China's educational services provider ChinaEdu Corp. (CEDU) announced late Monday that loss for the third quarter narrowed over the same quarter last year, boosted by higher margins and a strong 25.4% revenue growth. Results were also impacted by a goodwill impairment charge and the adoption of the new income tax rate. The company also provided revenue forecast for fourth quarter.
In a statement, chairman and chief executive officer, Julia Huang said, "We are pleased to report another quarter of strong execution and consistent growth. Despite a non-cash goodwill impairment charge incurred during the third quarter, our third quarter financial results reflect strong underlying operations and our ability to continue to deliver strong results."
The Beijing, China-based ChinaEdu reported a net loss of RMB 15.31 million or RMB 0.26 per share or US$2.25 million or US$0.04 per share for the third quarter, narrower than RMB 19.42 million or RMB 0.47 per share in the year-ago quarter.
Earnings per ADS for the quarter were RMB 0.78 or US$0.12 per share, compared to RMB 1.41 in the prior-year.
Excluding one-time non-recurring items, adjusted net income for the quarter rose more than two-fold to RMB 7.42 million or US$1.09 million, from RMB 3.24 million in the comparable quarter a year ago. On average, analysts polled by First Call/Thomson Financial expected earnings of US$0.05 per share for the third quarter.
Total net revenues for the quarter rose 25.4% to RMB 82.0 million or US$12.08 million from RMB 65.41 million in the same quarter last year. Wall Street analysts had a consensus revenue estimate of $11.49 million for the quarter.
Net revenues from online degree programs climbed 34.4%, fueled by a 25% year-over-year increase in spring students enrollments. Deferred revenue at the end of the third quarter of 2008 was RMB 33.2 million or US$4.9 million.
Loss from operations for the latest quarter narrowed to RMB 1.48 million or US$0.22 million, from $11.70 million in the prior-year quarter, while total operating expenses was RMB 52.29 million or US$7.07 million, up 10.4% from RMB 47.34 million in the year-ago quarter.
Gross profit was RMB 50.80 million or US$7.48 million, up 42.5% from RMB 35.65 million in the comparable quarter a year ago, while gross margin percentage climbed 750 basis points to 62.0% from last year.
The company ended the third quarter with cash and cash equivalents of RMB 303.33 million or US$44.67 million, compared to RMB 128.83 million at end of the prior-year quarter.
For the nine-month period, net loss narrowed to RMB 4.04 million or RMB 0.07 per share or US$0.59 million or US$0.01 per share, from RMB 6.95 million or RMB 0.17 per share in the year-ago period.
Earnings per ADS for the period were RMB 0.21 or US$0.03, compared to RMB 0.51 in the same period a year ago.
Excluding one-time non-recurring items, adjusted net income for the period rose to RMB 24.88 million or US$3.67 million, from RMB 21.00 million in the comparable period a year ago.
Total net revenues for the year-to-date period jumped 24.7% to RMB 231.18 million or US$34.05 million, from RMB 185.38 million in the same period last year.
Looking ahead to the fourth quarter, the company expects net revenues in a range of RMB 82 million to RMB 85 million or US$12.0 million to $12.4 million. Analysts expect the company to report revenues of $12.31 million for the fourth quarter of fiscal 2008.
CEDU last traded on Friday at $4.00.
For comments and feedback: editorial@rttnews.com