Recently, Lide Education (HK:01449), which is already a penny stock, released its fiscal year 2020 annual financial report as of August 31, 2020. It is understood that this is also the first financial report of Lide Education since its listing in August 2020.
The financial report shows that Lide Education achieved operating income of 156 million yuan in fiscal 2020, an increase of 12.94% year-on-year; net profit was 42 million yuan, a year-on-year decrease of 39.67%; after excluding listing expenses, its adjusted net profit was 70.7 million yuan, 2019 In the same period of the year, it was 70.93 million yuan, basically the same.
The stock price has long been "halved"
Less than half a year after the listing of Lide Education, its stock price has been "halved". From the opening price of HK$1.99 for listing on August 6, 2020, it has already fallen to less than HK$1, making it one of the penny stocks. As of January 8, 2021, the stock price was only 0.9 Hong Kong dollars, which was 57.1% lower than its issue price of 2.1 Hong Kong dollars, and the total market value was 600 million Hong Kong dollars.
It is worth mentioning that Lide Education also announced on January 7, 2021 that it intends to acquire a general higher education school in Qiqihar City, Heilongjiang Province-Qiqihar Polytechnic Vocational College. According to the announcement, its indirect wholly-owned subsidiary Liankang Consulting intends to invest 35 million yuan to purchase 100% of the school's equity.
It is understood that Qiqihar Polytechnic Vocational College has about 1722 students, and the total area of the campus is about 453,000 square meters. After the completion of the acquisition, it will be changed to one of the group members of Lide Education. Prior to this, Lide Education had only one school-Heilongjiang Institute of Business and Technology, with 9572 full-time students.
However, according to the Lide Education Announcement, Qiqihar Polytechnic Vocational College has been at a loss in the past few years. Its net profit in 2018 and 2019 was negative, but there will be changes in 2020. As of November 30, 2020 The net profit was RMB 2.3159 million.
In 2019, the total value of the audited assets of Qiqihar Polytechnic Vocational College was RMB 57,994,800, and the net asset value was RMB 31,689,900; as of November 30, 2020, the total value of unaudited assets of the school was RMB 61,046,900, and the net asset value was RMB 61,046,900. It is 34.0923 million yuan.
According to the introduction, Lide Education will cooperate to establish a new campus of Qiqihar Polytechnic Vocational College in Harbin, Heilongjiang through Liankang Consulting. After obtaining the approval of the relevant competent authority to change the school sponsor, establish a new campus and change the school name, the school shall use the new school name.
Market value is lower than net assets
While advancing the acquisition, Lide Education also plans to change its company name from Lide Education Co., Ltd. to Lide Education Co., Ltd. Lide Education stated that the use of a joint-stock company as part of a company name is generally considered to have a larger scale of operation and higher credibility.
Going back to the performance of Lide Education’s financial report, its sales cost in fiscal year 2020 was 71.1 million yuan, an increase of 12.1 million yuan from 59 million yuan in 2019, a year-on-year increase of 20.4%; sales expenses increased from 800,000 yuan in fiscal year 2019, Increase to 1 million yuan in fiscal year 2020.
As of the end of fiscal year 2020, Lide Education’s monetary funds totaled 338 million yuan, accounting for 18.04% of total assets; fixed assets such as property, plant and equipment were 1.451 billion yuan, accounting for 77.57% of total assets; total net assets were 801 million yuan , The price-to-book ratio is 0.66 and the price-to-earnings ratio (TTM) is 12.53.
According to the financial report, the total number of undergraduate students enrolled in Lide Education's schools has increased from 8,233 in the 2018/2019 academic year to 8,807 in the 2019/2020 academic year, a growth rate of 7.0%; the per capita tuition fee has increased from 15,500 in the 2018/2019 academic year Increased to 16,900 yuan in the 2019/2020 academic year, a growth rate of 9.2%.
From this perspective, Lide Education is quite satisfactory. Apart from its growing scale, its financial performance can be said to increase revenue but not profit. It will take a long time for the Qiqihar Vocational College of Technology to be acquired to contribute revenue and profits.
In fact, the performance of Lide Education is not unrelated to its location. According to the Frost & Sullivan Report, the total revenue of the private higher education industry in Heilongjiang Province increased from 1.6 billion yuan in 2014 to 2 billion yuan in 2018, a compound annual growth rate of 5.7%, which was lower than the national average growth rate in the same period. Speed 9.0%.
Statistics show that the total number of students in the private higher education industry in Heilongjiang Province was reduced to 111,100 in 2017, and further reduced to 110,100 in 2018. Among them, Lide Education is calculated based on the number of students in school. It contributed about 7.5% of the provincial market share in the 2018/2019 academic year, ranking eighth in the province.
It is understood that Lide Education also stated in its financial report that it will actively promote the construction of Daqing Transportation Vocational and Technical College in the future to increase market penetration, and will further promote the construction of Hanan campus, improve the overall school environment, expand school space, and further Increase the number of students that can accommodate, optimize pricing strategies, and improve profitability.