OneSmart Education Reports Strong Revenue, but Net Loss Sends Shares Sliding
The Shanghai-based education provider said it has added 52 new learning centers during the three months through November.
Shares in OneSmart International Education Group Ltd. (NYSE: ONE) were trading down nearly 2 percent Thursday afternoon, at $8.35 apiece, after the company reported a net loss for the first fiscal quarter, though said it enjoyed strong revenue growth.
In a statement Thursday, the Shanghai-based company, which provides K-12 after-school education, said its revenue increased 47 percent to $93 million during the three months through November.
Net loss, however, was $2.3 million during the quarter, in contrast to income of $4.1 million during the same period a year ago.
OneSmart's director and chief financial officer, Dong Li, noted in the report that the company added 52 new learning centers during the quarter. By the end of November, it operated 367 study centers in its network, according to the statement.
"We are delighted to see our mature learnings centers continue to consistently deliver satisfactory operating results and our newly opened learning centers to ramp up quickly and achieve higher utilization," Li said.
He added that OneSmart "continued to incubate and invest in more online and offline education products to encourage cross-selling and further enrich our services offerings, which will further expand our footprints in the online education market and form an integral part of our ecosystem."
The company said its operating costs and expenses during the quarter reached $101.8 million, up 55 percent year-over-year, increasing across all sectors.
Student enrollment in its math training programs increased 47 percent year-over-year to nearly 26,000, while its English language programs enjoyed a 56-percent rise, the company reported.
The chairman and chief executive officer of OneSmart, Steve Xi Zhang, said, looking ahead, "We will continue to significantly increase our investments on research and development in both curriculum development and integration of the latest education technology, as well as incubation and strategic investment in the online education space."
For the fiscal year 2019, OneSmart said it expects to achieve revenue in the range of $575.1 million and $596.6 million, representing an increase of between 40 and 45 percent from 2018.