UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of April 2013
Commission File Number: 001-34900
TAL EDUCATION GROUP
18/F, Hesheng Building
32 Zhongguancun Avenue, Haidian District
Beijing 100086
Peoples Republic of China
+86 (10) 5292 6669
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
TAL Education Group | |
|
| |
|
By: |
/s/ Joseph D. Kauffman |
|
Name: |
Joseph D. Kauffman |
|
Title: |
Chief Financial Officer |
|
| |
Date: April 25, 2013 |
|
Exhibit 99.1
TAL Education Group Announces Unaudited Financial Results for the Fourth Fiscal Quarter and Fiscal Year Ended February 28, 2013
· Quarterly Net Revenues Increased by 14.2% Year-Over-Year
· Quarterly Income from Operations Decreased by 10.4% Year-Over-Year
· Quarterly Net Income Attributable to TAL Decreased by 9.7% Year-Over-Year
· Fiscal Year Net Revenues Increased by 27.3%
· Fiscal Year Income from Operations Increased by 49.4%
· Fiscal Year Net Income Attributable to TAL Increased by 37.5%
(Beijing April 23, 2013)TAL Education Group (NYSE: XRS) (TAL or the Company), a leading K-12 after-school tutoring services provider in China, today announced its unaudited financial results for the quarter ended February 28, 2013, which is the fourth quarter of TALs fiscal year 2013.
Highlights for the Fourth Quarter of Fiscal Year 2013
· Net revenues increased by 14.2% year-over-year to US$59.6 million from US$52.2 million in the same period of the prior year.
· Income from operations decreased by 10.4% to US$5.7 million, from US$6.3 million in the fourth quarter of fiscal year 2012.
· Net income attributable to TAL decreased by 9.7% year-over-year to US$6.8 million from US$7.6 million in the same period of the prior year.
· Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, decreased by 5.0% year-over-year to US$8.6 million from US$9.0 million in the same period of the prior year.
· Basic and diluted net income per American Depositary Share (ADS)1 were both US$0.09. Non-GAAP basic and diluted net income per ADS, excluding share-based compensation expenses, were both US$0.11.
· Total student enrollments increased by 9.7% year-over-year to approximately 250,700.
· Total physical network decreased by a net four learning centers to 255 learning centers as of February 28, 2013 from 259 learning centers as of November 30, 2012, as the Company continued to focus on improving operational efficiency during the period.
1 Each ADS represents two Class A common shares.
Highlights for the Fiscal Year Ended February 28, 2013
· Net revenues increased by 27.3% year-over-year to US$225.9 million from US$177.5 million in the same period of the prior year.
· Income from operations increased by 49.4% to US$31.4 million, from US$21.0 million in the same period of fiscal year 2012.
· Net income attributable to TAL increased by 37.5% year-over-year to US$33.4 million from US$24.3 million in the same period of the prior year.
· Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, increased by 29.5% year-over-year to US$41.7 million from US$32.2 million in the same period of the prior year.
· Basic and diluted net income per ADS were both US$0.43. Non-GAAP basic and diluted net income per ADS, in each case excluding share-based compensation expenses, were US$0.54 and US$0.53, respectively.
· Total student enrollments in fiscal year 2013 increased by 18.2% year-over-year to approximately 816,110.
· Total physical network decreased to 255 learning centers as of February 28, 2013 from 270 learning centers as of February 29, 2012.
Financial and Operating DataFourth Quarter and Twelve Months of Fiscal Year 2013
(In US$ thousands, except per ADS data, student enrollments and percentages)
|
|
Three Months Ended |
|
|
| ||
|
|
February 29/28, |
|
|
| ||
|
|
2012 |
|
2013 |
|
Pct. Change |
|
Net revenues |
|
52,216 |
|
59,648 |
|
14.2 |
% |
Net income attributable to TAL |
|
7,582 |
|
6,848 |
|
-9.7 |
% |
Non-GAAP net income attributable to TAL |
|
9,019 |
|
8,571 |
|
-5.0 |
% |
Operating income |
|
6,321 |
|
5,663 |
|
-10.4 |
% |
Non-GAAP operating income |
|
7,758 |
|
7,386 |
|
-4.8 |
% |
Net income per ADS attributable to TAL basic |
|
0.10 |
|
0.09 |
|
-10.4 |
% |
Net income per ADS attributable to TAL diluted |
|
0.10 |
|
0.09 |
|
-9.9 |
% |
Non-GAAP net income per ADS attributable to TAL basic |
|
0.12 |
|
0.11 |
|
-5.7 |
% |
Non-GAAP net income per ADS attributable to TAL diluted |
|
0.12 |
|
0.11 |
|
-5.2 |
% |
Total student enrollments in small class, one-on-one, and online courses |
|
228,500 |
|
250,700 |
|
9.7 |
% |
|
|
Fiscal Year Ended |
|
|
| ||
|
|
February 29/28, |
|
|
| ||
|
|
2012 |
|
2013 |
|
Pct. Change |
|
Net revenues |
|
177,520 |
|
225,931 |
|
27.3 |
% |
Net income attributable to TAL |
|
24,314 |
|
33,440 |
|
37.5 |
% |
Non-GAAP net income attributable to TAL |
|
32,215 |
|
41,724 |
|
29.5 |
% |
Operating income |
|
21,025 |
|
31,421 |
|
49.4 |
% |
Non-GAAP operating income |
|
28,926 |
|
39,705 |
|
37.3 |
% |
Net income per ADS attributable to TAL basic |
|
0.32 |
|
0.43 |
|
36.1 |
% |
Net income per ADS attributable to TAL diluted |
|
0.31 |
|
0.43 |
|
36.9 |
% |
Non-GAAP net income per ADS attributable to TAL basic |
|
0.42 |
|
0.54 |
|
28.2 |
% |
Non-GAAP net income per ADS attributable to TAL diluted |
|
0.41 |
|
0.53 |
|
28.9 |
% |
Total student enrollments in small class, one-on-one, and online courses |
|
690,300 |
|
816,110 |
|
18.2 |
% |
During the fourth quarter, the small class business in markets other than Beijing and Shanghai once again drove our top line growth, more than doubling revenues and enrollments versus the year ago period. These cities contributed 29% of small class revenues in the fourth quarter versus 16% in the same period of the previous year, demonstrating the continued geographic diversification of our business. Another highlight is that our Shanghai business picked up again in the quarter following a period of transition in which we managed our growth while further improving teaching quality and curriculum.
In the coming fiscal year, we plan to undertake new content initiatives to enhance our core competency as a specialized, top-level tutoring services provider in the market. We will maintain our organizational focus on the math and science areas, with additional emphasis on the broader math and sciences curriculum offered in middle schools and high schools. At the same time, we plan to invest in further enhancing our LeJiaLe-branded English offering to make it an even more attractive cross-sell to our students. Finally, we will increase investments that bring our business closer to the cross-section of where education meets technology. Specifically, we will promote more refined assessment metrics at each level in our curriculum, an ever more interactive classroom experience and greater convenience in the class registration process, said TALs Chairman and Chief Executive Officer, Mr. Bangxin Zhang.
Mr. Joseph Kauffman, Chief Financial Officer, continued, I am pleased fourth quarter revenues came in as we expected, given the unfavorable timing of the Chinese New Year holiday this year and the ongoing impact from the policy change in Beijing.
On the whole, I am satisfied with the operating leverage we have achieved for this harvest year, especially in light of the unexpected disruption to our Beijing business beginning in the third quarter, which affected both our small class and 1-on-1 businesses in that city. For the full fiscal year 2013, total revenues surpassed the US$200 million mark, increasing by over 27%. We delivered operating income growth of 49.4% year-over-year and operating margin was 13.9%, up by 210 basis points versus fiscal year 2012. Our balance sheet remains strong at over US$200 million in cash, cash equivalents, and term deposits, even after returning to shareholders through share buyback and a special dividend a combined over US$40 million last year. With this solid foundation, and ongoing positive growth momentum in cities outside of Beijing, we are ready to re-enter the investment stage in our business in fiscal 2014, Mr. Kauffman added.
Financial Results for the Fourth Quarter of Fiscal Year 2013
Net Revenues
For the fourth quarter of fiscal year 2013, TAL reported net revenues of US$59.6 million, representing a 14.2% increase from US$52.2 million in the fourth quarter of fiscal year 2012. The increase was mainly driven by an increased number of total student enrollments combined with higher average selling prices (ASPs). Total student enrollments increased by 9.7% to approximately 250,700 from approximately 228,500 in the same period one year ago. The increase in total student enrollments was driven primarily by increases of enrollments in the small class offerings. ASP increased by 4.1% from US$229 in the fourth quarter of fiscal year 2012 to US$238 in the same quarter of fiscal year 2013. The growth in ASP was mainly driven by the hourly rate increases of a portion of center-based course offerings and the foreign exchange rate fluctuation.
Operating Costs and Expenses
Operating costs and expenses were US$54.0 million, a 17.6% increase from US$45.9 million in the fourth quarter of fiscal year 2012. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$52.3 million, a 17.6% increase from US$44.5 million in the fourth quarter of fiscal year 2012.
Cost of revenues increased by 10.1% to US$31.4 million, from US$28.5 million in the fourth quarter of fiscal year 2012. The increase in cost of revenues was mainly due to an increase in teacher compensation, rental costs and other staff costs associated primarily with an expansion of learning center capacity as well as increases in wages and teacher fees versus the year-ago period. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 10.4% to US$31.4 million, from US$28.4 million in the fourth quarter of fiscal year 2012.
Selling and marketing expenses increased by 37.8% to US$7.6 million, from US$5.5million in the fourth quarter of fiscal year 2012. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 41.9% to US$7.3 million, from US$5.2 million in the fourth quarter of fiscal year 2012. The increase of selling and marketing expenses in the fourth quarter of fiscal year 2013 was primarily a result of an increase in
compensation to sales and marketing staff to support a greater number of programs and service offerings, as well as an increase in brand promotion and advertising expenses.
General and administrative expenses increased by 21.3% to US$14.4 million, from US$11.9 million in the fourth quarter of fiscal year 2012. The increase in general and administrative expenses was mainly due to an increase in compensation to our general and administrative personnel to support a greater number of programs and service offerings, as well as the depreciation expenses for the office space purchased by the Company in Beijing, which commenced in the fourth quarter of fiscal year 2013. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 19.3% to US$12.9 million, from US$10.8 million in the fourth quarter of fiscal year 2012.
Total share-based compensation expenses allocated to the related operating costs and expenses increased by 19.9% to US$1.7 million in the fourth quarter of fiscal year 2013, from US$1.4 million in the same period of fiscal year 2012.
Impairment loss on Operating Assets
The impairment loss of US$0.6 million incurred in the quarter resulted from the impairment on the long-term prepayments by the Company in December 2011 for the acquisition of a study-abroad intermediary service operating license.
Gross Profit
Gross profit increased by 19.2% to US$28.3 million, from US$23.7 million in the fourth quarter of fiscal year 2012.
Income from Operations
Income from operations decreased by 10.4% to US$5.7 million, from US$6.3 million in the fourth quarter of fiscal year 2012. Non-GAAP income from operations, which excluded share-based compensation expenses, decreased by 4.8% to US$7.4 million, from US$7.8 million in the fourth quarter of fiscal year 2012.
Net Income Attributable to TAL Education Group
Net income attributable to TAL decreased by 9.7% to US$6.8 million, from US$7.6 million in the fourth quarter of fiscal year 2012. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, decreased by 5.0% to US$8.6million, from US$9.0 million in the fourth quarter of fiscal year 2012.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were both US$0.09 in the fourth quarter of fiscal year 2013. Non-GAAP basic and Non-GAAP diluted net income per ADS, which excluded share-based compensation expenses, were both US$0.11.
Financial Results for the Fiscal Year Ended February 28, 2013
Net Revenues
For the fiscal year 2013, TAL reported net revenues of US$225.9 million, representing a 27.3%
increase from US$177.5 million in the fiscal year 2012. The increase was primarily due to an increased number of total student enrollments combined with higher average selling prices (ASPs). Total student enrollments increased by 18.2% to approximately 816,110 from approximately 690,300 in the same period one year ago. The increase in total student enrollments was driven primarily by increases of enrollments in the small class offerings and to a lesser degree by increases in enrollments in our one-on-one tutoring services. ASPs increased by 7.7% to US$277 per enrollment in fiscal year 2013 from US$257 per enrollment in fiscal year 2012 mainly driven by the hourly rate increases in the Companys small class business and the foreign exchange rate fluctuation.
Operating Costs and Expenses
Operating costs and expenses were US$195.1 million, a 24.5% increase from US$156.7 million in fiscal year 2012. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$186.9 million, a 25.6% increase from US$148.8 million in fiscal year 2012.
Cost of revenues increased by 21.1% to US$115.7 million, from US$95.6 million in fiscal year 2012. The increase in cost of revenues was mainly due to an increase in teacher compensation, rental costs and other staff costs associated primarily with an expansion of learning center capacity as well as increases in wages and teacher fees. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 21.5% to US$115.6 million, from US$95.2 million in fiscal year 2012.
Selling and marketing expenses increased by 19.5% to US$27.7 million, from US$23.2 million in fiscal year 2012. The increase was primarily due to an increase of sales and marketing staff and related compensation to support an expanded number of cities in which the Company had learning center operations and a greater number of programs and service offerings. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 19.3% to US$25.9 million, from US$21.7 million in fiscal year 2012.
General and administrative expenses increased by 35.2% to US$51.1 million, from US$37.8 million in fiscal year 2012. The increase was mainly due to an increase in compensation for our general and administrative personnel to support an expanded number of cities in which the Company had learning center operations and a greater number of programs and service offerings, and the depreciation of office space purchased in Beijing, which commenced in the fourth quarter of fiscal year 2013. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 40.6% to US$44.8 million, from US$31.8 million in fiscal year 2012.
Total share-based compensation expenses that were allocated to related operating costs and expenses amounted to US$8.3 million in fiscal year 2013, as compared to US$7.9 in fiscal year 2012.
Gross Profit
Gross profit increased by 34.5% to US$110.2 million, from US$81.9 million in fiscal year
2012.
Income from Operations
Income from operations increased by 49.4% to US$31.4 million, from US$21.0 million in fiscal year 2012. Non-GAAP income from operations, which excluded share-based compensation expenses, increased by 37.3% to US$39.7 million, from US$28.9 million in fiscal year 2012.
Net Income Attributable to TAL Education Group
Net income attributable to TAL increased by 37.5% to US$33.4 million, from US$24.3 million in fiscal year 2012. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, increased by 29.5% to US$41.7 million, from US$32.2 million in fiscal year 2012.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were both US$0.43 in fiscal year 2013. Non-GAAP basic and diluted net income per ADS, which excluded share-based compensation expenses, were US$0.54 and US$0.53, respectively.
Capital Expenditures
Capital expenditures for fiscal year 2013 were US$6.9 million, representing a decrease of US$67.4 million from US$74.3 million in fiscal year 2012. The decrease was driven largely by the purchase of office space of US$62.5 million in fiscal year 2012.
Cash and Cash Equivalents
As of February 28, 2013, after the dividend payment of US$39.0 million in December 2012, the Company had US$185.1 million of cash and cash equivalents and US$24.1 million of term deposits, as compared to US$188.6 million of cash and cash equivalents and US$10.3 million of term deposits as of February 29, 2012.
Deferred Revenue
As of February 28, 2013, the Companys deferred revenue balance was US$102.5 million as compared to US$85.6 million as of February 29, 2012, representing an increase of 19.8% versus the same period of the previous year.
Business Outlook
Based on the Companys current estimates, total net revenues for the first quarter of fiscal year 2014 are expected to be between US$57.7 million and US$59.2 million, representing an increase of 17% to 20% on a year-over-year basis.
These estimates reflect the Companys current expectation, which is subject to change.
Conference Call
The Company will host a conference call and live webcast to discuss its financial results for the fourth fiscal quarter and fiscal year 2013 ended February 28, 2013 at 8:00 a.m. Eastern Time on April 23, 2013 (8:00 p.m. Beijing time on April 23, 2013).
The dial-in details for the live conference call are as follows:
· U.S. toll free: |
+1-866-519-4004 |
· Hong Kong toll free: |
800-930-346 |
· China toll: |
400-620-8038 |
· International toll: |
+65-6723-9381 |
Conference ID: |
34263430 |
A live and archived webcast of the conference call will be available on the Investor Relations section of TALs website at en.xueersi.org.
A telephone replay of the conference call will be available through April 30, 2013.
The dial-in details for the replay are as follows:
· U.S. toll free: |
+1-855-452-5696 |
· Hong Kong toll free: |
800-963-117 |
· China toll free: |
400-120-0932 |
· International toll: |
+61-2-8199-0299 |
Conference ID: |
34263430 |
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as will, expects, anticipates, future, intends, plans, believes, estimates and similar statements. Among other things, the outlook for the first quarter of fiscal year 2014, quotations from management in this announcement, as well as TAL Education Groups strategic and operational plans, contain forward-looking statements. The Company may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Companys beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: its ability to continue to attract students to enroll in its courses; its ability to continue to recruit, train and retain qualified teachers; its ability to improve the content of its existing course offerings and to develop new courses; its ability to maintain and enhance its brand; its ability to maintain and continue to improve its teaching results; and its ability to compete effectively against its competitors. Further information regarding these and other risks is included in the Companys reports filed with, or furnished to the Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and TAL Education Group undertakes no duty to update such information or any forward-looking statement, except as required under applicable law.
About TAL Education Group
TAL Education Group, which operates under the brand Xueersi, is a leading K-12 after-school tutoring service provider in China. Its tutoring services cover the core subjects in Chinas school curriculum, including mathematics, English, Chinese, physics, chemistry and biology, and are delivered through three formats: small class, one-on-one, and online courses. The Companys network includes 255 physical learning centers as of February 28, 2013, located in 15 key cities in China: Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Wuhan, Xian, Chengdu, Nanjing, Hangzhou, Taiyuan, Zhengzhou, Chongqing, Suzhou and Shenyang. It also operates www.eduu.com, a leading online education platform in China. The Companys ADSs trade on the New York Stock Exchange under the symbol XRS.
About Non-GAAP Financial Measures
In evaluating its business, TAL considers and uses the following measures defined as non-GAAP financial measures by the SEC as supplemental metrics to review and assess its operating performance: non-GAAP operating costs and expenses, non-GAAP cost of revenues, non-GAAP selling and marketing expenses, non-GAAP general and administrative expenses, non-GAAP income from operations, non-GAAP net income attributable to TAL, non-GAAP basic and non-GAAP diluted net income per ADS. To present each of these non-GAAP measures, the Company excludes share-based compensation expenses. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned Reconciliations of non-GAAP measures to the most comparable GAAP measures set forth at the end of this release.
TAL believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based expenses that may not be indicative of its operating performance from a cash perspective. TAL believes that both management and investors benefit from these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate managements internal comparisons to TALs historical performance and liquidity. TAL computes its non-GAAP financial measures using the same consistent method from quarter to quarter and from period to period. TAL believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using non-GAAP measures is that these non-GAAP measures exclude share-based compensation charges that have been and will continue to be for the foreseeable future a significant recurring expense in the Companys business. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables have more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.
For further information, please contact:
Mei Li
Investor Relations
TAL Education Group
Tel: +861052926658
Email: ir@xueersi.com
Caroline Straathof
IR Inside
Tel: +31 6 5462 4301
Email: info@irinside.com
TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In U.S. dollars)
|
|
As of |
|
As of |
| ||
ASSETS |
|
|
|
|
| ||
|
|
|
|
|
| ||
Current assets |
|
|
|
|
| ||
Cash and cash equivalents |
|
$ |
188,579,767 |
|
$ |
185,080,673 |
|
Term deposits |
|
10,328,116 |
|
24,110,716 |
| ||
Restricted cash |
|
|
|
2,270,269 |
| ||
Available-for-sale securities |
|
361,803 |
|
399,955 |
| ||
Inventory |
|
223,611 |
|
410,167 |
| ||
Deferred tax assets-current |
|
1,729,758 |
|
2,260,446 |
| ||
Prepaid expenses and other current assets |
|
9,011,975 |
|
11,906,317 |
| ||
Total current assets |
|
210,235,030 |
|
226,438,543 |
| ||
Property and equipment, net |
|
76,726,219 |
|
76,115,088 |
| ||
Deferred tax assets-non-current |
|
490,222 |
|
538,464 |
| ||
Rental deposit |
|
4,545,605 |
|
5,179,073 |
| ||
Intangible assets, net |
|
183,523 |
|
1,724,444 |
| ||
Goodwill |
|
548,825 |
|
555,194 |
| ||
Long-term prepayments |
|
1,923,481 |
|
|
| ||
Long-term investment |
|
|
|
5,491,073 |
| ||
Total assets |
|
$ |
294,652,905 |
|
$ |
316,041,879 |
|
|
|
|
|
|
| ||
LIABILITIES AND EQUITY |
|
|
|
|
| ||
|
|
|
|
|
| ||
Current liabilities |
|
|
|
|
| ||
Accounts payable (including accounts payable of the consolidated VIEs without recourse to TAL Education Group of 1,993,297 and 1,739,337 as of February 29, 2012, and February 28, 2013, respectively) |
|
$ |
2,863,596 |
|
$ |
2,009,473 |
|
Deferred revenue (including deferred revenue of the consolidated VIEs without recourse to TAL Education Group of 50,395,945 and 67,743,448 as of February 29, 2012, and February 28, 2013, respectively) |
|
85,594,032 |
|
102,513,876 |
| ||
Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of the consolidated VIEs without recourse to TAL Education Group of 9,546,915 and 11,269,507 as of February 29, 2012, and February 28, 2013, respectively) |
|
15,284,190 |
|
17,196,001 |
| ||
Income tax payable (including income tax payable of the consolidated VIEs without recourse to TAL Education Group of 2,206,266 and 2,165,785 as of February 29, 2012, and February 28, 2013, respectively) |
|
637,302 |
|
2,778,305 |
| ||
Total current liabilities |
|
104,379,120 |
|
124,497,655 |
| ||
Deferred tax liabilities-non-current (including deferred tax liabilities-non-current of the consolidated VIEs without recourse to TAL Education Group of 45,881 and 36,845 as of February 29, 2012, and February 28, 2013, respectively) |
|
156,494 |
|
98,945 |
| ||
Total liabilities |
|
104,535,614 |
|
124,596,600 |
| ||
|
|
|
|
|
| ||
TAL Education Group Shareholders Equity |
|
|
|
|
| ||
Class A common shares |
|
45,277 |
|
68,314 |
| ||
Class B common shares |
|
109,681 |
|
87,806 |
| ||
Additional paid-in capital |
|
119,769,989 |
|
86,016,387 |
| ||
Statutory reserve |
|
10,502,713 |
|
12,291,341 |
| ||
Retained earnings |
|
54,779,267 |
|
86,430,705 |
| ||
Accumulated other comprehensive income |
|
4,910,364 |
|
6,550,726 |
| ||
Total TAL Education Groups equity |
|
190,117,291 |
|
191,445,279 |
| ||
Total liabilities and equity |
|
$ |
294,652,905 |
|
$ |
316,041,879 |
|
TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME
(In U.S. dollars, except share, ADS, per share and per ADS data)
|
|
For the Three Months Ended |
|
For the Fiscal Year Ended |
| ||||||||
|
|
2012 |
|
2013 |
|
2012 |
|
2013 |
| ||||
Net revenues |
|
$ |
52,215,556 |
|
$ |
59,647,816 |
|
$ |
177,519,672 |
|
$ |
225,931,095 |
|
Cost of revenues |
|
28,510,837 |
|
31,388,999 |
|
95,587,218 |
|
115,748,650 |
| ||||
Gross profit |
|
23,704,719 |
|
28,258,817 |
|
81,932,454 |
|
110,182,445 |
| ||||
Operating expenses (note 1) |
|
|
|
|
|
|
|
|
| ||||
Selling and marketing |
|
5,533,211 |
|
7,624,043 |
|
23,166,231 |
|
27,673,598 |
| ||||
General and administrative |
|
11,850,869 |
|
14,379,389 |
|
37,814,962 |
|
51,125,534 |
| ||||
Impairment loss on operating assets |
|
|
|
594,162 |
|
139,660 |
|
594,162 |
| ||||
Total operating expenses |
|
17,384,080 |
|
22,597,594 |
|
61,120,853 |
|
79,393,294 |
| ||||
Government subsidies |
|
|
|
1,630 |
|
213,270 |
|
632,269 |
| ||||
Income from operations |
|
6,320,639 |
|
5,662,853 |
|
21,024,871 |
|
31,421,420 |
| ||||
Interest income |
|
909,394 |
|
1,432,391 |
|
3,499,926 |
|
5,343,445 |
| ||||
Other income / (expenses) |
|
1,214,199 |
|
(115,413 |
) |
3,945,306 |
|
776,293 |
| ||||
Income before income tax provision |
|
8,444,232 |
|
6,979,831 |
|
28,470,103 |
|
37,541,158 |
| ||||
Provision for income tax |
|
(862,055 |
) |
(131,745 |
) |
(4,156,450 |
) |
(4,101,092 |
) | ||||
Net income |
|
7,582,177 |
|
6,848,086 |
|
24,313,653 |
|
33,440,066 |
| ||||
Total net income attributable to TAL Education Group |
|
$ |
7,582,177 |
|
$ |
6,848,086 |
|
$ |
24,313,653 |
|
$ |
33,440,066 |
|
Net income per common share |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
$ |
0.05 |
|
$ |
0.04 |
|
$ |
0.16 |
|
$ |
0.21 |
|
Diluted |
|
0.05 |
|
0.04 |
|
0.16 |
|
0.21 |
| ||||
Net income per ADS (note 2) |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
0.10 |
|
0.09 |
|
0.32 |
|
0.43 |
| ||||
Diluted |
|
$ |
0.10 |
|
$ |
0.09 |
|
$ |
0.31 |
|
$ |
0.43 |
|
|
|
|
|
|
|
|
|
|
| ||||
Other comprehensive income, net of tax |
|
1,060,626 |
|
158,093 |
|
3,035,785 |
|
1,640,362 |
| ||||
Comprehensive income |
|
8,642,803 |
|
7,006,179 |
|
27,349,438 |
|
35,080,428 |
| ||||
Comprehensive income attributable to TAL Education Group |
|
$ |
8,642,803 |
|
$ |
7,006,179 |
|
$ |
27,349,438 |
|
$ |
35,080,428 |
|
Weighted average shares used in calculating net income per common share |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
154,958,044 |
|
156,120,150 |
|
154,000,219 |
|
155,607,458 |
| ||||
Diluted |
|
156,151,875 |
|
156,525,098 |
|
155,874,381 |
|
156,631,090 |
|
Note1: Share-based compensation expenses are included in the operating costs and expenses as follows:
|
|
For the Three Months |
|
For the Fiscal Year |
| ||||||||
|
|
Ended February 29/28 |
|
Ended February 29/28 |
| ||||||||
|
|
2012 |
|
2013 |
|
2012 |
|
2013 |
| ||||
Cost of revenues |
|
$ |
71,359 |
|
$ |
3,738 |
|
$ |
417,984 |
|
$ |
105,756 |
|
Selling and marketing |
|
361,164 |
|
283,448 |
|
1,497,266 |
|
1,814,748 |
| ||||
General and administrative |
|
1,004,448 |
|
1,435,864 |
|
5,985,993 |
|
6,363,396 |
| ||||
Total |
|
$ |
1,436,971 |
|
$ |
1,723,050 |
|
$ |
7,901,243 |
|
$ |
8,283,900 |
|
Note 2: Each ADS represents two Class A common shares.
TAL EDUCATION GROUP
Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures
(In U.S. dollar, except share, ADS, per share and per ADS data)
|
|
For the Three Months Ended |
|
For the Fiscal Year Ended |
| ||||||||
|
|
2012 |
|
2013 |
|
2012 |
|
2013 |
| ||||
Cost of revenues |
|
$ |
28,510,837 |
|
$ |
31,388,999 |
|
$ |
95,587,218 |
|
$ |
115,748,650 |
|
Share-based compensation expense in cost of revenues |
|
71,359 |
|
3,738 |
|
417,984 |
|
105,756 |
| ||||
Non-GAAP cost of revenues |
|
28,439,478 |
|
31,385,261 |
|
95,169,234 |
|
115,642,894 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Selling and marketing expenses |
|
5,533,211 |
|
7,624,043 |
|
23,166,231 |
|
27,673,598 |
| ||||
Share-based compensation expense in selling and marketing expenses |
|
361,164 |
|
283,448 |
|
1,497,266 |
|
1,814,748 |
| ||||
Non-GAAP selling and marketing expenses |
|
5,172,047 |
|
7,340,595 |
|
21,668,965 |
|
25,858,850 |
| ||||
General and administrative expenses |
|
11,850,869 |
|
14,379,389 |
|
37,814,962 |
|
51,125,534 |
| ||||
Share-based compensation expense in general and administrative expenses |
|
1,004,448 |
|
1,435,864 |
|
5,985,993 |
|
6,363,396 |
| ||||
Non-GAAP general and administrative expenses |
|
10,846,421 |
|
12,943,525 |
|
31,828,969 |
|
44,762,138 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Operating costs and expenses |
|
45,894,917 |
|
53,986,593 |
|
156,708,071 |
|
195,141,944 |
| ||||
Share-based compensation expense in operating costs and expenses |
|
1,436,971 |
|
1,723,050 |
|
7,901,243 |
|
8,283,900 |
| ||||
Non-GAAP operating costs and expenses |
|
44,457,946 |
|
52,263,543 |
|
148,806,828 |
|
186,858,044 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Income from operations |
|
6,320,639 |
|
5,662,853 |
|
21,024,871 |
|
31,421,420 |
| ||||
Share based compensation expenses |
|
1,436,971 |
|
1,723,050 |
|
7,901,243 |
|
8,283,900 |
| ||||
Non-GAAP income from operations |
|
7,757,610 |
|
7,385,903 |
|
28,926,114 |
|
39,705,320 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net income attributable to TAL Education Group |
|
7,582,177 |
|
6,848,086 |
|
24,313,653 |
|
33,440,066 |
| ||||
Share based compensation expenses |
|
1,436,971 |
|
1,723,050 |
|
7,901,243 |
|
8,283,900 |
| ||||
Non-GAAP net income attributable to TAL Education Group |
|
$ |
9,019,148 |
|
$ |
8,571,136 |
|
$ |
32,214,896 |
|
$ |
41,723,966 |
|
|
|
|
|
|
|
|
|
|
| ||||
Net income per ADS |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
$ |
0.10 |
|
$ |
0.09 |
|
$ |
0.32 |
|
$ |
0.43 |
|
Diluted |
|
0.10 |
|
0.09 |
|
0.31 |
|
0.43 |
| ||||
Non-GAAP Net income per ADS(note 3) |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
0.12 |
|
0.11 |
|
0.42 |
|
0.54 |
| ||||
Diluted |
|
$ |
0.12 |
|
$ |
0.11 |
|
$ |
0.41 |
|
$ |
0.53 |
|
|
|
|
|
|
|
|
|
|
| ||||
ADSs used in calculating net income per ADS |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
77,479,022 |
|
78,060,075 |
|
77,000,109 |
|
77,803,729 |
| ||||
Diluted |
|
78,075,937 |
|
78,262,549 |
|
77,937,191 |
|
78,315,545 |
|
Note 3: The Non-GAAP adjusted net income per ADS is computed using Non-GAAP adjusted net income and the same number of ADSs used in GAAP basic and diluted EPS calculation.