- Net revenues were
RMB280.6 million ($38.7 million ) for the first six months of 2023, compared toRMB260.4 million during the same period in 2022. - Gross profit was
RMB23.9million ($3.3million ) for the first six months of 2023, compared toRMB40.0 million during the same period in 2022. - Net loss for the first half 2023 was
RMB93.6 million ($12.9 million ), compared to net loss ofRMB2.9 million during the same period in 2022.
“We also faced challenges in our educational content services, which led to a decline in net revenues. Recognizing the potential risks of educational content becoming obsolete before generating profitability, we adopted conservative strategies and reduced investment in this area. While this impacted our revenues, we believe it was a prudent decision to mitigate future risks.”
“On a positive note, our acquisition of a cloud-based customer in 2022 significantly contributed to the growth in our IT-related solution services. We saw a remarkable 62.6% increase in revenue from this segment, reflecting our ability to provide value-added services and meet the evolving needs of our customers.”
“We successfully reduced our total operating expenses, demonstrating our commitment to optimizing operational efficiency. Sales and marketing expenses were slightly reduced, and general and administrative expenses also decreased. Furthermore, we achieved a decline in research and development expenses by streamlining outsourcing costs.”
“Looking ahead, we recognize the importance of reassessing our strategies for educational content services to overcome the challenges we faced. Our focus will be on optimizing the gross profit margin in our successful IT-related solution services segment. We remain committed to sustaining profitability by implementing continued cost management measures and capitalizing on market opportunities. We are confident in our ability to navigate the market landscape and drive future success.”
First Six Months of 2023 Financial Results
Net revenues
Net revenues increased by 7.8% from
- Educational content service and other services. Net revenue from the educational content service and other services decreased by
RMB76 .8 million fromRMB105 .3 million for the first half of 2022 toRMB28 .5 million (US$3 .9 million) for the first half of 2023.
Educational content services require us to make continuous capital expenditure to keep update of existing contents and development new educational contents to meet the latest market trends, which exposed us to potential risks of education contents becoming obsolete before making profitability. Accordingly, we determined to adopt conservative strategies to reduce investment in educational content services. The decrease in educational content services was primarily due to a decrease in subscription from our end customers since our adoption of conservative strategies in the second half of 2022. - IT related solution services. Net revenue from IT related solution services increased by
RMB97 .1 million, or 62.6% fromRMB155 .0 million for the first half of 2022 toRMB252 .1 million (US$34 .8 million) for the first half of 2023, primarily attributable to net effects of an increase in revenue ofRMB71.2 million from procurement and assembling of IT equipment and an increase in revenue ofRMB26.6 million from design and development of customized IT system service, both attributable to our acquisition of a cloud-based customer in the year of 2022 which contributed increase of revenues in IT-related solution services.
The following table sets forth the Company’s unaudited consolidated revenue by business segments for the six months ended
For the Six Months Ended | ||||||||||||
2022 | 2023 | |||||||||||
RMB | RMB | US$ | ||||||||||
(in thousands) | ||||||||||||
Revenues: | ||||||||||||
Educational content service and other services | ||||||||||||
– Educational content service | ||||||||||||
– B2B2C | 30,991 | 23,579 | 3,252 | |||||||||
– B2C | 71,837 | 3,112 | 429 | |||||||||
– Other services | 2,488 | 1,858 | 256 | |||||||||
Subtotal | 105,316 | 28,549 | 3,937 | |||||||||
IT related solution services | ||||||||||||
– Design and development of customized IT system | 28,398 | 54,992 | 7,584 | |||||||||
– Procurement and assembling of equipment | 125,840 | 197,052 | 27,175 | |||||||||
– Technological support and maintenance | 800 | 13 | 2 | |||||||||
Subtotal | 155,038 | 252,057 | 34,761 | |||||||||
Total revenues | 260,354 | 280,606 | 38,698 |
Cost of revenues
Cost of revenue increased by 16.5 % from
Gross profit
Gross profit decreased from
Operating expenses
The total operating expenses increased from
- Sales and Marketing Expenses: The sales and marketing expenses was
RMB4.1 million andRMB3.9 million (US$0.5 million ) for the first half of 2022 and 2023, respectively. The slight decrease ofRMB0.2 million in sales and marketing expenses was primarily due to a decrease ofRMB0.2 million in payroll and welfare expenses. - General and Administrative Expenses: The general and administrative expenses increased from
RMB9 .1 million for the first half of 2022 toRMB9.6 million (US$1 .3 million) for the first half of 2023. This increase was primarily attributable to a increase ofRMB1.1million in allowance of doubtful accounts. - Research and Development Expenses: The research and development expenses decreased from
RMB8 .1 million for the first half of 2022 toRMB4 .4 million (US$0 .6 million) for the first half of 2023. This increase was mainly driven by a decrease in the expenses incurred on outsourcing research and development projects. - Impairment of intangible assets: Impairment of intangible assets increased from
RMB 12 .7millon for the first half of 2022 toRMB 97.3 million (US$13.4 million ). The substantial increase can primarily be attributed to the cancellation of customized training course product orders developed for multiple overseas clients. During the first half of 2023, these course product orders were permanently canceled due to adjustments and transformations in the business operations of these overseas clients. Consequently, the Company foresees that these customized development course products will no longer yield consistent revenue in the foreseeable future.
Income Tax Expenses
The income tax expenses decreased from
Net loss
As a result of the foregoing, we reported a net loss of
About
Headquartered in
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This press release contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the
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Phone: +86 13811768559
+1 628 283 9214
Email: services@wealthfsllc.com
CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in Renminbi (“RMB”) and except for number of shares and per share data) | ||||||||||||
2022 | 2023 | 2023 | ||||||||||
RMB | RMB | US$ | ||||||||||
(unaudited) | (unaudited) | |||||||||||
Assets | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | 65,055,278 | 28,626,530 | 3,947,779 | |||||||||
Accounts receivable, net | 17,173,021 | 26,178,493 | 3,610,179 | |||||||||
Inventories | 399,439 | 399,439 | 55,085 | |||||||||
Due from a related party | 1,051,869 | 956,665 | 131,930 | |||||||||
Short-term prepayments | 254,493,399 | 120,257,158 | 16,584,220 | |||||||||
Short-term investments | 4,080,000 | 4,102,744 | 565,794 | |||||||||
Prepaid expenses and other current assets | 9,518,326 | 22,557,289 | 3,110,792 | |||||||||
Total current assets | 351,771,332 | 203,078,318 | 28,005,779 | |||||||||
Non-current assets: | ||||||||||||
Right-of-use assets, net | — | 1,665,864 | 229,733 | |||||||||
Deferred tax assets, net | 9,176,875 | 9,432,316 | 1,300,776 | |||||||||
Property and equipment, net | 153,880 | 432,783 | 59,684 | |||||||||
Educational contents, net | 214,441,814 | 206,258,794 | 28,444,388 | |||||||||
Long-term prepayments | 151,779,105 | 55,145,358 | 7,604,893 | |||||||||
Total non-current assets | 375,551,674 | 272,935,115 | 37,639,474 | |||||||||
Total assets | 727,323,006 | 476,013,433 | 65,645,253 | |||||||||
Liabilities | ||||||||||||
Current liabilities: | ||||||||||||
Accounts payable | 8,037,004 | 7,282,575 | 1,004,313 | |||||||||
Contract liabilities | 290,028,010 | 127,661,754 | 17,605,361 | |||||||||
Salary and welfare payable | 2,302,646 | 1,165,769 | 160,767 | |||||||||
Income taxes payable | 1,170,795 | 4,041,630 | 557,366 | |||||||||
Value added tax (“VAT”) and other tax payable | 4,063,389 | 2,198,217 | 303,148 | |||||||||
Other payables | 2,658,243 | 3,426,251 | 472,501 | |||||||||
Lease liabilities, current | — | 624,716 | 86,152 | |||||||||
Amount due to related parties | 52,711,457 | 54,861,723 | 7,565,778 | |||||||||
Total current liabilities | 360,971,544 | 201,262,635 | 27,755,386 | |||||||||
Non-current liabilities: | ||||||||||||
Deferred tax liabilities | — | 7,563 | 1,043 | |||||||||
Lease liabilities, non-current | — | 1,138,723 | 157,037 | |||||||||
Total non-current liabilities | — | 1,146,286 | 158,080 | |||||||||
Total liabilities | 360,971,544 | 202,408,921 | 27,913,466 |
CONDENSED CONSOLIDATED BALANCE SHEETS (continued) (Amounts in Renminbi (“RMB”) and except for number of shares and per share data) | ||||||||||||
2022 | 2023 | 2023 | ||||||||||
RMB | RMB | US$ | ||||||||||
(unaudited) | (unaudited) | |||||||||||
Commitments and contingencies | ||||||||||||
Shareholders’ equity | ||||||||||||
Ordinary shares ( | 77,747 | 77,747 | 12,111 | |||||||||
Additional paid-in capital | 242,093,942 | 242,093,942 | 33,384,892 | |||||||||
Statutory reserves | 23,599,304 | 23,599,304 | 3,254,493 | |||||||||
Retained earnings | 81,822,029 | (8,869,813 | ) | (1,223,276 | ) | |||||||
Accumulated other comprehensive income | 2,520,630 | 3,350,763 | 462,164 | |||||||||
Total Jianzhi Education Technology Group Company Limited’s shareholders’ equity | 350,113,652 | 260,251,943 | 35,890,384 | |||||||||
Noncontrolling interests | 16,237,810 | 13,352,569 | 1,841,403 | |||||||||
Total shareholders’ equity | 366,351,462 | 273,604,512 | 37,731,787 | |||||||||
Total liabilities, mezzanine equity and shareholders’ equity | 727,323,006 | 476,013,433 | 65,645,253 |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Amounts in Renminbi (“RMB”) and except for number of shares and per share data) | ||||||||||||
For the Six Months Ended | ||||||||||||
2022 | 2023 | 2023 | ||||||||||
RMB | RMB | US$ | ||||||||||
Net revenues | 260,353,542 | 280,606,379 | 38,697,389 | |||||||||
Cost of revenues | (220,373,446 | ) | (256,660,584 | ) | (35,395,113 | ) | ||||||
Gross profit | 39,980,096 | 23,945,795 | 3,302,276 | |||||||||
Operating expenses: | ||||||||||||
Sales and marketing expenses | 4,134,088 | 3,943,550 | 543,840 | |||||||||
General and administrative expenses | 9,093,274 | 9,581,756 | 1,319,808 | |||||||||
Research and development expenses | 8,118,990 | 4,412,218 | 608,473 | |||||||||
Impairment of intangible assets | 12,662,000 | 97,332,087 | 13,422,709 | |||||||||
Impairment of goodwill | 7,712,011 | — | — | |||||||||
Total operating expenses | 41,720,363 | 115,269,611 | 15,894,830 | |||||||||
Loss from operations | (1,740,267 | ) | (91,323,816 | ) | (12,592,554 | ) | ||||||
Other (expenses) income: | ||||||||||||
Investment income | 589,424 | 60,649 | 8,364 | |||||||||
Interest expenses, net | (523,388 | ) | (701,899 | ) | (96,796 | ) | ||||||
Other expenses | (7,997 | ) | (16,781 | ) | (2,312 | ) | ||||||
Government grants | 1,430,551 | 643,646 | 88,763 | |||||||||
Total other income (expenses), net | 1,488,590 | (14,385 | ) | (1,981 | ) | |||||||
Loss before income tax | (251,677 | ) | (91,338,201 | ) | (12,594,535 | ) | ||||||
Income tax expense | 2,644,464 | 2,238,882 | 308,756 | |||||||||
Net loss | (2,896,141 | ) | (93,577,083 | ) | (12,903,291 | ) | ||||||
Net income (loss) attributable to noncontrolling interests | 1,938,601 | (2,885,241 | ) | (397,893 | ) | |||||||
Net loss attributable to the Jianzhi Education Technology Group Company Limited’s shareholders | (4,834,742 | ) | (90,691,842 | ) | (12,505,398 | ) | ||||||
Net loss | (2,896,141 | ) | (93,577,083 | ) | (12,903,291 | ) | ||||||
Other comprehensive income: | ||||||||||||
Foreign currency translation adjustments | 1,047,899 | 830,133 | 114,481 | |||||||||
Total comprehensive loss | (1,848,242 | ) | (92,746,950 | ) | (12,788,810 | ) | ||||||
Net comprehensive income (loss) attributable to noncontrolling interests | 1,938,601 | (2,885,241 | ) | (397,893 | ) | |||||||
Comprehensive loss attributable to the Jianzhi Education Technology Group Company Limited’s shareholders | (3,786,843 | ) | (89,861,709 | ) | (12,390,917 | ) | ||||||
Loss per share | ||||||||||||
Basic and diluted | (0.04 | ) | (0.75 | ) | (0.10 | ) | ||||||
Weighted average number of shares | ||||||||||||
Basic and diluted | 111,110,000 | 121,100,000 | 121,100,000 |
Source:
2023 GlobeNewswire, Inc., source