structured contracts since their signing, ensuring continued compliance with relevant regulations[79]. - The foreign investment law effective from January 1, 2020, does not explicitly classify contractual arrangements as foreign investment, leaving future implications uncertain[78]. - The company has taken measures to ensure compliance with structured contracts and has not identified any violations as of the report date[80].