Bright Scholar(US:BEDU)2021-07-22 15:36Financial Performance and Key Metrics - The company reported a revenue growth of 42.5% year-over-year for Q3 2021, reaching RMB1,053.8 million, and a 7.4% increase for the nine-month period to RMB2,914.4 million [10][19] - Net income grew by 141% year-over-year for Q3, with adjusted net income at RMB170.6 million, up 285.5% from RMB44.3 million [10][25] - Adjusted EBITDA for Q3 was RMB319.3 million, reflecting a 94.1% increase from RMB164.5 million [25] Business Line Performance - Domestic K-12 schools, including international and bilingual schools, saw a revenue increase of 72.5% for Q3 and 28.4% for the nine-month period [20] - Revenue from complementary education services grew by 78.5% year-over-year, driven by the recovery of camps and domestic tour business [21] - Overseas schools revenue decreased by 32.4% for Q3 and 44.3% for the nine-month period due to ongoing pandemic impacts [21] Market Data and Key Metrics - Enrollment in international schools increased by 11.6%, bilingual schools by 8.4%, and kindergartens by 29.4% in Q3 [11][20] - The company reported a gross margin of 39.7% for Q3, a slight increase from the previous year, while the nine-month gross margin decreased to 35.2% [23] Company Strategy and Industry Competition - The company aims to enhance efficiency in domestic K-12 business, rebuild overseas revenue post-COVID, and expand complementary service offerings [17] - Management expressed confidence in capturing market opportunities as the operating environment normalizes, despite ongoing risks related to economic and regulatory issues [17] Management Comments on Operating Environment and Future Outlook - Management highlighted a strong recovery in domestic business and expressed optimism about sustainable growth despite challenges posed by the pandemic [10][29] - The company is focused on maintaining financial flexibility to grow its organic business and pursue acquisition opportunities [26] Other Important Information - The Board of Directors declared a cash dividend of $0.12 per ADS, reflecting the company's strong financial position [26] - The company is on track to achieve its revenue guidance for the fiscal year, expecting total revenue between RMB3.59 billion and RMB3.69 billion [27] Q&A Session Summary Question: Are the short-term investments held onshore or offshore? - Management confirmed that short-term investments are onshore, with the capability to transfer funds offshore for bond repayments [31][32] Question: What is the update on regulations in China's private education sector? - Management indicated that new laws may make it difficult to obtain new school licenses, but existing schools are expected to continue operating without significant impact [33][34]