First High-School Education Group Co., Ltd. American Depositary Shares

Good day, ladies and gentlemen. Thank you for standing by and welcome to the first high school education group third quarter 2023 unaudited financial results earnings conference call. Currently, all participants are in the listen-only mode and later we will conduct a question and answer session. Instructions will follow at that time. As a reminder, we are recording today's call. If you have any objections, you may disconnect at this time. I will now turn the call over to Mr. Tommy Zhou Chief Financial Officer of the company. Mr. Zhou, please proceed.

Thank you, operator, and greetings, investors and friends. Welcome to the first High School Education Group third quarter 2023 earnings conference call. This is Tommy speaking, the Chief Financial Officer of the company, and I will lead today's conference call. We released our most recent earning results earlier today prior to market open. The press release is available on the company's IR website at ir.diyi.top as well as from Access Wire and OTC services. A replay of this call will also be available the next day on via the replay number provided in the early release. Before we continue, please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Security Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties As such, the company's actual results may be materially different from the expectations expressed today. Further information regarding these and other risks and uncertainties is included in the company's public filings with the SEC. The company does not assume any obligation to update any forward-looking statement except as required under applicable law. Also, please note that unless otherwise stated, All figures mentioned during the conference call are in Chinese . With that, thank you all again for joining us. I will briefly spend the next 15 to 20 minutes updating our third quarter 2023 unaudited financial results for the nine months ended September 30th, 2023. For today's early release, all of our financial data will be dated to September 30th of 2023 and our operating data, including the total number of students enrolled and the total number of school programs will be dated October 31st, 2023. In comparison to the corresponding period last year, the company witnessed a decrease in both revenue and net income. The factors contributing to this decline remains consistent with those previously disclosed. The persisting challenges tied to discontinued schools and reduced student related services such as catering services and auxiliary materials continue to exert a negative impact on our financial performance. In addition, In communication with our auditor, we incurred a non-cash charge of asset impairment loss of 50.2 million RMB or 6.9 million US dollars. We have recognized a write-off for certain accounts receivable pertaining to overdue payments from local governments and collaborators, which are deemed unlikely to be collected. This non-cash charge has been accounted for, and as such, it will not impact our cash flow or day-to-day operation. It is merely an accounting adjustment. The third quarter period from July ending in September is commonly known as the quiet period in our business. It's quiet because there are no school activities, conducted during the summer months of July and August, meaning two third up to three months period, the company will have no revenue recognition. During the quiet period, the company did extensive preparation work for school opening and experienced steady operation for the first month of our newly school year. We welcomed three new schools for which we started to provide management services. Currently, there are a total of 25 school programs under our management. For the enrollment information, I have disclosed more detailed numbers during my last disclosure. For the 17 school programs that we operate independently, we hired 220 new teachers for this new semester. Our recruitment efforts targeted both senior educators and promising juniors.

Apologies there, Mr. Zhou's line has disconnected. He will be calling back very shortly. As mentioned, Mr. Zhou's line has just disconnected, but he's dialing back very, very shortly. Apologies for the delay.