“Though our general and administrative expenses significantly increased in the past year, affecting our overall profitability to some extent, it is important to note that these expenses were primarily due to non-cash factors, including increased impairment expenses related to licensing copyrights and goodwill, as well as changes in provisions for doubtful accounts, mainly due to payment delays from educational content customers caused by the impact of COVID-19. We expect these factors that led to the increase to cease as we consolidate our market leadership and expand content promotion and distribution with our partners, thereby not affecting the company's overall performance in the future.”
“With our expertise in vocational education and strong content development capabilities, we continued to build a comprehensive digital education content database in 2022. Our library comprises over 39,000 online videos and video courses, totaling approximately 10,080 hours, with over 75.8% of the content being self-developed. Our content covers a wide range of professional development topics, including employability skills, entrepreneurship guidance, professional skill training, skill enhancement, and professional certification exams, to meet the growing demand for online educational content.”
“In 2022, we continued to strengthen our collaboration with telecom operators. For example, the monthly subscription purchase volume via telecom operators of our own mobile video package product ‘Fish Learning launched the fourth quarter of 2017 reached approximately 31.4 million by
“By
“In addition, we also collaborate with third-party content providers to supplement our own content database. These agreements allow us to use their educational videos and we aim to expand such partnerships.”
“Looking forward we are encouraged by our revenue growth and remain focused on optimizing our operations, improving the quality of our educational content, and exploring opportunities for further growth in the IT related solution services sector. We will keep committed to enhancing our performance and delivering value to our stakeholders.”
Fiscal Year 2022 Financial Results:
The following table sets forth a summary of our (including the VIEs’) consolidated results of operations for the years indicated, both in absolute amounts and as percentages of total income from us and the VIEs.
For the Years Ended | ||||||||
2021 | 2022 | |||||||
RMB | RMB | % Change | ||||||
(in RMB million, except earnings per share; differences due to rounding) | ||||||||
Net revenues | 473.25 | 505.72 | 6.86 | % | ||||
Gross profit (loss) | 104.20 | (5.54 | ) | (105.32 | %) | |||
Gross (loss) margin | 22.02 | % | (1.1 | %) | N/A | |||
Income (loss) from operations | 50.79 | (207.45 | ) | (508.45 | %) | |||
Net income (loss) | 52.93 | (196.58 | ) | (471.40 | %) | |||
Earnings (loss) per share – basic and diluted | 0.43 | (1.68 | ) | (490.70 | %) |
Net Revenues
Net revenue increased by 6.9% from
- Net revenue from the educational content service and other services decreased by
RMB160 .2 million (US$23 .2 million) fromRMB365 .1 million for the year endedDecember 31, 2021 toRMB204 .9 million (US$29 .7 million) for the year endedDecember 31, 2022 . Because there is constant need for updating and developing educational content, the Company faced the risk of content becoming outdated before generating profits. Therefore In 2022, Jianzhi adopted conservative strategies, resulting in a significant decline in revenues and lost subscriptions. The decrease was primarily due to the absence of new courses and attractive content, leading to decreased subscriptions from end customers. - Net revenue from IT related solution services increased by
RMB192.6 million (US$27.9 million ), or 178.1% fromRMB108.2 million for the year endedDecember 31, 2021 toRMB300.8 million (US$43.6 million ) for the year endedDecember 31, 2022 . The increase was primarily attributable to acquisition of a cloud-based customer in the year of 2022 which contributed revenues ofRMB 197.5 million (US$28.6 million ) in IT procurement and assembling of equipment.
Cost of Revenues
Cost of revenue increased by 38.5% from
Gross profit (loss)
Due to the aforementioned factors, gross profit declined from
Operating Expenses
Total operating expenses rose from
- Sales and marketing expenses decreased from
RMB7.6 million in 2021 toRMB7.1 million (US$1.0 million ) in 2022. This decrease was mainly driven by a decrease ofRMB1.3 million (US$0.2 million ) in salary and welfare expenses because we laid off certain salespersons and reduced marketing and promotion for educational content services, and there was a decrease of$0.7 million in travel and entertainment expenses as a result of decrease in salespersons, partially net off by an increase ofRMB1.3 million (US$0.2 million ) in the service fee which were used in tendering for IT solution service customers. - General and administrative expenses increased from
RMB19.5 million in 2021 toRMB179.2 million (US$26.0 million ) in 2022. This increase was caused by several factors, including an impairment of licensed copyrights due to outdated educational content, impairments of goodwill and customer relationships related to an acquisition, and changes in allowance of doubtful accounts due to delayed payments from educational content customers affected by COVID-19. - Research and development expenses decreased from
RMB26.4 million in 2021 toRMB15.6 million (US$2.3 million ) in 2022. This decrease was primarily due to reductions in salary and welfare expenses and outsourced labor costs as the VIEs reduced expenditures on the development of new educational content.
Income Tax Expenses
Income tax expenses changed from
Net Income (Loss)
As a result of the foregoing, the Company reported net loss of
On
On
About
Headquartered in
Safe Harbor Statement
This press release (the “Press Release”) contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the
For investor and media inquiries, please contact:
WFS Investor Relations Inc.
Phone: +86 13811768559
+1 628 283 9214
Email: services@wealthfsllc.com
CONSOLIDATED BALANCE SHEETS
(Amounts in Renminbi (“RMB”) and
except for number of shares and per share data)
2021 | 2022 | 2022 | ||||||||||
RMB | RMB | US$ | ||||||||||
Assets | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | 61,266,782 | 65,055,278 | 9,432,129 | |||||||||
Accounts receivable, net | 104,775,266 | 17,173,021 | 2,489,854 | |||||||||
Inventories | 1,960,277 | 399,439 | 57,913 | |||||||||
Deferred offering expenses | 8,494,583 | — | — | |||||||||
Due from a related party | 2,473,750 | 1,051,869 | 152,507 | |||||||||
Short-term prepayments | 288,101,452 | 254,493,399 | 36,898,074 | |||||||||
Short-term investments | 11,430,000 | 4,080,000 | 591,544 | |||||||||
Prepaid expenses and other current assets | 5,123,221 | 9,518,326 | 1,380,029 | |||||||||
Total current assets | 483,625,331 | 351,771,332 | 51,002,050 | |||||||||
Non-current assets: | ||||||||||||
Right-of-use assets, net | 300,024 | — | — | |||||||||
Deferred tax assets, net | 388,321 | 9,176,875 | 1,330,522 | |||||||||
Property and equipment, net | 214,717 | 153,880 | 22,310 | |||||||||
Educational contents, net | 206,695,356 | 214,441,814 | 31,091,140 | |||||||||
Intangible assets, net | 17,187,208 | — | — | |||||||||
7,712,011 | — | — | ||||||||||
Long-term prepayments | 143,494,187 | 151,779,105 | 22,005,902 | |||||||||
Total non-current assets | 375,991,824 | 375,551,674 | 54,449,874 | |||||||||
Total assets | 859,617,155 | 727,323,006 | 105,451,924 | |||||||||
Liabilities | ||||||||||||
Current liabilities: | ||||||||||||
Accounts payable | 24,286,309 | 8,037,004 | 1,165,256 | |||||||||
Contract liabilities | 327,299,227 | 290,028,010 | 42,050,109 | |||||||||
Salary and welfare payable | 3,411,486 | 2,302,646 | 333,852 | |||||||||
Income taxes payable | 3,743,247 | 1,170,795 | 169,749 | |||||||||
Value added tax (“VAT”) and other tax payable | 2,669,408 | 4,063,389 | 589,136 | |||||||||
Other payables | 5,276,472 | 2,658,243 | 385,409 | |||||||||
Lease liabilities, current | 295,367 | — | — | |||||||||
Amount due to related parties | 71,707,642 | 52,711,457 | 7,642,443 | |||||||||
Total current liabilities | 438,689,158 | 360,971,544 | 52,335,954 | |||||||||
Non-current liabilities: | ||||||||||||
Deferred tax liabilities | 2,191,500 | — | — | |||||||||
Total non-current liabilities | 2,191,500 | — | — | |||||||||
Total liabilities | 440,880,658 | 360,971,544 | 52,335,954 |
2021 | 2022 | 2022 | ||||||||||
RMB | RMB | US$ | ||||||||||
Commitments and contingencies | ||||||||||||
Mezzanine equity: | ||||||||||||
Redeemable ordinary shares ( | 45,984,876 | — | — | |||||||||
Shareholders’ equity | ||||||||||||
Ordinary shares ( | 63,291 | 77,747 | 12,111 | |||||||||
Additional paid-in capital | 54,045,908 | 242,093,942 | 35,099,483 | |||||||||
Statutory reserves | 23,599,304 | 23,599,304 | 3,421,577 | |||||||||
Retained earnings | 280,983,836 | 81,822,029 | 11,863,081 | |||||||||
Accumulated other comprehensive income | 400,233 | 2,520,630 | 365,457 | |||||||||
Total Jianzhi Education Technology Group Company Limited’s shareholders’ equity | 359,092,572 | 350,113,652 | 50,761,709 | |||||||||
Noncontrolling interests | 13,659,049 | 16,237,810 | 2,354,261 | |||||||||
Total shareholders’ equity | 372,751,621 | 366,351,462 | 53,115,970 | |||||||||
Total liabilities, mezzanine equity and shareholders’ equity | 859,617,155 | 727,323,006 | 105,451,924 |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Amounts in Renminbi (“RMB”) and
except for number of shares and per share data)
For the Years Ended | ||||||||||||||||
2020 | 2021 | 2022 | 2022 | |||||||||||||
RMB | RMB | RMB | US$ | |||||||||||||
Net revenues | 404,931,954 | 473,247,283 | 505,724,311 | 73,323,133 | ||||||||||||
Cost of revenues | (275,790,112 | ) | (369,052,134 | ) | (511,265,334 | ) | (74,126,506 | ) | ||||||||
Gross profit (loss) | 129,141,842 | 104,195,149 | (5,541,023 | ) | (803,373 | ) | ||||||||||
Operating expenses: | ||||||||||||||||
Sales and marketing expenses | 5,031,526 | 7,576,963 | 7,087,625 | 1,027,609 | ||||||||||||
General and administrative expenses | 26,054,063 | 19,476,375 | 179,249,830 | 25,988,783 | ||||||||||||
Research and development expenses | 15,584,738 | 26,355,055 | 15,568,768 | 2,257,259 | ||||||||||||
Total operating expenses | 46,670,327 | 53,408,393 | 201,906,223 | 29,273,651 | ||||||||||||
Income (loss) from operations | 82,471,515 | 50,786,756 | (207,447,246 | ) | (30,077,024 | ) | ||||||||||
Other income (expenses): | ||||||||||||||||
Investment income | 407,827 | 569,737 | 603,058 | 87,435 | ||||||||||||
Interest income (expenses), net | 53,596 | (892,906 | ) | (2,088,467 | ) | (302,799 | ) | |||||||||
Other expenses | (19,614 | ) | (12,563 | ) | (286,522 | ) | (41,539 | ) | ||||||||
Government grants | 4,482,816 | 6,753,388 | 1,656,077 | 240,109 | ||||||||||||
Total other income, net | 4,924,625 | 6,417,656 | (115,854 | ) | (16,794 | ) | ||||||||||
Income (loss) before income tax | 87,396,140 | 57,204,412 | (207,563,100 | ) | (30,093,818 | ) | ||||||||||
Income tax (expense) benefits | (485,749 | ) | (4,273,788 | ) | 10,980,054 | 1,591,958 | ||||||||||
Net income (loss) | 86,910,391 | 52,930,624 | (196,583,046 | ) | (28,501,860 | ) | ||||||||||
Net income attributable to noncontrolling interests | 4,586,492 | 4,672,355 | 2,578,761 | 373,885 | ||||||||||||
Net income (loss) attributable to the Jianzhi Education Technology Group Company Limited’s shareholders | 82,323,899 | 48,258,269 | (199,161,807 | ) | (28,875,745 | ) | ||||||||||
Net income (loss) | 86,910,391 | 52,930,624 | (196,583,046 | ) | (28,501,860 | ) | ||||||||||
Other comprehensive (loss) income: | ||||||||||||||||
Foreign currency translation adjustments | (35,391 | ) | 211,494 | 2,120,397 | 307,429 | |||||||||||
Total other comprehensive (loss) income | (35,391 | ) | 211,494 | 2,120,397 | 307,429 | |||||||||||
Total comprehensive income (loss) | 86,875,000 | 53,142,118 | (194,462,649 | ) | (28,194,431 | ) | ||||||||||
Net comprehensive income attributable to noncontrolling interests | 4,586,492 | 4,672,355 | 2,578,761 | 373,885 | ||||||||||||
Comprehensive income (loss) attributable to the Jianzhi Education Technology Group Company Limited’s shareholders | 82,288,508 | 48,469,763 | (197,041,410 | ) | (28,568,316 | ) | ||||||||||
Earnings (loss) per share | ||||||||||||||||
Basic and diluted* | 0.74 | 0.43 | (1.68 | ) | (0.24 | ) | ||||||||||
Weighted average number of shares | ||||||||||||||||
Basic and diluted* | 111,110,000 | 111,110,000 | 118,512,959 | 118,512,959 |
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Renminbi (“RMB”) and
For the Years Ended | ||||||||||||||||
2020 | 2021 | 2022 | 2022 | |||||||||||||
RMB | RMB | RMB | US$ | |||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net income (loss) | 86,910,391 | 52,930,624 | (196,583,046 | ) | (28,501,860 | ) | ||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||||
Depreciation of property and equipment | 538,303 | 78,000 | 60,837 | 8,821 | ||||||||||||
Amortization of educational contents | 24,375,147 | 45,296,565 | 91,542,454 | 13,272,408 | ||||||||||||
Impairment of educational contents | 106,182,780 | 15,395,056 | ||||||||||||||
Amortization of intangible assets | 7,805,096 | 6,656,298 | 16,840,435 | 2,441,634 | ||||||||||||
Impairment of intangible assets | 12,139,226 | 1,760,022 | ||||||||||||||
Impairment of goodwill | 7,712,011 | 1,118,136 | ||||||||||||||
Amortization of operating lease right-of-use assets | 3,592,290 | 2,362,967 | 300,024 | 43,499 | ||||||||||||
Provision (Reversal of provision) for doubtful accounts | 210,433 | (119,539 | ) | 34,901,498 | 5,060,242 | |||||||||||
Deferred tax benefit | (45,415 | ) | (649,078 | ) | (10,980,054 | ) | (1,591,958 | ) | ||||||||
Changes in operating assets and liabilities: | ||||||||||||||||
Accounts receivable | (31,439,946 | ) | 10,148,705 | 52,700,747 | 7,640,890 | |||||||||||
Inventories | 1,877,720 | 15,655 | 1,560,838 | 226,300 | ||||||||||||
Prepaid expenses and other current assets | 357,319 | (2,197,407 | ) | 3,127,291 | 453,415 | |||||||||||
Short-term prepayments | 12,940,022 | (285,437,271 | ) | 33,608,121 | 4,872,720 | |||||||||||
Accounts payable | 7,921,537 | 1,059,057 | (16,249,305 | ) | (2,355,928 | ) | ||||||||||
Salary and welfare payable | 415,648 | 9,831 | (1,108,840 | ) | (160,767 | ) | ||||||||||
Contract liabilities | (9,365,507 | ) | 319,904,579 | (37,271,217 | ) | (5,403,819 | ) | |||||||||
Income taxes payable | (903,026 | ) | 2,822,268 | (2,572,452 | ) | (372,970 | ) | |||||||||
Value added tax (“VAT”) and other tax payable | (4,325,138 | ) | (1,122,235 | ) | 1,393,981 | 202,108 | ||||||||||
Other payables | 455,342 | (1,964,796 | ) | (2,787,853 | ) | (404,202 | ) | |||||||||
Lease liabilities | (3,566,734 | ) | (2,020,636 | ) | (295,367 | ) | (42,824 | ) | ||||||||
Net cash provided by operating activities | 97,753,482 | 147,773,587 | 94,222,109 | 13,660,923 | ||||||||||||
Cash flows from investing activities: | ||||||||||||||||
Purchase of short-term investments | (140,145,000 | ) | (24,405,127 | ) | (3,850,000 | ) | (558,198 | ) | ||||||||
Proceeds from redemption of short-term investment | 90,305,000 | 83,655,127 | 11,200,000 | 1,623,847 | ||||||||||||
Purchase of property and equipment | (39,980 | ) | (76,280 | ) | — | — | ||||||||||
Purchase of educational contents | (98,899,372 | ) | (64,811,320 | ) | (176,597,637 | ) | (25,604,251 | ) | ||||||||
Purchase of intangible assets | (3,669,811 | ) | — | — | — | |||||||||||
Prepayment for educational contents | (12,407,962 | ) | (139,002,868 | ) | (46,223,984 | ) | (6,701,848 | ) | ||||||||
Lonas made to a third party | — | — | (3,015,018 | ) | (437,137 | ) | ||||||||||
Net cash used in investing activities | (164,857,125 | ) | (144,640,468 | ) | (218,486,639 | ) | (31,677,587 | ) | ||||||||
Cash flows from financing activities: | ||||||||||||||||
Repayment to related parties | (26,697 | ) | — | (17,064,116 | ) | (2,474,064 | ) | |||||||||
Borrowing from related parties | 75,604 | 48,808,057 | — | — | ||||||||||||
Net proceeds raised in connection with initial public offering | — | — | 146,982,044 | 21,310,393 | ||||||||||||
Payments of issuance cost in relation with initial public offering | — | (8,621,261 | ) | (481,408 | ) | (69,798 | ) | |||||||||
Advance to a related party for issuance costs in relation with initial public offering | — | (2,512,809 | ) | — | — | |||||||||||
Refund from a related party for issuance costs in relation with initial public offering | — | — | 1,421,881 | 206,153 | ||||||||||||
Deposits made to a redeemable ordinary shareholder | — | — | (4,296,606 | ) | (622,949 | ) | ||||||||||
Net cash provided by financing activities | 48,907 | 37,673,987 | 126,561,795 | 18,349,735 | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents and restricted cash held in foreign currencies | (264,826 | ) | (489,011 | ) | 1,491,231 | 216,210 | ||||||||||
Net increase (decrease) in cash and cash equivalents and restricted cash | (67,319,562 | ) | 40,318,095 | 3,788,496 | 549,281 | |||||||||||
Cash and cash equivalents and restricted cash at beginning of the year | 88,268,249 | 20,948,687 | 61,266,782 | 8,882,848 | ||||||||||||
Cash and cash equivalents and restricted cash at end of the year | 20,948,687 | 61,266,782 | 65,055,278 | 9,432,129 | ||||||||||||
Supplemental disclosures of cash flows information: | ||||||||||||||||
Cash paid for income taxes | 1,436,662 | 2,617,807 | 1,177,693 | 170,749 | ||||||||||||
Cash paid for interest expenses | — | — | — | — | ||||||||||||
Non-cash Investing and Financing activities: | ||||||||||||||||
Transfer of prepaid issuance cost to additional paid-in capital | — | — | 8,943,892 | 1,296,742 |
Source:
2023 GlobeNewswire, Inc., source