Virtual Education

China On-line Schooling Group Declares Second Quarter 2022 Outcomes

SINGAPORE, Aug. 30, 2022 /PRNewswire/ — China On-line Schooling Group (“51Talk” or the “Firm”) (NYSE: COE), a worldwide on-line training platform with core experience in English training, introduced its unaudited monetary outcomes for the second quarter ended June 30, 2022.

Second Quarter 2022 Monetary and Working Highlights

The Firm accomplished the divesture of its China mainland enterprise on June 30th, 2022. After the divesture, the Firm focuses on offering on-line English tutoring classes taught by overseas academics to Okay-12 and post-secondary college students in international locations and areas exterior of the China mainland.

The Firm has introduced that an annual common assembly of shareholders can be held on September 30, 2022, to approve the change of the Firm’s authorized identify from China On-line Schooling Group to 51Talk On-line Schooling Group.

The audit committee and the board of administrators of the Firm have authorised the engagement of Marcum Bernstein & Pinchuk LLP (“MBP”) because the Firm’s impartial registered public accounting agency. MBP can be engaged to audit the annual consolidated monetary statements of the Firm and its subsidiaries to be filed with the U.S. Securities and Trade Fee for the fiscal yr ending December 31, 2022.

  • Internet revenues for the second quarter of 2022 had been US$3.5 million, and gross margin for the second quarter of 2022 was 79.2%.
  • Internet loss for the second quarter of 2022 was US$15.0 million, together with web loss from persevering with operations[1] of US$4.6 million and web loss from discontinued operations[2] of US$10.4 million.
  • Non-GAAP web loss[3] for the second quarter of 2022 was US$14.9 million, together with non-GAAP web loss from persevering with operations of US$4.5 million and non-GAAP web loss from discontinued operations of US$10.4 million.
  • Money, money equivalents and restricted money stability stood at US$22.1 million as of June 30, 2022.
  • Gross billings[4] of continuous operation for the second quarter of 2022 had been US$7.8 million.

 Monetary and Working Knowledge

For the three months ended




Mar. 31,


Jun. 30,


Q-o-Q


2022[5]


2022


Change







Internet Revenues (in US$ tens of millions)

1.9


3.5


87.7 %

Gross Margin

77.9 %


79.2 %


130 bps

Gross Billings of Persevering with Operations (in US$ tens of millions)

5.3


7.8


46.5 %







Lively college students with attended lesson consumption of continuous
operations[6]
(in 1000’s)

9.3


14.9


60.2 %

[1] “Persevering with operations” refers back to the Firm’s remaining abroad enterprise after the divesture of its China mainland enterprise.

[2] “Discontinued operations” refers back to the Firm’s China mainland enterprise, which has been disposed on June 30th, 2022.

[3] For extra data on non-GAAP monetary measures, please see the part of “Use of Non-GAAP Monetary Measures” and the desk captioned “Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures” set forth on this press launch.

[4] Gross billings for a selected interval, which is without doubt one of the Firm’s key working information, is outlined as the whole amount of money acquired and receivable from third get together fee platforms for the sale in fact packages and providers in such interval, web of the whole quantity of refunds in such interval.

[5] For functions of comparability, the monetary and working information of abroad enterprise for the primary quarter of 2022 are offered on this column.

[6] An “energetic scholar with attended lesson consumption” for a specified interval refers to a scholar who attended a minimum of one paid lesson, excluding these college students who solely attended paid stay broadcasting classes or trial classes.

“Within the second quarter of 2022, we efficiently accomplished the divesture of our China mainland enterprise and can solely give attention to abroad enterprise going ahead. Ranging from the third quarter, 100% of the Firm’s revenues can be derived from abroad markets. Moreover, to replicate our abroad focus, we’ll maintain an annual common assembly on September thirtieth to vote on the proposal of fixing our authorized identify from China On-line Schooling Group to 51Talk On-line Schooling Group.” stated Mr. Jack Jiajia Huang, Founder, Chairman and Chief Govt Officer of 51Talk.

“We’re excited to report one other quarter marked by continued top-line development of our abroad enterprise. Within the second quarter, our abroad enterprise continued to see wholesome and sustainable growth. Our second quarter abroad enterprise gross billings reached $7.8 million, representing 46.5% sequential development. The variety of our paying college students reached 8.1k, representing 25% sequential development and the variety of our energetic college students with attended lesson consumption reached 14.9k, representing 60% sequential development within the second quarter. As well as, our abroad enterprise achieved breakeven in money stream through the two months of Might and June. This displays our robust execution of a wholesome development technique in abroad enterprise and we’re trying ahead to the longer term efficiency of money stream.” concluded Mr. Huang.

Second Quarter 2022 Monetary Outcomes

The Firm formally launched its abroad enterprise in July 2021 and plans to give attention to the abroad enterprise after its divesture of China mainland enterprise. Because the Firm started to supply one-on-one course taught by overseas academics to college students in abroad markets from July 2021, there aren’t any comparative information for abroad enterprise for the second quarter of 2021.

Internet Revenues and Gross Margin

Internet revenues for the second quarter of 2022 had been US$3.5 million. The variety of energetic college students with attended lesson consumption of continuous operation was 14,900 within the second quarter of 2022.

Price of revenues for the second quarter of 2022 was US$0.7 million. Gross revenue for the second quarter of 2022 was US$2.8 million. Gross margin for the second quarter of 2022 was 79.2%.

Working Bills

Whole working bills for the second quarter of 2022 had been US$6.9 million.

Gross sales and advertising and marketing bills for the second quarter of 2022 had been US$3.6 million. Excluding share-based compensation bills, non-GAAP gross sales and advertising and marketing bills for the second quarter of 2022 had been US$3.6 million

Product growth bills for the second quarter of 2022 had been US$0.7 million. Excluding share-based compensation bills, non-GAAP product growth bills for the second quarter of 2022 had been US$0.7 million.

Normal and administrative bills for the second quarter of 2022 had been US$2.6 million. Excluding share-based compensation bills, non-GAAP common and administrative bills for the second quarter of 2022 had been US$2.5 million.

Loss from Operations

Working loss for the second quarter of 2022 was US$4.1 million.

Non-GAAP working loss for the second quarter of 2022 was US$4.0 million.

Internet loss

Internet loss for the second quarter of 2022 was US$15.0 million, together with web loss from persevering with operations of US$4.6 million and web loss from discontinued operations of US$10.4 million.

Non-GAAP web loss for the second quarter of 2022 was US$14.9 million, together with non-GAAP web loss from persevering with operations of US$4.5 million and non-GAAP web loss from discontinued operations of US$10.4 million.

Primary and diluted web loss per share attributable to peculiar shareholders for the second quarter of 2022 was US$0.04.

Non-GAAP fundamental and diluted web loss per share attributable to peculiar shareholders for the second quarter of 2022 was US$0.04.

Primary and diluted web loss per American depositary share (“ADS”) attributable to peculiar shareholders for the second quarter of 2022 was US$0.67. Every ADS represents 15 Class A peculiar shares.

Non-GAAP fundamental and diluted web loss per ADS attributable to peculiar shareholders for the second quarter of 2022 was US$0.67.

Steadiness Sheet

As of June 30, 2022, the Firm had complete money, money equivalents, restricted money of US$22.1 million.

The Firm had advances from college students[7] (present and non-current) of US$10.2 million as of June 30, 2022.

[7] “Advances from college students”  is outlined as the quantity of obligation to switch items or service to college students or enterprise companions for which consideration has been acquired from college students prematurely. The deposits from college students are additionally offered within the complete quantity of “advances from college students”

Outlook

For the third quarter of 2022, the Firm at present expects gross billings to be between US$8.0 million and US$8.2 million.

The above outlook relies on present market circumstances and displays the Firm’s present and preliminary estimates of market and working circumstances and buyer demand, that are all topic to alter.

Administration Change

The Firm additionally introduced in the present day that Mr. Min Xu, Chief Monetary Officer, has resigned for private causes and his final day with the Firm can be September thirtieth, 2022. Ms. Chun Tang, Vice President of Finance of the Firm, will assume the function of Chief Monetary Officer beginning on October 1st, 2022.

Ms. Tang has served in roles of Finance Director, Senior Finance Director, and Vice President of Finance since she joined the Firm in 2014 and performed an instrumental function within the Firm’s profitable IPO accomplished in June 2016. Beforehand, Ms. Tang served as Senior Monetary Analyst in Google’s Beijing workplace from 2007 to 2014. Earlier in her profession, Ms. Tang served as Senior Monetary Analyst with Novo Nordisk, a CSE-listed world main pharmaceutical producer, Finance Supervisor with Beijing Metropolis Worldwide Faculty, and Senior Auditor with PricewaterhouseCoopers Zhong Tian LLP. Ms. Tang acquired a Grasp of Arts diploma in western accounting from The Central College of Finance and Economics and a Bachelor of Arts diploma in accounting from Northeastern College in Shenyang China.

Mr. Jack Jiajia Huang, Founder, Chairman and Chief Govt Officer of the Firm, stated, “On behalf of the Board of Administrators and myself, I wish to thank Min for his service as 51Talk’s Chief Monetary Officer. Over the course of his four-year tenure, Min led us to attain profitability by specializing in sustainable development. We want him the very best in his future endeavors.”

Convention Name

The Firm’s administration will host an earnings convention name at 8:00 AM U.S. Jap Time on August 30, 2022 (8:00 PM Singapore/Beijing/Hong Kong time on August 30, 2022).

Dial-in particulars for the earnings convention name are as follows:

United States (toll free):

1-866-264-5888

Worldwide:

1-412-317-5226

Mainland China:

400-120-1203

Hong Kong (toll free):

800-905-945

Hong Kong:

852-3018-4992

Contributors ought to dial-in a minimum of 5 minutes earlier than the scheduled begin time and ask to be linked to the decision for “China On-line Schooling Group.”

Moreover, a stay and archived webcast of the convention name can be accessible on the Firm’s investor relations web site at http://ir.51talk.com.

A replay of the convention name can be accessible till September 6, 2022, by dialing the next phone numbers:

United States (toll free):

1-877-344-7529

Worldwide:

1-412-317-0088

Replay Entry Code:

9674628

About China On-line Schooling Group

China On-line Schooling Group (NYSE: COE) is a worldwide on-line training platform with core experience in English training. The Firm’s mission is to make high quality training accessible and reasonably priced. The Firm’s on-line and cell training platforms allow college students to take stay interactive English classes, on demand. The Firm connects its college students with a big pool of extremely certified academics that it assembled utilizing a shared financial system strategy, and employs scholar and trainer suggestions and information analytics to ship a customized studying expertise to its college students.

Use of Non-GAAP Monetary Measures

In evaluating its enterprise, 51Talk considers and makes use of the next measures outlined as non-GAAP monetary measures by the SEC as supplemental metrics to evaluate and assess its working efficiency: non-GAAP gross sales and advertising and marketing bills, non-GAAP product growth bills, non-GAAP common and administrative bills, non-GAAP working bills, non-GAAP working earnings/(loss), non-GAAP web earnings/(loss), non-GAAP web earnings/(loss) attributable to peculiar shareholders, and non-GAAP web earnings/(loss) attributable to peculiar shareholders per share and per ADS. To current every of those non-GAAP measures, the Firm excludes share-based compensation bills. The presentation of those non-GAAP monetary measures is just not supposed to be thought-about in isolation or as an alternative choice to the monetary data ready and offered in accordance with GAAP. For extra data on these non-GAAP monetary measures, please see the desk captioned “Reconciliations of non-GAAP measures to essentially the most comparable GAAP measures” set forth on the finish of this press launch.

51Talk believes that these non-GAAP monetary measures present significant supplemental data relating to its efficiency by excluding share-based compensation bills that will not be indicative of its working efficiency from a money perspective. 51Talk believes that each administration and traders profit from these non-GAAP monetary measures in assessing its efficiency and when planning and forecasting future durations. These non-GAAP monetary measures additionally facilitate administration’s inside comparisons to 51Talk’s historic efficiency. 51Talk computes its non-GAAP monetary measures utilizing the identical constant technique from quarter to quarter and from interval to interval. 51Talk believes these non-GAAP monetary measures are helpful to traders in permitting for better transparency with respect to supplemental data utilized by administration in its monetary and operational decision-making. A limitation of utilizing non-GAAP measures is that these non-GAAP measures exclude share-based compensation bills which have been and can proceed to be for the foreseeable future a major recurring expense within the 51Talk’s enterprise. Administration compensates for these limitations by offering particular data relating to the GAAP quantities excluded from every non-GAAP measure. The accompanying desk on the finish of this press launch supplies extra particulars on the reconciliations between GAAP monetary measures which might be most instantly similar to non-GAAP monetary measures.

Protected Harbor Assertion

This press launch incorporates statements which will represent “forward-looking” statements pursuant to the “protected harbor” provisions of the U.S. Personal Securities Litigation Reform Act of 1995. These forward-looking statements could be recognized by terminology akin to “will”, “expects”, “anticipates”, “goals”, “future”, “intends”, “plans”, “believes”, “estimates”, “more likely to” and related statements. Amongst different issues, 51Talk’s quotations from administration on this announcement, in addition to 51Talk’s strategic and operational plans, comprise forward-looking statements. 51Talk may make written or oral forward-looking statements in its periodic stories to the Securities and Trade Fee (“SEC”), in its annual report back to shareholders, in press releases and different written supplies and in oral statements made by its officers, administrators or workers to 3rd events. Statements that aren’t historic info, together with statements about 51Talk’s beliefs and expectations, are forward-looking statements. Ahead-looking statements contain inherent dangers and uncertainties. Quite a lot of elements may trigger precise outcomes to vary materially from these contained in any forward-looking assertion, together with however not restricted to the next: 51Talk’s objectives and methods; 51Talk’s expectations relating to demand for and market acceptance of its model and platform; 51Talk’s capability to retain and enhance its scholar enrollment; 51Talk’s capability to supply new programs; 51Talk’s capability to interact, practice and retain new academics; 51Talk’s future enterprise growth, outcomes of operations and monetary situation; 51Talk’s capability to keep up and enhance infrastructure essential to function its training platform; competitors within the on-line training business in its abroad markets; the anticipated development of, and developments in, the markets for 51Talk’s course choices in its abroad markets; related authorities insurance policies and laws regarding 51Talk’s company construction, enterprise and business; common financial and enterprise situation in the Philippines, its abroad markets and elsewhere; and assumptions underlying or associated to any of the foregoing. Additional data relating to these and different dangers is included in 51Talk’s filings with the SEC. All data supplied on this press launch is as of the date of this press launch, and 51Talk doesn’t undertake any obligation to replace any forward-looking assertion, besides as required underneath relevant legislation.

CHINA ONLINE EDUCATION GROUP


UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS


(In 1000’s)













 As of






Jun. 30







2022







US$










ASSETS






Present property







Money and money equivalents


21,115





Restricted money


975





Pay as you go bills and different present property


4,009




Whole present property


26,099











Non-current property







Property and gear, web


47





Intangible property, web


110





Proper-of-use property


74





Deferred tax property


33





Different non-current property


127




Whole non-current property


391











Whole property


26,490









LIABILITIES





AND SHAREHOLDERS’ EQUITY




Present liabilities






Advances from college students


10,243




Accrued bills and different present liabilities


3,437




Quantities attributable to associated events


982




Lease legal responsibility


38




Taxes payable


148



Whole present liabilities


14,848









Non-current liabilities






Different non-current liabilities


205



Whole non-current liabilities


205









Whole liabilities


15,053








Whole shareholders’ fairness


11,437








Whole liabilities and shareholders’ fairness


26,490


CHINA ONLINE EDUCATION GROUP

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In 1000’s aside from variety of shares and per share information)




For the three months ended


For the six months ended



Mar. 31,


Jun. 30,


Jun. 30,



2022


2022


2022



US$


US$


US$

Internet revenues


1,878


3,526


5,404

Price of revenues


(415)


(733)


(1,148)

Gross revenue


1,463


2,793


4,256

Working bills







Gross sales and advertising and marketing bills


(1,993)


(3,573)


(5,566)

Product growth bills


(1,101)


(700)


(1,801)

Normal and administrative bills


(1,885)


(2,611)


(4,496)

Whole working bills


(4,979)


(6,884)


(11,863)

Loss from operations


(3,516)


(4,091)


(7,607)

Different earnings/(bills), web


91


(498)


(407)

Loss earlier than earnings tax bills and
discontinued operations


(3,425)


(4,589)


(8,014)

Revenue tax bills


(12)


(14)


(26)

Loss from persevering with operations, web of earnings
tax


(3,437)


(4,603)


(8,040)

Loss from discontinued operations, web of
earnings tax


(17,734)


(10,375)


(28,109)

Internet loss, all attributable to the Firm’s
peculiar shareholders


(21,171)


(14,978)


(36,149)








Weighted common variety of peculiar shares
utilized in computing fundamental and diluted loss per
share


334,056,649


334,567,207


334,313,338

  CHINA ONLINE EDUCATION GROUP


UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS


(In 1000’s aside from variety of shares and per share information)






For the three months ended


For the six months ended







Mar. 31,


Jun. 30,


Jun. 30,







2022


2022


2022







US$


US$


US$













Internet  loss per share attributable to peculiar shareholders







Primary and diluted




(0.06)


(0.04)


(0.11)


Internet loss per ADS attributable to peculiar shareholders







Primary and diluted




(0.95)


(0.67)


(1.62)













Complete loss:










Internet loss




(21,171)


(14,978)


(36,149)


Different complete loss











Overseas foreign money translation changes




(2,403)


11,616


9,213


Whole complete loss




(23,574)


(3,362)


(26,936)












Share-based compensation bills are included within the working bills as follows:












Gross sales and advertising and marketing bills




8


5


13


Product growth bills




(38)


(17)


(55)


Normal and administrative bills




(293)


(63)


(356)


  CHINA ONLINE EDUCATION GROUP

Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures

(In 1000’s aside from variety of shares and per share information)













For the three months ended


For the six months ended






Mar. 31,


Jun. 30,


Jun. 30,






2022


2022


2022






US$


US$


US$











Gross sales and advertising and marketing bills




(1,993)


(3,573)


(5,566)

Much less: Share-based compensation bills




8


5


13

Non-GAAP gross sales and advertising and marketing bills




(2,001)


(3,578)


(5,579)











Product growth bills




(1,101)


(700)


(1,801)

Much less: Share-based compensation bills




(38)


(17)


(55)

Non-GAAP product growth bills




(1,063)


(683)


(1,746)











Normal and administrative bills




(1,885)


(2,611)


(4,496)

Much less: Share-based compensation bills




(293)


(63)


(356)

Non-GAAP common and administrative bills




(1,592)


(2,548)


(4,140)











Working bills




(4,979)


(6,884)


(11,863)

Much less: Share-based compensation bills




(323)


(75)


(398)

Non-GAAP working bills




(4,656)


(6,809)


(11,465)











Loss from operations




(3,516)


(4,091)


(7,607)

Much less: Share-based compensation bills




(323)


(75)


(398)

Non-GAAP loss from operations




(3,193)


(4,016)


(7,209)

CHINA ONLINE EDUCATION GROUP

Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures

 (In 1000’s aside from variety of shares and per share information)






For the three months ended


For the six months ended







Mar. 31,


Jun. 30,


Jun. 30,








2022


2022


2022








US$


US$


US$















Revenue tax bills




(12)


(14)


(26)



Much less: Tax affect of Share-based compensation bills








Non-GAAP earnings tax bills




(12)


(14)


(26)















Loss from persevering with operations, web of earnings tax




(3,437)


(4,603)


(8,040)



Much less: Share-based compensation bills




(323)


(75)


(398)



Non-GAAP loss from persevering with operations, web of earnings tax




(3,114)


(4,528)


(7,642)














Loss from discontinued operations, web of earnings tax




(17,734)


(10,375)


(28,109)



Much less: Share-based compensation bills








Non-GAAP loss from discontinued operations, web of earnings tax




(17,734)


(10,375)


(28,109)














Internet loss, all attributable to the Firm’s peculiar shareholders




(21,171)


(14,978)


(36,149)



Add again: Share-based compensation bills




323


75


398



Non-GAAP web loss, all attributable to the Firm’s peculiar
shareholders




(20,848)


(14,903)


(35,751)















Weighted common variety of peculiar shares utilized in computing
fundamental and diluted loss per share




334,056,649


334,567,207


334,313,338























Non-GAAP web loss per share attributable to peculiar shareholders








 fundamental and diluted




(0.06)


(0.04)


(0.11)














Non-GAAP web loss per ADS attributable to peculiar shareholders









 fundamental and diluted




(0.94)


(0.67)


(1.60)






















SOURCE China On-line Schooling Group

China On-line Schooling Group Declares Second Quarter 2022 Outcomes

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