EQS-News: China New Higher Education Group Announces 2020 Interim Results The Strategy of 'Quality, Grow and Light' Drives the Development of the Group Strong Results Growth with the Number of Enrolled Students up 27% and Adjusted Net Profit Rising by 46% to RMB330 MillionSource: EQS
(Stock code: 2001. HK)
China New Higher Education Group Announces 2020 Interim Results
The Strategy of "Quality, Grow and Light" Drives the Development of the Group
Strong Results Growth with the Number of Enrolled Students up 27% and Adjusted Net Profit Rising by 46% to
The Group's Position
* The adjusted figures refer to the sum of the deferred tuition income recognised in July and
Founder of the Company and Chairman of the Board Mr.
Meanwhile, we also focus on the employment of new graduates. Through cloud communication, cloud training, cloud guidance, cloud recruitment, cloud graduation, cloud publicity, and cloud safety on 'Qiduo.net' employment platform, and focusing on cooperation with famous enterprises, star employment, and excellence training, all the schools have held over 220 online job fairs involving more than 5,670 enterprises; we also set up internship bases in economically developed areas, explored quality resources for internship and employment, and conducted in-depth cooperation with
Seizing the opportunities arising from favorable policies related to higher education, vocational training, and online education, the Group has acquired Yunnan Vocational School and quickly expanded to the field of government - subsidized training, further realizing the diversification of the sources of revenue. Facts show that 'Organic Growth +
In the event of public health, the Group was actively responded to the emergencies in the following ways:
1) In response to national policies, it returned students the accommodation fees for the period when they are not at school, and arranged supplementary lessons in summer vocation at schools where face-to-face teaching conditions permit;
2) It actively undertook its CSR, reducing or exempting rents for merchants at school;
3) It continued to lower cost, strictly controlling administrative expenditure while guaranteeing the input in teaching to ensure competitive growth and reasonable returns to investors.
In the first half of 2020, the Group included income to be recognized during the period but deferred to July and
In the first half of 2020, the Group's 'High-Quality' strategy continued to advance, and revenue continued to grow strongly; teaching investment continued to increase, cost structure continued to optimize; profitability continued to improve, shareholder returns continued to increase; capital reserves continued to increase, and debt indicators continued to be optimized.
During the first half of 2020, the Group has made several achievements in terms of improving the quality of teaching and employment, expanding income and acquiring external resources, With 'Six Excellences' as the overall strategic goals and adhering to the strategic direction of "Quality, Grow and Light".
Organic Growth: During the first half of 2020, With 'Quality, Grow and Light' as the overall strategic goals, the Group will further improve the quality of teaching, employment, management and services, as well as expand and diversify income . To make asset base lighter, the Group will study demand more scientifically, use resources more efficiently, input more reasonably and generate income more efficiently.
Improving online education quality and increasing international cooperation
After the outbreak of the public health event, the Group made use of the online education platform TronClass and realized online teaching as scheduled, with more than 300 million clicks recorded by the teaching platform in the first half of 2020.
In terms of international cooperation, the Group has signed cooperation agreements with overseas schools and institutions in the US,
Developing channels to maintain a high level of employment
In 1H 2020, the average employment rate of the Group's schools was higher than the average level reported by schools peers in the provinces. Through 'Qiduo.net' employment platform, the Group provided students with massive resources, corporation with famous enterprises, star employment, excellent training and core process some other employment-related services; it reached in-depth cooperation with famous enterprises, with an aggregate of 893 companies for cooperation with the Group and increased the rate of internship at famous enterprises; the star employment rate rose by 20% YoY, and 15 high-paying employment excellence classes for freshmen were to be set up; it also optimized the core process of employment and established an effective linkage mechanism to enhance the quality of employment services.
Meeting trends and improving the level of digitalization
At the teaching level: the Group uses the TronClass, an on-line and off-line education platform, with AliCloud, Zhiyuan（智園）, and CC Video and other enterprises, allowing the simultaneous access by more than 100,000 visitors to satisfy the needs for large-scale online teaching and learning, realizing the principle of 'Delay backing to school, no delay in teaching and learning' during the public health event, which is covered by
At the management level, the Group exploites the ERP management system, NCCloud and business intelligence (BI) systerm, visualizing data such as revenue, cost, capital, KPI, procurement and asset management.
At the service level, the Group's digital service platform has provided teachers and students with around 20 million times of services related to academic record, examinations registration, fees payment, teaching evaluation, apartment maintenance and feebacks and the platform is still updated when applied by other schools of Group. The Group kept abreast of the health status of teachers and students during the pandemic, collecting over 7.5 million pieces of health information on a cumulative basis, supporting the work of teachers and students during the epidemic.
At the safety level, the Group also cooperated with Hikvision to deploy smart security and safe campus platform, Setting up the Campus Security System by technologies like face recognition, behavior recognition and big data. The Group is appreciated by
Take Opportunities to Expand Revenue Sources
The Group actively responds to the call of the government, continues to analyse on provincial policies, makes a good connection with the education department, human resources and social security departments, and other government departments, and provides vocational skill training services to the public, making contributions to ensuring employment. Various schools have set up special institutions, including continuing education colleges and vocational education colleges, to select and deploy professional talent, adjusted the structure of training programs, and vigorously promoted government-subsidized training projects. The Group's six schools were approved to be pilot 1+X certificate institutions by education authority. As of
Acquisition of Yunnan Vocational School: To expand the training income scale, the Yunnan Vocational School acquired by the Group in the first half of this year is a diversified lifelong vocational education and training institution with integrated businesses of accounting training, IT training and adult corporate-sponsored training. With the acquisition PE of merely 6.4x, which is relatively cost-efficient in the industry. Through the channels of the Group's colleges and universities, the Yunnan Vocational School can make use of the existing resources of schools to open up a new business and expand off-school training based on the existing student training. Furthermore, it significantly increases the government-subsidized training business scale, focusing on light assets and increase revenue.
Development of Light Assets
Cooperation and joint development: the Group will cooperate with large state-owned investment or construction companies to integrate superior resources, improve the quality of construction, and cooperate with companies for building school infrastructure like student dormitories and commercial facilities.
Socialization of asset investment: social resources have been introduced to improve campus facilities and equipment, provide students with high-quality services, and increase logistic income.
Sharing of the training center: it improves the quality of practical teaching and integrates high-quality government resources by sharing experimental and practical training bases, which improved the efficiency and quality of resource utilization.
Previously, the Group proactively acquired 5 colleges and universities and completed the integration through abundant experience in collectivized management. In 2020, it further acquired the remaining shares of school in
The Group's organic growth increases rapidly, and its newly acquired schools develop fast, which boosts its financial strength and multiplies its capital reserves. Under the development strategies of "Organic Growth +
With its strong collectivized management capacities, currently, the Group has more than 118,700 students (including the number of expanded enrollment), ranking third among the PRC higher education sector in the
The Group proactively invested in 5 colleges and universities before and after the listing where first-mover advantage is obvious. The average acquisition cost of schools is far lower than the current market price, accumulating extensive experience in mergers and acquisitions, restarting the exploration of external potential mergers and acquisitions projects.
The Group has a strong post-investment management ability. The quality of teaching and employment in the schools invested has improved significantly, and the net profit has increased significantly. The compound annual growth rate of the Group's net profit in the past 3 years had reached 56.5%.
In 2019, the Group's average tuition fee was
Benefiting from the national "vocational skills improvement action" with funding of
Finally, the Group's development strategy with 'Organic Growth+
The Group provides high quality higher education in a wide selection of fields in applied sciences. Its courses are designed to equip students with practical and readily applicable skills, helping to prepare them for the job market. As a leader in high-quality employment, the Group won the title of the Top 50 National Employment of the MOE, with an average employment rate of above 97%. The Group became a constituent stock of the Hang Seng Composite Small Cap Index and the Hang Seng Consumer Goods & Services Index in the Hang Seng Composite Index Series in
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