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China Distance Education Holdings Limited Reports Second Quarter 2009 Results.

Article Excerpt
Net Revenues Doubled YoY to US$6.8 million



Total Online Course Enrollment Grew 72.6% YoY to 197,000

BEIJING, China, May 15 /PRNewswire-Asia-FirstCall/ -- China Distance Education Holdings Limited ("CDEL", or the "Company"), a leading provider of online education in China focusing on professional education, reported today its unaudited financial results for the second quarter of fiscal year 2009 ended on March 31, 2009.

Second Quarter Fiscal 2009 Business and Financial Highlights: -- Total online course enrollments exceeded 197,000, an increase of 72.6% from the second quarter of fiscal 2008. -- Net revenues increased 99.3% over the second quarter of fiscal 2008 to US$6.8 million. -- Gross profit increased 53.2% over the second quarter of fiscal 2008 to US$3.3 million. Non-GAAP gross profit excluding share-based compensation charge was US$3.9 million, an increase of 80.0% over the same period of fiscal 2008. -- Gross profit margin was 48.8%, compared to 63.5% in the second quarter of fiscal 2008. Non-GAAP gross margin excluding share-based compensation charge was 57.4%, compared to 63.5% in the same period of fiscal 2008. -- Net income was US$0.3 million, compared to US$0.7 million in the second quarter of fiscal 2008. -- Non-GAAP net income excluding share-based compensation was US$1.4 million, an increase of 85.0% as compared to US$0.7 million in the second quarter of fiscal 2008. Non-GAAP net income margin for the second quarter of fiscal 2009 excluding the impact of share-based compensation was 20.0% as compared to 21.6% in the same period of 2008.(1) -- Basic and diluted net income per American Depositary Share ("ADS") was US$0.01 and US$0.01, respectively, compared to basic and diluted net income per ADS of US$0.01 and US$0.01, respectively, for the second quarter of fiscal 2008. Each ADS represents four ordinary shares. -- Basic and diluted non-GAAP net income per ADS excluding share-based compensation charge and the effect of Series A convertible contingently redeemable preferred shares ("Series A shares") were US$0.04 and US$0.04, compared to basic and diluted non-GAAP net income per ADS of US$0.03 and US$0.03, respectively, for the second quarter of fiscal 2008. -- Deferred revenue and refundable fees balance maintained at US$9.6 million, as elite class revenue of CPA Qualification Examination and healthcare has been recognized during the quarter. (1) For more information about the non-GAAP financial measures contained in this press release, please see "Use of Non-GAAP Financial Measures" below.

Commenting on the results, Mr. Zhengdong Zhu, CDEL Chairman and Chief Executive Officer said, "We are pleased to report another quarter of solid financial results. Our performance further demonstrates the resilient nature of the education industry in China and the strength of our professional education business model and growth strategy, which is allowing the Company to deliver sustainable growth throughout the economic cycle."

Mr. Zhu continued, "The sustained growth in enrollments in both accounting and non-accounting subjects demonstrates our ability to replicate our successful accounting model to other subject and course offerings. The strong acceptance of our premium classes has also proven our diversified pricing and marketing strategies, which have helped to maintain our average selling-price (ASP) level.

"The non-cyclical nature of the education industry has shielded us thus far from experiencing any significant adverse impact from the soft economic environment. While the half-price promotion launched in the previous quarters...

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