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 January 2022
Commission File Number: 001-34900
TAL EDUCATION GROUP
5/F, Tower B, Heying Center
Xiaoying West Street, Haidian District
Beijing 100085
People’s Republic of China
(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 ¨
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): ¨
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): ¨
TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars)
| As of February 28, 2021 | As of August 31, 2021 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 3,242,953 | $ | 3,375,073 | ||||
| Restricted cash-current | 1,758,937 | 1,984,403 | ||||||
| Short-term investments | 2,694,555 | 1,645,825 | ||||||
| Inventory | 38,675 | 26,492 | ||||||
| Amounts due from related parties-current | 2,964 | 1,978 | ||||||
| Income tax receivables | 15,641 | 13,773 | ||||||
| Prepaid expenses and other current assets | 403,110 | 258,286 | ||||||
| Total current assets | 8,156,835 | 7,305,830 | ||||||
| Restricted cash-non-current | 16,094 | 97,198 | ||||||
| Property and equipment, net | 511,415 | 387,250 | ||||||
| Deferred tax assets | 317,189 | 20,256 | ||||||
| Rental deposits | 102,555 | 101,405 | ||||||
| Intangible assets, net | 66,041 | 20,907 | ||||||
| Land use right, net | 216,702 | 214,837 | ||||||
| Goodwill | 454,413 | 62,522 | ||||||
| Amounts due from related parties- non-current | - | 67 | ||||||
| Long-term investments | 667,636 | 557,506 | ||||||
| Long-term prepayments and other non-current assets | 57,694 | 28,239 | ||||||
| Operating lease right-of-use assets | 1,545,735 | 1,486,040 | ||||||
| Total assets | $ | 12,112,309 | $ | 10,282,057 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 353,778 | $ | 170,817 | ||||
| Deferred revenue-current | 1,387,493 | 1,111,305 | ||||||
| Amounts due to related parties-current | 3,488 | 3,682 | ||||||
| Accrued expenses and other current liabilities | 911,283 | 938,623 | ||||||
| Income tax payable | 65,138 | 39,295 | ||||||
| Bond payable, current portion | - | 2,300,000 | ||||||
| Current portion of long-term debt | 270,000 | - | ||||||
| Operating lease liabilities, current portion | 382,671 | 386,976 | ||||||
| Total current liabilities | 3,373,851 | 4,950,698 | ||||||
| Deferred revenue-non-current | 30,005 | 132 | ||||||
| Deferred tax liabilities | 10,333 | 17,862 | ||||||
| Bond payable, non-current portion | 2,300,000 | - | ||||||
| Operating lease liabilities, non-current portion | 1,193,564 | 1,134,608 | ||||||
| Total liabilities | 6,907,753 | 6,103,300 | ||||||
| Mezzanine equity | ||||||||
| Redeemable non-controlling interests | 1,775 | - | ||||||
| Equity | ||||||||
| Class A common shares | 148 | 147 | ||||||
| Class B common shares | 67 | 67 | ||||||
| Additional paid-in capital | 4,369,125 | 4,317,313 | ||||||
| Statutory reserve | 121,285 | 112,423 | ||||||
| Retained earnings/(accumulated deficit) | 624,883 | (294,879 | ) | |||||
| Accumulated other comprehensive income | 86,321 | 62,483 | ||||||
| Total TAL Education Group's equity | 5,201,829 | 4,197,554 | ||||||
| Noncontrolling interest | 952 | (18,797 | ) | |||||
| Total equity | 5,202,781 | 4,178,757 | ||||||
| Total liabilities, mezzanine equity and equity | $ | 12,112,309 | $ | 10,282,057 | ||||
TAL EDUCATION GROUP
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of U.S. dollars, except share, ADS, per share and per ADS data)
| For the Six Months Ended August 31, | ||||||||
| 2020 | 2021 | |||||||
| Net revenues | $ | 2,013,931 | $ | 2,828,823 | ||||
| Cost of revenues (note 1) | 951,552 | 1,485,769 | ||||||
| Gross profit | 1,062,379 | 1,343,054 | ||||||
| Operating expenses (note 1) | ||||||||
| Selling and marketing | 598,851 | 741,037 | ||||||
| General and administrative | 484,892 | 687,632 | ||||||
| Impairment loss on intangible assets and goodwill | 304 | 426,190 | ||||||
| Total operating expenses | 1,084,047 | 1,854,859 | ||||||
| Government subsidies | 8,043 | 5,074 | ||||||
| Loss from operations | (13,625 | ) | (506,731 | ) | ||||
| Interest income | 50,186 | 71,897 | ||||||
| Interest expense | (6,664 | ) | (6,050 | ) | ||||
| Other income | 87,441 | 8,091 | ||||||
| Impairment loss on long-term investments | (6,885 | ) | (178,063 | ) | ||||
| Income/(loss) before provision for income tax and income from equity method investments | 110,453 | (610,856 | ) | |||||
| Income tax expense | (24,443 | ) | (341,558 | ) | ||||
| Income from equity method investments | 5,941 | 4,048 | ||||||
| Net income/(loss) | $ | 91,951 | $ | (948,366 | ) | |||
| Add: Net loss attributable to noncontrolling interest | 4,669 | 19,742 | ||||||
| Total net income/(loss) attributable to TAL Education Group | $ | 96,620 | $ | (928,624 | ) | |||
| Net income/(loss) per common share | ||||||||
| Basic | $ | 0.48 | $ | (4.33 | ) | |||
| Diluted | 0.46 | (4.33 | ) | |||||
| Net income/(loss) per ADS (note 2) | ||||||||
| Basic | $ | 0.16 | $ | (1.44 | ) | |||
| Diluted | 0.15 | (1.44 | ) | |||||
| Weighted average shares used in calculating net income/(loss) per common share | ||||||||
| Basic | 200,167,150 | 214,593,452 | ||||||
| Diluted | 208,429,705 | 214,593,452 | ||||||
Note1: Share-based compensation expenses are included in the operating costs and expenses as follows:
| For the Six Months Ended | ||||||||
| August 31, | ||||||||
| 2020 | 2021 | |||||||
| Cost of revenues | $ | 754 | $ | 734 | ||||
| Selling and marketing expenses | 17,322 | 48,432 | ||||||
| General and administrative expenses | 52,496 | 84,713 | ||||||
| Total | $ | 70,572 | $ | 133,879 | ||||
Note 2: Three ADSs represent one Class A common Share.
Recent Development
On November 12, 2021, the Company issued a press release to announce that in response to the regulatory developments relating to after-school tutoring services, including the Opinions on Further Alleviating the Burden of Homework and After-School Tutoring for Students in Compulsory Education, published in July 2021 by the General Office of the CPC Central Committee and the General Office of the State Council (the “Opinion”) and the related implementation rules, regulations and measures promulgated by competent authorities, the Company decided to cease offering academic subjects to students from kindergarten through grade nine (“K9 Academic AST Services”) in the mainland of China by the end of December 2021.
The Company has completed the cessation by the due date and expects that the cessation will have a substantial adverse impact on the Company’s revenues for the fiscal year ending February 28, 2022 and subsequent periods. In the fiscal year ended February 28, 2021, the revenues from offering K9 Academic AST Services accounted for a substantial majority of the Company’s total revenues in the year.
By leveraging its leading-edge education technology, high quality content and extensive experience, the Company will continue to operate and develop the portion of its business that is not related to K9 Academic AST Services, and will also explore other opportunities to provide education services in accordance with relevant rules and regulations.
The Company will continue to seek guidance from and cooperate with government authorities in various provinces and municipalities in China in connection with its efforts to comply with the policy directives in the Opinion and any related implementation rules, regulations and measures. The Company will further adjust its business operations as required, and update its shareholders as appropriate.
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.
| By: | /s/ Alex Zhuangzhuang Peng | ||
| Name: | Alex Zhuangzhuang Peng | ||
| Title: | President and Chief Financial Officer | ||
Date: January 14, 2022