NEW ORIENTAL(EDU)2023-10-25 14:52Financial Data and Key Metrics Changes - New Oriental reported a significant increase in operating income of 163% year over year, reaching 244.8 million [18][19] - Net income attributable to New Oriental was 0.99 [19] - The company had cash and cash equivalents totaling approximately 1.401 billion, an increase of 38.4% year over year [16][19] Business Line Data and Key Metrics Changes - The Overseas Test Prep Business saw a revenue increase of 52% in dollar terms, or 62% in RMB terms year over year [7] - The Overseas Study Consulting Business recorded a revenue increase of 27% in dollar terms, or 35% in RMB terms year over year [7] - New education business initiatives achieved a revenue increase of 103% in dollar terms, or 117% in RMB terms year over year [9] Market Data and Key Metrics Changes - The non-dynamic children business recorded approximately 438,000 student enrollments, with the top ten cities in China contributing over 60% of the revenue [8] - The Intelligent Learning System and Device Business reported approximately 181,000 active paid users, with revenue contribution from the top ten cities in China also around 60% [9] Company Strategy and Development Direction - The company plans to increase its learning center capacity by about 15% to 20% throughout fiscal year 2024, focusing on cities with strong performance [21] - New Oriental aims to leverage its brand advantage and solid foundation to capture more market share and enhance profitability through innovative educational offerings [20][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustainable growth for the remainder of fiscal year 2024, citing strong demand in the education sector and a favorable regulatory environment [20][31] - The company anticipates total net revenue for Q2 of fiscal year 2024 to be in the range of 804 million, representing a year-over-year increase of 23% to 26% [21] Other Important Information - The company has authorized a share repurchase program of up to 193.3 million repurchased as of October 24, 2023 [16] Q&A Session Summary Question: November quarter revenue guidance and growth drivers - Management clarified that the guidance reflects a conservative approach, with typical seasonality affecting Q2, but strong demand is expected to continue [25][26] Question: Capacity expansion plans - Management confirmed a 6% new capacity addition this quarter, with plans for 15% to 20% expansion for the year, focusing on top-tier cities [29][30] Question: Margin expansion analysis - The operating margin increased due to improved utilization of resources and higher margins from new business lines, with optimism for continued margin growth [33][35] Question: Long-term growth for existing businesses - Management is optimistic about top-line growth for existing businesses due to strong demand and reduced competition post-COVID [37][39] Question: Growth of Intelligent Learning Devices - The company is seeing strong demand for its Intelligent Learning Devices, with plans to enhance product quality and expand user numbers [42][44] Question: Shareholder return policy - Management reiterated commitment to the share buyback program, aiming to create value for shareholders [46][47]