Financial Performance - Total revenue decreased by 15.3% to RMB 573.5 million for the six months ended November 30, 2021, compared to RMB 676.8 million for the same period in 2020[6]. - The company reported a loss before tax of RMB 542.1 million, a reduction of 18.8% from RMB 667.4 million in the previous year[6]. - Adjusted loss for the period was RMB 409.8 million, a decrease of 38.0% from RMB 661.4 million in the previous year[6]. - The company reported a basic and diluted loss per share of RMB 0.54, down from RMB 0.72 in the previous year, reflecting a 25.0% decrease[6]. - The net loss for the period decreased by 19.3% to RMB 544.0 million for the six months ended November 30, 2021, from RMB 674.4 million for the same period in 2020[37]. - For the six months ended November 30, 2021, the company reported a net loss of RMB 543.997 million, an improvement from a net loss of RMB 674.426 million for the same period in 2020, representing a reduction of approximately 19.3%[40]. - Gross profit increased by 13.0% to RMB 173.0 million for the six months ended November 30, 2021, compared to RMB 153.1 million for the same period in 2020, with a gross margin increase from 22.6% to 30.2%[26]. - Total revenue cost decreased by 23.5% to RMB 400.5 million for the six months ended November 30, 2021, from RMB 523.6 million for the same period in 2020[26]. Student Enrollment and Revenue Segments - The number of paid students remained stable at 2.1 million, with K-12 education contributing 1,867 thousand students[8]. - The university education segment's total revenue decreased by 8.5% from RMB 292.4 million for the six months ended November 30, 2020, to RMB 267.6 million for the six months ended November 30, 2021[22]. - The number of paid students in the university education segment decreased from 299,000 to 275,000 during the same period[22]. - K-12 education segment's net revenue decreased by 19.7%, while the number of paid students increased by 1.6%[13]. - K-12 education segment total revenue decreased by 19.7% to RMB 270.5 million for the six months ended November 30, 2021, compared to RMB 336.9 million for the same period in 2020[23]. - The number of paid students in the K-12 education segment increased by 1.6% to 1.9 million for the six months ended November 30, 2021, from 1.8 million for the same period in 2020[23]. - The total revenue for the preschool education segment decreased by 62.2% to RMB 1.7 million for the six months ended November 30, 2021, from RMB 4.4 million for the same period in 2020[24]. - Total revenue from institutional clients decreased by 21.6% to RMB 33.7 million for the six months ended November 30, 2021, compared to RMB 43.0 million for the same period in 2020[25]. Strategic Adjustments and Focus Areas - The company is shifting its focus towards innovative, quality-based online education products and services in response to regulatory changes in the education sector[11]. - The company has terminated its K-9 business line as part of its strategic adjustments[8]. - The company is investing in new learning products and services, as well as integrating online and offline sales channels in the higher education segment[11]. - The company aims to improve rural education through partnerships, such as the collaboration with Tianjin University for teaching support initiatives[11]. - The company plans to expand its product offerings for adult student training and introduce new courses targeting students preparing for postgraduate entrance exams[18]. - The company is actively exploring new market opportunities, including live commerce for agricultural products and the development of innovative educational hardware[16]. - The company aims to strengthen collaborations with higher education institutions and actively explore vocational education development[18]. - The company has stopped investing in certain preschool education programs in compliance with new regulations[14]. Cost Management and Operational Efficiency - Total administrative expenses increased by 77.3% to RMB 227.1 million for the six months ended November 30, 2021, from RMB 128.1 million for the same period in 2020[34]. - Sales and marketing expenses decreased to RMB 340.8 million from RMB 515.3 million, a reduction of about 34%[79]. - Research and development expenses were RMB 156.8 million, down from RMB 234.1 million, representing a decrease of approximately 33%[79]. - The total salary expenses, including share-based payment expenses, for the six months ended November 30, 2021, were RMB 732.5 million, a decrease of 25% compared to the previous year[196]. - The company’s financial report indicates a strategic focus on cost management and operational efficiency amid regulatory changes in the education sector[150]. Cash Position and Financial Health - As of November 30, 2021, the company's cash and cash equivalents amounted to RMB 626.6 million, down from RMB 1.5 billion as of May 31, 2021, and RMB 1.9 billion as of November 30, 2020[42]. - Capital expenditures for the six months ended November 30, 2021, were RMB 18.742 million, significantly lower than RMB 59.714 million for the same period in 2020, reflecting a decrease of approximately 68.7%[43]. - The company had no bank loans or other borrowings during the reporting period, indicating a strong cash position to support operations and expansion[47]. - As of November 30, 2021, the company had no off-balance sheet transactions or significant contingent liabilities[44][48]. Employee and Corporate Governance - The company employed 1,224 full-time employees and 679 part-time employees as of November 30, 2021, a significant reduction from 7,588 full-time and 5,756 part-time employees in the previous year[45]. - The company is committed to maintaining strict corporate governance and has adhered to the applicable code provisions of the Corporate Governance Code during the reporting period[64]. - The Audit Committee has reviewed the unaudited condensed consolidated financial statements for the six months ended November 30, 2021[67]. - The company has established a Nomination Committee and a Remuneration Committee in addition to the Audit Committee[68].
东方甄选(01797) - 2022 - 中期财报