Ambow Education Announces Second Half and Full Year 2021 Financial Results

Author: Ambow Education Holding Ltd. / 2023-07-24 00:22 / Source: Ambow Education Holding Ltd.

Ambow Education Announces Second Half and Full Year 2021 Financial Results

BEIJING,May 3,2022 --Ambow Education Holding Ltd. ("Ambow" or the "Company") (NYSE American: AMBO),a leading cross-border career educational and technology service provider,today announced its financial and operating results for the third and fourth quarters of 2021,which have not been audited or reviewed by the Company's independent registered accounting firm,as well as its audited financial and operating results for the full fiscal year,ended December 31,2021.

"We remained focused on strengthening our core competencies during the second half of 2021: creating and providing high-quality,technology-driven educational and career enhancement products and services," noted Dr. Jin Huang,Ambow's President and Chief Executive Officer. "Amid the fast-evolving environment,we skillfully adapted our business to new PRC regulatory requirements and achieved total revenues of RMB 496.9 million (US$ 78.0 million) in the full year 2021."

"I firmly believe that our long-standing ability to innovate and advance technology will continue to drive our sustainable growth. Our valuable patent portfolio encompassing a wide spectrum of educational technologies is unparalleled in the industry. Notably,our cutting-edge multimedia blackboard technology received a new U.S. patent in September 2021,underscoring our industry-leading technology capabilities. As both a pioneer and veteran in the career educational services sector,we also remaindedicated to the development of Industry-University collaborative and coordinated education. In October2021,the Ministry of Education ("MoE") again added Ambow to its list of approved enterprises for the Industry-University Cooperation and Collaborative Education Project. Furthermore,in December 2021,MoEselected Ambow to its first group of companies for participation in its Education Program for Connecting Talent Supply and Demand to Promote Employment,affirming the exceptional quality of our collaborative projects,"Dr. Huang added.

"Looking ahead,we will continue to deepen our commitment to addressing the career education sector's critical demands and harnessing our core capabilities to meet those needs with innovative services and products. Building on our 20-year proven track record,resilient business model and strategic efforts,we believe we are well positioned to deliver sustainable,long-term growth to our shareholders," concluded Dr. Huang.

Third Quarter 2021 Financial Highlights

Net revenues in the third quarter of 2021 were RMB 76.2 million (US$ 11.8 million),compared with RMB 112.7 million (US$ 16.6 million) in the same period of 2020. The decrease was primarily due to the impact of the 2021 Implementing Rules for the Law for Promoting Private Education (the "2021 Implementing Rules") on the Company's compulsory education business ("K-9 business") from September 1,2021,as well as a high base effect resulting from the one-month extension of the spring semester at the Company's K-12 schools in the third quarter of 2020 and fewer services provided at the Company's tutoring centers and training offices during the third quarter of 2021.

Gross profit in the third quarter of 2021 was RMB 2.8 million (US$ 0.4 million),compared with RMB 6.5 million (US$ 1.0 million) in the same period of 2020. Gross profit margin was 3.7%,compared with 5.8% in the third quarter of 2020. The decreases in gross profit and gross margin were mainly attributable to the impact of the 2021 Implementing Rules on the Company's K-12 schools business.

Operating expenses in the third quarter of 2021 decreased by 29.9% to RMB 66.7 million (US$ 10.4 million) from RMB 95.1 million (US$ 14.0 million) in the same period of 2020. The decrease was primarily attributable to reduced impairment loss on long-lived assets and stringent expense controls to improve operating efficiency.

Operating loss in the third quarter of 2021 was RMB 63.9 million (US$ 9.9 million),compared with RMB 88.6 million (US$ 13.1 million) in the same period of 2020.

Net income attributable to ordinary shareholders was RMB 31.9 million (US$ 4.9 million),or RMB 0.68 (US$ 0.11) per basic and diluted share,compared with a net loss of RMB 84.5 million (US$ 12.5 million),or RMB 1.94 (US$ 0.29) per basic and diluted share,in the same period of 2020. The income was mainly attributable to the gain on disposal of the Company's subsidiaries of RMB 10.8 million (US$ 1.7 million),the gain on the forgiven PPP loan of RMB 9.3 million (US$ 1.4 million),as well as a reversal of income tax payable of RMB 62.8 million (US$ 9.7 million) due to the expiration of its five-year claw-back period during the third quarter of 2021.

Fourth Quarter 2021 Financial Highlights

Net revenues in the fourth quarter of 2021 were RMB 118.9 million (US$ 18.7 million),compared with RMB 173.5 million (US$ 26.6 million) in the same period of 2020. The decrease was primarily due to the 2021 Implementing Rules to the Company's K-12 schools business from September 2021 being brought into effect,as well as the regulatory changes to our tutoring business in the second half of 2021.

Gross profit in the fourth quarter of 2021 was RMB 33.9 million (US$ 5.3 million),compared with RMB 66.1 million (US$ 10.1 million) in the same period of 2020. Gross profit margin was 28.5%,compared with 38.1% in the third quarter of 2020. The decreases in gross profit and gross margin were mainly attributable to the decrease in net revenues.

Operating expenses in the fourth quarter of 2021 increased by 8.9% to RMB 68.4 million (US$ 10.7 million) from RMB 62.8 million (US$ 9.6 million) in the same period of 2020. The increase was primarily due to additional research and development expenditures.

Operating loss in the fourth quarter of 2021 was RMB 34.4 million (US$ 5.4 million),compared with an operating income of RMB 3.3 million (US$ 0.5 million) in the same period of 2020.

Net loss attributable to ordinary shareholders was RMB 37.0 million (US$ 5.8 million),or RMB 0.79 (US$ 0.12) per basic and diluted share,compared with a net income of RMB 11.0 million (US$ 1.7 million),or RMB 0.23 (US$ 0.04) per basic and diluted share,in the same period of 2020. The net loss was mainly caused by the decrease in the gross profit stemming from the impact of the 2021 Implementing Rules on the Company's K-12 schools business.

As of December 31,Ambow maintained strong cash resources of RMB 177.0 million (US$ 27.8 million),comprised of cash and cash equivalents of RMB 157.4 million (US$ 24.7 million),short-term investments of RMB 17.8 million (US$ 2.8 million) and restricted cash of RMB 1.8 million (US$ 0.3 million).

Full Fiscal Year 2021 Financial Highlights

Net revenues in fiscal year 2021 decreased by 6.6% to RMB 496.9 million (US$ 78.0 million) from RMB 532.0 million (US$ 81.5 million) in 2020. The decrease was primarily due to the 2021 Implementing Rules to the Company's K-12 schools business coming into effect,as well as the regulatory changes to our tutoring business in the second half of 2021.

Gross profit in fiscal year 2021 increased by 8.9% to RMB 157.3 million (US$ 24.7 million) from RMB 144.5 million (US$ 22.1 million) in 2020. Gross profit margin was 31.7%,compared with 27.2% in 2020. The increases in gross profit and gross margin were mainly attributable to stringent cost controls during 2021.

Operating expenses in fiscal year 2021 decreased by 6.9% to RMB 250.5 million (US$ 39.3 million) from RMB 269.0 million (US$ 41.2 million) in 2020. The decrease was primarily attributable to reduced impairment loss on long-lived assets during 2021.

Operating loss in fiscal year 2021 was RMB 93.2 million (US$ 14.6 million),compared with RMB 124.6 million (US$ 19.1 million) in 2020.

Net income attributable to ordinary shareholders was RMB 3.0 million (US$ 0.5 million),or RMB 0.06 (US$ 0.01) per basic and diluted share,compared with a net loss of RMB 62.7 million (US$ 9.6 million),or RMB 1.41 (US$ 0.22) per basic and diluted share,in 2020. The income was mainly attributable to the gain on the disposal of the Company's subsidiaries of RMB 12.2 million (US$ 1.9 million),the gain on the forgiven PPP loan of RMB 9.3 million (US$ 1.5 million),as well as a reversal of income tax payable of RMB 62.8 million (US$ 9.7 million) due to the expiration of its five-year claw-back period during 2021.

Impact of 2021 Implementing Rules for the Law for Promoting Private Education

On May 14,the People's Republic of China's State Council promulgated the 2021 Implementing Rules for the Law for Promoting Private Education (the "2021 Implementing Rules"),which became effective on September 1,2021. The Implementing Rules prohibit foreign-invested enterprises established in China and social organizations whose actual controllers are foreign parties from controlling private schools that provide compulsory education by means of mergers,acquisitions,contractual arrangements,etc.,and private schools providing compulsory education are prohibited from conducting transactions with their related parties.

To comply with the 2021 Implementing Rules,the Company planned to sell its business providing compulsory education services at its three K-12 schools to a third party on September 1,2021. The Company has found a third party buyer and signed a definitive sales agreement,which is currently under registration process and expected to be completed within one year from December 31,2021. As the transaction was not closed as of December 31,and such business did not meet the definition of a "component" under US GAAP to be presented as a discontinued operation,the Company recorded the assets and liabilities of the K-9 business as "Held for Sale" in accordance with ASC 360. The assets and liabilities of the K-9 business classified as held for sale were presented separately in the asset and liability sections,respectively,of the Consolidated Balance Sheet as of December 31,2021.

The Company's financial and operating results for the thirdquarter and fourth quarters of 2021,as well as the full fiscal year ended December 31,2021 can also be found on its Form 6-K and 20-F filed with the U.S. Securities and Exchange Commission atwww.sec.gov.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted,all amounts translated from RMB to U.S. dollars for the third quarter and first nine months of 2021 are based on the effective exchange rate of 6.4434 as of September 30,2021; all amounts translated from RMB to U.S. dollars for the third quarter and first nine months of 2020 are based on the effective exchange rate of 6.7896 as of September 30,2020; all amounts translated from RMB to U.S. dollars for the fourth quarter and fiscal year of 2021 are based on the effective exchange rate of 6.3726 as of December 30,2021;all amounts translated from RMB to U.S. dollars for the fourth quarter and fiscal year of 2020 are based on the effective exchange rate of 6.5250 as of December 31,2020. The exchange rates were according to the middle rate as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. Fluctuations in financial highlights are based on RMB amounts.

About Ambow Education Holding Ltd.

Ambow Education Holding Ltd. is a leading cross-border career educational and technology service provider,offering high-quality,individualized services and products. With its extensive network of regional service hubs complemented by a dynamic proprietary learning platform and distributors,Ambow provides its services and products to students in China and the United States of America.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of 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" and similar statements. Among other things,the outlook and quotations from management in this announcement,as well as Ambow's strategic and operational plans,contain forward-looking statements. Ambow may also make written or oral forward-looking statements in its reports filed or furnished to the U.S. Securities and Exchange Commission,in its annual reports to shareholders,in press releases and other written materials and in oral statements made by its officers,directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statements,including but not limited to the following: the Company's goals and strategies,expansion plans,the expected growth of the content and application delivery services market,the Company's expectations regarding keeping and strengthening its relationships with its customers,the general economic and business conditions in the regions where the Company provides its solutions and services,and continued compliance with governmental regulations regarding education industry in the People's Republic of China and any other jurisdiction in which the Company conducts its operations. 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 as of the date of this press release,and Ambow undertakes no duty to update such information,except as required under applicable law.

For investor and media inquiries please contact:

Ambow Education Holding Ltd.

Tel: +86-10-6206-8000

The Piacente Group | Investor Relations

Tel: +1-212-481-2050 or +86-10-6508-0677

E-mail: ambow@tpg-ir.com

AMBOW EDUCATION HOLDING LTD.

AUDITED CONSOLIDATED BALANCE SHEETS

(All amounts in thousands,except for share and per share data)

As of December 31,

2021

2020

US$

RMB

ASSETS

Current assets:

Cash and cash equivalents

24,699

157,399

118,821

Restricted cash

286

1,823

824

Short-term investments,available for sale

2,474

15,764

117,854

Short-term investments,held to maturity

314

2,000

45,000

Accounts receivable,net

4,018

25,602

20,972

Amounts due from related parties

487

3,103

3,024

Prepaid and other current assets,net

17,244

109,890

117,634

Assets classified as held for sale

20,827

132,724

Total current assets

70,349

448,305

424,129

Non-current assets:

Property and equipment,net

15,993

101,915

144,492

Land use rights,net

1,715

Intangible assets,705

29,986

54,808

Goodwill

3,438

21,907

25,710

Deferred tax assets,net

6,338

Operating lease right-of-use asset

34,586

220,404

247,608

Finance lease right-of-use asset

824

5,250

5,850

Other non-current assets

22,340

142,364

139,067

Total non-current assets

81,891

521,857

625,588

Total assets

152,240

970,162

1,049,717

LIABILITIES

Current liabilities:

Short-term borrowings*

1,585

10,103

10,000

Deferred revenue *

14,913

95,036

163,699

Accounts payable *

4,625

29,466

19,423

Accrued and other liabilities *

33,958

216,399

209,590

Income taxes payable,current *

18,256

116,341

184,638

Amounts due to related parties *

595

3,793

2,543

Operating lease liability,current *

7,677

48,923

53,702

Liabilities classified as held for sale *

13,050

83,161

Total current liabilities

94,659

603,222

643,595

Non-current liabilities:

Long-term borrowing

9,594

Other non-current liabilities *

292

Income taxes payable,non-current *

3,370

21,475

34,763

Operating lease liability,non-current *

31,178

198,687

220,319

Total non-current liabilities

34,563

220,258

264,968

Total liabilities

129,222

823,480

908,563

EQUITY

Preferred shares

(US$0.003 par value;1,666,667 shares authorized,

nil issued and outstanding as of December 31,

2021 and December 31,2020)

Class A Ordinary shares

(US$0.003 par value; 66,667 and 66,667

shares authorized,41,973,276 and 41,960,776

shares issued and outstanding as of December

31,2021 and December 31,2020,respectively)

125

795

794

Class C Ordinary shares

(US$0.003 par value; 8,333,333 and 8,333

shares authorized,4,708,415 and 4,415

shares issued and outstanding as of December

31,respectively)

Additional paid-in capital

556,438

3,545,955

3,073

Statutory reserve

602

3,837

4,210

Accumulated deficit

(536,009)

(3,415,771)

(3,419,146)

Accumulated other comprehensive income

1,772

11,291

12,101

Total Ambow Education Holding Ltd.'s equity

22,942

146,197

143,122

Non-controlling interests

485

(1,968)

Total equity

23,018

146,682

141,154

Total liabilities and equity

152,717

* All of the VIE's assets can be used to settle obligations of their primary beneficiary. Liabilities recognized as a result of

consolidating these VIEs do not represent additional claims on the Company's general assets.

AMBOW EDUCATION HOLDING LTD.

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

(All amounts in thousands,except for share and per share data)

For the nine months ended September 30,

For the three months ended September 30,

2021

2020

2021

2020

US$

RMB

US$

RMB

NET REVENUES

Educational programs and

services

58,551

377,268

358,098

11,820

76,164

112,439

Intelligent programs and

services

117

752

352

269

Total net revenues

58,668

378,020

358,450

11,708

COST OF REVENUES

Educational programs and

services

(39,177)

(252,431)

(277,683)

(11,338)

(73,056)

(105,359)

Intelligent programs and

services

(343)

(2,211)

(2,340)

(44)

(281)

(882)

Total cost of revenues

(39,520)

(254,642)

(280,023)

(11,382)

(73,337)

(106,241)

GROSS PROFIT

19,148

123,378

78,427

438

2,827

6,467

Operating expenses:

Selling and marketing

(5,983)

(38,554)

(37,861)

(2,193)

(14,132)

(13,655)

General and administrative

(19,115)

(123,165)

(127,230)

(5,868)

(37,808)

(42,987)

Research and development

(1,531)

(9,864)

(4,456)

(661)

(4,262)

(1,758)

Impairment loss

(1,633)

(10,525)

(36,699)

(1,699)

Total operating expenses

(28,262)

(182,108)

(206,246)

(10,355)

(66,727)

(95,099)

OPERATING LOSS

(9,114)

(58,730)

(127,819)

(9,917)

(63,900)

(88,632)

OTHER INCOME

(EXPENSES)

Interest income

948

6,108

7,150

326

2,100

3,015

Foreign exchange gain (loss),

net

206

(4)

Other income (loss),net

257

1,655

840

440

2,835

(712)

Gain from deregistration of

subsidiaries

206

1,325

3,967

Gain on disposal of

subsidiaries

1,675

10,792

752

1,792

752

Gain on the bargain purchase

40,273

Gain on forgiven PPP loan

1,444

9,305

1,305

Gain on sale of investment

available for sale

341

2,196

2,477

151

975

1,421

Total other income

4,903

31,587

55,490

4,036

26,010

4,542

LOSSBEFORE INCOME

TAX AND NON-

CONTROLLING

INTEREST

(4,211)

(27,143)

(72,329)

(5,881)

(37,890)

(84,090)

Income tax benefit (expense)

10,293

66,325

(2,399)

10,783

69,480

(776)

NET INCOME (LOSS)

6,082

39,182

(74,728)

4,902

31,590

(84,866)

Less: Net loss attributable to

non-controlling interest

(127)

(821)

(1,040)

(47)

(302)

(332)

NET INCOME (LOSS)

ATTRIBUTABLE TO

ORDINARY

SHAREHOLDERS

6,209

40,003

(73,688)

4,949

31,892

(84,534)

NET INCOME (LOSS)

6,866)

OTHER

COMPREHENSIVE

(LOSS) INCOME,NET

OF TAX

Foreign currency translation

adjustments

(42)

(271)

10,731

146

2,403

Unrealized gains on short term

investments

Unrealized holding gains

arising during period

217

1,397

1,518

322

578

Less: reclassification

adjustment for gains

included in net income

241

1,556

2,161

109

704

1,493

Other comprehensive (loss)

income

(66)

(430)

10,088

(36)

(236)

1,488

TOTAL

COMPREHENSIVE

INCOME (LOSS)

6,016

38,752

(64,640)

4,866

31,354

(83,378)

Net income (loss) per share –

basic and diluted

0.13

0.86

(1.69)

0.11

0.68

(1.94)

Weighted average shares used

in calculating basic and

diluted net income (loss)

per share

43,648,571

46,571

43,583,448

46,660,948

46,948

43,595,871

AMBOW EDUCATION HOLDING LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(All amounts in thousands,except for share and per share data)

For the years ended December 31,

For the three months ended December 31,

2021

2020

2021

2020

US$

RMB

US$

RMB

Audited

Unaudited

NET REVENUES

Educational programs and

services

77,202

491,979

525,727

18,001

114,711

167,629

Intelligent programs and

services

769

4,898

6,253

651

4,146

5,901

Total net revenues

77,971

496,877

531,980

18,652

118,857

173,530

COST OF REVENUES

Educational programs and

services

(52,786)

(336,381)

(379,571)

(13,174)

(83,950)

(101,888)

Intelligent programs and

services

(499)

(3,177)

(7,919)

(152)

(966)

(5,579)

Total cost of revenues

(53,285)

(339,558)

(387,490)

(13,326)

(84,916)

(107,467)

GROSS PROFIT

24,686

157,319

144,490

5,326

33,941

66,063

Operating expenses:

Selling and marketing

(8,704)

(55,468)

(52,355)

(2,654)

(16,914)

(14,494)

General and administrative

(26,676)

(169,994)

(174,283)

(7,348)

(46,829)

(47,053)

Research and development

(2,273)

(14,487)

(5,703)

(725)

(4,623)

(1,247)

Impairment loss

(1,652)

(10,699)

Total operating expenses

(39,305)

(250,474)

(269,040)

(10,727)

(68,366)

(62,794)

OPERATING (LOSS)

INCOME

(14,619)

(93,155)

(124,550)

(5,401)

(34,425)

3,269

OTHER INCOME

(EXPENSES)

Interest income

1,408

8,971

9,501

449

2,863

2,351

Foreign exchange gain,net

223

980

949

Other income (loss),net

260

1,657

(1,244)

(2,084)

Gain from derecognition of

liabilities

3,926

Gain from deregistration of

subsidiaries

208

1,967

Gain on disposal of

subsidiaries

1,908

12,158

752

214

1,366

Gain on the bargain purchase

40,460

9,305

Gain on sale of investment

available for sale

378

2,412

3,476

216

999

Total other income

5,657

36,051

61,631

700

4,464

6,141

LOSS BEFORE INCOME

TAX AND NON-

CONTROLLING

INTEREST

(8,962)

(57,104)

(62,919)

(4,701)

(29,961)

9,410

Income tax benefit (expense)

9,275

59,108

(1,062)

(1,133)

(7,217)

1,337

NET INCOME (LOSS)

313

2,004

(63,981)

(5,834)

(37,178)

10,747

Less: Net loss attributable to

non-controlling interest

(157)

(998)

(1,269)

(28)

(177)

(229)

NET INCOME (LOSS)

ATTRIBUTABLE TO

ORDINARY

SHAREHOLDERS

470

3,002

(62,712)

(5,806)

(37,001)

10,976

NET INCOME (LOSS)

313

2,747

OTHER

COMPREHENSIVE

INCOME (LOSS),NET

OF TAX

Foreign currency translation

adjustments

(112)

(711)

6,234

(69)

(440)

(4,497)

Unrealized gains on short term

investments

Unrealized holding gains

arising during period

237

1,513

2,458

116

940

Less: reclassification

adjustment for gains

included in net income

253

1,612

2,932

771

Other comprehensive (loss)

income

(128)

(810)

5,760

(60)

(380)

(4,328)

TOTAL

COMPREHENSIVE

INCOME (LOSS)

185

1,194

(58,221)

(5,894)

(37,558)

6,419

Net income (loss) per share –

basic and diluted

0.01

0.06

(1.41)

(0.12)

(0.79)

0.23

Weighted average shares used

in calculating basic and

diluted net income (loss)

per share

46,654,853

46,853

44,372,326

46,673,494

46,721,812

AMBOW EDUCATION HOLDING LTD.

UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(All amounts in thousands,except for share and per share data)

Attributable to Ambow Education Holding Ltd.'s Equity

Accumulated

Class A Ordinary

Class C Ordinary

Additional

other

Non-

shares

paid-in

Statutory

Accumulated

comprehensive

controlling

Total

Shares

Amount

Shares

Amount

capital

reserves

deficit

income

interest

Equity

RMB

Balance as of January 1,2021

41,923,276

794

4,415

3,073

4,210

(3,146)

12,101

(1,968)

141,154

Share-based compensation

219

Issuance of ordinary shares for restricted

stock award

12,500

(0)

Foreign currency translation adjustment

115

Unrealized gain on investment,net of

income taxes

Net loss

(14,329)

(242)

(14,571)

Balance as of March31,935,776

794

4,292

4,433,475)

12,254

(2,210)

126,955

Share-based compensation

220

Issuance of ordinary shares for restricted

stock award

12,500

(0)

Foreign currency translation adjustment

(532)

Unrealized gain on investment,net of

income taxes

185

Net income/(loss)

22,440

(277)

22,163

Balance as of June30,948,512

4,411,035)

11,907

(2,487)

148,991

Share-based compensation

224

Issuance of ordinary shares for restricted

stock award

12,500

(1)

Foreign currency translation adjustment

146

Unrealized gain on investment,net of

income taxes

(382)

Capital injection from minority

shareholders

100

Deregistration of subsidiaries

(373)

373

3,351

Net income/(loss)

31,892

(302)

31,590

Balance as of September30,776

795

4,735

3,837

(3,378,770)

11,671

662

184,020

Share-based compensation

220

Issuance of ordinary shares for restricted

stock award

12,500

(0)

Foreign currency translation adjustment

(440)

Unrealized gain on investment,net of

income taxes

Net loss

(37,001)

(177)

(37,178)

Balance as of December 31,276

795

4,955

3,771)

11,291

485

146,682

Attributable to Ambow Education Holding Ltd.'s Equity

Accumulated

Class A Ordinary

Class C Ordinary

Additional

other

Non-

shares

paid-in

Statutory

Accumulated

comprehensive

controlling

Total

Shares

Amount

Shares

Amount

capital

reserves

deficit

income

interest

Equity

RMB

Balance as of January 1,2020

38,858,199

730

4,508,745

20,185

(3,371,815)

6,341

(680)

163,596

Share-based compensation

238

Issuance of ordinary shares for restricted

stock award

12,500

(0)

Foreign currency translation adjustment

433

Unrealized gain on investment,net of

income taxes

154

Impact on adoption of ASC 326

(594)

Net income/(loss)

6,039

(412)

5,627

Balance as of March31,870,699

730

4,983

20,366,370)

6,928

(1,092)

169,454

Share-based compensation

242

Issuance of ordinary shares for restricted

stock award

12,500

(1)

Foreign currency translation adjustment

7,895

Unrealized gain on investment,net of

income taxes

118

Deregistration of subsidiaries

(15,473)

15,473

Net income/(loss)

4,807

(296)

4,511

Balance as of June30,883,199

731

4,509,224

4,712

(3,346,090)

14,941

(1,388)

182,220

Share-based compensation

239

Issuance of ordinary shares for restricted

stock award

12,501

(0)

Foreign currency translation adjustment

2,403

Unrealized gain on investment,net of

income taxes

(915)

Deregistration of subsidiaries

(16)

Disposal of subsidiaries

(133)

(502)

502

(133)

Net loss

(84,534)

(332)

(84,866)

Balance as of September30,895,700

731

4,330

4,430,122)

16,429

(1,736)

98,932

Share-based compensation

228

Issuance of ordinary shares for restricted

stock award

12,500

(0)

Issuance of ordinary shares in a

registered direct offering

3,015,076

35,515

35,578

Foreign currency translation adjustment

(4,497)

Unrealized gain on investment,net of

income taxes

169

Deregistration of subsidiaries

(3)

Net income/(loss)

10,976

(229)

10,747

Balance as of December 31,2020

41,154

Discussion of Segment Operations

(All amounts in thousands)

For the nine months ended September 30,

2021

2020

2021

2020

US$

RMB

US$

RMB

NET REVENUES

K-12 Schools

32,424

208,922

185,766

5,164

33,272

58,966

CP&CE Programs

26,244

169,098

172,684

6,656

42,892

53,742

Total net revenues

58,708

COST OF REVENUES

K-12 Schools

(20,692)

(133,330)

(119,972)

(5,501)

(35,444)

(45,430)

CP&CE Programs

(18,828)

(121,312)

(160,051)

(5,893)

(60,811)

Total cost of revenues

(39,241)

GROSS PROFIT

K-12 Schools

11,732

75,592

65,794

(337)

(2,172)

13,536

CP&CE Programs

7,416

47,786

12,633

775

4,999

(7,069)

Total gross profit

19,467

For the years ended December 31,

2021

2020

2021

2020

US$

RMB

US$

RMB

NET REVENUES

K-12 Schools

42,426

270,362

291,539

9,642

61,440

105,773

CP&CE Programs

35,545

226,515

240,441

9,010

57,417

67,757

Total net revenues

77,530

COST OF REVENUES

K-12 Schools

(27,067)

(172,489)

(188,628)

(6,145)

(39,159)

(68,656)

CP&CE Programs

(26,218)

(167,069)

(198,862)

(7,181)

(45,757)

(38,811)

Total cost of revenues

(53,467)

GROSS PROFIT

K-12 Schools

15,359

97,873

102,911

3,497

22,281

37,117

CP&CE Programs

9,327

59,446

41,579

1,829

11,660

28,946

Total gross profit

24,063

View original content:https://www.prnewswire.com/news-releases/ambow-education-announces-second-half-and-full-year-2021-financial-results-301537764.html

Tags: Banking/Financial Service Education

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