Company Releases 2024 Interim Report

The 24Q2 company's revenue was 0.08 billion, up 25.8%; net profit to mother was 0.006 billion, up 33.6%; net profit after deducting non-return to mother was 0.007 billion, up 32.5%; 24H1's revenue was 0.15 billion, up 18.9%; net profit to mother was 0.01 billion, up 51.0%; net profit from non-return to mother was 0.01 billion, up 47.5%.

By product, 24H1 education service business revenue was 0.12 billion, up 30.7%, accounting for 77.0%; 24H1 training business revenue was 0.03 billion, down 9.2%, accounting for 21.6%.

The 24H1 gross profit margin was 27.8%, an increase of 5.7pct; of these, the gross profit margin of the education service business was 35.4%, an increase of 7.4 pct; the gross profit margin of the training business was 6.8%, a decrease of 2.9 pcts; and the 24H1 net profit margin was -5.3%, an increase of 10.2 pcts.

Excellent freshman admission results, increased international and domestic recognition, and impressive teaching results in expanding the domestic college entrance examination circuit in 2024. The acceptance rate of Haidian Kevin School's top 50 in the US overall ranking is 100%, the US top 30 acceptance rate is 55%, the UK top 5 acceptance rate is 71%, and the acceptance rate of Australia's top eight is 100%. 24H1 Haidian Kevin School was certified by the ALevel Edith Committee, providing additional opportunities and advantages; Chaoyang Kevin School passed the official candidate review by Cognia, the world's largest authoritative certification body for non-profit international schools, which helped graduates apply to prestigious overseas schools and recruit teachers.

In order to meet the diverse teaching needs of more families, the two Kevin schools each added domestic-oriented programs in different school segments. Among them, Chaoyang Kevin School's quality high school class officially started in the fall of 2023. This class is aimed at enrolling students in the Beijing Secondary School Entrance Examination. It uses an excellent team of teachers and a small-class mentorship teaching model to fully cover the core cornerstone courses and quality development courses covering college entrance examination subjects.

The project is the starting point for the company to expand the domestic college entrance examination circuit. It is an important step for Chaoyang Kevin School to actively assume social responsibility and help Beijing and Chaoyang District increase the supply of high-quality degree resources. The elementary school at 24H1 Haidian Kevin School is also actively promoting the establishment of ordinary classes in addition to the original international special classes.

The Jingrun Mathematics Special Class (Year 1) will begin in the fall of 2024. This class will focus on creating mathematical characteristics and increasing math class hours on the basis of continuing the English characteristics of primary school foreign teachers. The math class incorporates the Olympic math mentality on the basis of meeting the requirements of the four national foundations (basic knowledge, basic skills, basic ideas, and basic activity experience) to enhance students' ability to understand mathematics.

Maintain profit forecasts and maintain “buy” ratings

The company takes advantage of the controlling shareholder's state-owned assets background and relies on Haidian's educational and technological resources to seek development. We expect the return in 24-26 to be 0.006 billion, 0.03 billion, and 0.07 billion, respectively, and PE is 369X, 73X, and 32X, respectively.

Risk warning: risk of changes in industry policies; risk of market competition increasing risk; risk of depreciation and amortization dragging down performance, etc.