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spk07: Ladies and gentlemen, thank you for standing by and welcome to the fourth quarter and full year of 2020 Tarina International Incorporation Earnings Conference Call. At this time, all participants are in listen-only mode. After speaker's presentation, there will be a question and answer session. To ask questions during the session, you will need to press star one on your telephone. I must advise you that this conference has been recorded today, March the 19th, 2021. I would now like to hand the conference over to our first speaker today, Ms. Amanda Wong, the Investor Relationship Director. Thank you. Please go ahead now.
spk00: Thank you, Operator. Hello, everyone, and welcome to Tarina's Earnings Conference Call for the fourth quarter and the fourth year of 2020. The company's earnings results were released earlier today and are available on our website, ir.tedu.cn, as well as on newswire services. Today you will hear from Mr. Yongji Sun, our CEO, Ms. Nancy Sun, our Senior VP, and Mr. Kevin Lo, our CFO, who will take you through the company's operational and financial results for the fourth quarter and the fall year of 2020, and give revenue guidance for the first quarter of 2021. After their prepared remarks, Mr. Sun, Nancy, and Kevin will be available to answer your questions. Before we continue, Please note that the discussion today will contain certain forward-looking statements made under the safe harbor provisions of U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Tarina does not assume any obligations to update any forward-looking statements. except as required under applicable law. Also, please note that some of the information to be discussed includes non-GAAP financial measures as defined in Regulation G. The U.S. GAAP financial measures and the information reconciling these non-GAAP financial measures to Tarina's financial results prepared in accordance with U.S. GAAP are included in Tarina's earnings release, which has been posted on the company's R website. Finally, As a reminder, this conference call is being recorded. In addition, a webcast of this conference call is available on Tarina's air website. I will now turn the call over to Mr. Calvin Low, CFO of Tarina.
spk04: Hi, everybody. I'm Calvin. First of all, I got to apologize first. Our CEO, Mr. Sun, is out for a meeting and he's on the way back to the office now. So I will present Mr. Sun's script on his behalf. Thank you, Amanda, and thank you, everybody, for joining us today. We are delighted to announce our result for the fourth quarter and full year of 2020. Our net revenue in the fourth quarter of 2020 was RMB $650.3 million, which was higher than the guidance range of RMB $540 million to RMB $570 million we gave. Compared to the net revenue of RMB509.6 million in the fourth quarter of 2019, the net revenues in the fourth quarter of 2020 increased by RMB140.7 million, or 27.6%. The net revenue for the year end December 31, 2020 was RMB1,897.9 million, decreased by RMB 153.5 million, or 7.5%, as compared to the net revenue of RMB 2,051.4 million for the year ended December 31, 2019. Net revenue from K-12 education business increased by 64.7% from RMB 180.9 million. In the fourth quarter of 2019, to RMB 297.9 million in the same period of 2020. The number of student enrollments for K-12 education increased by 47% from 87,300 in the fourth quarter of 2019 to 128,300 in the same period of 2020. The number of new students equipped for K-12 education increased by 6.7% from 19,400 in the fourth quarter of 2019 to 20,700 in the same period of 2020. Net revenue from adult professional education business increased by 7.2% from RMB $328.7 million in the fourth quarter of 2019 to RMB $352.4 million in the same period of 2020. Despite the number of student enrollments for adult professional education business decreased by 21.3% from 44,600 in the fourth quarter of 2019 to 35,100 in the same period of 2020. And the number of new students recruited for adult professional education business decreased by 20.1% from 20,900 in the fourth quarter of 2019 to 16,700 in the same period of 2020. In 2020, we have adopted a series of policies and actions to minimize the impact of COVID-19 pandemic on our businesses. We have achieved remarkable results on the optimization of organizational structure, improvement of operational efficiency, and effective controls on costs and expenses. The total cost of The total cost of revenues and operating expenses decreased by 12.6% from RMB 841.4 million in the fourth quarter of 2019 to RMB 735.4 million in the same period of 2020. The net loss decreased by 68.8% from RMB 303.8 million in the fourth quarter of 2019 to RMB 94.7 million in the same quarter of 2020. The net loss decreased by 25.8% from RMB 1,038.9 million for the full year of 2019 to RMB 771.2 million for the full year of 2020. Our total headcounts decreased by 14.3% from an average of 11,713 in the fourth quarter of 2019 to 10,043 in the same period of 2020. Productivity per capita increased by about 49% from RMB 43,500 in the fourth quarter of 2019 to RMB 64,800 in the same period of 2020. Improving the operational efficiency of our adult learning centers is one of our key strategies in 2020. We have taken active steps to close or merge those underperforming learning centres. The number of adult learning centres decreased from 130 in the fourth quarter of 2019 to 104 in the same period of 2020. The net revenue per adult learning centre increased by about 34% from RMB 2.53 million in the fourth quarter of 2019 to RMB 3.39 million in the fourth quarter of 2020. The net revenue per student enrollment increased by about 35.1% from RMB 7,400 in the fourth quarter of 2019 to RMB 10,000 in the same period of 2020. The number of K-12 education learning centers increased from 217 in the fourth quarter of 2019 to 236 in the same period of 2020. The net revenue per K-12 Learning Center increased by about 51.4% from RMB 0.83 million in the fourth quarter of 2019 to RMB 1.26 million in the fourth quarter of this year. We are pleased with the progress and result of our K-12 business development we have achieved. In 2020, The company has developed more resources to our K-12 education online courses and encouraged more strategic migration to the online operation and business. The net revenue contributed by our K-12 online education business increased by 215.8% from RMB $34.2 million in 2019 to RMB $108 million in 2020. K-12 online education business contributed 14.2% and 6.5% of the K-12 education net revenue for the fiscal year of 2020 and 2019 respectively. Going into 2021, we will continuously stick to and implement our strategies we adopted in 2020, which are streamlining our products and services and uplifting the operational and organizational structure efficiency. For adult education business, we will further explore deeper and more well-added cooperation with educational institutions to strengthen our existing leading positions in the market. For K-12 education business, we will further devote more resources to product research and development and enlarge our K-12 services capacity On top of the K-12 programming and robotic training programs, we will organize and launch more IT-related competitions and relevant training campaigns. We will continuously build and strengthen our national brand, both for the adult professional training and K-12 IT education. With that, I will turn the call to our Operation SVP, Nancy Sun, who will present to you some details of our operation performance in the fourth quarter and full year of 2020.
spk01: Thank you, Calvin. Hello, ladies and gentlemen. I am going to present to you with information regarding our operation performance in the fourth quarter and the full year of 2020. In the fourth quarter, some local areas were affected for a short term by COVID-19.
spk03: including Beijing, Shenyang, Dalian, Harbin, and some cities of Hebei Province. Our team, however, has gathered a wealth of experiences in the delivery and the marketing of products and the operations management, allowing us to get through this wave without causing serious impact on our actual operations.
spk01: I'll start with the adult education business. During the year 2020, our adult businesses continued to insist on optimizing costs, improving productivity, healthy management, and stable development. Due to the pandemic, our annual income of 11.36 billion yuan decreased by 25.6% compared to 15.27 billion yuan in 2019. At the same time, the operating cost of 4.2 billion yuan decreased by 33.1% compared to 6.3 billion yuan in 2019.
spk03: In 2020, we have been adhering to the business strategy of cost-efficient and productivity improvement to achieve healthy operation and steady development in the adult education business. Affected by the pandemic, our revenue in 2020 was RMB 1,136.1 million, a decline of 25.6%. compared with RMB 1,527.2 million in 2019. And the cost of revenues also dropped by 33.1% from RMB 627.8 million in 2019 to RMB 420.3 million in 2020. The gross profit decreased by 20.4% from RMB 899.4 million in 2019 to RMB 715.8 million in 2020.
spk01: 但是非常值得欣喜的是, 第四季度,我们的成本以及运营的费用继续降低, 而收入从时增长,能效提高幅度很大。 在Q3运营盈利的基础之上, 我们实现了Q4的持续盈利。 But the good news is that our cost of revenues and operating expenses in the fourth quarter
spk03: had decreased, allowing us to have huge regain and efficiency. We thus retained our operating profitability in the fourth quarter, continuing the operating profitability in the third quarter.
spk01: Q4虽然成人业务的中心数量相对于2019年12月末减少了26个,场地面积12.92万,从底减少了32%,但是我们的收入3.52亿 In the fourth quarter of 2020, despite the number of learning centers for adult education had a net decrease of 26%,
spk03: and the site areas which is 129.2 thousand square meters were reduced by 32% as compared to the same period of 2019. Our revenue reached up to RMB 352.4 million with an increase of 7.2% compared with RMB 328.7 million achieved in the fourth quarter of 2019. The cost of revenues was RMB 119.2 million, marking a drop of 22.3% compared with the cost of RMB 153.5 million in the fourth quarter of 2019. The gross profit increased by 33.1% from RMB 175.2 million in the fourth quarter of 2019 to RMB 233.2 million in the same period of 2020.
spk01: 那么在提高收入的方面,我们持续优化产品线,提高一线人员销售和服务的专业能力,减少了价格优惠和低价模块课程销售。 通过这些有效的运营管理手 段,我们使得升均的学费有所提高,从而使得收入同比实现增长。 In respect of revenue growth, we lifted the sales and service abilities of the frontline employees.
spk03: continuously optimize our product lines, raise the average tuition fees per student by using effective operational means, such as reducing the price discounts and the sales of low-price module courses. We thus realize the year-over-year growth of revenues. Meanwhile, we made good progress in terms of the optimization of operating expense structure. The increased proportion of student enrollment by word-of-mouth promotion at the front end enabled a great reduction in the marketing expenses. By virtue of our strong strength in teaching and employment service, the six-month post-course job placement rate remained above 90%. Good job placement rates served the foundation for our sustainable business development. 展望2021,我们持续坚持健康运营稳健发展的经营策略,并且将持续发展我们的组织,提高效能,探索新的产品交付的模式。 Looking forward to 2021, we will continuously follow the strategies of maintaining healthy operation and steady development, optimizing organizational structures, enhancing efficiency, and exploring new models of product delivery.
spk01: Now I'd like to give you some colors of our K-12 education business operations. As it is known, for K-12 education business,
spk03: Our goal and position are to provide professional programming education to Chinese students age 3 to 18. Based on our strong accumulated experience and knowledge on professional programming education, we have long been committed to becoming a programming education expert that every child can trust and a science and technology education partner that every family can rely on.
spk01: In the fourth quarter of 2020, we witnessed a continuous improvement in products and services, operation and student recruitment,
spk03: in the K-12 education business sector. Relying on our efficient management, we realized an overall substantial increase in revenues and operational efficiency with reduction of total cost of revenues and operating expenses.
spk01: In the fourth quarter of 2020, the number of young people was 236. In the fourth quarter of 2019, the number of young people increased by 19. The income of the young people was 2.98 billion yuan, which increased by 64.7%. The cost increased by 9.9%. The profit increased by 419.7%. The profit rate reached 42.2%. In the fourth quarter of 2020, there were 236 learning centers in K-12 education.
spk03: With a net increase of 19 centers compared with the number in the fourth quarter of 2019, the revenues contributed by the K-12 education business reached RMB 297.9 million in the fourth quarter of 2020, increasing by 64.7% on a year-to-year basis. Besides, in the fourth quarter of 2020, the cost of revenues increased by 9.9%. The gross profit grew by 419.7% year-over-year. The gross margin reached up to 42.2%. The net revenue in 2020 was RMB 761.8 million, a year-over-year growth of 45.3%. The cost of revenues increased by 18.4%, and the gross profit increased by 626.7%. In 2020, the total student enrollment was 141,600, indicating a year-over-year growth of 42.7%. 收入增长方面,第四季度我们新缴费的学员,包括新注册和续费的学员,总人数是35,000人,同比去年增长了22.4%。
spk01: In 2020, the total number of new students, including those who have just registered and those who have already paid, was 103,300, which is 11.3% higher than last year. Due to the continuous improvement of products and improvement of services, improving the satisfaction of students is our main focus. Therefore, in the fourth quarter, the ratio of students who have just registered and those who have already paid continued to increase, reaching 56.1%. In the aspects of revenue growth, the number of new contracted students, including newly registered students and renewal students, reached up to 35,000 in the fourth quarter of 2020, increasing by 22.4% compared with the same period of 2019.
spk03: For the whole year of 2020, there were a total of 103,300 new contracted students, including newly registered students and renewal students, representing a year-over-year increase of 11.3%. The renewal and word of mouth recruited students accounted for 56.1% and 49.8% of new contracted students in the fourth quarter of 2020 and the full year of 2020, respectively. which was attributed to our business focus on optimizing product lines, improving services, and student satisfaction. About 86% of those students who have been studying our K-12 education programs for more than one year have completed the renewal in the fourth quarter of 2020.
spk01: In the fourth quarter, our management of marketing and customers was very bright. This led to a significant decrease in sales costs in the case of rising growth. Our gross sales costs here do not include personnel-related wages and welfare costs. Gross sales costs dropped to 46% at the same time. In the whole year of 2020, gross sales costs dropped to 21% at the same time.
spk03: We also achieved excellent results on optimizing the sales and marketing expenses and student acquisition costs in the fourth quarter of 2020. While our student enrollment increased, specifically the marketing expenses per student enrollment, which is excluding wages and the welfare expenses of related personnel, dropped by 46% year over year. For the whole year of 2020, the marketing expenses per student's enrollment decreased by 21%. In 2020, we achieved a revenue of RMB 108 million, in the K-12 education online business, making a year-over-year growth of 215.8%, which accounted for 14.2% of total revenue in K-12 education business. In 2021, we will carry out the operating management focusing on healthy growth, word-of-mouth recognized service, product innovation, and lastly, organizational development. We will provide better products and services and boost efficiency through the continuous optimization of cost structure, thus reducing achieving the sound growth of revenues.
spk01: 面向未来,在少儿编程教育的赛道上, 我们的线下用户管理和获客渠道以及线上直播教育 将持续成为我们发展的两个重要基点。 我们将坚持教育的初心,提供好的教育产品, 并坚持持续探索健康的商业模型,实现业务的盈利。 Looking into the future, offline customer relations
spk03: relationship management, exploitation of student recruitment channels, as well as online live broadcasting education will continue to be our key pillars on the track of K-12 education. We will keep the original faith to provide good educational products and keep on exploring healthy business models for profitable operations. 借此機會,再次感謝大家一直以來對我們的關注和支持。
spk01: 下面有请我们的CFO Kevin为大家分享一下2020年第四季度以及全年财务数据的情况。 Thanks again for your constant support.
spk03: I would like to turn the call to Kelvin, our CFO, who will share with you the fourth quarter and the full year of 2020 financial highlights. Thank you.
spk04: Thank you, Leslie. Now I would like to take you through the fourth quarter and full year of 2020 financial highlights. First of all, I will go through the fourth quarter financial highlights. Total revenue increased by 27.6% to RMB 650.3 million in the fourth quarter of 2020, from RMB 509.6 million in the same period of 2019. Net revenue from adult education business increased by 7.2% to RMB 352.4 million in the fourth quarter of 2020, from RMB 328.7 million in the same period of 2019. The increase was primarily due to that less price discounts were offered to students as a result of the implementation of the standardized pricing and discount policies in the fourth quarter of 2020. Net revenues from K-12 education business increased by 64.7% to RMB 297.9 million in the fourth quarter of 2020. from RMB 180.9 million in the same period of 2019. The increase was primarily due to the increase in student enrollments of K-12 education by 47%, from 87,300 in the fourth quarter of 2019 to 128,300 in the same period of 2020, as well as higher class consumption rates resulting from the increase in numbers of students attending organized competitions and sitting for certificate examinations. Cost of revenue decreased by 6% to RMB $291.5 million in the fourth quarter of 2020, from RMB $310.1 million in the same period of 2019. The decrease was primarily due to the decrease in number of adult education learning centers, which resulted which resulted in a reduction of both personnel-related costs and rental expenses, partially offset by the increase in costs arising from the addition of K-12 education new learning centres. Gross profit increased by 79.9% to RMB358.8 million in the fourth quarter of 2020. from RMB 199.4 million in the same period of 2019. Gross margin, which is equal to gross profit divided by net revenue, was 55.2% in the fourth quarter of 2020, compared to 39.1% in the same period of 2019. The increase in gross margin was primarily due to significant increase in net revenue plus the effective control on cost. Total operating expenses decreased by 16.4% to RMB 443.9 million in the fourth quarter of 2019, from RMB 531.3 million in the same period of 2019. Total non-GAAP operating expenses, which excluded share-based compensation expenses, decreased by 16.3% to RMB 436.4 million in the fourth quarter of 2020, from RMB 521.4 million in the same period of 2019. Total share-based compensation expenses allocated to the related operating expenses decreased by 23.7% to RMB 7.5 million in the fourth quarter of 2020, from RMB 9.9 million in the same period of 2019. Selling and marketing expenses decreased by 26.8% to RMB 23.3 million in the fourth quarter of 2020 from RMB 305.1 million in the same period of 2019. The decline was mainly due to decrease in marketing activities and promotional spending and decrease in personnel related expenses resulting from lower headcounts in the fourth quarter of 2020. General and administrative expenses decreased by 1.4% to RMB 195.3 million in the fourth quarter of 2020. from RMB 198.1 million in the same period of 2019. The decline was primarily due to decrease in personnel related expenses resulting from lower headcounts in the fourth quarter of 2020 and there were one-time investigation related professional expenses incurred in the fourth quarter of 2019. Research and development expenses decreased by 10.1% to RMB 25.2 million in the fourth quarter of 2020. from RMB28.1 million in the same period of 2019. The decline was mainly due to a decrease in personnel-related expenses resulting from lower headcounts. Operating loss was RMB85.1 million in the fourth quarter of 2020, compared to operating loss of RMB331.9 million in the same period of 2019. Non-GAAP operating loss, which excluded share-based compensation expenses, was RMB 77.5 million in the fourth quarter of 2020, compared to the non-GAAP operating loss of RMB 321.7 million in the same period of 2019. The company recorded an income tax expense of RMB 7 million in the fourth quarter of 2020, compared to the income taxed benefit of RMB 28.7 million in the same period of 2019. As a result of the fourth going, net loss was RMB 94.7 million in the fourth quarter of 2020, compared to net loss of RMB 303.8 million in the same period of 2019. Non-GAAP net loss, which excluded share-based compensation expenses, was RMB 87.1 million in the fourth quarter of 2020, compared to non-GAAP net loss of RMB $293.6 million in the same period of 2019. Loss per ADS was RMB 1.72 in the fourth quarter of 2020, compared to loss per ADS of RMB 5.64 in the fourth quarter of 2019. Non-GAAP loss per ADS which excluded share-based compensation expenses was RMB 1.58 in the fourth quarter of 2020, compared to non-GAAP loss per ADS of RMB 5.45 in the fourth quarter of 2019. Net cash inflow from operating activities in the fourth quarter of 2020 was RMB 86.5 million. Capital expenditures in the fourth quarter of 2020 were RMB 14.6 million. Now I'm going to take you through the full year of 2020 financial highlights. Net revenues decreased by 7.5% to RMB 1,897.9 million in 2020, from RMB 2,051.4 million in 2019. The decrease was primarily due to the reduction of class consumption rates for both adult and K-12 education businesses during the COVID-19 pandemic in the fiscal year of 2020. Cost of revenue decreased by 9.1% to RMB 1,066.8 million in 2020, from RMB 1,173.8 million in 2019. The decrease was mainly due to the reduction of cooperation with touring service providers, as most students were transferred to online studying during the COVID-19 pandemic. Furthermore, during the COVID-19 pandemic, the utility and office fees declined as our employees worked from home. and the social security fees were exempted due to the preferential policies enacted by the government. The decrease was also partially attributable to the decrease in numbers of adult education learning centers, which resulted in decrease in personnel related costs and rental expenses. Gross profit decreased by 5.3% to RMB $831 million in 2020, from RMB $877.5 million in 2019, Gross margin, which is equal to gross profit divided by net revenues, was 43.8% in 2020, compared with 42.8% in 2019. The increase in gross margin was mainly attributable to our efficient cost controls implemented in 2020. Total operating expenses decreased by 17.1% to RMB 1,637.4 million in 2020, from RMB 1,975.7 million in 2019. Total non-GAAP operating expenses, which exclude the share-based compensation expenses, decreased by 16.5% to RMB 1,601.6 million in 2020, from RMB 1,917.5 million in 2019. Total share-based compensation expenses allocated to the related operating expenses decreased by 38.4% to RMB 35.8 million in 2020 from RMB 58.2 million in 2019. Selling and marketing expenses decreased by 19.1% to RMB 906.3 million in 2020 from RMB 1119.7 million in 2019. The decline was mainly due to decrease in marketing activities and promotional spendings in fiscal year of 2020. In addition, personal related expenses decreased as a result of lower headcounts and social security fees were extended due to the preferential policies and added by the government during COVID-19 pandemic in the fiscal year of 2020. General and administrative expenses decreased by 12.8% to RMB 630.6 million in 2020, from RMB 723.3 million in 2019. The decline was mainly due to decrease in personnel related expenses resulting from lower headcounts and social security fees were exempted according to preferential policies enacted by the government during COVID-19 pandemic in the fiscal year of 2020. Furthermore, There were one-time investigation-related professional expenses incurred in the fiscal year of 2019. Research and development expenses decreased by 24.3% to RMB $100.5 million in 2020. From RMB $132.7 million in 2019, the decline was mainly due to decrease in personnel-related expenses resulting from lower headcounts. Operating loss was RMB $800. and 6.4 million in 2020, compared to the operating loss of RMB 1,098.2 million in 2019. Non-GAAP operating loss, which excluded share-based compensation expenses, was RMB 770.1 million in 2020, compared to the non-GAAP operating loss of RMB 1,039 million in 2019. The company recorded an income tax benefit of RMB 35 million in 2020, compared to the income tax benefit of RMB 41.6 million in 2019. As a result of the fourth going, net loss was RMB 771.2 million in 2020, compared to the net loss of RMB 1,038.9 million in 2019. Non-GAAP net loss, which excluded share-based compensation expenses, was RMB 734.9 million in 2020, compared to non-GAAP net loss of RMB 979.7 million in 2019. Loss per ADS was RMB 14.11 in 2020, compared to loss per ADS of RMB 19.41 in 2019. Non-GAAP loss per ADS, which excludes share-based compensation expenses, was RMB 13.44 in 2020, compared to the non-GAAP loss per ADS of RMB 18.3 in 2019. Cash and cash equivalents and time deposits, including current and non-current, and restricted cash, decreased by 41.3% from RMB as of December 31, 2019, to RMB 364.8 million as of December 31, 2020. The decrease was mainly due to net cash used in operating activities, which was mainly composed of net loss of RMB 771.2 million incurred in the year of 2020. partially offset by the increase in total deferred revenue of RMB 412.2 million and depreciation and amortization charges of RMB 177.5 million, and net cash used in financing activities, which were mainly composed of the repayment of RMB 78.5 million bank borrowings in 2020. Capital expenditures in 2020 were RMB 71.5 million, In terms of financial guidance, based on our current operations, total revenues for the first quarter of 2021 are expected to be between RMB$470 million and RMB$500 million. After taking into consideration the seasonal fluctuation factors and likely continuous impact of COVID-19, this guidance is based on the current market conditions and reflects the company's current and preliminary estimates of market and operating conditions, which are subject to change, particularly as to the potential impact of COVID-19 on the economy in China and elsewhere in the world. This concludes my financial highlights section. Operator, we are ready for questions.
spk07: Secondly, ladies and gentlemen, we will now begin the question and answer session. If you wish to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced. If you wish to cancel your request, please press pound or hash key. It's star followed by one to ask a question. Thank you. Once again, if you wish to ask a question, please press star one on your telephone keypad. and wait for your name to be announced. Thank you. Once again, if you wish to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced. Once again, if you wish to ask a question, please press star one on your telephone keypad and wait for your name to be announced. Thank you.
spk04: Hey, operator, our CEO, Mr. Sun, is already back to the office. He wants to speak to you a little bit, okay?
spk06: Okay.
spk07: So please go ahead.
spk06: We have no questions at this point of time. Please go ahead.
spk03: Okay.
spk06: Hello, everyone. My name is Sun Yongji. I'm the CEO of Terena International Incorporation. First of all, I want to say sorry because I was caught in a traffic jam, so I was late for our conference call.
spk03: But I believe that you guys are very excited after hearing our SVP Nancy and Calvin, our CFO's words. So we do have a very promising Q4 in 2020 and we do have very promising figures in the 2024 year. So the time is quite precious here. If you guys have any questions, you are welcome to ask your question and we will answer your question.
spk07: We have a question. We have a question on the line here. The first question comes from the line of Zhang Jian from Ma & Wong Asset Management. Please go ahead.
spk08: Excuse me, Zhang, your line is open.
spk07: You can ask your question now. Please go ahead.
spk03: Can I ask a question? Hello?
spk02: Hello?
spk05: Can you hear me? Yes, we can.
spk02: Hello. Hello.
spk05: First of all, congratulations.
spk02: The company Q4 has achieved a relatively good performance. I would like to ask a question. I would like to ask a question about the company's urbanization. Because it has been announced before. I would like to ask about the current progress.
spk05: I can't think I want to know I don't know I don't know I don't know I don't know I don't know I don't know I don't know
spk04: So, we are not in a proper position to comment on the progress or the expectation of the privatization process. So, whenever there is any progress or any development in terms of the Related to the project, we will make the announcement in public to inform everybody. It's not proper for us to talk about the prioritization in this common score. Okay, thank you. Thank you.
spk02: I would like to ask another question. The Q4 performance of the company looks good, but in general, it is a loss, right? I want to ask, can you guess in detail, can you guess every month, is it already achieved? Before we manage the city, we hope that at least one month, can achieve this one-month report. Is this target already achieved?
spk01: Hi. The adult business has indeed achieved profit. The young business, we still see the growth of the entire income in a relatively good condition in the market. If we adopt a relatively conservative management strategy, it is possible to achieve this profit in some months. But in such a stage where the entire track is growing faster and faster, we are not talking about loss. Our market share, what you can see is that in the fourth quarter, we adults have achieved profit. On the basis of Q3, business is profitable. Our young people's income growth is actually very, very favorable. If we look at the impact of the epidemic in the first half of this year, in July to December, then our children's income has increased nearly 96% compared to the second half of last year. This is the data of our business. So in fact, I hope everyone can understand that when our two businesses are at different stages or different opportunities, we hope to miss this opportunity. But from the perspective of our cash management, our children have achieved Oh, okay. Oh, okay.
spk03: Previously, the question was about the Q4 financials and the total financials. It seems that Tarina scored a very positive Q4 numbers. However, overall speaking, Tarina is still in a lost position. So I was just wondering whether we can achieve the earnings or monthly profitability like our management has said before. And our SVP, Ms. Nancy, have said, have answered the question that we do have a very positive earnings for our adult business in Q4, and our revenues for K-12 business is very exciting. And we will continue our rather conservative strategies going forward because the market is developing very fast. We don't want to lose our market shares Based on the Q3 numbers, we can see that our adult business figures and our revenues for K-12 business in the Q4 of 2020 is quite promising. And excluding the factors such as COVID-19, from July to December in 2020, we do see 96% of revenue growth for our K-12 business compared with the second half of 2019. So that is a huge opportunity for us. We don't want to miss the opportunity, and we do have a very positive cash revenue. So in the future, we will continue to focus on cash revenue increase and our increase of cost, our decrease of cost per acquisition.
spk02: Okay, good. Thank you, Nathan. I have one last question. I would like to ask about our first business in Seoul. What is our strategy for this year? Are we going to start expanding again? Are we going to expand some network points? Are there any specific plans? Because if we expand, it may also involve a financial problem. How do we solve the financial problem? That's probably the question. Thank you.
spk03: So this is the last question for our conference call. And it's a question about K-12 business, or children education business. So just asking, what is the strategy for K-12 this year? Do we want to expand our learning centers? And if we want to expand our sites, that means we need more money. How to solve that issue?
spk01: Okay. In 2021, we will look back at our service and reputation, continue to maintain the service and reputation of this kind of growth, will explore some new innovations, and then maintain the upgrade of our organizational structure. At these levels, we will look back at our service and reputation, continue to maintain the service and reputation of this kind of growth, and then maintain the upgrade of our organizational structure. Okay, so to answer your first question, we were in this market since 2015, and over the past three years from 2017, 2018, and 2019, we've witnessed a very fast development for Terena International.
spk03: And although there was a COVID-19 pandemic in 2020, we do have a positive financials in 2020. And in 2021, we want to continue our fast development based on a very sound structure, meaning that we will continue to rely on our very stable operating structure. We will continue to enhance and adjust our organization power. We believe that we want to be a powerhouse rather than a big house. And in 2021, we will continue to strengthen our services, our word-of-mouth referrals, our innovative operating method, and our value-added structures. So we don't have any new plans to build new sites in Q1 of 2021. Okay, thank you. Thank you, Nancy.
spk02: Very clear. I have no more questions here. Thank you.
spk04: No question.
spk07: Thank you. Once again, if you wish to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced. Thank you. If there are no further questions, I would like to hand the call back to our presenters for any closing remarks.
spk00: Okay. Thank you, Operator. If there's no further questions at present, we would like to conclude by thanking everyone for joining our conference call. We welcome you to reach out to us directly by email at ir.edu.cn. Should you have any questions or requests for additional information, we encourage you to visit our website at ir.dedu.cn. Thank you.
spk01: Thank you.
spk07: Thank you. Ladies and gentlemen, that does conclude the conference for today. Thank you for participating. You may all disconnect now. Thank you.
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