51Talk net revenue in the first quarter was 260 million, an increase of 64.6% over the same period.


51Talk net revenue in the first quarter was 260 million, an increase of 64.6% over the same period.

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Sina Technology News Beijing time June 12th afternoon news, 51Talk (NYSE:COE) released today's first quarter 2018 earnings report. Financial reports showed that 51Talk's net revenue in the first quarter was 262 million 600 thousand yuan, up 64.6% over the same period last year. According to the non general US accounting standard (Non-GAAP), the net loss of 51Talk is RMB 106 million 100 thousand yuan (about 16 million 900 thousand US dollars).

Financial and operational points of the first quarter of 2018

Net revenue of RMB 262 million 600 thousand yuan, compared with 159 million 500 thousand yuan in the same period last year, an increase of 64.6% over the same period last year.

- cash income of RMB 355 million 300 thousand yuan, compared with 325 million 100 thousand yuan in the same period last year, an increase of 9.3% over the same period last year.

- the gross profit rate was 64.6%, 65.7% in the same period last year.

- K-12 accounts for 83.8% of cash income, and 68.7% in the first quarter of 2017.

- a net loss of 106 million 100 thousand yuan (US $16 million 900 thousand) is calculated on the basis of non general US accounting standards (Non-GAAP).

Financial performance in the first quarter of 2018

Net revenue

Net revenue was 262 million 600 thousand yuan (US $41 million 900 thousand), compared with 159 million 500 thousand yuan in the same period last year, an increase of 64.6% over the same period last year. The increase was mainly due to the increase in the number of active students, followed by an increase in the average net revenue of each active student. The number of active students in this quarter was 190 thousand and 800, up 41.8% from 134 thousand and 500 in the same period last year.

Revenue cost

The cost of the revenue was RMB 92 million 900 thousand yuan (US $14 million 800 thousand), which was 54 million 800 thousand yuan in the same period last year, an increase of 69.7% over the same period last year. The increase is mainly due to the increase in the total cost of teachers caused by the increase in the number of paid courses taught by teachers.

Gross profit and gross margin

Gross profit was 169 million 600 thousand yuan (US $27 million), compared with 104 million 800 thousand yuan in the same period last year, an increase of 61.9% over the same period last year.

The gross profit rate was 64.6%, which was 65.7% in the same period last year.

Operating expenses

The total operating cost was 280 million 200 thousand yuan (about $44 million 700 thousand), which was 245 million yuan in the same period last year, up 14.3% from the same period. The growth was mainly due to the growth of sales cost, R & D cost and management cost.

The selling cost was RMB 171 million 600 thousand yuan (US $27 million 400 thousand), which was 146 million 100 thousand yuan in the same period last year, an increase of 17.5% over the same period last year. The growth is mainly due to the increase in the cost of brand promotion, and the new accounting standards, which the company started to apply from January 1, 2018, have a decrease of 6 million 700 thousand yuan for the related expenses of the sales staff, partly offset the overall cost increase. The non-GAAP sales cost, excluding the equity incentive related costs, was 170 million 400 thousand yuan (about $27 million 200 thousand), 144 million 900 thousand yuan in the same period last year, an increase of 17.6% over the same period.

The R & D cost is RMB 52 million 200 thousand yuan (US $8 million 300 thousand), which was 50 million 600 thousand yuan in the same period last year, an increase of 3.2% over the same period last year. The growth is mainly due to the increase in the cost of R & D personnel to strengthen the technical platform and the expansion of the course products, and the increase in the cost of technical services. The reduction of the related cost of equity incentive offset some of the impact. The non-GAAP R & D cost excluding equity incentive costs was 50 million 700 thousand yuan (US $8 million 100 thousand), compared with 45 million 500 thousand yuan in the same period last year, an increase of 11.5% over the same period last year.

The management fee is RMB 56 million 400 thousand yuan (US $9 million), which was 48 million 400 thousand yuan in the same period last year, an increase of 16.5% over the same period last year. The growth is mainly due to the increased costs associated with an increase in the size of the business, as well as the increase in the cost of compliance and reporting responsibility as a listed company, and the reduction in the related cost of equity incentive offset some of the impact. Excluding the equity incentive related costs, the non-GAAP management fee was RMB 52 million 600 thousand yuan (US $8 million 400 thousand), compared with 41 million 600 thousand yuan in the same period last year, an increase of 26.4% over the same period last year.

Operating loss

The operating loss was RMB 110 million 500 thousand yuan (US $17 million 600 thousand), a loss of 140 million 300 thousand yuan in the same period last year.

Non-GAAP's operating loss was 104 million yuan (US $16 million 600 thousand), a loss of 127 million 200 thousand yuan in the same period last year.

Net loss

The net loss was 112 million 700 thousand yuan (US $18 million), a loss of 140 million yuan in the same period last year.

The net loss of Non-GAAP was 106 million 100 thousand yuan (US $16 million 900 thousand), a loss of 126 million 900 thousand yuan in the same period last year.

The basic and amortized losses per share of ADS (US depositary shares) belonging to ordinary shareholders were 5.55 yuan (about $0.90) and 7.05 yuan in the same period last year. Each ADS represents 15 common shares of a class a.

The basic and diluted losses per share of Non-GAAP attributable to common shareholders were 5.25 yuan (US $0.90), compared to 6.30 yuan in the same period last.

Balance sheet

As of March 31, 2018, the company held cash and cash equivalents, fixed deposit and short-term investment in the total RMB 549 million yuan (approximately $87 million 500 thousand), and 623 million 400 thousand yuan as of December 31, 2017.

As of March 31, 2018, the deferred income of the company, including the flow and the non current part, was 1 billion 274 million 800 thousand yuan (approximately $203 million 200 thousand), and 1 billion 201 million 800 thousand yuan as of December 31, 2017.


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