ATA Announces Results for Second Fiscal Quarter 2010
Second Quarter 2010 Highlights
-- Net revenues decreased by 19.6% year-over-year to RMB41.6 million
(US$6.1 million).
-- Gross profit decreased by 54.3% year-over-year to RMB15.7 million
(US$2.3 million).
-- Loss from operations was RMB17.2 million (US$2.5 million) compared to
an operating income of RMB8.8 million in the same period last year.
-- Net loss was RMB16.4 million (US$2.4 million) compared to a net income
of RMB8.3 million in the same period last year.
-- Net loss excluding share-based compensation expense and foreign
currency exchange gain (losses) (non-GAAP) was RMB15.2 million (US$2.2
million).
-- Basic and diluted loss per ADS was RMB0.74 (US$0.11). Basic and diluted
loss per ADS excluding share-based compensation expense and foreign
currency exchange gain (losses) (non-GAAP) was RMB0.68 (US$0.10). Each
ADS represents two common shares of the Company.
-- For the quarter, revenue from testing services increased 88.8% from the
same period last year. ATA delivered approximately 0.7 million tests, a
decrease of 49.1% year-over-year while average revenue per test
increased to RMB36.2 from RMB9.8 in the same period last year.
"We are pleased with our results for the quarter, as we were able to meet
our guidance despite the challenging economic environment and pressure from
the H1N1 virus that delayed some of our tests," commented
ATA's Chief Financial Officer,
Financial Results for the Second Quarter 2010
For Second Quarter 2010, net revenues were
The overall number of tests delivered decreased by 49.1% year-over-year to
approximately 0.7 million in the quarter as we did not conduct close to 1
million lower end tests such as provincial high school exams and NTET tests,
while the average revenue per test delivered increased 270.9% to
Gross profit decreased by 54.3% to
Operating expenses increased by 28.6% to
Headcount expanded by 148 to 519 in the Second Quarter 2010 from 371 in the comparable of fiscal year 2009 to support the operational continuity of the JDX business following completion of acquisition as well as the business development of TOEIC, HR Select and the Cambridge Young Learners English online tutorials.
Loss from operations was
Net loss excluding share-based compensation expense and foreign currency
exchange gain (losses) (non-GAAP) was
Other Operating Data
As of
The number of weighted average ADSs used to calculate basic and diluted
earnings per ADS for the quarter ended
Third Fiscal Quarter 2010 and Full Fiscal Year 2010 Guidance
For the third fiscal quarter 2010, ATA forecasts net revenues will be in
the range of
Conference Call
The Company will host a conference call at
If you are unable to participate in the call at this time, a replay will
be available on
This conference call will be broadcast live over the Internet and can be accessed by all interested parties on ATA Inc.'s website at http://www.ata.net.cn . To listen to the live webcast, please go to ATA Inc.'s website at least fifteen minutes prior to the start of the call to register, download, and install any necessary audio software. For those unable to participate during the live broadcast, a replay will be available shortly after the call on ATA Inc.'s website for 90 days.
About ATA Inc.:
ATA is the leading provider of computer-based testing services in
Cautionary Note Regarding Forward-looking Statements
This announcement contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended, and as defined in the Private
Securities Litigation Reform Act of 1995. These forward-looking statements can
be identified by terminology such as "look forward to," "outlook," "forecast,"
"will," "expect," "anticipate," "future," "intend," "plan," "believe,"
"estimate" and similar terminology and include, among other things, the
Company's guidance relating to anticipated financial and operating results for
the fiscal quarter ending
The forward-looking statements in this release involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the markets in which it operates. The Company undertakes no obligation to update forward-looking statements, which speak only of the Company's views as of the date of this release, to reflect subsequent events or circumstances, or to changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, the Company cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results.
About Non-GAAP Financial Measures
To supplement ATA's consolidated financial information presented in accordance with U.S. generally accepted accounting principles ("GAAP"), ATA uses the following measures defined as non-GAAP financial measures by the U.S. Securities and Exchange Commission: net income (loss) excluding share-based compensation expenses and foreign currency exchange gains (losses) and basic and diluted earnings per ADS excluding share-based compensation expenses and foreign currency exchange gains (losses). The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Unaudited Reconciliations of Non-GAAP Measures to the Most Comparable GAAP Measures" set forth at the end of this release. ATA believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based compensation expenses and foreign currency exchange gains (losses), which may not be indicative of its operating performance from a cash perspective. ATA believes that both management and investors benefit from these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management's internal comparisons to ATA's historical performance and liquidity. ATA computes its non-GAAP financial measures using a consistent method from quarter to quarter. ATA believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using non-GAAP net income (loss) excluding share-based compensation expenses and basic and diluted earnings per share and per ADS excluding share-based compensation expenses is that share-based compensation charges have been, and are expected to continue to be for the foreseeable future, a significant recurring expense in ATA's business. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The table captioned "Unaudited Reconciliations of Non-GAAP Measures to the Most Comparable GAAP Measures" set forth at the end this release has more details on the reconciliations between GAAP financial measures that are most directly comparable to the non-GAAP financial measures used by ATA.
Currency Convenience Translation
The Company's financial information is stated in RMB. The translation of
RMB amounts for the second quarter of 2010 into
For further information, please contact:
ATA Inc.
Carl Yeung, CFO
Phone: +86-10-6518-1122 ext. 5107
Email: ir@ata.net.cn
CCG Investor Relations
Crocker Coulson, President
Phone: +1-646-213-1915
Ed Job, CFA
Phone: +1-646-213-1914
Email: ed.job@ccgir.com
ATA INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, September 30, September 30,
2009 2009 2009
RMB RMB USD
ASSETS
Current assets:
Cash 310,503,071 233,719,719 34,238,627
Accounts receivable, net 71,076,794 87,407,955 12,804,775
Inventories 2,287,260 2,480,763 363,418
Prepaid expenses and other current
assets 15,134,804 14,668,357 2,148,832
Total current assets 399,001,929 338,276,794 49,555,652
Property and equipment, net 20,987,472 72,332,087 10,596,245
Goodwill 23,422,850 23,422,850 3,431,316
Intangible assets, net 25,994,261 24,600,426 3,603,824
Other assets 1,838,544 1,488,251 218,020
Total assets 471,245,056 460,120,408 67,405,057
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Accrued expenses and other payables 44,950,280 50,605,464 7,413,416
Deferred revenues 40,238,256 27,028,858 3,959,576
Total current liabilities 85,188,536 77,634,322 11,372,992
Deferred revenues 5,626,153 5,236,896 767,176
Deferred tax liabilities 189,583 166,979 24,461
Total liabilities 91,004,272 83,038,197 12,164,629
Shareholders' equity:
Common shares 3,503,619 3,503,619 513,261
Treasury shares (10,126,861) (17,018,432) (2,493,105)
Receivable from shareholders (5,226,173) -- --
Additional paid-in capital 500,350,068 502,699,362 73,642,636
Accumulated other comprehensive
loss (16,157,846) (16,328,764) (2,392,072)
Accumulated deficit (92,102,023) (95,773,574) (14,030,292)
Total shareholders' equity 380,240,784 377,082,211 55,240,428
Total liabilities and shareholders'
equity 471,245,056 460,120,408 67,405,057
ATA INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three-month Period Ended
September June September September
30, 2008 30, 2009 30, 2009 30, 2009
RMB RMB RMB USD
Net revenues 51,696,431 79,802,924 41,582,006 6,091,531
Testing services 14,175,165 63,651,285 26,756,135 3,919,624
Test-based educational
services 10,937,400 9,293,623 6,435,702 942,794
Test preparation and
training solutions 21,215,476 1,549,421 3,921,362 574,458
Other revenue 5,368,390 5,308,595 4,468,807 654,655
Cost of revenues 17,321,775 35,198,516 25,880,510 3,791,350
Gross profit 34,374,656 44,604,408 15,701,496 2,300,181
Operating expenses:
Research and development 4,778,038 5,768,559 5,519,310 808,548
Sales and marketing 6,908,588 8,399,617 11,166,569 1,635,840
General and
administrative 13,911,591 14,926,414 16,236,304 2,378,528
Total operating expenses 25,598,217 29,094,590 32,922,183 4,822,916
Income (loss) from
operations 8,776,439 15,509,818 (17,220,687) (2,522,735)
Subsidy income 2,000,000 -- -- --
Interest income 61,664 179,902 153,148 22,435
Foreign currency exchange
gain (loss), net 135,115 (169,731) (116,492) (17,065)
61,664
Earnings (loss) before
income taxes 10,973,218 15,519,989 (17,184,031) (2,517,365)
Income tax benefit
(expense) (2,628,085) (2,829,740) 822,231 120,452
Net income (loss) 8,345,133 12,690,249 (16,361,800) (2,396,913)
Basic earnings (loss) per
common share 0.18 0.28 (0.37) (0.05)
Diluted earnings (loss)
per common share 0.18 0.28 (0.37) (0.05)
Basic earnings (loss) per
ADS 0.36 0.56 (0.74) (0.11)
Diluted earnings per
(loss) ADS 0.36 0.56 (0.74) (0.11)
UNAUDITED RECONCILIATIONS OF NON-GAAP MEASURES TO THE MOST COMPARABLE
GAAP MEASURES
Three-month Period Ended
September 30, September 30,
2008 2009
RMB RMB
GAAP net income (loss) 8,345,133 (16,361,800)
Share-based compensation expenses 1,447,324 1,071,338
Foreign currency exchange (gain)
losses (135,115) 116,492
Non-GAAP net income (loss) 9,657,342 (15,173,970)
GAAP earnings (loss) per ADS:
Basic 0.36 (0.74)
Diluted 0.36 (0.74)
Share-based compensation expenses per
ADS:
Basic 0.06 0.05
Diluted 0.06 0.05
Foreign currency exchange (gain)
losses per ADS:
Basic (0.01) 0.01
Diluted (0.01) 0.01
Non-GAAP earnings (loss) per ADS:
Basic 0.41 (0.68)
Diluted 0.41 (0.68)
Non-GAAP earnings (loss) per common
share:
Basic 0.21 (0.37)
Diluted 0.21 (0.37)
SOURCE ATA Inc.
Released November 8, 2009