WEB NEWS Comments & Business Outlook
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(All amounts in thousands, except for share and per share data)
Years ended December 31,
Note
2012
2013
2014
2014
RMB
RMB
RMB
US$
NET REVENUES
- Educational program and services
675,174
536,511
411,998
66,402
- Software products
66,886
-
-
-
Total net revenues
20
742,060
536,511
411,998
66,402
COST OF REVENUES
- Educational program and services
(465,022
)
(361,573
)
(274,036
)
(44,167
)
- Software products
(12,177
)
-
-
-
Total cost of revenues
20
(477,199
)
(361,573
)
(274,036
)
(44,167
)
GROSS PROFIT
264,861
174,938
137,962
22,235
OPERATING EXPENSES
Selling and marketing
(321,418
)
(151,480
)
(80,377
)
(12,954
)
General and administrative
(632,603
)
(471,915
)
(508,544
)
(81,963
)
Research and development
(31,842
)
(19,545
)
(12,259
)
(1,976
)
Impairment loss
7,9,10,11,26
(761,996
)
(84,246
)
(292,577
)
(47,155
)
Total operating expenses
(1,747,859
)
(727,186
)
(893,757
)
(144,048
)
OPERATING LOSS
(1,482,998
)
(552,248
)
(755,795
)
(121,813
)
OTHER INCOME (EXPENSE)
Interest expenses, net
13,14
(10,293
)
(13,673
)
(121,794
)
(19,630
)
Loss from extinguishment of debt
14
-
-
(143,901
)
(23,193
)
Foreign exchange loss, net
(1,229
)
(109
)
(580
)
(93
)
Other income (loss), net
4,783
(8,150
)
(8,989
)
(1,449
)
Gain on disposal of subsidiary
25
-
-
7,403
1,193
Total other expenses
(6,739
)
(21,932
)
(267,861
)
(43,172
)
LOSS BEFORE INCOME TAX, NON-CONTROLLING INTERESTS, AND DISCONTINUED OPERATIONS
(1,489,737
)
(574,180
)
(1,023,656
)
(164,985
)
Income tax (expense) benefit
17
(10,893
)
10,424
(1,135
)
(183
)
LOSS FROM CONTINUING OPERATIONS
(1,500,630
)
(563,756
)
(1,024,791
)
(165,168
)
Loss from and on sale of discontinued operations, net of income tax
24
(172,885
)
(346,449
)
(57,764
)
(9,310
)
NET LOSS
(1,673,515
)
(910,205
)
(1,082,555
)
(174,478
)
Less: Net loss attributable to non-controlling interests from continuing operations
(57,448
)
(4,606
)
(6,244
)
(1,006
)
Less: Net income attributable to non-controlling interests from discontinued operations
5,099
1,219
502
81
NET LOSS ATTRIBUTABLE TO AMBOW EDUCATION HOLDING LTD.
(1,621,166
)
(906,818
)
(1,076,813
)
(173,553
)
NET LOSS
(1,673,515
)
(910,205
)
(1,082,555
)
(174,478
)
Foreign translation adjustments
4,401
1,239
12,137
1,956
TOTAL COMPREHENSIVE LOSS
(1,669,114
)
(908,966
)
(1,070,418
)
(172,522
)
Net loss from continuing operations per share - basic and diluted
18
(9.91
)
(3.41
)
(2.44
)
(0.39
)
Net loss from discontinued operations per share - basic and diluted
18
(1.22
)
(2.12
)
(0.14
)
(0.02
)
Weighted average shares used in calculating basic and diluted net loss per share
18
145,659,940
163,942,809
417,841,426
417,841,426
Share-based compensation expense included in:
- Selling and marketing
6,286
2,658
351
56
- General and administrative
88,019
73,108
156,870
25,283
- Research and development
872
829
144
23
Management Discussion and Analysis
Year ended December 31, 2014 compared with year ended December 31, 2013
Net income / (Loss). According to above mentioned factors, our net loss increased from RMB 910.2 million in 2013 to RMB 1,082.6 million (US$174.5 million) in 2014.
Comments & Business Outlook
AMBOW EDUCATION HOLDING LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(All amounts in thousands, except for share and per share data)
Years ended December 31,
Note
2011
2012
2013
2013
RMB
RMB
RMB
US$
NET REVENUES
- Educational program and services
1,130,269
1,210,591
1,140,487
188,395
- Software products
366,600
66,886
—
—
Total net revenues
1,496,869
1,277,477
1,140,487
188,395
COST OF REVENUES
- Educational program and services
(571,953
)
(793,129
)
(742,637
)
(122,675
)
- Software products
(49,223
)
(12,177
)
—
—
Total cost of revenues
(621,176
)
(805,306
)
(742,637
)
(122,675
)
GROSS PROFIT
875,693
472,171
397,850
65,720
Operating expenses:
Selling and marketing
(351,592
)
(594,456
)
(374,301
)
(61,830
)
General and administrative
(266,101
)
(698,977
)
(555,494
)
(91,761
)
Research and development
(39,541
)
(31,842
)
(19,545
)
(3,229
)
Impairment loss
7,9,10,11,26
—
(806,646
)
(84,246
)
(13,916
)
Total operating expenses
(657,234
)
(2,131,921
)
(1,033,586
)
(170,736
)
OPERATING INCOME (LOSS)
218,459
(1,659,750
)
(635,736
)
(105,016
)
OTHER INCOME (EXPENSE)
Interest expenses, net
(15,854
)
(9,857
)
(14,126
)
(2,333
)
Foreign exchange losses, net
(5,343
)
(1,229
)
(109
)
(18
)
Other income (loss), net
1,078
1,581
(13,500
)
(2,230
)
INCOME (LOSS) BEFORE INCOME TAX, NON-CONTROLLING INTEREST, AND DISCONTINUED OPERATIONS
198,340
(1,669,255
)
(663,471
)
(109,597
)
Income tax benefit (expense)
18
(37,239
)
52,628
29,471
4,868
INCOME (LOSS) FROM CONTINUING OPERATIONS
161,101
(1,616,627
)
(634,000
)
(104,729
)
Loss from and on sale of discontinued operations, net of income tax
25
(144,882
)
(56,888
)
(276,205
)
(45,626
)
NET INCOME (LOSS)
16,219
(1,673,515
)
(910,205
)
(150,355
)
Add: Net loss attributable to non-controlling interest from continuing operations
4,377
(319
)
3,387
559
Add: Net loss attributable to non-controlling interest from discontinued operations
589
52,668
—
—
NET INCOME (LOSS) ATTRIBUTABLE TO AMBOW EDUCATION HOLDING LTD.
21,185
(1,621,166
)
(906,818
)
(149,796
)
Net income (loss) from continuing operations per share-basic
19
1.16
(11.10
)
(3.85
)
(0.64
)
Net income (loss) from continuing operations per share-diluted
19
1.10
(11.10
)
(3.85
)
(0.64
)
Net income (loss) from discontinued operations per share-basic
19
(1.01
)
(0.03
)
(1.68
)
(0.28
)
Net income (loss) from discontinued operations per share-diluted
19
(1.01
)
(0.03
)
(1.68
)
(0.28
)
Weighted average shares used in calculating basic net income (loss) per share
19
142,939,038
145,659,940
163,942,809
163,942,809
Weighted average shares used in calculating diluted net income (loss) per share
19
150,432,812
145,659,940
163,942,809
163,942,809
Share-based compensation expense included in:
- Selling and marketing
7,286
6,286
2,658
439
- General and administrative
25,220
88,019
73,108
12,077
- Research and development
842
872
829
137
Management Discussion and Analysis
Year ended December 31, 2013 compared with year ended December 31, 2012
Net revenues. Our net revenues decreased by 10.7% from RMB1,277.5 million in 2012 to RMB1,140.5 (US$188.4 million) in 2013. This decrease was primarily due to the suspension of software sales to focus company’s resources on educational programs and services as part of the strategic business development.
Net income / (Loss). According to above mentioned factors, our net loss decreased from RMB1,673.5 million in 2012 to RMB910.2 (US$150.4 million) in 2013.
Company Rebuttal
BEIJING, June 24, 2013 /PRNewswire / -- Ambow Education Holding Ltd. (NYSE: AMBO) has issued the following open letter to its shareholders from Dr. Jin Huang, Chairwoman and CEO of the Company:
My Fellow Shareholders:
As you have seen, the Grand Court of the Cayman Islands issued an order on June 7, 2013 appointing members of KPMG as provisional liquidators of the Company, which immediately turned control of the Company over to the provisional liquidators and marked an important turning point in the history of the Company. I am writing this open letter to shareholders in order for you to make informed decisions about your investment in Ambow and to open a dialogue that will be needed to ensure a promising future for the Company and the value of your shares.
The Facts about Ambow
Many rumors have circulated regarding the Company and the status of various important inquiries that it is the subject of. As investors, you are entitled to transparency and good governance and we are committed to providing you accurate, current information in this regard:
Cash position . As a result of our recent financing transaction with SummitView Investment Limited, a strategic and well-connected investment fund, some parties have questioned our liquidity and working capital position. Prior to the issuance of the order of the Grand Court, the Company had ready access to cash and cash equivalents on deposit in major banks in the People's Republic of China and available lines of credit more than sufficient for its current and future needs. In addition, as announced on June 7, 2013, we recently secured the strategic cooperation of the prestigious Bank of Beijing regarding the establishment of further credit lines and comprehensive financial services.
Rationale for Financing . The SummitView transaction was also the subject of speculation regarding the terms and purpose of the financing. We engaged in the deal with SummitView due to the resignation of certain directors of the Company resulting in a non-financial covenant having been triggered and the lender's resulting ability to require early repayment. By accepting SummitView's equity investment to replace debt, we not only added another sophisticated financial institution to the list of those who have examined and validated our business model and governance structure, but improved our debt to equity ratio.
Fraud . Many bloggers and market players have questioned whether Ambow is one of the PRC-based businesses which make false disclosures and inaccurate public filings. In this regard, I can inform you that my belief is the internal investigation by the international law firm DLA Piper into certain issues affecting the strength of our internal financial controls is close to completion and its findings are capable of release should the provisional liquidators allow DLA Piper to complete this process, although we will need the final report to be made to the Audit Committee in this regard. I am confident that a professionally prepared report would contradict any unfounded rumors regarding the Company.
Moreover, we were the subject of many years of audits conducted by a Big Four accounting firm, extensive due diligence conducted over the course of years by highly sophisticated investors, investment banks and law firms without any of these parties raising any concerns regarding our transparency or the accuracy of our public disclosures.
Status of the Audit . We are currently completing the final stages of the audit required to file our Annual Report on Form 20-F with the SEC, subject only to the completion of the internal investigation.
What is at Stake
For you, as public shareholders, there is a significant risk to your investment posed by the Grand Court's order. The investors who filed the petition seeking the winding up of the Company are led by Avenue Capital. Avenue Capital is a private equity fund that is not constrained to holding only public company shares - in other words, they target returns generated by holding private company shares and then driving a significant liquidity event - and this type of fund typically can hold private company shares for as long as ten years before seeking an exit. For this basic reason, their interests and your interests as public shareholders are not aligned, and their goal will be to buy out the public shares in Ambow at a steep discount to their true value, only to benefit upon the relisting or sale of the Company in a better market. Public shareholders, however, would not participate in such a liquidity event and would be forced to sell their shares at the price these private equity funds acquired the company. In our case, these sophisticated investors have sought to file for liquidation, which could be to wind up the Company (leaving little upside for them) or more likely to benefit from a steep decline in value that would occur if a liquidation is imminent and accrue to their benefit when the public shareholders sell their shares at those prices and then profit upon the sale or relisting in a better market. The facts that this private equity fund still owns shares, has never sold them to date and recently initiated the Cayman Islands petition process with only two private equity firms in support, would strongly suggest that this may be their strategy. This is further evidence that our Company has significant value (or at least they believe so) or they would not be still allocating the significant resources required in their attempt to wrest control of the company. As a fiduciary to the public shareholders, I cannot allow one minority group of financial investors to realize a significant profit at the expense of all the public shareholders.
Moreover, even for those private shareholders who may have the opportunity to participate in taking the Company private, much risk is presented by the actions of these private equity funds. The order issued by the Grand Court onJune 7 has raised significant concerns among the education authorities in the PRC, the school administrators and innocent students regarding the stability of the Company and its operations. As a result of my experience in viewing the actions of these constituencies in other situations, I am very worried that these events could have a significant impact on the operations of the Company and it is unclear to me what steps the relevant government authorities might take in this regard.
What I did Wrong and How We Can Still Participate in a Turnaround
Since taking Ambow public, I have learned much. Having spent most of my career focused on execution in a private company context, I was under-prepared for the demands of managing our relations with investors, building investor confidence in the organization's governance culture and preserving regular dialogue with Wall Street analysts and shareholders. I also did not act quickly enough once market confidence in the Company and my team began to decline, which was compounded by resignations and market-moving events affecting many companies in our industry segment.
On the other hand, I am still one of the largest shareholders of the Company and to date have not sold a single share of my holdings. While many other CEO's have adopted "10b5-1 plans" and other means of monetizing their company positions, I have preserved my commitment to Ambow and my long-term interests remain aligned with yours.
We have no desire to engage in a war with opportunistic private equity funds with vast resources and an investment focus that may not be aligned with all of our shareholders', and we certainly have no desire to destroy the Company we worked so hard to build. In fact, I sought to reconcile all outstanding issues with Avenue before the order was issued by the Grand Court and have consistently recommended that the governance dispute be the subject of an open vote of the Company's shareholders.
In sum, I am open to finding a solution that accommodates the legitimate concerns of shareholders so long as our business operations are not adversely affected. While my continued leadership as CEO has been challenged several times, I have retained this job only for two important reasons - I am responsible for the continued welfare of the thousands of full and part-time employees of Ambow and hundreds of thousands of students receiving our services. Secondly, many of the licenses in the PRC and critical relationships with government officials, lenders and business partners are based on my involvement with the Company, which cannot be jeopardized to suit the whims of one investor group's investment thesis. As one of the largest shareholders of Ambow, I need to take those actions which are prudent to continue the growth of the Company and I care about the value of my shares just as you do. If I saw there was another feasible option which I believed could increase the value of my shares, I would consider it.
The path I see as most beneficial to the mutual interests of all shareholders involves:
Achieving a consensus among the factions within the Company that the most important focus of our efforts is to mitigate the anxiety of the education authorities and students regarding the future of the Company
Co-operate with the provisional liquidators in compliance with the Grand Court'scourt order, hoping that they will acknowledge, understand and work with comments of management that founded the company and operated it for the past thirteen years
Stabilizing the team within the Company and ensuring continued smooth operations of the education business
Completion of the Internal Investigation and FY 2012 audit
Filing of 20-F with the SEC
Resumption of NYSE trading of our ADSs
Opening the board to new independent candidates to add new voices and perspectives, unconnected to the deadlock of earlier this year and its adverse consequences (auditor resignation and trading halt)
Continued growth in the education business and opportunistic partnering with high-quality profitable operations in the PRC
We believe that these issues should be resolved by you, and we hope that the issues facing the Company can be the subject of an emergency general meeting of shareholders so that the decision makers can hear the voices of all shareholders. We believe that liquidating the Company, or turning it over to the private equity funds seeking to profit to your detriment, is clearly not in the best interests of all shareholders and public shareholders in particular. As the founder of Ambow, I will continue to fight for the best interests of the shareholders, and we ask for your support.
Respectfully,
Dr. Jin Huang
For investor and media inquiries please contact:
Ms. Annie Wangir@ambow.com
Comments & Business Outlook
BEIJING, June 7, 2013
/PRNewswire / -- Ambow Education Holding Ltd. ("Ambow" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China, today announced that, on June 7, 2013, Beijing Ambow Online Software Co., Ltd.,
("Ambow Online"), the Company's wholly owned subsidiary in China,
entered into a strategic cooperation agreement (the "Strategic Cooperation Agreement")
with Bank of Beijing, Weigongcun Branch, ("BOB"). Pursuant to the Strategic Cooperation Agreement, subject to entering into specific agreements, BOB plans to provide Ambow Online and its affiliates with comprehensive finance services, including providing credit line, financing service, financial consulting service, settlement service, cash management service and wealth management service. The initial term of the Strategic Cooperation Agreement is one year and shall be automatically renewed for successive one-year terms unless terminated by either party by providing 30 days' written notice prior to expiry.
Notable Share Transactions
BEIJING, June 3, 2013 /PRNewswire / -- Ambow Education Holding Ltd. ("Ambow" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China, today announced that it consummated the transactions provided for in a share purchase agreement dated April 28, 2013 between the Company and SummitView Investment Limited, an amendment to share purchase agreement dated May 24, 2013between the Company, SummitView Investment Limited and SummitView Investment Fund I, L.P. (the "Fund") and a supplementary agreement dated May 31, 2013 between the Company and the Fund, regarding the issuance and sale of 30,801,128 Class A Ordinary Shares of the Company to the Fund for a total purchase price of US$21,000,000.
Investor Alert
BEIJING, May 20, 2013 /PRNewswire / -- Ambow Education Holding Ltd. ("Ambow" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China, today announced that it has received a notification from the New York Stock Exchange (the "NYSE") that it has failed to timely file its Form 20-F for the fiscal year ended December 31, 2012 (the "2012 Annual Report"). On April 30, 2013, the Company filed with the United States Securities and Exchange Commission, Form 12b-25 Notification of Late Filing for the 2012 Annual Report because it required additional time to complete its 2012 Annual Report due to the change of its independent auditor and will delay the filing beyond the deadline of April 30, 2013. The Company is working diligently to file the 2012 Annual Report as soon as practicable.
The NYSE has indicated that it will closely monitor the status of the Company's late filing and related public disclosures for up to a six-month period from its due date subject to the NYSE's ongoing oversight and monitoring. If the Company fails to file its annual report within six months from the filing due date, the NYSE may allow the Company's securities to trade for up to an additional six months.
Company Rebuttal
BEIJING, May 6, 2013 /PRNewswire / -- Ambow Education Holding Ltd. ("Ambow" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China, today announced that GL Asia Mauritius II Cayman Limited ("GLA"), an affiliate of Avenue Asia Capital and a shareholder of the Company, filed a petition on April 23, 2012 in the Grand Court of the Cayman Islands, the Company's jurisdiction of organization, to request an order to wind up the Company and other remedies.
The Company firmly believes that there is no basis for any of GLA's claims, and that the filing of the petition and the relief it seeks are wholly inappropriate. The Company has engaged Cayman Islands legal counsel and intends to vigorously contest GLA's petition
Company Rebuttal
BEIJING, September 6, 2012 /PRNewswire / -- Ambow Education Holding Ltd. ("Ambow" or the "Company") (NYSE: AMBO), a leading national provider of educational and career enhancement services in China, is aware of recent media reports about Beijing Jinghan Yingcai Education and Technology Co., Ltd. ("Jinghan"), one of the Company's subdivisions that currently operates approximately 100 tutoring centers nationwide that provide one-on-one tutoring services to students who are seeking admission to better schools.
The discussion in the media reports focuses on common issues facing the educational and tutoring industry in China, including competitive pressures for students to enter better schools and pricing concerns, as well as the overall regulatory framework for the industry. The Company believes the media reports were triggered by concerns about these issues. The media reported on complaints of several parents who do not believe Jinghan's services lived up to their expectations and raised questions regarding some parents' satisfaction with Jinghan's services and compliance with local registration requirements.
In response to concerns over the media reports, Jinghan internally reviewed the issues raised and found that:
All of Jinghan's operated centers are legally registered with the local Administration for Industry and Commerce and the relevant local tax bureaus. As required by local regulations, all of Jinghan's centers display the service price list openly and the staff is required to explain the prices clearly. The Company believes that Jinghan's ability to raise prices reflects Ambow's market leadership in tutoring and the premium its one-on-one brand commands in the market. It has never been Jinghan's policy to encourage staff to exaggerate training results and any such unprofessional behavior of staff is not tolerated.
Based on the information currently known, the Company does not anticipate that these Jinghan matters will result in any restatement of previously announced financial results.
Jinghan has completed its internal review regarding these media reports and the Company does not expect to engage third party advisors to assist with any further internal review related to these matters. The Company is not aware of any pending regulatory reviews.
Notable Share Transactions
BEIJING , July 13, 2012 /PRNewswire-Asia / -- Ambow Education Holding Ltd. ("Ambow" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China , today announced that its Board of Directors approved a share repurchase program.
Under the program, Ambow is authorized to repurchase up to $10 million worth of its outstanding American Depositary Shares (ADSs) representing its Class A ordinary shares from time to time in open market transactions, in block trades or otherwise. The timing and amount of any ADSs repurchased will be determined by Ambow's management, based on its evaluation of market conditions, the trading price of the stock and other factors, as well as subject to relevant rules under the Securities Exchange Act of 1934, as amended (the "Act"). The Company also will effect repurchase transactions in compliance with the Company's insider trading policy. The repurchase program does not obligate the Company to acquire any particular number or amount of its ADSs and may be suspended or discontinued at any time.
"This announcement illustrates our confidence in the long-term growth opportunities for Ambow and our commitment to shareholder value," stated Dr. Jin Huang , founder and CEO of Ambow. "We believe that our ability to generate cash will remain strong and have confidence in our fundamentals."
"In addition to growing our company," added Chief Strategy Officer, Ms. Jenny Zhan . "it is our goal to enhance long-term stockholder value. We believe that our current share price presents an attractive investment opportunity and that it is prudent to establish a stock repurchase program at this time. We remain steadfast in our confidence in Ambow's fundamentals as reflected with this share repurchase program, and look forward to keeping shareholders apprised of our progress."
The Company intends to use available cash balances to fund the share repurchase program.
Comments & Business Outlook
Financial Highlights for the First Quarter Ended March 31, 2012:
Total net revenue increased 22.1% year-over-year to $59.5 million[ 1] from $48.8 million for the same period in 2011 and organic growth is over 11.4% year-over-year.
The growth assets, which consist of Tutoring and Career Enhancement , achieved 27.6% year-over-year revenue growth , of which organic growth was 13.6%. $14.3 million of services and products delivered in the first quarter will be recognized as revenue in future periods upon cash collection while $4.3 millionof services and products delivered in 2011 were recognized as revenue in the first quarter of 2012.
Tutoring revenue increased 42.0% to $35.9 million from $25.3 million for the same period in 2011, of which organic growth was 28.4% year-over-year. $4.8 million of services and products delivered in the first quarter will be recognized as revenue in future periods upon cash collection while $2.4 million of services and products delivered in 2011 were recognized as revenue in the first quarter of 2012.
Career Enhancement revenue decreased 2.8% to $11.7 million from $12.0 million for the same period in 2011. $9.5 million of services and products delivered in the first quarter will be recognized as revenue in future periods upon cash collection while $1.9 million of services and products delivered in 2011 were recognized as revenue in the first quarter of 2012.
Operating loss was $13.0 million compared to operating income of $3.4 million for the same period in 2011. Non-GAAP operating loss[ 3] was $10.6 million compared to non-GAAP operation income of $4.5 million for the same period in 2011.
Net loss was $12.7 million compared to net income of $2.0 million for the same period in 2011. Non-GAAP net loss[ 4] was $10.2 million compared to non-GAAP net income of $3.0 million for the same period in 2011.
Diluted non-GAAP net loss per ADS attributable to Ambow[5] was $0.14 as compared to diluted non-GAAP net income per ADS attributable to Ambow of $0.04 for the same period in 2011.
Total student enrollments[6] increased 17.4% to 265,400 from 226,000 for the same period in 2011.
The student enrollments for growth assets increased 21.3 % to 239,000 from 197,000 for the same period in 2011.
As part of the latest development, Ambow has signed a US$50 million loan package agreement with International Financial Corporation (IFC), a member of the World Bank Group, to support Ambow's employment oriented career enhancement developments. The loan package consists of 1) a $30 million 8-year loan with a variable interest rate of Libor + 4.5%, and 2) a $20 million 5-year convertible bond with a variable interest rate of Libor +4.2% and a conversion price of $10 per ADS. Both loans have interest rate step down features. Disbursement of the loan proceeds to Ambow is subject to various conditions. Subject to satisfaction of these conditions and disbursement of the loan proceeds, the company will use IFC's $50 million loan to build two new campuses in the capital Beijing and the southern city of Guangzhou, and expand existing campuses in the eastern cities of Kunshan and Dalian. The Company cannot be sure that we will satisfy the conditions to the disbursement in a timely manner, or at all.
Commenting on the first quarter results, Ambow's President and Chief Executive Officer Dr. Jin Huang provided the following remarks:
Ambow's Chief Strategy Officer Ms. Jenny Zhan added, "I am happy to report that as of the last month of the second quarter we are again focusing our efforts on growing the business. We believe that our business fundamentals are strong and that our operations are resilient. Concurrently, we expect our growth to recover in the second half of the year."
Financial Outlook for the Second Quarter and Full-Year of 2012
Ambow expects total net revenues for the second quarter of 2012 to be in the range of $69.9 million (Rmb440 million) to $73.0 million (Rmb460 million). The net revenue for the full year of 2012 is expected to be in the range of $301.7 million (Rmb1.9 billion) to $333.5 million (Rmb2.1 billion).
CFO Trail
BEIJING , July 5, 2012 /PRNewswire-Asia / -- Ambow Education Holding Ltd. ("Ambow" or the "Company") (NYSE: AMBO), a leading national provider of educational and career enhancement services in China , announced that effective July 5, 2012 Beijing Time, Mr. Gareth Kung , the Company's Chief Financial Officer, who had joined the Company in December 2011 , has resigned from his position with the Company.
"We thank Mr. Kung for his many contributions to the Company and wish Mr. Kung the best in the future," stated Dr. Jin Huang , Ambow's President and Chief Executive Officer.
The Company also announced that Mr. KJ Tan, who currently serves as the Company's Vice President of Finance has been appointed as Acting Chief Financial Officer until a permanent successor is appointed. KJ Tan joined Ambow as its Corporate Controller in December 2008 . In March 2010 , KJ was promoted to the position of VP Finance. KJ has more than ten years' working experience with Big Four accounting firms in both China and Singapore . He was with KPMG Shanghai from December 2002 to September 2005 and with PricewaterhouseCoopers Shanghai from October 2005 to November 2008 . Prior to joining Ambow, he worked as a Senior Audit Manager in PricewaterhouseCoopers' Shanghai office.
Dr. Huang also commented on Mr. Tan's promotion: "KJ has done a fantastic job since he joined Ambow, including building up the daily financial operations to support Ambow's expansion in the last four years. I am very pleased to work with KJ in his new role, together with Ms. Jenny Zhan , the Chief Strategy Officer of Ambow and other executive members to continue the Company's growth and drive our future success."
Comments & Business Outlook
BEIJING, May 29, 2012 /PRNewswire-Asia/ -- Ambow Education Holding Ltd. ("Ambow" or the "Company") (NYSE: AMBO), a leading national provider of educational and career enhancement services in China, today announced that it has filed its 2011 annual report on Form 20-F (the "2011 Annual Report") with the U.S. Securities and Exchange Commission (the "SEC"). The 2011 Annual Report is available on the SEC's website at http://www.sec.gov .
The Company will provide a hard copy of the 2011 Annual Report containing its audited consolidated financial statements, free of charge, to its shareholders and ADS holders upon request. The Company also reached a conclusion on certain discussions included in its press release dated May 16, 2012 (the "May 16 Press Release"), regarding the preliminary adjustments to the Company's 2011 unaudited annual financial results included in the Company's press release dated March 5, 2012 (the "March 5 Press Release"), which was included as an exhibit to the Company's Form 6-K furnished to the SEC on March 5, 2012. The Company has determined the following: Full article .
Investor Alert
BEIJING, May 16, 2012 /PRNewswire-Asia / -- Ambow Education Holding Ltd., ("Ambow" or the "Company") (NYSE: AMBO), a leading national provider of educational and career enhancement services in China, today announced that the filing of its 2011 annual report on Form 20-F (the "2011 Annual Report") is delayed beyond the end of the 15 day extension period provided by the rules of the U.S. Securities and Exchange Commission (the "SEC") because the Company requires additional time to complete the audit of its 2011 financial statements. The Company is working to complete the audit as soon as practicable and expects to file the 2011 Annual Report with the SEC within one month. The Company also announced that it has identified certain preliminary adjustments to the 2011 unaudited financial results included in the Company's press release dated March 5, 2012, which was included as an exhibit to the Company's Form 6-K furnished to the SEC on March 5, 2012 (the "Form 6-K"). In connection with its annual audit, which has yet to be completed, the Company expects to make the following adjustments:
The Company will change the revenue recognition method in respect of sales of the Company's educational services and software products to certain distributors. For those distributors with a proven payment history, the Company will continue to recognize revenue upon delivery of services and products. For those distributors without adequate history of timely payment, the Company will defer the recognition of revenue until cash is collected. Accordingly, the Company expects that between US$13.5 million (RMB85 million) and US$15.1 million (RMB95 million) of revenue previously recognized in 2011 will be reversed and recognized in the future when cash is collected from certain distributors. This adjustment does not impact revenue in 2010. As of the date of this press release, the Company has collected approximately US$12.2 million (RMB77 million) of the cash associated with the revenue to be deferred as of December 31, 2011, which collected revenue (together with any additional collections before June 30, 2012) will be recognized by the Company in the first half of 2012. Any remaining balance will be recognized when collected. All future sales to distributors without adequate history of timely payment will be recognized on the cash basis until such time as a proven payment history is established.
The Company expects to make a bad debt provision of between US$2.1 million (RMB13 million) and US$2.4 million (RMB15 million).
In addition to the 10 new tutoring centers opened in the fourth quarter of 2011 as described in the Form 6-K, an additional 12 centers began operations in late December 2011, bringing the total number of newly opened centers to 22 in the fourth quarter of 2011. As a result, depreciation and other expense is expected to increase by between US$0.5 million (RMB3 million) and US$0.6 million (RMB3.5 million).
The adjustments described above are not expected to have any effect on the Company's cash flow in 2011 or its previously announced cash balance at December 31, 2011.
In addition to the adjustments described above, the Company is evaluating whether it will take a one-time non-cash charge of between US$1.6 million (RMB 10 million) and $3.2 million (RMB20 million) associated with a 2011 acquisition. The Company is also evaluating the need to make an additional tax provision in respect of one of its subsidiaries. The amount being considered for tax provision is between US$3.2 million (RMB20 million) and US$4.8 million (RMB30 million).
In addition to the above, the Company also has identified certain other preliminary adjustments that it expects to make during the completion of the audit; these certain other preliminary adjustments are not expected to impact the Company's net income.
While the Company does not expect further adjustments, the audit is not yet complete and, consequently, the Company cannot assure you that further adjustments may not be identified. Source: PR Newswire (http://s.tt/1bZKH)
Comments & Business Outlook
BEIJING , March 13, 2012 /PRNewswire-Asia / -- Ambow Education Holding Ltd. ("Ambow" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China , today announced that it has won the bid from the Chinese Ministry of Education (MOE), an agency of the State Council which regulates all aspects of the educational system in China , to exclusively design and develop the first national cloud-based education data platform. Ambow will create an entirely new way for over 14 million K-12 school teachers and approximately 4 million teacher candidates(1), who study at the normal universities, or teachers' colleges in China , to take cloud-based classes, share professional experiences, and sharpen their teaching skills. The Normal University and College system focuses on training and preparing school teachers to become eligible in entire accredited school system in China . The system also ensures these teachers maintain good standing by obtaining all necessary certifications and fulfilling continuing education requirements.
Education in the Cloud will be designed to offer a place with rich media content, virtual communities, live discussions, and interactive features that enrich learning experiences. It will provide a means for teachers and teacher candidates to update their knowledge, take refresher courses, and improve their teaching skills through cloud-based certification programs, advanced and joint-degree programs, and peer-to-peer professional social networking that are supported by the best experts, practices, and content. The system will also support a standardized process to pay for online classes, obtain teacher recertification, transfer intercollegiate credits, and leverage the entire Normal University and College system and the database of the hundreds and thousands of K-12 schools across China .
Ambow, as the exclusive designer and developer of China 's Education in the Cloud, sees the MOE's cloud initiative as just the beginning of a trend in education and an enormous market opportunity. "The project win from the Ministry of Education is a recognition of our decade-long effort in online education, and positions us to continue to be a leader in innovation and education," commented Dr. Jin Huang , CEO of Ambow Education. "Ambow seeks to provide students the best in choice, the best in opportunities, and the best in education. As such, this project is a win for teachers and students, and a clear win for our cloud capabilities and the huge market opportunities it presents," concluded Dr. Huang.
Comments & Business Outlook
Financial Highlights for the Fourth Quarter Ended December 31, 2011:
Total net revenue from continuing operations increased 58.5% to $89.2 million (2) from $56.2 million for the same period in 2010 and organic growth increased 42.6 % year-over-year.
The growth assets from continuing operations, which consists of Tutoring and Career Enhancement , achieved 77.7 % year-over-year revenue growth, of which organic growth was 54.9%.
Tutoring revenue from continuing operations increased 47.6% to $35.7 million from $24.2 million for the same period in 2010, of which organic growth was 35.0%.
Career Enhancement revenue from continuing operations increased 126.7% to $33.8 million from$14.9 million for the same period in 2010, of which organic growth was 87.2%.
Non-GAAP operating income(3) from continuing operations increased 41.2% to $21.6 million from $15.3 million for the same period in 2010.
Non-GAAP net income from continuing operations increased over 54.6% to $18.4 million from $11.9 millionfor the same period in 2010.
Diluted non-GAAP net income from continuing operations per adjusted ADS attributable to Ambow(4) increased to $0.25 as compared to $0.16 for the same period in 2010.
Total student enrollments(5) from continuing operations increased 40% to 341,000 from 243,000 for the same period in 2010.
The student enrollments from continuing operations for growth assets increased 46.5% to 312,000 from 213,000 for the same period in 2010.
This was a remarkable and the most profitable quarter in our history. Our growth assets, consisting of Tutoring and Career Enhancement , set records in enrollment and revenue. Our total enrollment for growth assets surpassed one million in 2011. Looking at our Tutoring line of business , we opened 10 new tutoring centers in the fourth quarter of 2011 alone, which pushes our total national coverage to 138 centers in 17 provinces. The results of the new centers have exceeded our expectations. The tutoring enrollment from continuing operations organically grew by 20% year-over-year.
Turning to Career Enhancement , we continue to experience explosive growth and demand in this segment. The enrollment increased over 300% year-over-year in the fourth quarter of 2011, led by our Career Competence Enhancement Program (CCEP)(6), which is designed to teach students soft skills. This soft-skill based college credit course has attracted around 57,000 students since its launch in March 2011. Not factoring in CCEP, revenue from the rest of Career Enhancement organically grew 70% year-over-year in the fourth quarter of 2011. After the impressive growth in 2011, our results for Q4 show that revenues between Career Enhancement andTutoring were almost evenly split. As both of our growth engines meet and exceed our expectations, we see 2012 ripe for continued organic growth and our leadership position be firmly reinforced in the Chinese education industry.
"To implement our current growth strategy, we reviewed our business portfolios, and subsequently, divested non-strategic assets at the end of 2011," added Ms. Jenny Zhan, Ambow's Chief Strategy Officer. "This strategic move reflects our commitment to business lines with stronger growth potential, greater capital efficiency, and better asset turnover." She continued, "We expect to see substantial improvement of our Return on Equity in 2012."
"It is also worth noting that Campus Holdings, in which both Dr. Jin Huang and Baring Asia have a shared economic interest through October 2015," added Ms. Zhan. "spent approximately $50 million to acquire 5.972 million shares of ADS or its equivalent of common shares, both publicly and privately, from November 2011through January 2012. "She concluded, "This purchase demonstrates the confidence and commitment of our management team, and moreover, the endorsement of our business model from a private equity leader inChina's education sector."
Shedding more light on the financial picture, the Chief Financial Officer of Ambow Education, Mr. Gareth Kungadded, "Turning to operations, I am very pleased to announce that even though we are in the investment phase of our Tutoring and Career Enhancement businesses, we achieved outstanding growth in both top and bottom lines." He continued, "Our non-GAAP operating income from continuing operations grew over 41% year-over- year while 2011 adjusted EBIDTA margin(7) was around 27% which is one of the highest in the industry." Furthermore, "These results show that our resolve to improve the efficiency and scalability of our business remains strong." Mr. Kung concluded by stating, "Though we are still in the early stages of our expansion, it is our goal to maintain sustainable growth in both top and bottom lines."
Joint Venture
BEIJING , January 31, 2012 /PRNewswire-Asia / -- Ambow Education Holding Ltd. ("Ambow" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China , today announced a partnership with Oracle to provide the Workforce Development Program (WDP ) , a unique training program developed by Oracle that is ideally suited for Ambow's career enhancement students.
This program will provide accessible and affordable IT training to Ambow's career enhancement students with the purpose of preparing these students for Oracle certification exams. Graduates of Ambow with a WDP certificate will have greater access to entry level positions with Oracle application requirement, a competitive advantage over those without this skill set, and moreover, greater opportunities for career advancement. The WDP not only addresses the long-standing difficulty that businesses have in finding qualified IT staff in China , but also has a positive impact on local communities and their economic development.
"Through the partnership, Ambow will provide students with Oracle's latest core technology training, allowing the participants to be qualified for large database management jobs," said Ms. Yisi Gu , Ambow's Chief Technology Officer. "This collaboration with Oracle strengthens Ambow's leadership position in IT training within China ."
Notable Share Transactions
BEIJING , January 9, 2012 /PRNewswire-Asia / -- Ambow Education Holding Ltd. ("Ambow Education" or the "Company" NYSE: AMBO), a leading national provider of educational and career enhancement services in China , and Baring Private Equity Asia ("Baring Asia"), one of the most established independent private equity firms in Asia with extensive experience in China 's education sector, announce the recent acquisition of shares in Ambow Education by Campus Holdings Limited ("Campus Holdings" or "Campus"). Campus Holdings was formed for the purpose of acquiring shares in the Company pursuant to a Participation Agreement dated October 26th, 2011 between Baring Asia and Dr. Jin Huang , the CEO and Chairwoman of Ambow Education. Under the Participation Agreement, both Dr. Jin Huang and Baring Asia have an economic interest in the shares of Ambow Education acquired by Campus Holdings, and have structured a long-term investment to focus on the future growth and development of the Company.
From November 9th, 2011 to January 6th, 2012 , Campus purchased an aggregate of 10,939,555 Class A ordinary shares and 477,475 Class B ordinary shares (a total of 11,417,030 ordinary shares) from third parties who are not affiliates of Campus in privately negotiated transactions for an aggregate consideration of $48,170,329 . Upon the acquisition by Campus, the Class B ordinary shares automatically converted into Class A ordinary shares. Campus also acquired an aggregate of 234,296 ADSs, representing 468,592 Class A Shares, in open market transactions.
Dr. Jin Huang , the founder of Ambow Education, commented: "Despite the macroeconomic uncertainties both globally and in China , Ambow has gained market share and delivered on our promises, achieving 33% year-over-year net revenue growth and over 35% year-over-year GAAP operating income growth for the first 9 months of 2011. I am very pleased that Baring Asia shares our view about the prospects for Ambow and China 's education industry. This purchase demonstrates our joint confidence in the Company's long-term business fundamentals and growth prospects. The management team is dedicated to improving shareholder value and increasing investors' understanding of Ambow and China 's education sector."
Mr. Jean Eric Salata , Founder and CEO of Baring Asia, commented: "We are very excited about this new partnership and our long-term involvement with Ambow Education. Education in China is a sector in which Baring Asia has had extensive prior investment experience, and we continue to see strong demand for the private education industry in China due to sustained rising disposable incomes and high competition for admission to schools. We believe that our pan-Asian investment program, including expertise in the education sector across multiple Asian geographies, makes us a strategic investor capable of adding value to the Company through the next stage of its development."
Investor Alert
BEIJING , January 5, 2012 /PRNewswire-Asia / -- Ambow Education Holding Ltd. ("Ambow" or the "Company") (NYSE: AMBO), a leading national provider of educational and career enhancement services in China today announced a number of asset divestments that completed before the end of fiscal year 2011 to sharpen the focus on its growth layer, which consists of Tutoring and Career Enhancement . The Company completed the following transactions:
It sold its Beijing Century College and its 100% owned Beijing Siwa Century Facility Management Co. back to its original owner;
It returned its 21st Century K-12 school assets to its original owner for a 15-year operating right of the school. It also agrees to jointly fund future capital expenditures through separately negotiable agreements; and
It sold one career enhancement and three tutoring subdivisions as a package. Ambow made the above divestments following a recent strategic review of its business portfolios to sharpen the focus on its growth layer. As a result of the above transactions, the revenue of the sold business units excluding 21st Century K-12 School for which the Company has retained a 15-year operating right are estimated to be around US$8.0 million [1] for the fourth quarter of 2011 and US$25.0 million for fiscal year 2011. The aforementioned revenue together with the related expenses will be reclassified and disclosed separately in the income statement as a net result from discontinued operations. Notwithstanding this reclassification, the revenue from continuing operations alone is expected to meet the previous revenue guidance of US$82.6 million (RMB520 million) to US$84.2 million (RMB530 million ) for the fourth quarter of 2011, due to the faster than expected ramp up of the Company's growth layer initiatives especially related to the tutoring center expansions.
The Company expects to record a non-cash charge arising from disposals of approximately US$23.0 million for the fourth quarter of 2011, or 5.0% of net equity value at the end of third quarter of 2011 as a result of the above transactions. These transactions are expected to generate proceeds of US$34.6 million while reducing the Company's liabilities relating to acquisition consideration by approximately US$32.0 million , therefore significantly increasing its financial flexibility to further invest in strategically important growth areas.
Comments & Business Outlook
Third Quarter 2011 Results
Total net revenue increased 42.6% to $72.8 million (1) from $51.1 million for the same period in 2010 and organic growth increased 25.0% year-over-year.
Non-GAAP net income(3) increased to $7.3 million from $6.6 million for the same period in 2010.
Diluted non-GAAP net income per adjusted ADS attributable to Ambow(4) increased to $0.097 as compared to $0.091 for the same period in 2010.
Commenting on the third quarter results, Ambow's President and Chief Executive Officer Dr. Jin Huang said, "I am pleased with Ambow's performance this quarter as we continue to successfully execute our strategy to sustain strong top-line growth and improve operating profit. We remain focused on growing our Tutoring and Career Enhancement services organically and satisfying the immense demand for these services through our diversified offerings. "
"During the quarter we also closed our last acquisition of the year. Due to our strong organic growth, we expect that acquisitions will contribute to less than 10% of our annual revenue in 2011." Dr. Huang concluded.
Ambow's Chief Financial Officer, Paul Chow , added, "In the third quarter, the Growth Layer which consists of Tutoring and Career Enhancement , achieved approximately 27% year-over-year organic growth."
"Turning to operations, I am very pleased to announce that, even though we are in the investment phase of our Tutoring and Career Enhancement businesses, we achieved 27.1% year-over-year non-GAAP operating income growth. Non-GAAP G&A expense(5) as a percentage of sales decreased to 17.9% in the third quarter from 19.8% for the same period of 2010. This decrease is a direct result of our efforts to improve the efficiency and scalability of our business. Though we are still in the early stages of our expansion, it is our goal to maintain sustainable growth in both the top and bottom lines," concluded Mr. Chow.
Financial Outlook for the Fourth Quarter and Full-Year 2011
The Company expects total net revenues in the fourth quarter of 2011 to be in the range of $81.5 million (Rmb520 million) to $83.0 million (Rmb530 million ).
Comments & Business Outlook
Financial Highlights for the Quarter Ended June 30, 2011 :
Total net revenues increased 26.1% to $77.8 million (1) from $61.7 million for the same period in 2010.
Tutoring revenues increased 20.3% to $33.7 million from $28.0 million for the same period in 2010.
Career Enhancement revenues increased 90.0% to $20.8 million from $11.0 million for the same period in 2010.
The growth layer, which consists of Tutoring and Career Enhancement , achieved 39.9% year-over-year revenue growth. Excluding revenue of $6.2 million from acquisition, our organic growth is 24.0%.
EBITDA(2) increased 27.3% to $25.2 million from $19.8 million for the same period in 2010.
Operating income increased 33.3% to $20.4 million from $15.3 million for the same period in 2010.
Net income(3) increased 22.2% to $16.7 million from $13.6 million for the same period in 2010.
Diluted non-GAAP net income per adjusted ADS attributable to Ambow(4) increased to $0.24 as compared to $0.22 for the same period in 2010.
Total student enrollments increased to 298,000.
Commenting on the second quarter results, Ambow's President and Chief Executive Officer Dr. Jin Huang said, "I am pleased with Ambow's performance this quarter as we continue to successfully execute our strategy to sustain strong growth and profitability in our growth layer. We will continue to focus on growing our Tutoring and Career Enhancement services organically and satisfying the immense demand for these services through our diversified offerings. Turning to acquisitions, we are going to continue our disciplined strategy to expand Ambow's footprint and offerings throughout China . We completed one acquisition during the quarter and we are in the process of closing another. We expect our acquisition will contribute less than 10% of our annual revenue."
Financial Outlook for the Third Quarter and Full-Year 2011
The Company expects total net revenues in the third quarter of 2011 to be in the range of $64 million (Rmb415 million) to $67 million (Rmb430 million ).
The Company expects net revenue for 2011 full-year to be in the estimated range of $276 million (Rmb1,785 million) to $280 million (Rmb1,810 million ).
Comments & Business Outlook
BEIJING , August 18, 2011 /PRNewswire-Asia / -- Ambow Education Holding Ltd (NYSE: AMBO), is pleased to guide today that it expects net revenues for the third quarter of 2011 to be between $64 million to $67 million (1) ( RMB 415 million to RMB 430 million ).
The company is further providing net revenues guidance for 2011 which is expected to be between $ 276 million to $ 280 million ( RMB 1,785 million to RMB 1,810 million ), representing a 27.1 % - 28.8% year-over-year increase compared to 2010.
The net revenues the company is guiding towards for 2011 would represent a record high since the company's inception and reflect substantial growth in our career enhancement and tutoring segments, from 2010.
Comments & Business Outlook
BEIJING , July 1, 2011 /PRNewswire-Asia / -- Ambow Education Holding Ltd. ("Ambow" or the "Company") (NYSE: AMBO), a leading national provider of educational and career enhancement services in China , announces that it remains firmly confident in its long-term business outlook, and is comfortable with the revenue guidance previously provided.
The revenue guidance for the second quarter of 2011 is to be in the range of $74.8 million (RMB 490 million) to $76.4 million (RMB 500 million ), as provided in the last earnings call on May 18, 2011 . This is the Company's current view and is subject to market changes and other future events that may occur.
Comments & Business Outlook
Financial Highlights for the Quarter Ended March 31, 2011
Total net revenues increased 29.6% to $51.5 million(1) from $39.7 million for the same period in 2010. Existing business contributed 24.2% growth, while 5.4% came from acquisitions.
Tutoring revenues increased 24.6% to $25.3 million from $20.3 million for the same period in 2010.
Career Enhancement revenues increased 116.2% to $11.8 million from $5.5 million for the same period in 2010.
Net income(2) increased 151.6% to $1.5 million from $0.6 million for the same period in 2010.
Operating income increased 86.5% to $2.8 million from $1.5 million for the same period in 2010.
Adjusted EBITDA(3) increased 28.9% to $8.6 million from $6.7 million for the same period in 2010.
Total student enrollments increased 16% year-over-year to 234,000.
Basic and diluted non-GAAP net income per adjusted ADS attributable to Ambow(8) was $0.04 and $0.03, respectively, compared to $0.02 for the same period in 2010.
Commenting on the first quarter results, Ambow's President and Chief Executive Officer Dr. Jin Huang said, "We are pleased to report that Ambow started the year with a strong quarter, highlighted by impressive revenue and net income growth. Ambow is the only listed company in the education sector that is able to address two fundamental market demands in China - the desire to get into a better school and the desire to get a better job. Our business objective is to acquire more and more students and retain them through Ambow's education services platform."
Financial Outlook for the Second Quarter of Full-Year 2011
Ambow expects total net revenues for the second quarter of 2011 to be in the range of $74.8 million (Rmb490 million) to $76.4 million (Rmb500 million).
Liquidity Requirements
We expect that our capital expenditures in 2011 covering existing and newly acquired schools and learning centers will be at a similar level as compared to 2010. In addition, we expect to continue our cooperation with local governments to open a number of service hubs in business concentrated areas in the year 2011 and beyond for providing career enhancements services to students. Capacities of these hubs are expected to range from 3,000 to 5,000 students. We expect to invest considerable capital expenditures in facility upgrades, lab renovation, technology and equipment and similar items to help us provide the best value to our students and to maintain our leading position in this business segment. We currently anticipate that our capital expenditures in 2011
will primarily be funded with the net cash generated from operating activities.
Comments & Business Outlook
Fourth Quarter Highlights :
Total net revenues for the fourth quarter of 2010 increased 17.9% to $63.7 million , from $54.0 million for the same period in 2009. This improvement was primarily the result of strong revenues contribution from Tutoring.
Gross profit was $40.0 million for the fourth quarter of 2010, increasing 26.1% year-over-year from $31.7 million for the same period in 2009.
Net income was $13.7 million for the fourth quarter of 2010, increasing 8.6% year-over-year from $12.6 million for the same period in 2009.
Basic and diluted non-GAAP net income per adjusted ADS attributable to Ambow was $0.21 and $0.20 , respectively, compared to $0.21 and $0.20 , respectively for the same period in 2009.
Commenting on the fourth quarter and year end results, Ambow's President and Chief Executive Officer Dr. Jin Huang said, "We are happy to report that Ambow made significant progress in executing its business strategy during the fourth quarter and full year. Ambow continues to expand across the country through its innovative intelligence systems and service platform, further establishing itself as a market leader and the preeminent provider of education and career enhancement services in China. We remain dedicated to helping our students achieve their educational goals and improve their ability to contribute meaningfully in the work place; fulfilling our mission to create a better school, better job and better life ."
Dr. Huang continued, "It is important to understand that our long-term objectives are sustained revenue growth, acquisition integration and expense control. Throughout the year, each of these goals was achieved to our satisfaction. Based on the success of these efforts, our strategy in 2011 is to drive positive revenue expansion through strong growth in our Tutoring and Career Enhancement segments ."
Ambow expects total net revenues in the first quarter of full-year 2011 to be in the range of $49.7 million (Rmb328.0 million) to $52.7 million (Rmb348.0 million).
