Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company's revenue, net profit attributable to shareholders, and adjusted net profit for 2024 are projected to be CNY 4.116 billion, CNY 0.513 billion, and CNY 0.525 billion respectively, representing year-on-year growth of 3.5%, 88.0%, and 86.6% [2] - The increase in net profit outpaced revenue growth due to improved gross margins and a comprehensive decline in expense ratios [2] - The company plans to distribute a final dividend of HKD 0.22 per share, with a payout ratio of 93.5% and a dividend yield of 5.1% [3] Summary by Sections Business Performance - The core business, New Oriental, saw a positive revenue growth rate in the second half of the year, with only the IT segment under pressure [4] - Revenue by segment for 2024 is projected as follows: Culinary Technology CNY 1.927 billion, Western Pastry CNY 0.343 billion, IT and Internet Technology CNY 0.763 billion, Automotive Services CNY 0.914 billion, Fashion Beauty CNY 0.105 billion, and Other Income CNY 0.224 billion, with respective year-on-year growth rates of 0.7%, 3.6%, -2.4%, 7.9%, 124.9%, and 9.1% [4] - The average training participants for new enrollments are projected at 143,000, with a year-on-year decline of 6.2% [4] Financial Metrics - The gross margin for 2024 is expected to be 51.4%, an increase of 3.4 percentage points year-on-year [7] - The net profit margin for 2024 is projected at 12.5%, reflecting a year-on-year increase of 5.6 percentage points [7] - The company’s total revenue for 2024 is expected to be CNY 4.116 billion, with a year-on-year growth of 3.46% [10] Future Outlook - Short-term performance is expected to exceed market expectations due to cost control measures [8] - Mid-term projections indicate a normalization of enrollments, with growth in long-term students gradually recovering [8] - Long-term advantages include competitive employment rates and the ability to quickly adjust courses to market changes [8] - The earnings per share (EPS) forecast for 2025 is CNY 0.28, with a price-to-earnings (PE) ratio of 14 [8]

Financial Performance - For the year ended December 31, 2024, the company reported a revenue of RMB 4,116 million, representing a 3.5% increase from RMB 3,979 million in 2023[5] - The gross profit for the same period was RMB 2,115 million, which is a 10.8% increase compared to RMB 1,908 million in 2023[5] - The net profit surged by 88.0% to RMB 513 million from RMB 273 million in the previous year[5] - Adjusted net profit increased by 86.6% to RMB 525 million from RMB 281 million in 2023[5] - The company reported a basic earnings per share of RMB 23.53, up from RMB 12.51 in 2023[5] - Adjusted net profit for the year ended December 31, 2024, was RMB 524.94 million, compared to RMB 281.34 million in 2023, while adjusted EBITDA was RMB 1,375.65 million, up from RMB 1,136.39 million[71] - The company's gross profit for the fiscal year ending December 31, 2024, was approximately RMB 2,115 million, with a gross margin of 51.4%, up from 48.0% in the previous year[62] - The cost of revenue decreased by 3.3% from approximately RMB 2,070 million for the fiscal year ending December 31, 2023, to about RMB 2,002 million for the fiscal year ending December 31, 2024[58] Operational Changes - The company has restructured its internal reporting segments, merging several educational divisions to enhance operational efficiency[18] - The company has restructured its business segments, integrating the operations of Meishi Academy into the New Oriental Cooking Education division, which now includes 75 schools[42] - The company adjusted its enrollment strategy and optimized course structure to attract more high-value new students, despite a 6.2% decrease in new training participants and new customer registrations[56] Training Participants and Customer Registrations - The number of new training participants and new customer registrations decreased by 6.2% to 143,441 from 152,881 in 2023[3] - New training participants in the cooking technology segment decreased by 7.7% from 68,473 in 2023 to 63,228 in 2024[48] - Long-term courses in information technology and internet technology saw a 15.0% decline, from 22,060 in 2023 to 18,755 in 2024[49] - The number of new customers registered for the cooking technology segment decreased by 6.7% from 28,600 in 2023 to 26,686 in 2024[48] - The fashion beauty education segment experienced a significant increase of 79.6% in new training participants, rising from 3,406 in 2023 to 6,118 in 2024[50] - The overall average training participants for the group remained relatively stable, with a slight decrease of 0.4%, from 146,839 in 2023 to 146,294 in 2024[52] Financial Assets and Liabilities - The company’s total liabilities, including trade and other payables, amounted to RMB 706,794,000 in 2024, compared to RMB 681,433,000 in 2023, reflecting an increase of approximately 3.7%[35] - The company held other financial assets of approximately RMB 550 million as of December 31, 2024, with a focus on investments that do not impact operational or capital expenditure needs[76] - The company has committed capital expenditures of RMB 152,099,000 for property and equipment acquisitions as of December 31, 2024, down from RMB 485,613,000 in 2023, indicating a reduction of approximately 68.7%[38] Dividends and Shareholder Information - The company proposed a final dividend of HKD 0.22 per share for the year ended December 31, 2024, totaling approximately HKD 479 million[30] - The board has approved a dividend policy to distribute at least 60% of the net profit attributable to shareholders for the fiscal years ending December 31, 2025, 2026, and 2027[94] - The company will suspend share transfer registration from May 22, 2025, to May 27, 2025, to determine shareholders eligible to attend the annual general meeting and vote[101] - The company will also suspend share transfer registration from June 3, 2025, to June 5, 2025, to determine shareholders entitled to the proposed final dividend[102] Employee and Staffing - As of December 31, 2024, the company employed a total of 10,346 staff, with full-time teachers and instructors making up 50.5% of the workforce[91] - The company aims to hire more teachers and staff as it expands its business, utilizing various recruitment channels[92] Compliance and Governance - The company has adopted the Corporate Governance Code and has complied with all its provisions for the fiscal year ending December 31, 2024[95] - The audit committee, composed of three independent non-executive directors, reviewed the company's consolidated financial statements for the fiscal year ending December 31, 2024, ensuring their completeness and accuracy[99] Future Plans and Market Position - The group aims to establish vocational education industrial parks to enhance its market position and brand, with ongoing projects in Sichuan, Shandong, Guizhou, and Henan[86] - The group plans to expand its campus network to cover all provincial capitals in China, focusing on cities with unmet demand in culinary arts, IT, automotive services, and fashion[87] - The group intends to diversify its course offerings in response to industry trends and market demand, with a focus on emerging sectors[88] - The company believes it has sufficient funds to meet its operational capital needs for future business expansion and development[75]

Core Viewpoint - China Oriental Education and Guangzhou Frans have established a strategic partnership to create the "Wantong·Frans Industry College," addressing the talent gap in the new energy vehicle industry, which currently stands at 1.03 million [1][5]. Group 1: Partnership Details - The unveiling ceremony of the "Wantong·Frans Industry College" took place at Anhui Wantong Technical College, marking a significant collaboration between the two companies [1][5]. - Key leaders from both organizations attended the ceremony, highlighting the importance of this partnership in enhancing vocational education [2]. Group 2: Educational Objectives - The partnership aims to develop a comprehensive talent cultivation system that integrates theoretical knowledge and practical skills, thereby improving the quality of technical talent in the industry [5][9]. - Both parties will focus on deepening the integration of industry and education, with an emphasis on co-developing courses, building training bases, and cultivating dual-qualified teachers [9]. Group 3: Strategic Goals - China Oriental Education will leverage its resources in vocational education, while Frans will contribute its industry expertise in logistics equipment, creating a new model for talent development [7][8]. - The collaboration is expected to facilitate the sharing of resources and mutual advantages, ultimately addressing the industry's talent shortage and enhancing the integration of education and industry [9].

Summary of Conference Call for China Oriental Education Company Overview - **Company**: China Oriental Education - **Document ID**: 1 Key Points Industry Performance - **Spring Enrollment 2025**: Achieved record highs in enrollment numbers, revenue, and fees, with growth exceeding 10% across all sectors including cooking and automotive [2][3] - **Short-term Courses**: Experienced significant growth, with enrollment increasing over 30% [2][3] Financial Performance - **Revenue Growth**: Projected revenue growth of approximately 7% for 2025, driven by a 5% increase in student numbers and a 2-3% increase in tuition fees [2][16] - **Net Profit Margin**: Expected to rise from 16% to between 19.9% and 20% by 2027 [2][16] - **Capital Expenditure**: Anticipated to decrease from over 900 million yuan in 2024 to 200-300 million yuan by 2027 [2][16] - **Dividends**: Expected to increase, with a minimum of 0.2 yuan per share in 2024 [2][16] Strategic Initiatives - **Cost Control**: Achieved a 2% reduction in customer acquisition costs and renegotiated rental contracts to lower costs by several million yuan [2][4] - **Market Focus**: Targeting unemployed graduates and students from vocational schools, leading to over 100% growth in a 15-month course [2][5] - **School Optimization**: Closing smaller city-level schools to concentrate resources on regional centers and provincial capitals [2][3] Competitive Landscape - **Public School Competition**: Company remains confident against public institutions, leveraging over 50 academic licenses and strong employment rates [2][7] - **Impact of COVID-19**: The pandemic accelerated the elimination of weaker competitors, allowing the company to strengthen its market position [2][8] Future Outlook - **Enrollment Trends**: Anticipated strong enrollment for fall 2025, benefiting from policy changes that encourage vocational education [2][9] - **Short-term Course Demand**: High-quality short-term courses saw a 36% increase in enrollment, reflecting a recovery in economic confidence [2][10] - **Employment Trends**: Stable employment rates across sectors, with IT and culinary fields showing strong demand [2][11] School Utilization - **Current Utilization Rates**: Overall school utilization has recovered to over 70%, with specific schools like Xinhua Computer School at 80% [2][13] Expansion Plans - **New Schools**: Plans to open new institutions in regions like Hangzhou and Shandong, with a focus on the beauty industry [2][18] Conclusion - **Long-term Growth**: The company is positioned for sustained growth with a focus on strategic market adaptation, cost efficiency, and quality education offerings [2][16][19]

Investment Rating - The report upgrades the investment rating of China Oriental Education to "Buy" [1][5][10]. Core Views - The company is expected to achieve high-quality growth in revenue and profit margins over the next three years, driven by refined operational strategies and market-oriented training systems [3][5][10]. - The average training participants are projected to grow at a compound annual growth rate (CAGR) of approximately 4% from 2024 to 2026, reaching 165,000 participants by 2026 [5][10][11]. - Revenue is anticipated to increase to 4.08 billion, 4.38 billion, and 4.69 billion yuan in 2024, 2025, and 2026, respectively, with a CAGR of 5.6% during the same period [5][10][11]. Summary by Sections 1. Refined Operational Strategy - The company has reduced the number of its teaching centers to 234, optimizing capacity utilization from 72.2% in 2023 to 75.9% in 2024, and further to 79.8% by 2026 [4][19][29]. - Marketing efficiency is expected to improve, with the marketing expense ratio decreasing from approximately 26.1% in 2023 to 23.8% in 2024, and further to 22.9% by 2026 [4][11][46]. 2. Expanding Market for High School and College Graduates - The company is developing mid-cycle courses of 15 months to 1.5 years to cater to the training needs of high school and college graduates, which is expected to enhance enrollment [51][52]. - The introduction of the Oumandi brand in the beauty and wellness training sector is projected to achieve 11,500 training participants by 2026, contributing 470 million yuan to total revenue, accounting for 10% [5][59]. 3. Financial Data and Profit Forecast - Revenue for 2024 is estimated at 4.08 billion yuan, with adjusted net profits expected to reach 488 million yuan, reflecting a significant increase from previous years [6][10]. - The net profit margin is projected to improve from 12% in 2024 to 14.8% by 2026, driven by scale effects and cost control measures [5][10][11].

Investment Rating - The investment rating for the company is "Buy" with a target price set at HKD 3.92, reflecting a potential upside from the latest closing price of HKD 2.85 [2][4]. Core Insights - The establishment of the first technician college by the company, recognized by the Anhui provincial government, signifies the company's commitment to enhancing vocational education and aligns with national policy initiatives [3]. - The college currently has over 8,100 students and 463 full-time teachers, offering 18 specialized programs, which is expected to attract more high school students and potentially extend the duration of study programs [3]. - The company aims to build a multi-tiered educational framework that includes vocational training, technical schools, and technician colleges, enhancing its ability to produce skilled talent in high-demand sectors such as new energy vehicles and intelligent manufacturing [3]. - The company is expected to see continued revenue growth driven by effective cost control and normalization of student enrollment, with projected revenues of HKD 41.5 billion, HKD 44.1 billion, and HKD 48.4 billion for the years 2024, 2025, and 2026 respectively [4][5]. Financial Summary - The company's revenue for 2023 is projected at HKD 3,978.65 million, with a year-on-year growth of 4.18%. The revenue is expected to grow to HKD 4,149.49 million in 2024, HKD 4,405.82 million in 2025, and HKD 4,841.54 million in 2026 [5][8]. - The net profit attributable to the parent company is forecasted to be HKD 272.62 million in 2023, increasing to HKD 496.06 million in 2024, HKD 596.04 million in 2025, and HKD 725.32 million in 2026, reflecting significant growth rates [6][8]. - The earnings per share (EPS) are projected to be HKD 0.23, HKD 0.27, and HKD 0.33 for the years 2024, 2025, and 2026 respectively, with a corresponding price-to-earnings (PE) ratio of 11, 9, and 8 [4][6].

School Operations and Enrollment - As of June 30, 2024, China East Education operated 234 schools and centers with an average of 144,793 students enrolled and customers registered for the six months ended[3] - The culinary arts segment, under the New East and Cuisine Academy brands, had 93 schools with an average of 57,013 students enrolled[7] - The auto services segment, branded as Wontone, operated 41 schools and had an average of 40,143 students enrolled[7] - The information technology segment, under Xinhua Internet and Wisezone brands, included 57 schools with an average of 39,590 students enrolled[7] - The fashion and beauty segment, branded as On-mind, had 7 schools with an average of 3,409 students enrolled[7] - The western cuisine and pastry segment, branded as Omick, operated 36 schools with an average of 4,638 students enrolled[7] - The number of schools in operation reached 245 as of December 31, 2023, including 76 schools under New East Culinary Education and 46 schools under Omick Education of Western Cuisine and Pastry[8] - As of June 30, 2024, the company operated 234 schools and centers across almost all provinces in mainland China and Hong Kong[15] - The company operates under seven school brands, including New East Culinary Education and Xinhua Internet Technology Education[15] Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 1,983 million, compared to RMB 1,953 million for the same period in 2023, representing a growth of approximately 1.5%[10] - Net profit for the period increased to RMB 272 million for the six months ended June 30, 2024, up from RMB 204 million in the same period of 2023, reflecting a growth of approximately 33.3%[10] - Adjusted net profit for the six months ended June 30, 2024, was RMB 278 million, compared to RMB 176 million in the same period of 2023, indicating a growth of approximately 57.9%[10] - Adjusted EBITDA for the six months ended June 30, 2024, was RMB 715 million, an increase from RMB 633 million in the same period of 2023, representing a growth of approximately 13%[10] - Total assets amounted to 9,259 million as of the reporting period[11] - The net assets as of June 30, 2024, were RMB 5,496 million, a slight decrease from RMB 5,608 million as of December 31, 2023[9] Enrollment Trends - For the six months ended June 30, 2024, the total new student enrollments in the Culinary Arts segment decreased by 11.2% to 34,682 from 39,068 in the same period of 2023[20] - In the Western Cuisine and Pastry segment, new student enrollments fell by 12.9% to 7,549 compared to 8,666 in the prior year[20] - The Information Technology and Internet Technology segment experienced a decrease of 11.1% in total new student enrollments, dropping from 14,835 to 13,192[22] - The total number of new students enrollment for the group decreased by 7.7% to 78,009 in the six months ended June 30, 2024, compared to 84,552 in 2023[24] - The average number of long-term students enrolled as of June 30, 2024, increased by 3.8% to 37,006 from 35,653 in 2023[28] - The average number of long-term students enrolled in the "On-mind" segment surged by 189.9% to 2,574 from 888 in 2023[28] Cost and Profitability - Gross profit for the six months ended 30 June 2024 was RMB 1,051 million, compared to RMB 997 million for the corresponding period in 2023, with a gross profit margin of 53.0% compared to 51.1% in 2023[47] - Teaching staff salaries and benefits accounted for RMB 377.9 million, representing 40.5% of total costs for the six months ended 30 June 2024, up from 37.9% in 2023[46] - Selling expenses decreased from RMB 513 million for the six months ended 30 June 2023 to RMB 464 million for the six months ended 30 June 2024, primarily due to tighter control on advertising costs[53] - The cost of revenue decreased from approximately RMB 956 million for the six months ended 30 June 2023 to approximately RMB 932 million for the six months ended 30 June 2024, representing a decrease of approximately 2.5%[43] Strategic Initiatives - The company established Anhui Xinhua Education to consolidate all schools under a single entity, increasing operational efficiency[8] - The company expanded its business to Hong Kong, increasing its market presence[8] - The Group plans to establish Vocational Education Industrial Parks in major student recruitment provinces to enhance teaching and training facilities[65] - The Group intends to expand its school network to cover all provincial capital cities in China, targeting cities with high demand for skilled workers[67] - The Group is exploring new markets for vocational training in emerging fields such as artificial intelligence and healthcare[70] Shareholding and Corporate Governance - As of June 30, 2024, Mr. Wu Junbao holds 721,792,602 shares, representing 33.13% of the company's issued share capital[83] - Mr. Wu Wei owns 490,361,609 shares, accounting for 22.51% of the total issued share capital[83] - The interests of directors and chief executives in associated corporations are significant, indicating strong ownership ties[84] - The company has complied with all code provisions set out in the Corporate Governance Code during the six months ended June 30, 2024[106] - The company is committed to enhancing its corporate governance practices to safeguard the interests of shareholders and potential investors[106] Compliance and Regulatory Environment - The Group is subject to annual reviews of connected transactions by relevant governmental authorities[108] - The newly revised "Vocational Education Law of the People's Republic of China" was implemented in May 2022, improving the recognition of vocational education[115] - The Group's vocational education business aligns with the requirements of modern vocational education systems as outlined in recent policies, which is expected to benefit future development[116] Cash Flow and Investments - Net cash from operating activities for the six months ended June 30, 2024, was RMB 639,213, an increase of 31% compared to RMB 487,865 for the same period in 2023[148] - Net cash used in investing activities amounted to RMB (245,028) for the six months ended June 30, 2024, compared to RMB (145,166) in the same period of 2023, indicating a significant increase in investment outflows[148] - The company received asset-related government grants amounting to RMB 39,169, a significant increase from RMB 368 in the same period last year[148] - The company reported a net cash used in financing activities of RMB (566,056), a decrease from RMB (595,240) in the same period of 2023, reflecting improved financing efficiency[148]

社会服务 证券分析师 朱芸 S1350524070001 zhuyun@huayuanstock.com 研究支持 联系人 市场表现： | --- | --- | |-------------------------|--------------------| | 股票数据： | 2024 年 8 月 27 日 | | 收盘价（港元） | 2.35 | | 一年内最高/最低（港元） | 3.65/1.91 | | 总市值（百万港元） | 5099 | | 市净率 PB | 0.87 | | 基础数据： | 2024 年 6 月 30 | | 总股本（百万股） | 2178.85 | | 总资产（百万元） | 9259.37 | | 净资产（百万元） | 5495.55 | | 每股净资产（元） | 2.52 | | 资料来源：公司公告， | | 首次覆盖报告 2024 年 08 月 28 日 中国东方教育(0667.HK) 增持（首次覆盖） ——降本增效显著，招生结构优化、盈利能力改善 投资要点： ➢ 2024H1 公司实现营收 19.83 亿元，同比增长 1.6%；实现归母净利润 2.72 亿元，同比增长 ...

港股公司报告 | 公司点评 业绩兑现分红延续，关注股息属性 公司发布 2024H1 业绩报告 24H1 年实现营收 19.83 亿人民币，同比+1.6%；净利 2.72 亿，同比+33.2%； 调后净利 2.78 亿，同比+57.9%。 分品牌看：新东方及美味学院 9.19 亿（占比 46.3%，同比-2.4pct），同比-3.3%； 欧米奇 1.59 亿（占比 8.0%，同比-0.2pct），同比-0.8%； 新华电脑及华信智原 3.78 亿（占比 19.1%，同比-1.2pct），同比-4.3%； 万通 4.49 亿（占比 22.6%，同比+1.9pct），同比+11.1%； 欧曼谛 0.40 亿（占比 2.0%，同比+1.2pct），同比+142.1%。 截止至 24H1，公司定期存款 13.01 亿，现金及等价物 13.44 亿，合计 26.45 亿；净资产 54.96 亿，PB 为 0.9。本次派息（2023 年股息）4 亿人民币； 公司 2019-2023 年派息分别为 4.2/4.9/4.5/3.9/4 亿，合计约 22 亿。 公司学校 234 所，24H1 新培训人次及新客户注册人数 7.8 ...

调结构、费用管控效果显著，时尚美业增长靓丽 2024 年 08 月 22 日 ➢ 事件：中国东方教育发布 2024 年半年报。2024 年公司实现收入 19.83 亿 元/yoy+1.6%，归母净利润为 2.72 亿元/yoy+33.2%，经调整净利润为 2.78 亿 元/yoy+57.9%。24H1 公司毛利率为 53%/yoy+1.93pcts，归母净利率为 13.72%/yoy+3.27pcts，经调整归母净利率为 14.02%/yoy+5.01pcts。 ➢ 学校结构优化效果显著，公司成本及费用率显著优化。从学校数量来看， 24H1 公司学校数量为 234 所，同比减少 11 所，截至 2024H1，公司旗下拥有 新东方烹饪教育/美味学院/欧米奇/新华电脑/华信智原/万通汽修/欧曼谛各 75/18/36/38/19/41/7 所，分别较 2023 年变动-1/0/-10/-1/-1/0/+2 所，持续 对相关学校进行结构优化。此外，公司亦对销售费用进行了管控，带动公司费率 显著优化。综合影响下，2024H1 公司营业成本为 9.32 亿元/yoy-2.45%，公司 销 售 费 用 率 / 管 理 费 ...