NEW ORIENTAL(EDU)2022-04-26 14:46Financial Data and Key Metrics Changes - Operating costs and expenses for the quarter were 725.3 million, a 32.5% decrease year-over-year [34] - Net loss attributable to New Oriental for the quarter was 151.3 million in the same period last year [38] - Cash and cash equivalents totaled approximately 971.3 million, a decrease of 47.9% compared to the same period last year [41] - The company reduced the total number of schools and learning centers to 847 by the end of the fiscal quarter [22] Company Strategy and Development Direction - The company is focusing on new business opportunities, including non-academic tutoring and intelligent learning systems [11] - Management emphasized the importance of the OMO (Online-Merge-Offline) system during the restructuring process [23] - Future growth is expected from new initiatives, which are anticipated to become key revenue contributors [80] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainable profitability of remaining key businesses and the growth potential of new initiatives [33] - The company is prepared for a new beginning as it identifies new and profitable market opportunities [43] - Management acknowledged the impact of the pandemic but noted that the OMO system has minimized learning disruptions [48] Other Important Information - The company invested 129 million in the first three quarters of the fiscal year to improve the OMO teaching platform [26] - The restructuring phase is nearing completion, with expectations of further closures of learning centers [56] Q&A Session Summary Question: What is the sustainability of the learning centers after restructuring? - Management plans to reduce the number of learning centers to between 650 and 700 by the end of the fiscal year [56] Question: How much of the costs this quarter are related to one-off restructuring? - Most one-off costs related to learning center closures were accrued in the first half of the fiscal year [57] Question: What is the revenue contribution from new initiatives? - New business initiatives are expected to contribute over 20% of revenue next year [64] Question: What is the retention rate for new non-academic courses? - Retention rates for non-academic courses are improving and are close to those of academic courses from the previous year [67] Question: How does the company view competition in the new business area? - Management believes competition will lessen as many competitors have exited the market [68] Question: What are the profitability expectations for remaining and new businesses? - Remaining businesses have margins of 10% to 20%, while new businesses are expected to achieve similar margins in the upcoming year [76]