Four Seasons Education (Cayman) Inc.

Fourth-quarter fiscal 2021 revenue was RMB 70.2 million, down from RMB 71.1 million a year ago. Cost of revenue decreased 9.4% to RMB 41.9 million, and gross profit increased 14.1% to RMB 28.3 million. General and administrative expenses fell 29.0% to RMB 28.3 million, and impairment loss on intangible assets and goodwill was zero versus RMB 145.4 million last year. Operating loss was RMB 8.5 million compared with RMB 168.2 million last year; adjusted operating loss was RMB 1.9 million versus RMB 15.1 million. Net loss was RMB 11.5 million versus RMB 145.4 million, and adjusted net loss was RMB 4.2 million versus RMB 4.7 million. Basic and diluted net loss per ADS were RMB 0.25, versus RMB 3.11 a year ago. Cash and cash equivalents were RMB 410 million as of February 28, 2021, compared with RMB 404.7 million a year earlier. For Q1 fiscal 2022, management expects revenue of RMB 67.5 million to RMB 70.4 million, representing 15% to 20% year-over-year growth.

The CEO framed fiscal 2021 as a difficult pandemic year but said the company proactively optimized operations and costs to support long-term sustainability. She emphasized strong demand for academically focused programs, 26% year-over-year enrollment growth in Q4, and record-high spring retention in Shanghai, saying the company is moving back toward its pre-pandemic growth trajectory. She also highlighted expansion initiatives, including a community-based study room brand and cooperation with tech-focused internet companies such as Tencent.

The CFO focused on the improvement in the income statement from lower costs and the absence of last year’s large impairment charge. She cited Q4 revenue of RMB 70.2 million, gross profit of RMB 28.3 million, operating loss of RMB 8.5 million, and net loss of RMB 11.5 million, alongside a cash balance of RMB 410 million as of February 28, 2021. She guided Q1 fiscal 2022 revenue to RMB 67.5 million to RMB 70.4 million, equal to 15% to 20% year-over-year growth.

There were no analyst questions on the call, so the only forward-looking discussion came from management’s prepared remarks and guidance. The main point raised was the company’s expectation for Q1 fiscal 2022 revenue growth of 15% to 20% year over year, with management noting that guidance is preliminary and subject to change. No additional concerns were addressed in a Q&A session.