Ambow Education Announces First Quarter 2016 Unaudited Financial Results

BEIJING, June 20, 2016 /PRNewswire/ -- Ambow Education Holding Ltd. ("Ambow" or the "Company"), a leading national provider of educational and career enhancement services in China, today announced unaudited financial and operating results for the three months ended March 31, 2016.

"We are pleased with our solid operating and financial results in the first quarter of 2016, as we continue to provide outstanding educational and career enhancement services in China," commented Dr. Jin Huang, Ambow's President and Chief Executive Officer. "Recently, we organized the Application-Oriented University Development and Presidents' Forum, hosted by China's Ministry of Education Science and Technology Development Center.  We are committed to supporting application-oriented education in China through our proprietary Application-Oriented Education System, and further developing our platform to help students develop successful careers in the workplace. Our goal is to enhance application-oriented education through joint programs with colleges and universities and connecting students and young professionals with leading enterprises.

"Our efforts were well-recognized by the industry as we received the '2016 China Excellent Brand Top 500' award at the Asian Brand Forum, and the 'Most Powerful Internet Innovative Talent Education Company' award at the 2015 Annual Economic Conference of China IT Industry hosted by China Center for Information Industry Development," added Dr. Huang.

Kia Jing Tan, Chief Financial Officer, added, "In the first quarter, our gross margin increased to 36.9% compared with 26.4% in the first quarter of 2015, fueled mostly by increased operating efficiencies and stronger financial controls. We have ample capital resources and are well positioned to support Ambow's growth objectives." 

"We believe the establishment of our service center and the enhancement of our Enterprise Resource Planning system and operational procedures will provide significant leverage by maximizing internal resources and lowering costs. As we further consolidate resources through a cloud-based service platform and talent management processes, we look to enhance our Customer Relationship Management system and upgrade our learning engine. The cloud-based service will be the core IT infrastructure for our unique Ambow platform," concluded Chiao-Ling Hsu, Chief Operating Officer. 

Year-to-Date Financial Information For The Three Months Ended March 31, 2016

• Net revenues in the first quarter of 2016 were RMB68.3 million, remained constant compared to the first quarter of 2015. Gross profit in the first quarter of 2016 was RMB25.2 million, an increase of 34.0% compared with RMB18.8 million in the same period of 2015. Gross profit margin in the first quarter of 2016 was 36.9%, compared with 26.4% in the same period of 2015. The increase was primarily the result of the suspension of unprofitable businesses and a successful business restructuring, as well as an improved operating efficiency.
• Operating expenses for the first quarter of 2016 were RMB44.0 million, a decrease of 40.6% compared with RMB74.1 million in the same period of 2015. The decrease was mainly due to decreased one-time expenses and headcount reduction, as well as effective cost control.
• Net loss attributable to the Company was RMB19.1 million in the first quarter of 2016, or RMB0.5 per basic and diluted share, compared with a net loss of RMB117.6 million, or RMB3.59 per basic and diluted share, in the same period of 2015. Net loss in the first quarter of 2015 included a one-time interest expense of convertible loan discount amortization amount of RMB56.6 million.
• As of March 31, 2016, the Company continued to maintain strong capital resources with a total of RMB494.7 million, including cash and cash equivalents of RMB155.4 million, short-term investments of RMB336.1 million, and restricted cash and term deposits of RMB3.2 million.

Recent Developments

• In the month of June 2016, the Company entered into the initial implementation phase of its enhanced Enterprise Resource Planning system, covering the majority of operations in the tutoring, school partnership business, Genesis as well as group headquarter functions.
• The Company has established a succession management system, using a talent management pool that provides continuous training to individual business units' management teams while simultaneously strengthening the company culture.

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 translations from RMB to U.S. dollars are based on the effective exchange rate of 6.4480 as of March 31, 2016.

About Ambow Education Holding Ltd.

Ambow Education Holding Ltd. is a leading national provider of educational and career enhancement services in China, 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 30 out of the 31 provinces and autonomous regions within China.

Follow us on Twitter: @Ambow_Education

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 for the second quarter and full year 2016 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, and the general economic and business conditions in the regions where the Company provides its solutions and services. 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: +86-10-6206-8104The Piacente Group | Investor RelationsTel: +1 212-481-2050 or +86 10-6535-0147Email: [email protected]

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SOURCE Ambow Education Holding Ltd.