Bright Scholar Education Holdings Limited (NYSE: NYSE:BEDU), a global education service provider, has reported stable financial results for the fiscal year 2024, with a notable increase in overseas group revenue and a significant improvement in its cash position. The company, which focuses on international education, has shown resilience, turning a previous year's adjusted net loss into a positive adjusted net income.
Key Takeaways
- Bright Scholar's total revenue remained consistent year-over-year.
- Overseas group revenue grew by 17.5%.
- The company transitioned from an adjusted net loss of $192.6 million to an adjusted net income of $1.1 million.
- Cash and cash equivalents rose by 20%.
- Operational efficiency was enhanced through a 16% reduction in headcount and a 28% decrease in related costs at overseas headquarters.
- Academic achievements highlighted with students gaining admission to prestigious universities and winning awards.
Company Outlook
- Bright Scholar plans to expand its overseas school business and propel global recruitment initiatives.
- The company aims to continue streamlining global operations and enhancing operational efficiency and service delivery in fiscal year 2025.
Bearish Highlights
- No bearish highlights were provided in the summary.
Bullish Highlights
- The company's overseas school segment is its strongest, contributing to more than half of the total revenue and growing significantly.
- The company has completed the divestiture of non-core businesses, allowing more focus on core growth areas.
Misses
- There were no reported misses in the provided summary.
Q&A Highlights
- CEO Robert Niu expressed confidence in capturing growth opportunities in overseas markets to strengthen market share.
- CFO Cindy Zhang emphasized enhancing operational efficiency and profitability while improving service offerings.
- The company's commitment to premium education was reiterated as a driving factor for business growth.
Bright Scholar has demonstrated a successful year with its strategic focus on the overseas education market and operational efficiency. The company's financial metrics reflect its growth strategy, with a total revenue of 1,755.2 million RMB and overseas group revenue accounting for 54.2% of that total. Gross profit increased by 7.7%, while SG&A expenses decreased by 8.1%. The company's cash position is stronger, with cash and cash equivalents reaching 505.8 million RMB.
The operational highlights of Bright Scholar include a significant reduction in headcount and related costs at the overseas headquarters, emphasizing the company's commitment to efficiency. The academic achievements of its schools have been outstanding, with students excelling in A levels, gaining admission to top universities, and achieving success in events like the Paralympics and Graduate Fashion Week.
Looking ahead, Bright Scholar's strategic focus for fiscal year 2025 is on reinforcing its growth strategy through the expansion of its overseas school business and global recruitment initiatives. The company's leadership has expressed confidence in their ability to strengthen their market share and status as a leading global education service provider. With a clear direction and proven resilience, Bright Scholar is poised to continue its trajectory in the global education sector.
Full transcript - Bright Scholar Education Holdings Ltd Class A (BEDU) Q4 2024:
Conference Operator: Hello, ladies and gentlemen. Thank you for standing by for Bright Scholar's 4th Quarter and Fiscal Year 2024 Earnings Conference Call. At this time, all participants are in listen only mode. After management's remarks, there will be a question and answer session. Today's conference call is being recorded.
I will now turn the call over to your host from Piacente Financial Communications, Andrea Guo, IR Counsel for the company. Please go ahead, Andrea.
Andrea Guo, IR Counsel, Piacente Financial Communications: Thank you very much. Hello, everyone, and welcome to the Bright Scholar's earnings conference call for the Q4 fiscal year 2024. The company's financial and operational results were released earlier today and are available online by visiting the IR section of our website at ir. Breastscholar.com. Please note that today's discussion will contain forward looking statements made under the Safe Harbor provisions of the U.
S. Private Securities Litigation Reform Act of 1995. Forward looking statements involve inherent risks and uncertainties. As such, the company's results may materially differ from today's views. Further information regarding these and other risks and uncertainties is included in the company's prospectus and other public filings as filed with the U.
S. SEC. The company does not assume any obligation to update any forward looking statements, except as required under applicable law. Additionally, Bright Scholar's earnings press release and this conference call include discussions of our undivided GAAP and non GAAP financial measures. West Scholar's earnings press release contains a reconciliation of the unaudited non GAAP measures.
Please also note that all numbers are in RMB. Participants on today's call will include our Chief Executive Officer, Mr. Robert Niu, who will provide a company overview and update on our strategic initiatives with highlights from the quarter and the fiscal year. Our Chief Financial Officer, Ms. Cindy Zhang, will then provide details on the company's financial results for the period.
We'll then open the call for questions. I will now turn the call over to Brascotta's Chief Executive Officer, Mr. Robert Liu. Please go ahead, sir.
Robert Niu, Chief Executive Officer, Bright Scholar: Thank you. Hello, everyone, and thank you for joining us on today's call. We posted with our global business and operations throughout this year, shoring up our foundation for future growth. Despite ongoing macro challenges, we drove rapid expansion in our overseas business, delivering continued double digit year over year revenue growth in our overseas schools business for the full fiscal year. Our primary objectives remain laser focused on strengthening our high growth, high return core business.
With this focus, I would please to announce that we have completed divestiture of all non core business on our complementary education service segment and we'll be concentrating our efforts on our global recruitment initiatives, providing service for students with ambitions to study overseas. Meanwhile, the integration of our headquarters and overseas management team has also helped us with reducing management costs and increased our organizational productivity significantly, allowing the group's strategies to be executed more efficiently at the local level. In FY 2024, our streamlined global operations led to a 16% reduction year over year in headcounts at our overseas headquarters and a 28% decrease in related costs for the upcoming financial year. Moving into fiscal year 2025, we plan to reinforce new engine growth strategy by focusing on continued expansion of our overseas school business, while propelling our global recruitment initiatives for prospective international students. This will enable us to drive further expansion and capture more of sizable market opportunities that will support our sustainable growth over the long term.
Now I'd like to share some details on the Q4 fiscal year for each of our business segments. First, as I said, overseas school subtended solid growth momentum and remain our strongest segment. For the fiscal year, revenue was up 17.5% year over year accounting for 51.7% 54.2% of our total revenue for the Q4 and the fiscal year respectively. The ability to achieve exceptional academic outcome is one of the ways we are accelerating enrollment. Our schools continue to foster students' stellar academic performance this year.
We are proud to share that our CAST Global Schools students achieved outstanding A level results with 53% of grades being to A, while a remarkable 86.8% of St. Michael School's students grades were to A, propelling this school to a new high ranking of 3rd place in the U. K. For A level results in 2024. Moreover, many CGS students successfully gained admissions to their top choice universities, including the University of Cambridge, the University of Oxford, other G5 institutions and the University of Doctor London.
Additionally, CTS (NYSE:CTS) students also receive offers from Ivy League Schools in the United States. Those noteworthy achievements are a testament to the dedication and diligence by our students and our teachers. Moving forward, we aim to enhance our curriculum further by bringing superior quality teaching resources and sponsoring a collaborative learning environment. Beyond their remarkable academic accomplishment, our students have also excelled in athletics and arts. In the 4th fiscal quarter, 3 Booms Collegiate Schools graduates secured gold medals at the 2024 Paris Paralympics, amassing 3 golds, 1 silver and 2 bronze ones.
Notably, 2 of these athletes honed their skills at the sports academy within BCS. In other sports, our Academy Boston is excelling in hockey and basketball with students representing a broad range of national teams. And in fashion, 4 of our Cambridge School of Visual Performing Arts students were nominated 7 awards at Graduate Fashion Week, the world's largest special of arts fashion showcase, sending out among 2,000 entrants and showcasing the impressive talent and creativity. This exceptional blend of talent highlights our students' diverse strengths and reinforces the importance of holistic education programs that nurture both intelligence and creative pursuits. Looking ahead, we are dedicated to cultivating an environment that fosters continued success inspiring the next generation of leaders across diverse fields.
Overall, we are pleased with progress of our overseas school business during the 4th fiscal quarter. Our commitment to provide a premium education that prepares students for success in the global marketplace propels our business growth accelerating year over year increase in enrollments. Moving on to our complementary education services, we saw a 19.7% year over year decline in revenue during the fiscal Q4 as we continue to wind down low return and underutilized programs. We have successfully divested our non core business by the end of this quarter. Looking forward, we aim to drive innovation and enhance service delivery of our global recruitment initiatives to serve more students planning to study abroad.
We are expanding our products and services offering on our existing China platform and make these available in more international markets, all while aligning our efforts with our long term vision and adapting to a dynamic environment. In the 4th fiscal quarter, we also enhanced our senior leadership team to help advance our near term expansion goals in overseas markets and strengthen our global enrollment. A new principal has joined us to Cambridge plus another highly experienced educator will take over the principal role of both independent schools. In April next year, focusing on curriculum reform and team enhancement to advance the school's development. Additionally, a new General Manager will lead our sales and marketing efforts in China.
These strategic appointments demonstrate our commitment to building a high caliber team with international expertise and leadership, promoting student enrollment engagement and academic success, as well as the group's long term growth and development. In summary, our relentless focus on strengthening our high growth core business in fiscal year 2024 has played us in a strong position to grow this fiscal year. Moving forward, we will continue to advance our dual engine growth strategy to expand our overseas to expand our steady overseas school business and boost our global recruitment initiative. Meanwhile, we will proceed in streamlining our global operations and enhancing efficiencies to align our goals. We are confident that we can capture the extensive growth opportunities in overseas markets that will strengthen our market share and status as a leading global education service provider.
With that, I will turn the call over to our CFO, Ms. Cindy Zhang, who will discuss our key financial results. Please go ahead, Cindy.
Cindy Zhang, Chief Financial Officer, Bright Scholar: Thank you, Robert. Now I'd like to discuss our financial results for the Q4 fiscal year 2024. Please note all amounts are in RMB unless otherwise stated. We are pleased to report healthy financial results for the fiscal year, driven by ongoing development across our core businesses. Our total revenue for fiscal year 2024 remains stable, with overseas group revenue increasing by 17.5 percent year over year.
Our gross profit increased by 7.7% and gross margin by 2.3 percentage points year over year. We recorded an adjusted net income of $1,100,000 compared to an adjusted net loss of $192,600,000 for the prior fiscal year. We continue to streamline our operations and to improve operational efficiency, reducing our SG and A expenses by 18% and 8% year over year for the Q4 and fiscal year respectively, benefiting from the integration of our headquarters and overseas management team. Notably, we significantly enhanced our cash position, increasing our cash and cash equivalent and restricted cash by 20% for the fiscal year. Looking at our financial results for the Q4 and fiscal year in more details.
Our revenue from continuing operations for the Q4 was 358 point $3,000,000 compared to $442,200,000 for the same quarter last fiscal year. By segment, overseas goods revenue contribution was 190 $5,100,000 Complementary Education Services and Domestic Kindergartens and K-twelve Operations Services revenues were $129,800,000 dollars 43,300,000 respectively. For fiscal year 2024, we achieved total revenue of 1,000 $755,200,000 compared to $1772,100,000 for the last fiscal year. By segment, overseas grew recorded revenue of $951,200,000 contributing 54.2 percent of total revenues and growing by 17.5 percent year over year. Complementary education service and domestic kindergartens and K-twelve operation services revenues were $495,100,000 and $308,900,000 respectively.
Gross profit from continuing operations for the 4th quarter
Robert Niu, Chief Executive Officer, Bright Scholar: was
Cindy Zhang, Chief Financial Officer, Bright Scholar: $35,900,000 compared to $79,800,000 for the same quarter last fiscal year. For the whole fiscal year, our gross profit was $503,600,000 representing a 7.7% increase year over year, driven by a 47.8% increase in overseas group gross profit. Gross margin from continuing operations for the Q4 was 10% compared to 18.1% for the same quarter last year. For the whole fiscal year, gross margin increased to 28.7% from 26.4% for the last fiscal year. The improvement was mainly attributable to cost saving measures and efficiency enhancements.
Notably, our overseas business gross margin grew 4.1percent.and 4.9percentpoint for the 4th quarter and fiscal year respectively. Adjusted gross profit from continuing operations was 30 $6,900,000 $507,800,000 for the 4th quarter and fiscal year compared to $18,800,900,000 for the same quarter last fiscal year and the 4 100 and $1,000,000 for the same quarter last fiscal year and $471,800,000 for the last fiscal year, respectively. SG and A expenses from continuing operations for the 4th quarter were $119,300,000 representing an 18.3% decrease year over year. For the fiscal year, SG and A expenses decreased by 8.1% to $469,000,000 This improvement was mainly due to our continuous efforts to streamline our global operations and improve operational efficiency in our headquarters. Adjusted EBITDA loss from continuing operations was $81,800,000 for the 4th quarter compared to $55,000,000 for the same quarter last fiscal year.
For the whole fiscal year 2024, adjusted EBITDA increased by 44.1 percent to $80,700,000 from $56,000,000 for the last fiscal quarter. Now turning to profitability, we recorded a net loss of RMB954,800,000
Robert Niu, Chief Executive Officer, Bright Scholar: $869,100,000
Cindy Zhang, Chief Financial Officer, Bright Scholar: from continuing operations in the Q4 and fiscal year compared to 280 $5,100,000 for the same quarter last year and $358,900,000 for the last fiscal year, mainly due to an $852,000,000 impairment loss from goodwill and intangible assets. Adjusted net loss from continued operations for the Q4 narrowed by 24.3% year over year to $92,000,000 For the fiscal year, adjusted net income was $101,000,000 compared to an adjusted net loss of $192,600,000 for the last fiscal year. As for our balance sheet, our cash position was significantly enhanced. As of August 31, 2024, we had cash and cash equivalents and restricted cash of 500 and $5,800,000 an increase of $20,000,000 from $419,900,000 as of August 31, 2023. In addition, our net cash from operating activities also increased by 14 times year over year to $104,000,000 for the 4th quarter and 5 times to $126,000,000 for the fiscal year.
Moving into fiscal year 2025, we will further enhance our operational efficiency and profitability while strengthening our service offerings. Supported by our healthy balance sheet, we are confident in our ability to execute our dual engine growth strategy, expanding our overseas group business and promoting our global recruitment initiatives. We believe this productivity approach will not only solidify our competitive edge, but also drive long term growth and profitability. Okay. This concludes all our prepared remarks today.
We will now open the call to the questions. Operator, please go ahead.
Conference Operator: Thank you. This concludes the question and answer session. I'd like to turn the conference back over to Andrea Goh for any closing remarks.
Andrea Guo, IR Counsel, Piacente Financial Communications: Thank you once again for joining us today. If you have further questions, please feel free to contact Rex Scholar's Investor Relations through the contact information provided on our website.
Conference Operator: Thank you. This concludes today's conference call. You may now disconnect your lines. Thank you and have a wonderful day.
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