Category: Financial Results

Jaguar Mining Reports First Quarter 2020 Financial Results, Free Cash Flow and Stronger Liquidity

Jaguar Mining Inc. (“Jaguar” or the “Company”) (TSX:JAG) today announced financial results for the first quarter (“Q1 2020”) ended March 31, 2020. All figures are in US Dollars, unless otherwise expressed.

Q1 2020 Financial Highlights

– Gold production increased 28% with 21,008 ounces compared to 16,365 ounces in Q1 2019;
– Consolidated Cash Operating Costs (“COC”) decreased 20% to $693 per ounce mainly due to increase in head-grade and devaluation of the BRL currency;
– Consolidated All-in Sustaining Costs (“AISC”) decreased 23% to $1,103 per ounce;
– Net Income of $12.3 million; cash generated from operating activities of $8.6 million;
– Sustaining capital expenditures of $6.6 million invested in development and mining equipment, with free cash flow of $2.1 million;
– Free cash flow was $2.1 million for Q1 2020, compared to negative $4.6 million in Q1 2019. Free cash flow was lower than expected due to approximately 2,000 ounces sold on March 31, 2020, for which the payment was received in April due to COVID-19 related logistics issues. Had the payment been received in March, the free cash flow would have been $5.3 million.
– Strong liquidity as at March 31, 2020, with a cash and sold bullion receivable of $15.6 million, as compared to $11.7 million of cash and unsold bullion on December 31, 2019;
– Delivered into all gold option contracts and is completely unhedged at the end of Q1 2020.

Vern Baker, President and CEO of Jaguar Mining stated: “During Q1 2020, we continued improving production numbers as we move toward our sustainable goal of 25,000 ounces per quarter. Q1 2020 is our second quarter in a row with positive free cash flow, and the fourth quarter in a row with increasing ounce production. With the fulfillment of the last option contracts Jaguar is unhedged. I would like to thank our team of miners in Brasil for their efforts and commitment. This is especially evident as we deal with the COVID-19 crisis. The team has maintained focus, operating safely and continuing to build the company’s capacity for sustainable production.

While the COVID-19 issue remains a critical theme in operations, the team is committed to continuing our path toward 25,000 ounces per quarter. Coupled with the current gold price and favourable exchange rate the steady expected improvement of production will show up in increasingly stronger financials each quarter this year.”

Vern added, “Pilar Gold Mine had its highest production quarter on record at 11,521 ounces. Turmalina Gold Mine production was consistent with the prior quarter at 9,487 ounces, and development rates are sufficient to see the augmentation of production in the second half of the year.

In Q1 2020 we completed our option contracts (6,700 ounces at $1,363 per ounce) and completely unhedged. Bank debt is $4.8 at March 31, 2020. All the bank debt is held by Brazilian banks and is unsecured.”

Q1 2020 Financial Results
Image 1: http://acnnewswire.com/topimg/JAG_1Q20201.jpg
Image 2: http://acnnewswire.com/topimg/JAG_1Q20202.jpg

Cash Position and Use of Funds

– Strong treasury position as at March 31, 2020, with a cash and unsold bullion balance of $15.6 million as compared to $11.7 million of cash and unsold bullion on December 31, 2019. As of the end of Q1 2020, the Company is completely unhedged on gold price.
– As at March 31, 2020, working capital was $12.5 million, compared to $9.4 million as at December 31, 2019, which includes $4.8 million in loans from Brazilian banks, which mature every six months and are expected to be rolled forward.

Qualified Persons

Scientific and technical information contained in this press release has been reviewed and approved by Jonathan Victor Hill, BSc (Hons) (Economic Geology – UCT), Senior Expert Advisor Geology and Exploration to the Jaguar Mining Management Committee, who is also an employee of Jaguar Mining Inc., and is a “qualified person” as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”).

The Iron Quadrangle

The Iron Quadrangle has been an area of mineral exploration dating back to the 16th century. The discovery in 1699-1701 of gold contaminated with iron and platinum-group metals in the southeastern corner of the Iron Quadrangle gave rise to the name of the town Ouro Preto (Black Gold). The Iron Quadrangle contains world-class multi-million-ounce gold deposits such as Morro Velho, Cuiaba, and Sao Bento. Jaguar holds the second largest gold land position in the Iron Quadrangle with just over 25,000 hectares.

About Jaguar Mining Inc.

Jaguar Mining Inc. is a Canadian-listed junior gold mining, development, and exploration company operating in Brazil with three gold mining complexes and a large land package with significant upside exploration potential from mineral claims covering an area of approximately 64,000 hectares. The Company’s principal operating assets are located in the Iron Quadrangle, a prolific greenstone belt in the state of Minas Gerais and include the Turmalina Gold Mine Complex and Caete Mining Complex (Pilar and Roca Grande Mines, and Caete Plant). The Company also owns the Paciencia Gold Mine Complex, which has been on care and maintenance since 2012. The Roca Grande Mine has been on temporary care and maintenance since April 2019. Additional information is available on the Company’s website at www.jaguarmining.com.

For further information please contact:

Vernon Baker
Chief Executive Officer
Jaguar Mining Inc.
vernon.baker@jaguarmining.com
416-847-1854

Hashim Ahmed
Chief Financial Officer
Jaguar Mining Inc.
hashim.ahmed@jaguarmining.com
416-847-1854

Forward-Looking Statements

Certain statements in this news release constitute “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking statements and information are provided for the purpose of providing information about management’s expectations and plans relating to the future. All of the forward-looking information made in this news release is qualified by the cautionary statements below and those made in our other filings with the securities regulators in Canada. Forward-looking information contained in forward-looking statements can be identified by the use of words such as “are expected,” “is forecast,” “is targeted,” “approximately,” “plans,” “anticipates,” “projects,” “anticipates,” “continue,” “estimate,” “believe” or variations of such words and phrases or statements that certain actions, events or results “may,” “could,” “would,” “might,” or “will” be taken, occur or be achieved. All statements, other than statements of historical fact, may be considered to be or include forward-looking information. This news release contains forward-looking information regarding, among other things, expected sales, production statistics, ore grades, tonnes milled, recovery rates, cash operating costs, definition/delineation drilling, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of projects and new deposits, success of exploration, development and mining activities, currency fluctuations, capital requirements, project studies, mine life extensions, restarting suspended or disrupted operations, continuous improvement initiatives, and resolution of pending litigation. The Company has made numerous assumptions with respect to forward-looking information contained herein, including, among other things, assumptions about the estimated timeline for the development of its mineral properties; the supply and demand for, and the level and volatility of the price of, gold; the accuracy of reserve and resource estimates and the assumptions on which the reserve and resource estimates are based; the receipt of necessary permits; market competition; ongoing relations with employees and impacted communities; political and legal developments in any jurisdiction in which the Company operates being consistent with its current expectations including, without limitation, the impact of any potential power rationing, tailings facility regulation, exploration and mine operating licenses and permits being obtained and renewed and/or there being adverse amendments to mining or other laws in Brazil and any changes to general business and economic conditions. Forward-looking information involves a number of known and unknown risks and uncertainties, including among others: the risk of Jaguar not meeting the forecast plans regarding its operations and financial performance; uncertainties with respect to the price of gold, labour disruptions, mechanical failures, increase in costs, environmental compliance and change in environmental legislation and regulation, weather delays and increased costs or production delays due to natural disasters, power disruptions, procurement and delivery of parts and supplies to the operations; uncertainties inherent to capital markets in general (including the sometimes volatile valuation of securities and an uncertain ability to raise new capital) and other risks inherent to the gold exploration, development and production industry, which, if incorrect, may cause actual results to differ materially from those anticipated by the Company and described herein. In addition, there are risks and hazards associated with the business of gold exploration, development, mining and production, including environmental hazards, tailings dam failures, industrial accidents and workplace safety problems, unusual or unexpected geological formations, pressures, cave-ins, flooding, chemical spills, procurement fraud and gold bullion thefts and losses (and the risk of inadequate insurance, or the inability to obtain insurance, to cover these risks). Accordingly, readers should not place undue reliance on forward-looking information.

For additional information with respect to these and other factors and assumptions underlying the forward-looking information made in this news release, see the Company’s most recent Annual Information Form and Management’s Discussion and Analysis, as well as other public disclosure documents that can be accessed under the issuer profile of “Jaguar Mining Inc.” on SEDAR at www.sedar.com. The forward-looking information set forth herein reflects the Company’s reasonable expectations as at the date of this news release and is subject to change after such date. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law. The forward-looking information contained in this news release is expressly qualified by this cautionary statement.

Non-IFRS Measures

This news release provides certain financial measures that do not have a standardized meaning prescribed by IFRS. Readers are cautioned to review the below stated footnotes where the Company expands on its use of non-IFRS measures.

1. Cash operating costs and cash operating cost per ounce are non-IFRS measures. In the gold mining industry, cash operating costs and cash operating costs per ounce are common performance measures but do not have any standardized meaning. Cash operating costs are derived from amounts included in the Consolidated Statements of Comprehensive Income (Loss) and include mine-site operating costs such as mining, processing and administration, as well as royalty expenses, but exclude depreciation, depletion, share-based payment expenses, and reclamation costs. Cash operating costs per ounce are based on ounces produced and are calculated by dividing cash operating costs by commercial gold ounces produced; US$ cash operating costs per ounce produced are derived from the cash operating costs per ounce produced translated using the average Brazilian Central Bank R$/US$ exchange rate. The Company discloses cash operating costs and cash operating costs per ounce, as it believes those measures provide valuable assistance to investors and analysts in evaluating the Company’s operational performance and ability to generate cash flow. The most directly comparable measure prepared in accordance with IFRS is total production costs. A reconciliation of cash operating costs per ounce to total production costs for the most recent reporting period, the quarter ended March 31, 2020, is set out in the Company’s first quarter 2020 Management Discussion and Analysis (MD&A) filed on SEDAR at www.sedar.com.

2. All-in sustaining cost is a non-IFRS measure. This measure is intended to assist readers in evaluating the total costs of producing gold from current operations. While there is no standardized meaning across the industry for this measure, except for non-cash items the Company’s definition conforms to the all-in sustaining cost definition as set out by the World Gold Council in its guidance note dated June 27, 2013. The Company defines all-in sustaining cost as the sum of production costs, sustaining capital (capital required to maintain current operations at existing levels), corporate general and administrative expenses, and in-mine exploration expenses. All-in sustaining cost excludes growth capital, reclamation cost accretion related to current operations, interest and other financing costs, and taxes. A reconciliation of all-in sustaining cost to total production costs for the most recent reporting period, the quarter ended March 31, 2020, is set out in the Company’s first quarter 2020 MD&A filed on SEDAR at www.sedar.com.

SOURCE: Jaguar Mining Inc.

Nissin Foods Delivers Solid 2020 Q1 Financial Results

Revenue up 10.6% to HK$884.6 million; and
Segment results record double-digit growth for two consecutive years

Mr. Kiyotaka Ando, Executive Director, Chairman
and Chief Executive Officer of Nissin Foods

Nissin Foods Company Limited (the “Company”, and together with its subsidiaries, the “Group”; Stock code: 1475) has today announced its unaudited 2020 first quarter financial information for the three months ended 31 March 2020 (“the Reporting Period”).

Revenue of the Group amounted to HK$884.6 million, representing a year-on-year (YoY) increase of 10.6% from HK$799.6 million. Gross profit increased by 7.9% YoY to HK$284.2 million (2019: HK$263.4 million), with gross profit margin decreasing slightly by 0.8% to 32.1% (2019: 32.9%), mainly attributable to the increase in raw material costs YoY. Profit attributable to owners of the Company was HK$99.0 million, representing an increase of 8.0% YoY from HK$91.7 million. Segment results recorded an optimal double-digit growth of 25.7% YoY to HK$125.7 million from HK$100.0 million.

For the Hong Kong operations, revenue recorded an increase of 11.1% YoY to HK$358.4 million (2019: HK$322.7 million) during the Reporting Period, mainly attributable to the increase in demand of bag-type instant noodles in Hong Kong. As for the PRC operations, revenue increased by 10.3% YoY (in local currency: 16.1%) from HK$476.9 million to HK$526.2 million, due to the improvement in sales volume of cup-type instant noodles in the PRC, although the foreign exchange translation of earnings in Renminbi depreciated against the Hong Kong Dollar this year.

The Group has recorded a remarkable performance, with segment results achieving double-digit growth for two consecutive years. During the Reporting Period, the Group has formed a joint venture company to provide a more comprehensive range of products for customers to satisfy their greater demand for Japanese-branded food and beverage products in the PRC. This helps diversify the Group’s product offering as well as seek new revenue streams in the long run.

Mr. Kiyotaka Ando, Executive Director, Chairman and Chief Executive Officer of Nissin Foods, said, “The Group has delivered a solid set of results in the dynamic environment in the first quarter of 2020, achieving double-digit revenue growth in Hong Kong and the PRC. Our business has proven resilient in the face of the Covid-19 pandemic. We have moved fast to support our consumers and reacted quickly to meet their needs. As we humbly take it as our responsibility to ensure the stable and reliable supply of quality food products, we have also tapped into growth opportunities in non-instant noodles business for long-term development. It remains impossible to predict how long today’s socio-economic uncertainty will last. However, the Group will remain focused on delivering satisfactory results to its shareholders in 2020.”

For details, please refer to the announcement:
https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0511/2020051100308.pdf

About Nissin Foods Company Limited
Nissin Foods Company Limited (The “Group”; Stock code: 1475) is a renowned food company in Hong Kong and the PRC with a diversified portfolio of well-known and highly popular brands and the largest instant noodle company in Hong Kong. The Group officially established its presence in Hong Kong in 1984. The Group primarily manufactures and sells instant noodles, frozen foods and other food products under its two core corporate brands, namely “NISSIN” and “DOLL” together with a diversified portfolio of iconic household premium food brands. The Group’s five flagship product brands, namely “Cup Noodles”, “Demae Iccho”, “Doll Instant Noodle”, “Doll Dim Sum” and “Fuku” are also among the most popular choices in their respective food product categories in Hong Kong. In the PRC market, the Group has introduced technology innovation through the “ECO Cup” concept into the market and primarily focuses its sales efforts in first- and second-tier cities located in the eastern and southern parts of the PRC. For more information, please visit www.nissingroup.com.hk.

For media enquiries:
Nissin Foods Company Limited
Public Relations Department
Blanche Wong / June Lau
Email: pr@nissinfoods.com.hk

For investor enquiries:
Nissin Foods Company Limited
Investor Relations Department
Shingo Yamazaki / Peter Kwok
Email: ir@nissinfoods.com.hk

Strategic Financial Relations Limited
Vicky Lee Tel: (852) 2864 4834 Email: vicky.lee@sprg.com.hk
Carven Tsui Tel: (852) 2864 4859 Email: carvensm.tsui@sprg.com.hk
Cara Lau Tel: (852) 2864 4890 Email: cara.lau@sprg.com.hk

Joyoung (002242): Steady Q1 Domestic Growth, with Outlook for Quality 2020 Performance

Early this year, the outbreak of COVID-19 has put a pause on the development of economy and society. China’s GDP in the first quarter fell by 6.8% year on year, and the total retail sales of consumer goods was 7,858 billion Yuan, down 19.0% year on year. Joyoung Co., Ltd. (002242), the domestic brand advocating for national healthiness and well-being, released its Interim Report for the First Quarter 2020 today. In the reporting period, the Company has achieved operating revenues of 1,702 million Yuan, down 5.37% year on year; net profits attributable to the Company’s shareholder were 147 million Yuan, down 9.91% year on year.

Facing the great challenges imposed by the COVID-19 outbreak, the Company has adjusted its sales strategies promptly. Under the pandemic control regulations, the Company has been actively restoring production and manufacturing and endeavour to mitigate the adverse impact from closed offline stores, cancellation of Spring Festival promotions and low efficiency in logistics and managed to achieve positive domestic growth.

In March, the Company held the first Joyoung Live Shopping Festival campaign. Thousands of offline shopping guides were online at the same time, with a total of more than 20,000 live streaming events held in 7 days. Joyoung’s crossover product in collaboration with LINE FRIENDS, the sandwich maker, was promoted in the Weiya live-stream channel. As soon as the purchase link came out, tens of thousands of machines were sold out. Many consumers commented that the products were sold out so quickly that they were not even able to make the purchase.

To digitalize business operations, users’ networks and scenarios, the Company has been exploring and practising new retailing and live-streaming. It has established a comprehensive live-streaming hosts system consists of celebrities, KOLs (Key Opinion Leader) and KOCs (Key Opinion Customer). With offline shopping guides joining live-stream, the Company is more dedicated than ever to build a one-stop, visible and interactive shopping scenario for consumers.

During this special time, consumers have become more aware of the healthy attributes of household appliances. Top picks very often feature in sterilizing or enhancing immunity. The Company has launched a series of kitchen appliances products that can use high temperature steam for sterilization, such as the Little Magic Cube dishwasher with a bacteria removal rate at 99.9%, soymilk maker and cell wall-breaking high speed blender that are self-cleaning and steam sterilizing, steam rice cooker with liner free of inner-coating that can sterilize milk bottle for baby and steam mop that generates high-temperature steam at 120 degrees Celsius, which can remove 99.9%, which have become very popular among consumers. Shark steam mop has been the best-seller on Tmall in the steam mop category for 10 consecutive months. The products have been well received, and even some models have been sold out.

Driven by momentums in product and channel and oriented by customer demand, the Company will also actively grasp business opportunities in the new economy and live streaming, proactively cater to new customer behaviour and demand, intensively promote digital and social network-reliant new retailing and widely develop new users, attract new fans and establish new channels, through which it will create a new retail operation model customized for its development. The Company will be continued to actively engage in the development of 5G mobile internet, and strive to achieve a comprehensive digital transformation, achieving cross-border operations in different fields such as social e-commerce, on-line live streaming, and O2O new retailing, allowing the seamless integration of brands, products, and users.

China Leon Recorded a Significant Increase in Net Profit of RMB396.5 million

International Network and Smart Inspection;
Technological Innovation Leads the Future

China Leon Inspection Holding Limited (“China Leon” or the “Company” together with its subsidiaries, the “Group”, stock code: 1586), announced its annual results for the year ended 31 December 2019 (the “Year”).

During the Year, the Group recorded revenue of RMB396.5 million, representing an increase of 69.6% when compared with the corresponding period of last year, which was mainly attributable to the Group’s successful development in the field of commodities and energy inspection. The Group’s gross profit increased by 51.5% from RMB122.9 million in 2018 to RMB186.2 million in 2019. The Group’s profit for the year increased by 486.8% from approximately RMB4.9 million in 2018 to approximately RMB28.8 million in 2019. The Board has proposed a final dividend of RMB0.0375 per share for the year ended 31 December 2019 to shareholders as a reward for their support.

Continued to improve service network, grew customer base and enhanced competitive advantages
The Group has 20 inspection agencies and laboratories within China, covering major domestic trading ports and cities, including Hong Kong, Qinhuangdao, Tangshan, Tianjin, Cangzhou, Nanjing, Jiangyin, Hunan, Hubei, Guangzhou, Zhuhai, Xinjiang, Shaanxi, Inner Mongolia, Dalian, Zhoushan, Xiamen, Nanjing and Dongguan. Overseas, the Group has 8 inspection agencies and laboratories, covering Singapore, India, Malaysia, Indonesia, Pakistan, Brunei and Australia. The key customers of the Group include CHN Energy, Shaanxi Coal Group, China Coal Group, Yitai Group, Datang Group, China Resources Group, CNPC, SINOPEC, CNOOC, ChemChina, SinoChem, Shell, BP, Exxon – Mobil, Chevron, Total, Saudi Aramco, ENOC and Rosneft, etc.

Continued to strengthen core competence through technological improvement and R&D
The Group continued to attract new talents through incubator framework and M&A. The Group actively participated in the formulation of national and industry standards. During the Year, the Group participated in creation of four national standards. The Group also crystallized 39 corporate standards. The Group successfully deployed the in-house developed ‘Leon LIMS’ laboratory system and industrial robot sampling system which significantly improved the efficiency and consistency of sampling process. The Group will continue to build competitive advantage through increasing effort in R&D and developing industry-leading technologies.

Mr. YANG Rongbing, Executive Director and Vice Chairman of China Leon Inspection Holding Limited, said “In 2020, our growth strategy is based on further strengthening existing business as well as continuing to expand into new service offerings. We will increase our competitive advantage through better allocation of enterprise’s resources to improve cost control and performance measurement as well as enhancement of our enterprise-wide business platform. We will continue maintain our leading position and market share in its established markets while further promoting our “Leon” brand, and improving our management and control systems to deliver a better return to our shareholders.”

Annual Report on Form 20-F for Fiscal Year 2019 of Aluminum Corporation of China Limited Now Available

Aluminum Corporation of China Limited (the “Company”; NYSE “ACH”; SEHK “2600”; SSE “601600”) announces that the Company’s annual report for the 2019 fiscal year filed with the SEC on April 22, 2020 can be accessed via the following link:

http://www.chalco.com.cn/chalcoen/tzzgx/pr/webinfo/2020/04/1587581225293050.htm.

A paper copy of the Company’s complete annual report will be provided to any shareholder without charge upon written request to Aluminum Corporation of China Limited at No. 62 North Xizhimen Street, Haidian District, Beijing, PRC 100082.

Background information:

Aluminum Corporation of China Limited is a leading enterprise in non-ferrous metal industry in China. The scope of business of the Company primarily includes bauxite and coal mining, alumina refining, primary aluminum smelting, trading of alumina, primary aluminum, other non-ferrous metal products, coal products and raw and ancillary materials in bulk and power generation. The Company was established as a joint stock limited company incorporated in the People’s Republic of China. The Company’s American Depository Shares and H Shares are listed on the New York Stock Exchange, Inc. and the Stock Exchange of Hong Kong Limited respectively. The Company’s A Shares are listed on the Shanghai Stock Exchange.

For further queries, please visit http://www.chalco.com.cn

Edvantage Group (0382.HK) Announced its FY2020 Interim Results

Net Profit Soared by Approximately 61.1% YOY to Approximately RMB147.1 Million;
Determined Interim Dividend of HK4.9 Cents per share;
Growth in Performance Surpassed Guideline in Profit Alert Announcement

(Hong Kong Office)From left: Mr. Wong Shing Mun, Chief Financial Officer and Company Secretary; Mr. Liu Yung Chau, Executive Director and Chairman of the Board; Ms. Liu Yi Man, Executive Director and Chief Executive Officer; Mr. Yan Kwok Ting Sunny, Director of CF & IR Department
(Guangzhou Headquarter) Ms. Liu Wenqi, Chief Operating Officer

Edvantage Group Holdings Limited (“Edvantage Group” or the “Group”, stock code: 0382.HK) announces its unaudited interim results for the six months ended 29 February 2020 (the “reporting period”). The Group operates four schools during the reporting period, Huashang College Guangdong University of Finance and Economics (“Huashang College”) and Guangzhou Huashang Vocational College (“Huashang Vocational College”) in the Guangdong-Hong Kong-Macau Greater Bay Area (“Greater Bay Area”) of the PRC, and one private vocational education institution in Australia, Global Business College of Australia (“GBCA”), as well as NYU Language School, a private education institution in Singapore, which was acquired during the reporting period.

Financial Highlights (for the six months ended 29 February 2020)
– Number of student enrolments increased by 8% YoY to 35,300
– Average tuition fee of Huashang College increased by 11.3% YoY to RMB24,315
– Average tuition fee of Huashang Vocational College increased by 3.4% YoY to RMB15,573
– Revenue rose by approximately 18.9% YoY to approximately RMB418.3 million
– Gross profit increased by approximately 23.3% YoY to RMB204.1 million
– Gross margin climbed 1.8 ppts to 48.8%
– Adjusted net profit1 surged approximately 35.4% YoY to approximately RMB150.8 million
– Adjusted net profit margin rose by 4.4 ppts YoY to 36.1%
– Net profit2 surged approximately 61.1% YoY to approximately RMB147.1 million
– Net profit margin climbed 9.2 ppts YoY to 35.2%
– Interim dividend per share is HK4.9 cents
Note: (1) Adjusted net profit includes three one-off adjusted net profit items: 1) Net foreign exchange loss and gain (FY2020 Interim: Loss of RMB2,364,000; FY2019 Interim: Gain of RMB565,000); 2) Share-based payments relevant to a share option scheme and share award scheme as incentive for employees (FY2020 Interim: RMB1,345,000; FY2019 Interim: nil); 3) Listing expenses (FY2020 Interim: nil; FY2019 Interim: RMB20,710,000); (2) Profit from continuing operations

During the reporting period, the Group recorded an outstanding growth performance in its interim results. The total number of student enrolments amounted to 35,300, representing a year-on-year (“YoY”) increase of 8.0%. The average tuition fee of Huashang College was RMB24,315, representing a YoY increase of 11.3%, while Huashang Vocational College’s average tuition fee was RMB15,573, representing a YoY increase of 3.4%. Revenue rose by approximately 18.9% YOY to approximately RMB418.3 million. Gross profit rose by approximately 23.3% YOY to approximately RMB204.1 million, while gross margin rose by 1.8 percentage points YOY to 48.8%. Adjusted net profit grew by approximately 35.4% YoY to approximately RMB 150.8 million, while adjusted net profit margin grew by 4.4 percentage points YOY to 36.1%. Net profit soared by approximately 61.1% YOY to approximately RMB147.1 million, while net profit margin increased by 9.2 percentage points YOY to 35.2%. The Board of Directors of the Group declared an interim dividend of HK4.9 cents per share.

Business Operation Overview

During the reporting period, Huashang College moved up six spots from the previous year to the 29th place in the 2020 ranking of top independent colleges released by CUAA.NET and was rated as “China’s Top-Level Independent College”. During the reporting period, Huashang College offered 37 undergraduate courses, including three new major courses, namely, taxation, cosmetic science and technology, and science of Chinese traditional medicine. In terms of student enrolment in the 2019/2020 school year, the top five majors were accounting, English, international economics and trade, financial engineering and Chinese literature. Among majors, accounting and journalism were designated as a “featured key disciplines in Guangdong Province” and “key development disciplines in Guangdong province” respectively and included in “leading top undergraduate majors for development in Guangdong province”. In the 2019/2020 school year, the minimum scores of liberal arts and science students for admission to Huashang College were 31 and 28 points higher than minimum admission scores of Guangdong Province, respectively. During the reporting period, the total number of student enrolments in Huashang College was 24,110, representing a YOY increase of 6.5%, and the average tuition fee for its students was RMB24,315, representing a YOY increase of 11.3%.

Huashang Vocational College offered 44 junior college diploma programmes during the reporting period, including 10 new programmes such as medical aesthetics technology, health management, interior art design and automotive electronics technology. Among the majors, tourism and hotel management were rated by the Education Department of Guangdong Province as “key development disciplines”. During the reporting period, the total number of student enrolments in Huashang Vocational College was 10,661, representing a YOY increase of 11.8%, and the average tuition fee for its student enrolments was RMB15,573, representing a YOY increase of 3.4%.

GBCA offers vocational education courses and non-academic short-term courses. A total of 22 training courses were offered during the reporting period. These courses are divided into five categories: interpreting, English, business and accounting, information technology and childcare and community services programmes. Students will receive certifications issued by GBCA which are recognised or endorsed by relevant training agencies, such as the National Accreditation Authority for Translators and Interpreters, or a diploma or advanced diploma upon completing all courses required by the respective programmes. During the reporting period, its number of student enrolments was 506.

During the reporting period, the Group acquired NYU Language School, a Singaporean private school. Established in 1991, the school has attained the authoritative EduTrust certification from the Ministry of Education, Singapore. It offers short-term and long-term language training courses and various courses in preparation for entrance to Singaporean schools for Singaporeans and international students. It is qualified to offer internationally recognised courses and accept local and overseas students in Singapore. The Group has established the Singapore campus based in the existing NYU Language School. The new campus is situated in the city centre with favourable geographical location and excellent accessibility. It is also in the vicinity of various universities, including the National University of Singapore and the Nanyang Academy of Fine Arts, which are accessible within a short period of time. The new campus is expected to be put into use in the second quarter of 2020. The Group will then gradually add new teaching content. For example, the Group’s “Global Immersion Program” will continuously provide short-term overseas courses (such as arts and landscape design courses) for students from the families of Chinese businessmen. The number of student enrolments was 23 up to the end of the reporting period following the Group’s acquisition of NYU Language School in December 2019.

Business Update and Outlook

During the reporting period, the Group experienced the global outbreak of a novel coronavirus pneumonia epidemic (“COVID-19”). Since the industry in which the Group operates is higher education, the Group was minimally affected. In early March 2020, both Huashang College and Huashang Vocational College opened as scheduled. Guided by the national policy of “classes suspended but learning continues”, the Group actively arranged students to switch from studying offline to online, and online teaching progressed smoothly. In addition, the Group’s APP “Huashang e-Home” fully demonstrated its advantages by providing various convenient services for Internet-assisted teaching, faculty and student management services and faculty’s and students’ lives during this period for responding to the COVID-19 epidemic. The Group will also seize the online education opportunity to focus on future and constantly discover and explore typical cases, laying the foundation for reform in online education.

Looking forward, the Group will continuously strengthen its core business, vigorously develop vocational education and training business, constantly improve the quality of the Group’s education services, enhance the overall operation level and achieve higher profitability through diversified models.

Continuous Strengthening of the Core Business:

Improvement in School Condition and Proactive Deployment of Teaching Resources

New Sihui campus: The new Sihui campus will be put into operation as scheduled in September 2020. The new campus covers an area of approximately 533,300 sq. m. (800 Mu) and can accommodate approximately 16,000 students. The net increase in the number of students is expected to record no fewer than 3,000 each year.

Existing Zengcheng campus: The constructions of the Huashuang Science & Technology Centre and Huashang International Conference Centre on the Zengcheng campus are in progress as scheduled. The Huashuang Science & Technology Centre will be mainly used for related teaching activities, and the Huashang International Conference Centre will be mainly used to host industry or school-enterprise meetings, academic activities, and practical training.

Diversification of Education Services

New teaching venue in Shenzhen: The new teaching venue is located in The Mixc Commercial Zone, Nanshan District, Shenzhen and is expected to commence operation in the second quarter of 2020. It will serve mainly for the purpose of high-end vocational certificate training and examinations (training and examinations for certificates such as the certificate in finance and technology, big data/artificial intelligence (AI) certificate and related qualification certificates issued by the institute of chartered secretaries), high-end business activities and academic salons and serve as an innovation entrepreneurship base/incubator, an extracurricular practice base, and a place for delivering employment and internship skills training.

Course Improvement

Comprehensive strategic cooperation with SenseTime: The Group signed a comprehensive strategic cooperation agreement with SenseTime Group Limited, a world-leading AI platform company on 12 November 2019. The cooperation content includes developing AI courses (including providing general education courses for students from Huashang College and Huashang Vocational College and providing major courses for students from the school of data science in Huashang College and Huashang Vocational College) and training compound talents in combination with superior disciplines. The Group plans to offer relevant courses from the 2020/2021 school year.

Cooperation with the Southwest University of Political Science and Law: On 31 December, the Group entered into a cooperation agreement with the Southwest University of Political Science and Law in Chongqing. The joint establishment of Southwest University of Political Science & Law Huashang College to award double bachelor’s degree of Business and Law inter-disciplinary talent to enhance the level of recognition and the competitiveness of its graduates. The Group expects the tuition fees of the joint programme will be considerably higher than its original single subject programme.

Comprehensive strategic cooperation with Kingdee Group: On 12 March 2020, the Group signed a comprehensive strategic cooperation agreement with Kingdee Software China Company Ltd., a leading enterprise management software and e-commerce application solution provider in the Asia-Pacific region. The two parties will work together to promote the integration of production and education, thereby developing compound application talents adapted to enterprise digital management.

Global Expansion and Improvement of Teaching Quality

New Singapore campus: The Group has established the Singapore campus based in the existing NYU Language School. Expected to commence operation in the second quarter of 2020, the new campus is situated in the city centre with favourable geographical location and excellent accessibility. It is also in the vicinity of various universities, including the National University of Singapore and the Nanyang Academy of Fine Arts. Besides providing long-term and short-term language training courses and various courses in preparatory for entrance of different schools, the new campus also provides college graduate degree and operates other universities’ undergraduate and master programmes, as well as kinds of non-formal education training and innovation & entrepreneurship courses.

New campus in London: The Group is advancing relevant preparations for a new campus in London. As part of the preparations, software-related work such as licensing application is ongoing, but the management of the Group decided to postpone hardware-related work due to the COVID-19 epidemic. Given this, the Group strives to further implement the hardware-related work in due course. So far, the Group has not invested much in preparing for the new campus in London.

Vigorous Development of Vocational Education Training Business:

The business of vocational education training of the Group further grew under the provisional government policy on quality classification of vocational skills, i.e. “1 + X” certificate system, introduced for vocational colleges and technical training colleges.

The business of vocational education training of the Group has high growth and gross profit margin and will become a new revenue growth factor for the Group. The Group expects that the revenue of this business segment in the financial year (“FY”) 2019/2020 will increase by approximately 50% or above YoY (approximately RMB9 million in FY2018/2019 and its gross profit margin will also exceed that of its core business (gross profit margin of the core business: approximately 48.6% in FY2018/2019. The Group has taken the following main measures recently to vigorously develop its vocational education training business:

The Group actively cooperates with industry-leading institutions/schools to offer high-end vocational education training courses in China and beyond: including Development of AI-related courses with SenseTime (expected to commence in the second quarter of 2020); Development of courses related to enterprise digital management talents with Kingdee Group (expected to commence in the second quarter of 2020); Implementation of vocational training projects in law with the Southwest University of Political Science and Law through overseas educational resources (expected to commence in the school year of 2020/2021);

More certified vocational training courses have been introduced in Zengcheng campus: such as CFA, junior accountant, computer science, teacher qualification certificate, CET 4, CET 6 and IELTS;

Further development of the School of Continuing Education in Zengcheng campus: The contribution of revenue from continuing education in the school year of 2020/2021 and beyond is expected to be more significant.

Mr. Liu Yung Chau, Executive Director and chairman of the Board of Edvantage Group Holdings Limited, said, “benefiting from national policies which support the Greater Bay Area as well as the natural demographic dividend there, Edvantage Group has been clearly positioned as ‘Nurturing professional talents for the Greater Bay Area.’ Our interim results performance in FY2020 was satisfying and surpassed the 30%-guideline stated in the profit alert announcement. Amid the epidemic, this was even more precious and was a surprise as well. We have always valued shareholders’ interests. This is the first full interim dividend since listing, which remained the 30%-rate stated in 2019 Annual Report. Since Edvantage Group was listed on 16 July 2019, the Group distributed dividends in FY2019 for the first time in FY2019 ended 31 August 2019, which was HK1 cent per share for only a 1.5-month period, while for this time, an interim dividend of HK4.9 cents per share will be distributed. Our management hope to maintain outstanding and growing performance and stable dividends to reward shareholders for their unwavering support.”

About Edvantage Group Holdings Limited
Edvantage Group Holdings Limited (“Edvantage Group” or the “Group”, stock code: 0382.HK) is the largest private higher education group in the Greater Bay Area (in terms of total student enrolments of business majors for the 2017/2018 school year), and an early mover in education sector in pursuing international expansion. The total number of student enrolments of the Group were 35,300 as of 29 February 2020. The Edvantage Group currently operates two private higher education institutions located in the Great Bay Area of Guangdong Province, China, namely Huashang College and Huashang Vocational College. Huashang College and Huashang Vocational College focus their programme offerings on business programmes, such as accounting, finance, economics and business English, and strive to help students achieve employment prospects when they graduate and benefit from the availability of employment opportunities in the Greater Bay Area. The Group also operates a private vocational education institution named Global Business College of Australia (“GBCA”) authorized by ASQA in Australia, offering vocational education courses and non-formal short-term courses. The Group has also acquired NYU Language School, a local private school in Singapore and has established the Singapore campus based in the existing NYU Language School. NYU Language School has been accredited as EduTrust by the Education Department of Singapore. The Singapore campus is expected to commence operation in the second quarter of 2020. It is qualified to offer internationally-recognised courses and accept local and overseas students in Singapore.