Rich way October 22 news, New Oriental Education & Technology Group announced the first quarter of fiscal year 2020 results before the market.

• Net revenue for the first quarter was $1.07 billion, and the market is expected to be $1.069 billion, compared with $860 million in the same period last year

• The net profit attributable to shareholders in the first quarter was $209 million, and the market is expected to be $197 million, compared with $123 million in the same period last year, an increase of 69.6% over the same period last year.

• In the first quarter, non-GAAP ADS was $1.44, GAAP ADS was $1.31
  

• Total enrollment increased by 50.4% in the first quarter, compared with 13.2% in the same period last year.

Net income and total enrollment

New Oriental Education & Technology Group's net income in the first quarter of 2020 was $1.071 billion, up 24.6 per cent from a year earlier. Net income from education programs and services in the first quarter was $996 million, up 25.0% from a year earlier. The increase was mainly due to the increase in the number of students in KMel 12 after-school tutoring courses.

The first quarter of fiscal year 2020The number of students enrolled reached about 2.6 million.50.4% increase over the same period last year.The main reason for the higher-than-normal increase in student enrollment is that the autumn semester is divided into two parts. Under this method, the student enrollment rate of each semester is recorded separately, and the student enrollment rate of each semester is divided into different quarters. This practice was adopted in November 2018 and is in line with the latest regulatory requirements.

As of 31 August 2019, the total number of learning centres reached 1261, a net increase of 161 over the same period in 2019 (1100 for the same period in 2019) and 7 on a month-on-month basis (1254 in the fourth quarter of 2019). The total number of schools is 95.

Operating costs and expenses

Operating expenses and expenses in the first quarter of fiscal 2020 were $825.6 million, up 17.9 percent from a year earlier.

Revenue costs rose 19.8 per cent year-on-year to $440.2 million, mainly due to higher rental costs due to increased teacher compensation for more teaching time and an increase in the number of operating schools and learning centres.

Sales and marketing expenses were $101.2 million, up 1.9 per cent from a year earlier, and total share award spending fell by 20.8 per cent in the first quarter of 2020.

Yu Minhong, executive chairman of New Oriental Education & Technology Group, said:

We are very pleased to achieve a good momentum of development in fiscal year 2020. Not only did net income grow 24.6 per cent year-on-year, exceeding the upper limit expected, but operating profit margins also improved significantly from a year earlier. New Oriental Education & Technology Group K12 primary and secondary school general education business continued to develop steadily this quarter, with income growth of about 35%, which is still the main driving force of the company's performance growth. Among them, the secondary school business achieved about 33% year-on-year income growth, while the primary school business income increased by about 38% year-on-year.

Outlook for the second quarter of fiscal year 2020

New Oriental Education & Technology Group expects total net income in the second quarter of fiscal 2020 (September 1, 2019 to November 30, 2019) to be between $753.6 million and $771 million, an increase of 26% 29% over the same period last year.

Since its listing in 2006, New Oriental Education & Technology Group's share price has risen nearly 30 times. One of the main factors driving the rise is to cut into the new track, from the overseas training business to the K12 extracurricular training business.

At present, K12 business has become an important source of revenue for New Oriental Education & Technology Group, but also contributed to the main growth. According to China Merchants's research report, excellent middle schools and bubble children under the K12 business account for 65 per cent of revenue.

Previously, according to Bloomberg statistics, market forecasts for New Oriental Education & Technology Group's new quarterly results showed adjusted EPS of $1.373, GAAP earnings of $1.251 per share and operating income of $1.069 billion, an absolute year-on-year increase of 24.3 per cent.