Ambow Education Announces Second Quarter 2018 Financial Results

- Net Revenues Increases 19.5% to $22.7 Million - 
- Net Income Increases 47.1% to $5.0 Million -

BEIJING, Aug. 30, 2018 /PRNewswire/ -- Ambow Education Holding Ltd. ("Ambow" or the "Company") (NYSE American: AMBO), a leading national provider of educational and career enhancement services in China, today announced its unaudited financial and operating results for the three-month and six-month periods ended June 30, 2018.

Second Quarter 2018 Financial Highlights

• Net revenues for the second quarter of 2018 increased by 19.5% to US$22.7 million from US$19.0 million in the same period of 2017. This increase was due primarily to recording US$2.9 million in revenue from Boston-based Bay State College (acquired by Ambow in November 2017), higher student enrollment for the 2017-2018 academic year in the Company's K-12 schools, and growth of Ambow's smart office solution business.
• Gross profit for the second quarter of 2018 was US$10.8 million, compared with US$10.4 million for the same period of 2017. Gross profit margin was 47.6% for the second quarter of 2018, compared with 54.7% in the same period of 2017.
• Operating expenses in the second quarter of 2018 decreased by 2.9% to US$6.8 million from US$7.0 million for the same period of 2017. Operating expenses as a percentage of net revenues for the quarter decreased to 30.0% from 36.8% in the same period of 2017, primarily due to stringent cost controls.
• Net income attributable to ordinary shareholders for the second quarter of 2018 was US$5.0 million, or US$0.13 per basic and US$0.12 per diluted share, representing a 47.1% increase from a net income of US$3.4 million, or US$0.09 per basic and diluted share, in the second quarter of 2017.
• As of June 30, 2018, Ambow maintained strong cash resources of US$58.2 million, comprising cash and cash equivalents of US$31.5 million, short-term investments of US$26.3 million, and restricted cash of US$0.4 million.

First Six Months 2018 Financial Highlights

• Net revenues for the first six months of 2018 increased by 27.1% to US$38.5 million from US$30.3 million in the first six months of 2017, due primarily to recording US$6.5 million in revenue from Boston-based Bay State College, higher student enrollment for the 2017-2018 academic year in the Company's K-12 schools, and growth of Ambow's smart office solution business.
• Gross profit for the first six months of 2018 increased by 13.4% to US$16.1 million from US$14.2 million in the first six months of 2017. Gross profit margin was 41.8%, compared with 46.9% in the same period of 2017.
• Operating expenses for the first six months of 2018 was US$13.5 million, relatively flat compared with US$13.6 million in the first six months of 2017. Operating expenses as a percentage of net revenues for the period decreased to 35.1% from 44.9% in the same period of 2017, primarily due to stringent cost controls.
• Net income attributable to ordinary shareholders for the first six months was US$4.0 million, or US$0.10 per basic and diluted share, representing a 263.6% increase from a net income of US$1.1 million, or US$0.03 per basic and diluted share, in the first six months of 2017.

"We are pleased with our solid financial results for the second quarter as we continue to streamline our business," said Dr. Jin Huang, Ambow's Chief Executive Officer. "Ambow's college and corporate partnerships and curriculum offerings continue to expand, allowing us to add more desirable technology programs and training courses to meet the demand fueled by China's booming IT and technology-driven economy. In addition to the robust results for this quarter, we have successfully returned to a national securities exchange with our listing on the NYSE American, which has renewed the recognition of Ambow's core value and the strength of our business model."

"As we announced earlier, we have brought a strong management team to Bay State College, and we expect our new team to accelerate the progress of our curriculum offerings, which are tailored to provide dual China and U.S. diplomas for the 2019 fall semester. We are confident that Ambow and Bay State are well-positioned to capitalize on the growing interest among the large base of Chinese students who want to obtain a U.S. university degree. Through Bay State we are establishing a new business model for expanding the cooperation between China and U.S. colleges and servicing the growing demand for studying abroad."

Ambow will participate in the upcoming BMO Capital Markets 18th Annual Back to School Conference to be held at the New York InterContinental Barclay Hotel. The Company will present at 2:30 PM ET on Thursday, September 13, 2018. Management will also host one-on-one meetings with investors throughout the conference.

The Company's second quarter 2018 performance can also be found on its Form 6-K filing at www.sec.gov.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all amounts translated from RMB to U.S. dollars for the second quarter and the first half of 2018 are based on the effective exchange rate of 6.6171 as of June 29, 2018; all amounts translated from RMB to U.S. dollars for the second quarter and the first half of 2017 are based on the effective exchange rate of 6.7793 as of June 30, 2017. The exchange rates were according to the middle rate as set forth in the H.10 statistical release of the U.S. Federal Reserve Board.

About Ambow Education Holding Ltd.

Ambow Education Holding Ltd. is a leading national provider of educational and career enhancement services in China, offering high-quality, individualized services and products. With its extensive network of regional service hubs complemented by a dynamic proprietary learning platform and distributors, Ambow provides its services and products to students in 30 out of the 31 provinces and autonomous regions within China.

Follow us on Twitter: @Ambow_Education

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 and quotations from management in this announcement, as well as Ambow's strategic and operational plans, contain forward-looking statements. Ambow may also make written or oral forward-looking statements in its reports filed 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. 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 statements, including but not limited to the following: the Company's goals and strategies, expansion plans, the expected growth of the content and application delivery services market, the Company's expectations regarding keeping and strengthening its relationships with its customers, and the general economic and business conditions in the regions where the Company provides its solutions and services. Further information regarding these and other risks is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is as of the date of this press release, and Ambow undertakes no duty to update such information, except as required under applicable law.

For investor and media inquiries please contact:

Ambow Education Holding Ltd.
Tel: +86-10-6206-8000

The Piacente Group | Investor Relations
Tel: +1 212-481-2050 or +86 10-5730-6200
Email: ambow@tpg-ir.com

 

SOURCE Ambow Education Holding Ltd.