Puxin Limited Announces Second Quarter 2019 Unaudited Financial Results

BEIJING,Aug. 13,2019 --Puxin Limited (NYSE: NEW) ("Puxin" or the "Company"),a successful consolidator of the after-school education industry in China,today announced its unaudited financial results for the second quarter ended June 30,2019.

Second Quarter 2019 Financial and Operational Highlights

Net revenues were RMB632.9 million (US$92.2 million),an increase of 19.1% from RMB531.3 million in the second quarter of 2018.

Operating loss was RMB168.7 million (US$24.6 million),an increase of 96.1% from RMB86.1 million in the second quarter of 2018.

Adjusted operating loss[1] was RMB53.3 million (US$7.8 million),a decrease of 12.6% from RMB61.0 million in the second quarter of 2018.

Net loss attributable to Puxin Limited was RMB194.6 million (US$28.4 million),an increase of 3.3% from RMB188.4 million in the second quarter of 2018.

Adjusted net loss attributable to Puxin Limited[2] was RMB60.7 million (US$8.8 million),a decrease of 14.4% from RMB70.9 million in the second quarter of 2018.

Adjusted EBITDA[3] was RMB(25.8) million (US$(3.8) million),an increase of 33.3% from RMB(38.7) million in the second quarter of 2018.

Cash and cash equivalents were RMB500.6 million (US$72.9 million),compared with RMB778.0 million as of December 31,2018.

Student enrollments increased by 39.5% to 725,118 from 519,962 in the second quarter of 2018.

Mr. Yunlong Sha,Chairman and Chief Executive Officer of Puxin,commented,"We are pleased to report that we made solid progress during the second quarter. Net revenues grew 19.1% year-over-year to RMB632.9 million,and business continued to move forward with strong momentum while our adjusted net loss attributable to Puxin Limited narrowed by 14.4% from the same period last year. In particular,revenues from K-12 education rose 30.4% year-over-year,mainly driven by our efforts to enlarge organic growth in student enrollments. Gross profit for the quarter increased by 23.6% year-over-year while our gross margin reached 47.4%. Although we took a modest approach to opening new learning centers and acquisitions during late last year in response to changes in the regulatory environment,student enrollments during the quarter increased by 39.5% and our class retention rate further reached 71.4%. We believe the solid growth demonstrates the effective implementation of our PBS system in lower-tier cities. We dedicated our efforts particularly to class retention rate,with a notable rise in the quality of classroom content and a strong team of teachers. This productive approach helped us grow market shares in lower-tiered cities. Going forward,we will stay focused on our plans to further develop Puxin Online School and continue acquiring new schools. Overall,we are particularly pleased to have narrowed our loss while achieving such solid top-line growth in the first half of 2019. We are excited and confident about our future growth in the education market in China.

[1]Adjusted operating loss is a non-GAAP financial measure,which is defined as operating loss excluding share-based compensation expenses. See "Use of Non-GAAP Financial Measures" and "Reconciliations of GAAP and non-GAAP results" elsewhere in this earnings release.

[2]Adjusted net loss attributable to Puxin Limited is a non-GAAP financial measure,which is defined as net loss attributable to Puxin Limited excluding share-based compensation expenses and loss on changes in fair value of convertible notes,derivative liabilities and warrants and loss on extinguishment of convertible notes. See "Use of Non-GAAP Financial Measures" and "Reconciliations of GAAP and non-GAAP results" elsewhere in this earnings release.

[3] EBITDA is a non-GAAP financial measure,which is defined as net loss excluding depreciation,amortization,interest expense,interest income and income tax (benefits) expenses; adjusted EBITDA is a non-GAAP financial measure,interest income,income tax (benefits) expenses,share-based compensation expenses,loss on changes in fair value of convertible notes,derivative liabilities and warrants and loss on extinguishment of convertible notes. See "Use of Non-GAAP Financial Measures" and "Reconciliations of GAAP and non-GAAP results" elsewhere in this earnings release.

Financial Results for the Second Quarter of 2019

Net Revenues

Net revenues increased by 19.1% to RMB632.9 million (US$92.2 million) from RMB531.3 million in the second quarter of 2018. This increase was primarily driven by an increase in student enrollments. Student enrollments increased by 39.5% to 725,962 in the same period of 2018.

Cost of Revenues

Cost of revenues increased by 15.3% to RMB332.8 million (US$48.5 million) from RMB288.6 million in the same period of 2018,primarily due to an increase in teaching staff's compensation. Cost of revenues,excluding share-based compensation expenses,increased by 15.8% to RMB331.7 million (US$48.3 million) from RMB286.3 million in the second quarter of 2018.

Gross Profit and Gross Margin

Gross profit was RMB300.1 million (US$43.7 million),an increase of 23.6% from RMB242.7 million in the same period of 2018. Gross margin was 47.4%,compared with 45.7% for the same period in 2018.

Operating Expenses

Total operating expenses increased by 42.6% to RMB468.8 million (US$68.3 million) from RMB328.8 million in the second quarter of 2018.

Selling expenses increased by 15.1% to RMB241.7 million (US$35.2 million) from RMB210.0 million in the second quarter of 2018. Selling expenses,increased by 17.2% to RMB236.4 million (US$34.4 million) from RMB201.6 million in the second quarter of 2018. The increases were primarily due to increases in sales and marketing staff compensation.

General and administrative expenses increased by 91.2% to RMB227.1 million (US$33.1 million) from RMB118.7 million during the same period of 2018. General and administrative expenses,increased by 13.3% to RMB118.2 million (US$17.2 million) from RMB104.4 million in the second quarter of 2018. The increases were primarily due to increases in staff compensation.

Total share-based compensation expenses allocated to related operating costs and expenses increased to RMB115.4 million (US$16.8 million) from RMB25.1 million in the same period of 2018,primarily due to new grants of options to employees in the first quarter of 2019.

Operating Loss and Operating Margin

Operating loss increased by 96.1% to RMB168.7 million (US$24.6 million) from RMB86.1 million in the second quarter of 2018.

Operating margin was (26.7)% in the second quarter of 2019,compared with (16.2)% in the same period in 2018.

Adjusted operating loss was RMB53.3 million (US$7.8 million),compared with RMB61.0 million in the second quarter of 2018.

Adjusted operating margin was (8.4)%,compared with (11.5)% in the same period of the prior year.

Net Loss

Net loss attributable to Puxin Limited increased by 3.3% to RMB194.6 million (US$28.4 million) from RMB188.4 million during the second quarter of 2018.Basic and diluted net loss per ADS attributable to Puxin Limited were RMB2.28 (US$0.34),compared with RMB2.88 during the same period of 2018.

Adjusted net loss attributable to Puxin Limited was RMB60.7 million (US$8.8 million),compared with RMB70.9 million during the same period of 2018. Adjusted basic and diluted net loss per ADS attributable to Puxin Limited[4] were RMB0.71 (US$0.10),compared with RMB1.09 during the same period of 2018.

EBITDA

EBITDA was RMB(159.8) million (US$(23.3) million),compared with RMB(156.2) million in the second quarter of 2018.

EBITDA margin was (25.2)% in the second quarter of 2019,compared with (29.4)% in the same period in 2018.

Adjusted EBITDA was RMB(25.8) million (US$(3.8) million),compared with RMB(38.7) million in the second quarter of 2018.

Adjusted EBITDA margin was (4.1)%,compared with (7.3)% in the same period in 2018.

Cash and cash equivalents

As of June 30,2019,the Company had total cash and cash equivalents of RMB500.6million (US$72.9million),compared with RMB778.0million as of December 31,2018.

Business Outlook

For the third quarter of 2019,based on the information available as of the date of this press release,the Company expects net revenues to be between RMB937.5 million and RMB971.0 million,which represents an increase of 40% to 45% year-over-year. These forecasts reflect the Company's current and preliminary views on the market and operational conditions,which are subject to change.

Conference Call Information

Puxin's management team will hold a conference call on August 13,2019 at 8:00 AM U.S. Eastern Time (or 8:00 PM on the same day,Beijing/Hong Kong Time) following the quarterly results announcement. Participants may access the call by dialing the following numbers:

International:

+1-412-902-4272

Mainland China:

4001-201203

US:

+1-888-346-8982

Hong Kong:

+852-301-84992

Passcode:

Puxin

Please dial in 10 minutes before the call is scheduled to begin. When prompted,ask to be connected to the Puxin Limited Call. Participants will be required to state their name and company upon entering the call.

A replay of the conference call will be accessible two hours after the conclusion of the conference call through August 20,2019 by dialing the following numbers:

International:

+1-412-317-0088

US:

+1-877-344-7529

Passcode:

10134205

A live webcast and archive of the conference call will be available on the Investor Relations section of Puxin's website at http://ir.pxjy.com/.

[4] Adjusted basic and diluted net loss per ADS attributable to Puxin Limited is a non-GAAP financial measure,which is defined as basic and diluted net loss per ADS attributable to Puxin Limited excluding share-based compensation expenses,derivative liabilities and warrants and loss on extinguishment of convertible notes. See "Use of Non-GAAP Financial Measures" and "Reconciliations of GAAP and non-GAAP results" elsewhere in this earnings release.

Exchange Rate

The Company's business is primarily conducted in China and all of the revenues are denominated in Renminbi ("RMB"). This announcement contains translations of certain RMB amounts into U.S. dollars ("USD") at specified rates solely for the convenience of the readers. Unless otherwise noted,all translations from RMB to USD are made at the rate of RMB6.8650 to US$1.00,the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on June 28,2019. No representation is made that the RMB amounts could have been,or could be,converted,realized or settled into US$ at that rate on June 28,or at any other rate.

Use of Non-GAAP Financial Measures

To supplement the Company's financial results presented in accordance with U.S. GAAP,the Company also uses non-GAAP financial measures,including adjusted operating loss,adjusted net loss attributable to Puxin Limited,EBITDA,adjusted EBITDA,adjusted basic and diluted net loss per ADS attributable to Puxin Limited,as supplemental measures to review and assess the Company's operating performance. Adjusted operating loss is defined as operating loss excluding share-based compensation expenses; adjusted net loss attributable to Puxin Limited is defined as net loss attributable to Puxin Limited excluding share-based compensation expenses,derivative liabilities and warrants and loss on extinguishment of convertible notes; EBITDA is defined as net loss excluding depreciation,interest income and income tax (benefits) expenses; adjusted EBITDA is defined as net loss excluding depreciation,derivative liabilities and warrants and loss on extinguishment of convertible notes,and adjusted basic and diluted net loss per ADS attributable to Puxin Limited are defined as basic and diluted net loss per ADS attributable to Puxin Limited excluding share-based compensation expenses,derivative liabilities and warrants and loss on extinguishment of convertible notes.

The Company believes that these non-GAAP financial measures provide useful information about the Company's operating results,enhance the overall understanding of the Company's past performance and future prospects and allow for greater visibility with respect to key metrics used by the Company's management in its financial and operational decision-making.

Non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. These non-GAAP financial measures have limitations as analytical tools,and when assessing the Company's operating performance,investors should not consider them in isolation. In addition,calculations of this non-GAAP financial information may be different from calculations used by other companies,and therefore comparability may be limited.

The Company mitigates these limitations by reconciling the non-GAAP financial measures to the most comparable U.S. GAAP performance measures,all of which should be considered when evaluating our performance.

For more information on this non-GAAP financial measure,please see the table captioned "Reconciliations of GAAP and non-GAAP results" set forth at the end of this press release.

Safe Harbor Statement

This press release contains forward-looking statements made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934,as amended,and the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will","expects","anticipates","future","intends","plans","believes","estimates","confident" and similar statements. The Company may also make written or oral forward-looking statements in its reports filed with or furnished to the U.S. Securities and Exchange Commission,in its annual report to shareholders,in press releases and other written materials and in oral statements made by its officers,directors or employees to third parties. Any statements that are not historical facts,including statements about the Company's beliefs and expectations,are forward-looking statements that involve factors,risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include,but not limited to the following: its goals and strategies,its ability to achieve and maintain profitability,its ability to attract and retain students to enroll in its courses,its ability to effectively manage its business expansion and successfully integrate businesses it acquired,its ability to identify or pursue targets for acquisitions,its ability to compete effectively against its competitors,its ability to improve the content of its existing courses or to develop new courses,and relevant government policies and regulations relating to the Company's corporate structure,business and industry. Further information regarding these and other risks is included in the Company's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release,and the Company does not undertake any obligation to update such information,except as required under applicable law.

About Puxin Limited

Puxin Limited ("Puxin" or the "Company") is a successful consolidator of the after-school education industry in China. Puxin has a strong acquisition and integration expertise to effectively improve education quality and operational performance of acquired schools. Puxin offers a full spectrum of K-12 and study-abroad tutoring programs designed to help students achieve academic excellence,as well as prepare for admission tests and applications for top schools,universities and graduate programs in China and other countries. The Company has developed a business model effectively combining strategic acquisitions and organic growth achieved through successful post-acquisition integration,which has differentiated the Company from other after-school education service providers in China. For more information,please visit http://www.pxjy.com/.

Contacts

Puxin Limited

Phone: +86-10-6269-8930

E-mail: ir@pxjy.com

Institutional Capital Advisory (ICA)

Mr. Kevin Yang

Phone: +86-021-8028-6033

E-mail: puxin@icaasia.com

PUXIN LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of RMB and USD,except for share,per share and per ADS data)

As of December 31,

As of June 30,

2018

2019

2019

RMB

RMB

USD

ASSETS

Current assets

Cash and cash equivalents

778,006

500,556

72,914

Restricted cash,current portion

-

344,700

50,211

Inventories

9,659

11,280

1,643

Prepaid expenses and other current assets

128,638

98,639

14,368

Total current assets

916,303

955,175

139,136

Non-current assets

Restricted cash,non-current portion

40,971

39,141

5,701

Operating lease right-of-use assets

-

804,322

117,163

Property,plant and equipment,net

248,801

270,933

39,466

Intangible assets

218,978

210,309

30,635

Goodwill

1,243,817

1,358,165

197,839

Deferred tax assets

3,456

1,478

215

Rental deposit

64,693

64,765

9,434

Other non-current assets

-

34,000

4,953

TOTAL ASSETS

2,737,019

3,738,288

544,542

LIABILITIES

Current liabilities

Accrued expenses and other current liabilities (including accrued

expenses and other current liabilities of the consolidated VIE

without recourse to the Group of RMB490,696 and

RMB712,735 as of December 31,2018 and June 30,

respectively)

515,623

766,598

111,669

Income tax payable of the consolidated VIE without recourse to

the Group

15,755

12,131

1,767

Deferred revenue,current portion (including deferred revenue,

current portion of the consolidated VIE without recourse to the

Group of RMB862,043 and RMB999,890 as of

December 31,respectively)

876,861

1,011,142

147,289

Operating lease liabilities,current portion (including operating

lease liabilities,current portion of the consolidated VIE

without recourse to the Group of RMB nil and RMB224,631

as of December 31,respectively)

-

225,249

32,811

Amounts due to related parties (including amounts due to related

parties of the consolidated VIE without recourse to the Group

of RMB3,199 and RMB404 as of December 31,2018 and

June 30,respectively)

54,493

22,898

3,335

Bank borrowing of the consolidated VIE without recourse to the

Group

106,600

353,900

51,551

Promissory notes,current portion (including promissory notes,

current portion of the consolidated VIE without recourse to the

Group of RMB190,000 and RMB nil as of December 31,2018

and June 30,respectively)

361,888

171,625

25,000

Total current liabilities

1,931,220

2,563,543

373,422

PUXIN LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of RMB and USD,

2018

2019

2019

RMB

RMB

USD

Non-current liabilities

Deferred revenue,non-current portion of the consolidated VIE

without recourse to the Group

121,191

110,939

16,160

Operating lease liabilities,non-current portion of the consolidated

VIE without recourse to the Group

-

516,397

75,222

Deferred tax liabilities of the consolidated VIE without recourse

to the Group

71,031

68,637

9,998

Franchise deposits of the consolidated VIE without recourse to

the Group

1,763

1,873

273

Derivative liabilities (including derivative liabilities of the

consolidated VIE without recourse to the Group of RMB nil and RMB nil

as of December 31,respectively)

63,942

164,279

23,930

TOTAL LIABILITIES

2,189,147

3,425,668

499,005

SHAREHOLDERS' EQUITY

Ordinary shares (par value of USD0.00005 per share;

1,000,000 and 1,000 shares authorized,

188,627,228 and 188,228 shares issued and

165,038,164 and 173,927,126 shares outstanding as of

December 31,respectively)

62

62

9

Additional paid-in capital

1,944,325

2,154,533

313,843

Statutory reserve

4,595

4,595

669

Accumulated other comprehensive income

68,214

66,133

9,633

Accumulated deficit

(1,469,303)

(1,912,718)

(278,619)

Total Puxin Limited shareholders' equity

547,893

312,605

45,535

Non-controlling interest

(21)

15

2

TOTAL SHAREHOLDERS' EQUITY

547,872

312,620

45,537

TOTAL LIABILITIES AND TOTAL SHAREHOLDERS' EQUITY

2,542

PUXIN LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands of RMB and USD,per share and per ADS data)

For the three months ended June30,

2018

2019

2019

RMB

RMB

USD

Net revenues

531,304

632,922

92,195

Cost of revenues (including share-based compensation expenses of

RMB2,276 and RMB1,178 for the three months ended June 30,

2018 and 2019,respectively)

288,582

332,828

48,482

Gross profit

242,722

300,094

43,713

Operating expenses:

Selling expenses (including share-based compensation expenses of

RMB8,411 and RMB5,347 for the three months ended June 30,respectively)

210,025

241,739

35,213

General and administrative expenses (including share-based

compensation expenses of RMB14,369 and RMB108,844 for the

three months ended June 30,2018 and 2019,respectively)

118,747

227,063

33,075

Total operating expenses

328,772

468,802

68,288

Operating loss

(86,050)

(168,708)

(24,575)

Interest expense

12,606

10,193

1,485

Interest income

181

4,144

604

Foreign exchange gain

-

179

26

Loss on changes in fair value of convertible notes,derivative

liabilities and warrants

92,485

18,617

2,712

Gain on disposal of subsidiary

93

-

-

Loss before income taxes

(190,867)

(193,195)

(28,142)

Income tax (benefits) expenses

(2,476)

1,424

207

Net loss

(188,391)

(194,619)

(28,349)

Less: Net income attributable to non-controlling interest

19

18

3

Net loss attributable to Puxin Limited

(188,410)

(194,637)

(28,352)

Net loss per share attributable to Puxin Limited

Basic and diluted

(1.44)

(1.14)

(0.17)

Net loss per ADS attributable to Puxin Limited

Basic and diluted

(2.88)

(2.28)

(0.34)

Weighted average shares used in calculating basic and diluted

net loss per share

130,533,721

170,511,022

170,022

Note: Each ADS represents two ordinary shares.

PUXIN LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands of RMB and USD)

For the three months ended June30,

2018

2019

2019

RMB

RMB

USD

Net loss

(188,349)

Other comprehensive (loss) income,net of tax:

Change in cumulative foreign currency translation adjustments

(4,557)

4,383

638

Total comprehensive loss

(192,948)

(190,236)

(27,711)

Less: comprehensive income attributable to non-controlling interest

19

18

3

Total comprehensive loss attributable to Puxin Limited

(192,967)

(190,254)

(27,714)

PUXIN LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands of RMB and USD,per share and per ADS data)

For the six months ended June30,

2018

2019

2019

RMB

RMB

USD

Net revenues

1,027,012

1,248,597

181,879

Cost of revenues (including share-based compensation expenses of RMB

3,252 and RMB2,580 for the six months ended June 30,respectively)

562,040

668,427

97,367

Gross profit

464,972

580,170

84,512

Operating expenses:

Selling expenses (including share-based compensation expenses of

RMB10,647 and RMB12,465 for the six months ended June 30,respectively)

374,672

464,373

67,644

General and administrative expenses (including share-based

compensation expenses of RMB296,571 and RMB195,072 for the

six months ended June 30,respectively)

502,120

421,048

61,332

Total operating expenses

876,792

885,421

128,976

Operating loss

(411,820)

(305,251)

(44,464)

Interest expense

17,646

40,232

5,860

Interest income

284

4,910

715

Foreign exchange loss

-

10

1

Loss on changes in fair value of convertible notes,derivative

liabilities and warrants

116,150

98,879

14,403

Loss on extinguishment of convertible notes

900

-

-

Gain on disposal of subsidiary

93

-

-

Loss before income taxes

(546,139)

(439,462)

(64,013)

Income tax (benefits) expenses

(2,699)

3,917

571

Net loss

(543,440)

(443,379)

(64,584)

Less: Net (loss) income attributable to non-controlling interest

(6)

36

5

Net loss attributable to Puxin Limited

(543,434)

(443,415)

(64,589)

Net loss per share attributable to Puxin Limited

Basic and diluted

(4.40)

(2.64)

(0.38)

Net loss per ADS attributable to Puxin Limited

Basic and diluted

(8.80)

(5.28)

(0.76)

Weighted average shares used in calculating basic and diluted net loss per

share

123,488,289

167,791,531

167,531

Note: Each ADS represents two ordinary shares.

PUXIN LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands of RMB and USD)

For the six months ended June30,

2018

2019

2019

RMB

RMB

USD

Net loss

(543,584)

Other comprehensive income (loss),net of tax:

Change in cumulative foreign currency translation adjustments

14,715

(2,081)

(303)

Total comprehensive loss

(528,725)

(445,460)

(64,887)

Less: comprehensive (loss) income attributable to non-controlling interest

(6)

36

5

Total comprehensive loss attributable to Puxin Limited

(528,719)

(445,496)

(64,892)

PUXIN LIMITED

RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS

(In thousands of RMB and USD,

2018

2019

2019

RMB

RMB

USD

Operating loss

(86,575)

Add: Share-based compensation expenses

25,056

115,369

16,806

Adjusted operating loss

(60,994)

(53,339)

(7,769)

Net loss attributable to Puxin Limited

(188,352)

Add: Share-based compensation expenses

25,806

Add: Loss on changes in fair value of convertible notes,712

Adjusted net loss attributable to Puxin Limited

(70,869)

(60,651)

(8,834)

Net loss

(188,349)

Add: Income tax (benefits) expenses

(2,424

207

Depreciation of property,plant and equipment

14,150

19,357

2,820

Amortization of intangible assets

8,052

8,002

1,166

Interest expense

12,485

Less: Interest income

181

4,144

604

EBITDA

(156,240)

(159,787)

(23,275)

Add: Share-based compensation expenses

25,806

Loss on changes in fair value of convertible notes,

derivativeliabilities and warrants

92,712

Adjusted EBITDA

(38,699)

(25,801)

(3,757)

Net loss per ADS attributable to Puxin Limited

-Basic and diluted

(2.88)

(2.28)

(0.34)

Adjusted net loss per ADS attributable to Puxin Limited

- Basic and diluted

(1.09)

(0.71)

(0.10)

Weighted average shares used in calculating basic and diluted

net loss per share

130,022

Note: Each ADS represents two ordinary shares.

PUXIN LIMITED

RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS

(In thousands of RMB and USD,

2018

2019

2019

RMB

RMB

USD

Operating loss

(411,464)

Add: Share-based compensation expenses

310,470

210,117

30,607

Adjusted operating loss

(101,350)

(95,134)

(13,857)

Net loss attributable to Puxin Limited

(543,589)

Add: Share-based compensation expenses

310,607

Add: Loss on changes in fair value of convertible notes,derivative

liabilities and warrants

116,403

Add: Loss on extinguishment of convertible notes

900

-

-

Adjusted net loss attributable to Puxin Limited

(115,914)

(134,419)

(19,579)

Net loss

(543,584)

Add: Income tax (benefits) expenses

(2,917

571

Depreciation of property,plant and equipment

27,497

36,663

5,341

Amortization of intangible assets

16,104

15,769

2,297

Interest expense

17,860

Less: Interest income

284

4,910

715

EBITDA

(485,176)

(351,708)

(51,230)

Add: Share-based compensation expenses

310,607

Loss on changes in fair value of convertible notes,

derivative liabilities and warrants

116,403

Loss on extinguishment of convertible notes

900

-

-

Adjusted EBITDA

(57,656)

(42,712)

(6,220)

Net loss per ADS attributable to Puxin Limited

- Basic and diluted

(8.80)

(5.28)

(0.76)

Adjusted net loss per ADS attributable to Puxin Limited

- Basic and diluted

(1.88)

(1.60)

(0.23)

Weighted average shares used in calculating basic and diluted

net loss per share

123,531

Note: Each ADS represents two ordinary shares.

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