Document And Entity Information
Document And Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Document Information [Line Items] | |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Document Period End Date | Dec. 31, 2020 |
Amendment Flag | false |
Entity Registrant Name | Tarena International, Inc. |
Entity Emerging Growth Company | false |
Entity Central Index Key | 0001592560 |
Entity Current Reporting Status | Yes |
Current Fiscal Year End Date | --12-31 |
Entity File Number | 001-36363 |
Entity Incorporation, State or Country Code | E9 |
Entity Address, Address Line One | 6/F, No. 1 Andingmenwai Street, Litchi Tower |
Entity Address, Address Line Two | Chaoyang District |
Entity Address, City or Town | Beijing |
Entity Address, Postal Zip Code | 100011 |
Entity Address, Country | CN |
Entity Filer Category | Non-accelerated Filer |
Entity Well-known Seasoned Issuer | No |
Entity Shell Company | false |
Entity Interactive Data Current | Yes |
Entity Voluntary Filers | No |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
Document Accounting Standard | U.S. GAAP |
ICFR Auditor Attestation Flag | true |
Business Contact [Member] | |
Document Information [Line Items] | |
Contact Personnel Name | Wing Kee Lau |
Contact Personnel Email Address | liuyongji@tedu.cn |
Entity Address, Address Line One | 6/F, No. 1 Andingmenwai Street, Litchi Tower |
Entity Address, Address Line Two | Chaoyang District |
Entity Address, City or Town | Beijing |
Entity Address, Postal Zip Code | 100011 |
Entity Address, Country | CN |
Ordinary Shares | |
Document Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 55,552,443 |
Common Class A | |
Document Information [Line Items] | |
Title of 12(b) Security | Class A ordinary shares |
No Trading Symbol Flag | true |
Security Exchange Name | NASDAQ |
Entity Common Stock, Shares Outstanding | 48,346,384 |
ADS | |
Document Information [Line Items] | |
Title of 12(b) Security | American Depositary Shares |
Trading Symbol | TEDU |
Security Exchange Name | NASDAQ |
Entity Common Stock, Shares Outstanding | 7,099,141 |
Common Class B | |
Document Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 7,206,059 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
Current assets: | |||
Cash and cash equivalents | ¥ 320,179 | $ 49,070 | ¥ 537,701 |
Time deposits | 6,257 | 959 | 83,081 |
Restricted cash | 38,369 | 5,880 | 0 |
Accounts receivable, net of allowance for doubtful accounts | 32,790 | 5,025 | 31,442 |
Amounts due from related parties | 305 | 47 | 16,492 |
Prepaid expenses and other current assets | 138,353 | 21,204 | 132,539 |
Total current assets | 536,253 | 82,185 | 801,255 |
Time deposits-non current | 406 | ||
Accounts receivable, net of allowance for doubtful accounts-non current | 192 | 29 | 724 |
Property and equipment, net | 464,490 | 71,186 | 576,633 |
Intangible assets, net | 13,444 | 2,060 | 17,669 |
Right-of-use assets | 586,451 | 89,878 | 773,472 |
Goodwill | 52,782 | 8,089 | 52,782 |
Long-term investments, net | 67,592 | 10,359 | 67,773 |
Deferred income tax assets | 142,220 | 21,796 | 99,789 |
Other non-current assets | 95,825 | 14,685 | 121,517 |
Total assets | 1,959,249 | 300,267 | 2,512,020 |
Current liabilities: | |||
Short-term bank loans | 10,710 | 1,641 | 89,162 |
Accounts payable | 10,293 | 1,577 | 16,563 |
Amounts due to related parties | 180 | 28 | 239 |
Operating lease liabilities-current | 199,083 | 30,511 | 241,710 |
Income taxes payable | 76,817 | 11,773 | 69,671 |
Deferred revenue-current | 1,980,138 | 303,469 | 1,554,431 |
Accrued expenses and other current liabilities | 391,904 | 60,062 | 397,558 |
Total current liabilities | 2,669,125 | 409,061 | 2,369,334 |
Deferred revenue-non current | 18,060 | 2,768 | 31,539 |
Operating lease liabilities-non current | 406,251 | 62,261 | 508,810 |
Other non-current liabilities | 5,082 | 779 | 5,401 |
Total liabilities | 3,098,518 | 474,869 | 2,915,084 |
Commitments and contingencies | |||
Shareholders' equity: | |||
Additional paid-in capital | 1,324,161 | 202,937 | 1,284,573 |
Accumulated other comprehensive income | 49,120 | 7,528 | 51,386 |
Accumulated deficit | (2,045,891) | (313,547) | (1,279,248) |
Total equity deficit to the shareholders of Tarena International, Inc. | (1,132,002) | (173,488) | (400,047) |
Non-controlling interest | (7,267) | (1,114) | (3,017) |
Total liabilities and equity | 1,959,249 | 300,267 | 2,512,020 |
Common Class A | |||
Shareholders' equity: | |||
Ordinary shares | 349 | 53 | 337 |
Treasury shares (7,099,141 and 7,199,870 Class A ordinary shares as of December 31, 2019 and 2020, at cost) | (459,815) | (70,470) | (457,169) |
Common Class B | |||
Shareholders' equity: | |||
Ordinary shares | ¥ 74 | $ 11 | ¥ 74 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Common Class A | ||
Ordinary shares | ||
Ordinary shares, par value | $ 0.001 | $ 0.001 |
Authorized | 860,000,000 | 860,000,000 |
Issued | 55,546,254 | 53,806,534 |
Outstanding | 48,346,384 | 46,707,393 |
Treasury shares | 7,199,870 | 7,099,141 |
Common Class B | ||
Ordinary shares | ||
Ordinary shares, par value | $ 0.001 | $ 0.001 |
Authorized | 40,000,000 | 40,000,000 |
Issued | 7,206,059 | 7,206,059 |
Outstanding | 7,206,059 | 7,206,059 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥)¥ / shares | Dec. 31, 2020USD ($)$ / shares | Dec. 31, 2019CNY (¥)¥ / shares | Dec. 31, 2018CNY (¥)¥ / shares | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | ||||
Net revenues | ¥ 1,897,883 | $ 290,863 | ¥ 2,051,354 | ¥ 2,085,371 |
Cost of revenues | (1,066,842) | (163,501) | (1,173,834) | (918,549) |
Gross profit | 831,041 | 127,362 | 877,520 | 1,166,822 |
Selling and marketing expenses | (906,337) | (138,902) | (1,119,698) | (1,047,632) |
General and administrative expenses | (630,618) | (96,646) | (723,306) | (546,568) |
Research and development expenses(a) | (100,466) | (15,397) | (132,672) | (167,254) |
Operating loss | (806,380) | (123,583) | (1,098,156) | (594,632) |
Interest income (expense) | (199) | (30) | 15,859 | 26,200 |
Other (loss) income | 5,201 | 797 | 246 | (33,583) |
Foreign currency exchange gains (loss) | (4,849) | (743) | 1,614 | 4,951 |
Loss before income taxes | (806,227) | (123,559) | (1,080,437) | (597,064) |
Income tax benefit | 35,034 | 5,369 | 41,559 | 4,865 |
Net loss | (771,000) | (118,190) | (1,038,878) | (592,199) |
Less: Net loss attributable to non-controlling interests | (4,550) | (697) | (2,792) | (2,025) |
Net loss attributable to Class A and Class B ordinary shareholders | ¥ (766,643) | $ (117,493) | ¥ (1,036,086) | ¥ (590,174) |
Basic loss per Class A and Class B ordinary share | (per share) | ¥ (14.11) | $ (2.16) | ¥ (19.41) | ¥ (10.74) |
Diluted loss per Class A and Class B ordinary share | (per share) | ¥ (14.11) | $ (2.16) | ¥ (19.41) | ¥ (10.74) |
Net loss | ¥ (771,000) | $ (118,190) | ¥ (1,038,878) | ¥ (592,199) |
Other comprehensive income (loss) | ||||
Foreign currency translation adjustment | (2,266) | (347) | 914 | 11,100 |
Comprehensive loss | (773,459) | (118,537) | (1,037,964) | (581,099) |
Less: Comprehensive loss attributable to non-controlling interests | (4,550) | (697) | (2,792) | (2,025) |
Comprehensive loss attributable to Class A and Class B ordinary shareholders | ¥ (768,909) | $ (117,840) | ¥ (1,035,172) | ¥ (579,074) |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Parenthetical) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
Share-based compensation expense | ¥ (36,246) | $ (5,555) | ¥ (59,172) | ¥ (124,253) |
Cost of revenues | ||||
Share-based compensation expense | (379) | (58) | (983) | (2,265) |
Selling and marketing expenses | ||||
Share-based compensation expense | (1,842) | (282) | (6,502) | (8,866) |
General and administrative expenses | ||||
Share-based compensation expense | (26,242) | (4,022) | (36,719) | (84,645) |
Research and development expenses | ||||
Share-based compensation expense | ¥ (7,783) | $ (1,193) | ¥ (14,968) | ¥ (28,477) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY ¥ in Thousands | Ordinary SharesCommon Class ACNY (¥)shares | Ordinary SharesCommon Class AUSD ($)shares | Ordinary SharesCommon Class BCNY (¥)shares | Ordinary SharesCommon Class BUSD ($)shares | Treasury SharesCNY (¥) | Additional Paid-in CapitalCNY (¥) | Accumulated Other Comprehensive Income (Loss)CNY (¥) | Retained Earnings (accumulated deficit)CNY (¥) | Non-controlling InterestCNY (¥) | Common Class Ashares | Common Class Bshares | CNY (¥) | USD ($) |
Balance at Dec. 31, 2017 | ¥ 327 | ¥ 74 | ¥ (255,103) | ¥ 1,094,872 | ¥ 39,372 | ¥ 389,967 | ¥ 1,269,509 | ||||||
Balance, shares at Dec. 31, 2017 | shares | 52,340,176 | 52,340,176 | 7,206,059 | 7,206,059 | |||||||||
Net loss | (590,174) | ¥ (2,025) | (592,199) | ||||||||||
Conversion of Class B ordinary shares to Class A ordinary shares | ¥ 4 | ||||||||||||
Issuance of Class A ordinary shares upon exercise of share options and vesting of non-vested shares | 2,947 | 2,951 | |||||||||||
Issuance of Class A ordinary shares upon exercise of share options and vesting of non-vested shares (shares) | shares | 632,402 | 632,402 | |||||||||||
Foreign currency translation adjustment | 11,100 | 11,100 | |||||||||||
Non-controlling interest contribution | 1,050 | 1,050 | |||||||||||
Share-based compensation | 124,253 | 124,253 | |||||||||||
Dividends | (42,955) | (42,955) | |||||||||||
Purchase of Class A ordinary shares | (202,066) | (202,066) | |||||||||||
Balance at Dec. 31, 2018 | ¥ 331 | ¥ 74 | (457,169) | 1,222,072 | 50,472 | (243,162) | (975) | 571,643 | |||||
Balance, shares at Dec. 31, 2018 | shares | 52,972,578 | 52,972,578 | 7,206,059 | 7,206,059 | |||||||||
Net loss | (1,036,086) | (2,792) | (1,038,878) | ||||||||||
Conversion of Class B ordinary shares to Class A ordinary shares | ¥ 6 | ||||||||||||
Issuance of Class A ordinary shares upon exercise of share options and vesting of non-vested shares | 3,329 | 3,335 | |||||||||||
Issuance of Class A ordinary shares upon exercise of share options and vesting of non-vested shares (shares) | shares | 833,956 | 833,956 | |||||||||||
Foreign currency translation adjustment | 914 | 914 | |||||||||||
Non-controlling interest contribution | (750) | (750) | |||||||||||
Share-based compensation | 59,172 | 59,172 | |||||||||||
Balance at Dec. 31, 2019 | ¥ 337 | ¥ 74 | (457,169) | 1,284,573 | 51,386 | (1,279,248) | (3,017) | (403,064) | |||||
Balance, shares at Dec. 31, 2019 | shares | 53,806,534 | 53,806,534 | 7,206,059 | 7,206,059 | 53,806,534 | 7,206,059 | |||||||
Net loss | (766,643) | (4,550) | (771,000) | $ (118,190,000) | |||||||||
Issuance of Class A ordinary shares upon exercise of share options and vesting of non-vested shares | ¥ 12 | ¥ 0 | 0 | 3,342 | 0 | 0 | 0 | 3,354 | |||||
Issuance of Class A ordinary shares upon exercise of share options and vesting of non-vested shares (shares) | shares | 1,739,720 | 1,739,720 | 0 | 0 | |||||||||
Foreign currency translation adjustment | ¥ 0 | $ 0 | ¥ 0 | $ 0 | 0 | 0 | (2,266) | 0 | 0 | (2,266) | $ (347,000) | ||
Non-controlling interest contribution | (300) | (300) | |||||||||||
Share-based compensation | 36,246 | 36,246 | |||||||||||
Purchase of Class A ordinary shares | (2,646) | (2,646) | |||||||||||
Balance at Dec. 31, 2020 | ¥ 349 | ¥ 74 | ¥ (459,815) | ¥ 1,324,161 | ¥ 49,120 | ¥ (2,045,891) | ¥ (7,267) | ¥ (1,139,269) | |||||
Balance, shares at Dec. 31, 2020 | shares | 55,546,254 | 55,546,254 | 7,206,059 | 7,206,059 | 55,546,254 | 7,206,059 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
Operating activities: | ||||
Net loss | ¥ (771,000) | $ (118,190) | ¥ (1,038,878) | ¥ (592,199) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation and amortization | 177,478 | 27,200 | 194,806 | 158,757 |
Amortization of operating lease right-of-use asset | 170,022 | 26,057 | 218,314 | |
Bad debt provision | 13,900 | 2,130 | 2,251 | |
Loss on disposal of property and equipment | 3,303 | 506 | 5,118 | 1,238 |
Deferred income tax benefit | (42,431) | (6,503) | (46,037) | (46,595) |
Share based compensation expense | 36,246 | 5,555 | 59,172 | 124,253 |
Investment loss (income) | 77 | 12 | (27) | 1,548 |
Foreign currency exchange loss (gain), net | 4,849 | 743 | (1,614) | (4,440) |
Impairment of long term investments | 2,000 | 35,524 | ||
Changes in operating assets and liabilities | ||||
Accounts receivable | (7,779) | (1,192) | 17,641 | 6,000 |
Amounts due from related parties | (252) | (39) | (54) | (2,996) |
Inventory | 699 | 107 | (3,551) | (971) |
Prepaid expenses and other current assets | 97 | 15 | 22,773 | (3,454) |
Accrued interest income on time deposits | (2,307) | (354) | 538 | 9,814 |
Other non-current assets | 14,549 | 2,230 | (4,616) | (15,986) |
Accounts payable | 821 | 126 | 55 | (390) |
Fund wired to a related party | (22,488) | |||
Fund received from a related party | 22,488 | |||
Amounts due to related parties | (58) | (9) | (634) | 656 |
Income taxes payable | 7,146 | 1,095 | (2,176) | 2,978 |
Deferred revenue | 412,228 | 63,177 | 755,951 | 445,854 |
Accrued expenses and other current liabilities | 2,289 | 351 | 29,086 | 44,128 |
Operating lease liabilities | (128,186) | (19,645) | (241,266) | |
Other non-current liabilities | (319) | (49) | (582) | (638) |
Net cash provided by (used in) operating activities | (109,000) | (16,677) | (31,730) | 163,081 |
Investing activities: | ||||
Purchase of property and equipment and intangible assets | (79,414) | (12,171) | (161,275) | (276,253) |
Proceeds from disposal of property and equipment | 7,909 | 1,212 | 10,144 | 8,905 |
Purchase of long-term investments | (4,000) | (613) | (3,000) | (14,580) |
Purchase of time deposits | (94,426) | (14,471) | (341,722) | (284,166) |
Proceeds from maturity of time deposits | 171,660 | 26,308 | 419,777 | 563,354 |
Payment for acquisition of RTEC | (57,700) | |||
Cash acquired from acquisition of RTEC | 11,424 | |||
Issuance of loans to employees | (8,782) | (1,346) | (12,042) | (69,784) |
Proceeds from repayment of loans to employees | 6,396 | 980 | 36,901 | 26,823 |
Net cash used in investing activities | (657) | (101) | (51,217) | (91,977) |
Financing activities: | ||||
Proceeds from bank borrowing | 10,710 | 1,641 | 89,162 | 13,229 |
Contribution from non-controlling entities | 300 | 46 | 750 | 1,050 |
Repayment of bank borrowings | (89,162) | (13,665) | (13,792) | |
Collection of loan from a related party | 6,499 | 996 | ||
Issuance of Class A ordinary shares in connection with exercise of share options | 3,354 | 514 | 3,335 | 2,951 |
Payment of dividend | (42,955) | |||
Repurchase of treasury shares | (5,058) | (196,957) | ||
Net cash (used in) provided by financing activities | (68,299) | (10,468) | 74,397 | (222,682) |
Changes in cash, cash equivalents an restricted cash | (177,777) | (27,246) | (8,550) | (151,578) |
Effect of foreign currency exchange rate changes on cash, cash equivalents and restricted cash | (1,376) | (210) | 567 | 10,571 |
Net change in cash, cash equivalents and restricted cash | (179,153) | (27,456) | (7,983) | (141,007) |
Cash, cash equivalents and restricted cash at beginning of year | 537,701 | 82,406 | 545,684 | 686,691 |
Cash, cash equivalents and restricted cash at end of year | 358,548 | 54,950 | 537,701 | 545,684 |
Supplemental disclosure of cash flow information: | ||||
Income taxes paid | 615 | 94 | 6,654 | 37,216 |
Interest paid | 4,954 | 759 | 419 | 163 |
Non-cash investing and financing activities: | ||||
Accrual for purchase of equipment | 9,180 | 1,407 | 16,272 | 18,292 |
Payable for repurchase of treasury shares | ¥ 5,109 | |||
Operating lease right-of-use assets obtained in exchange for new operating lease liabilities | ¥ 484,202 | $ 74,207 | ¥ 432,898 |
DESCRIPTION OF BUSINESS, ORGANI
DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | 12 Months Ended |
Dec. 31, 2020 | |
DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |
DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | 1 DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (a) Description of business Tarena International, Inc. (“Tarena International”), through its wholly-owned subsidiaries and consolidated variable interest entities or VIEs (collectively referred to hereinafter as the “Company”), is principally engaged in providing professional education services including professional information technology (“IT”) training courses and non-IT training courses across the People’s Republic of China (“PRC”). The Company is also engaged in providing IT and non-IT training courses for children. All of the Company’s operations are located in the PRC with nearly all of its customers located in the PRC. (b) Organization Tarena International is a holding company that was incorporated in the Cayman Islands on October 8, 2003 by Mr. Han Shaoyun (“Mr. Han”), the founder and former chief executive officer of the Company, and five other individuals. Tarena International is the parent company of a number of wholly-owned subsidiaries that are engaged in the provision of educational products and services. The Company’s education services in certain locations of the PRC were previously conducted through Beijing Tarena Jinqiao Technology Co., Ltd. (“Beijing Tarena”), and its subsidiaries, in order to comply with the PRC laws and regulations which restricted foreign investments in companies that were engaged in education products and services. Pursuant to the VIE Agreement as described below, Tarena International has effective financial control over Beijing Tarena and its initial capital funding was provided by Tarena Technologies Inc., (a wholly-owned subsidiary of Tarena International or the “WFOE”, formerly known as Beijing Tarena Technology Co., Ltd.). The recognized and unrecognized revenue-producing assets that were held by Beijing Tarena and its subsidiaries primarily consists of property and equipment, operating leases for the learning premises, ICP license, www.tmooc.cn website and assembled workforce in those learning centers. All of the equity interests of Beijing Tarena are legally held by Mr. Han and Mr. Li Jianguang (“Mr. Li”), a director of Tarena International. Both individuals are nominee equity holders of Beijing Tarena and holding their equity interests on behalf of Tarena International. Through a series of contractual agreements and arrangements (the “VIE Agreement”), among Tarena International, WFOE, Beijing Tarena and its nominee equity holders, the nominee equity holders of Beijing Tarena have granted all their legal rights including voting rights and disposition rights of their equity interests in Beijing Tarena to Tarena International. The nominee equity holders of Beijing Tarena do not participate significantly in income and loss and do not have the power to direct the activities of the Beijing Tarena that most significantly impact their economic performance. Accordingly, the Beijing Tarena is considered variable interest entities. In accordance with Accounting Standards Codification (“ASC”) 810-10-25-38A, Tarena International has a controlling financial interest in Beijing Tarena because Tarena International has (i) the power to direct activities of Beijing Tarena that most significantly impact the economic performance of Beijing Tarena; and (ii) the obligation to absorb the expected losses and the right to receive expected residual return of Beijing Tarena that could potentially be significant to Beijing Tarena. Thus, Tarena International is the primary beneficiary of the Beijing Tarena. Under the terms of the VIE Agreement, Tarena International has (i) the right to receive economic benefits that could potentially be significant to Beijing Tarena in the form of service fees under the exclusive business cooperation agreements; (ii) the right to receive all dividends declared by Beijing Tarena and the right to all undistributed earnings of Beijing Tarena; (iii) the right to receive the residual benefits of Beijing Tarena through its exclusive option to acquire 100% of the equity interests in Beijing Tarena, to the extent permitted under PRC law. Accordingly, Tarena International is the primary beneficiary of the Beijing Tarena and the financial statements of Tarena VIE Entities are consolidated in Tarena International’s consolidated financial statements. 1 DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (CONTINUED) (b) Organization (continued) Under the terms of the VIE Agreement, Beijing Tarena’ nominee equity holders have no rights to the net assets nor have the obligations to fund the deficit, and such rights and obligations have been vested to Tarena International. All of the equity (net assets) and net income of Beijing Tarena are attributed to Tarena International. The key terms of the VIE Agreement are as follows: Loan Agreements: Exclusive Option Agreements: Exclusive Business Cooperation Agreements: 1 DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (CONTINUED) (b) Organization (continued) Power of Attorney: Equity Interest Pledge Agreements: Tarena International relies on the VIE Agreement to operate and control the Beijing Tarena. However, these contractual arrangements may not be as effective as direct equity ownership in providing Tarena International with control over Beijing Tarena. Any failure by Beijing Tarena or the nominee equity holders to perform their obligations under the VIE Agreement would have a material adverse effect on the consolidated financial position and consolidated financial performance of the Company. All the VIE Agreement is governed by PRC law and provide for the resolution of disputes through arbitration in the PRC. Accordingly, these contracts would be interpreted in accordance with PRC law and any disputes would be resolved in accordance with PRC legal procedures. The legal system in the PRC is not as developed as some other jurisdictions, such as the United States. As a result, uncertainties in the PRC legal system could limit Tarena International’s ability to enforce these contractual arrangements. In addition, if the legal structure and the VIE Agreement was found to be in violation of any existing or future PRC laws and regulations, Tarena International may be subject to fines or other legal or administrative sanctions. 1 DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (CONTINUED) (b) Organization (continued) In the opinion of management, based on the legal opinion obtained from the Company’s PRC legal counsel, the above contractual arrangements are legally binding and enforceable and do not violate current PRC laws and regulations. However, there are uncertainties regarding the interpretation and application of existing and future PRC laws and regulations. Accordingly, Tarena International cannot be assured that PRC regulatory authorities will not ultimately take a contrary view to its opinion. If the current ownership structure of the Company and the VIE Agreement is found to be in violation of any existing or future PRC laws and regulations, the PRC government could: ● revoke the business and operating licenses of the WFOE, its subsidiaries and Beijing Tarena; ● discontinue or restrict the conduct of any transactions between the WFOE, its subsidiaries and Beijing Tarena; ● impose fines, confiscate the income from Beijing Tarena, or impose other requirements with which the Company may not be able to comply; ● require Tarena International to restructure its ownership structure or operations, including terminating the contractual arrangements with Beijing Tarena and deregistering the equity pledges of Beijing Tarena; and ● restrict or prohibit the use of the proceeds of future offering to finance the Company’s business and operations in the PRC. If the imposition of any of these government actions causes Tarena International to lose its right to direct the activities of Beijing Tarena or its right to receive substantially all the economic benefits and residual returns from Beijing Tarena and Tarena International is not able to restructure its ownership structure and operations in a satisfactory manner, Tarena International would no longer be able to consolidate the financial results of Beijing Tarena and its subsidiaries. In the opinion of management, the likelihood of deconsolidation of the Beijing Tarena and its subsidiaries is remote based on current facts and circumstances. The equity interests of Beijing Tarena are legally held by Mr. Han and Mr. Li as nominee equity holders on behalf of the Company. Mr. Han and Mr. Li are also directors of Tarena International. Mr. Han and Mr. Li each holds 67.8% and 0.1% of the total voting rights as of December 31, 2020, respectively, assuming the exercise of all outstanding options held by Mr. Han and Mr. Li as of such date. The Company cannot assure that when conflicts of interest arise, either of the nominee equity holders will act in the best interests of the Company or such conflicts will be resolved in the Company’s favor. Currently, the Company does not have any arrangements to address potential conflicts of interest between the nominee equity holders and the Company, except that Tarena International could exercise the purchase option under the exclusive option agreement with the nominee equity holders to request them to transfer all of their equity ownership in Beijing Tarena to a PRC entity or individual designated by Tarena International. The Company relies on the nominee equity holders, who are both Tarena International’s directors and who owe a fiduciary duty to Tarena International, to comply with the terms and conditions of the contractual arrangements. Such fiduciary duty requires directors to act in good faith and in the best interests of Tarena International and not to use their positions for personal gains. If the Company cannot resolve any conflict of interest or dispute between the Company and the nominee equity holders of Beijing Tarena, the Company would have to rely on legal proceedings, which could result in disruption of the Company’s business and subject the Company to substantial uncertainty as to the outcome of any such legal proceedings. 1 DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (CONTINUED) (b) Organization (continued) The Company’s involvement with Beijing Tarena under the VIE Agreement affected the Company’s consolidated financial position, results of operations and cash flows as indicated below. The assets and liabilities of Beijing Tarena and its subsidiaries that were included in the accompanying consolidated financial statements as of December 31, 2019 and 2020 are as follows: December 31, 2019 2020 RMB RMB Cash 211 1,332 Amounts due from Tarena International and its wholly-owned subsidiaries 39,464 113,394 Amounts due from a related party 4 4 Prepaid expenses and other current assets 2,269 4,103 Total current assets 41,948 118,833 Property and equipment, net 2,121 1,552 Long term investments, net 48,380 48,380 Deferred income tax assets — 74 Right-of-use assets 7,083 5,540 Other non-current assets 363 539 Total assets 99,895 174,918 Accounts payable 282 8,610 Deferred revenue-current 51,808 138,529 Operating lease liabilities-current 2,574 3,377 Income taxes payable 2,049 8,037 Accrued expenses and other current liabilities 17,397 13,909 Amounts due to Tarena International and its wholly-owned subsidiaries 74,991 21,072 Amounts due to related parties 130 — Total current liabilities 149,231 193,534 Deferred revenue-non current 215 133 Operating lease liabilities-non current 3,843 1,536 Other non-current liabilities 122 122 Total liabilities 153,411 195,325 1 DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (CONTINUED) (b) Organization (continued) The financial performance and cash flows of Beijing Tarena and its subsidiaries that were included in the accompanying consolidated financial statements for the years ended December 31, 2018, 2019 and 2020 are as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Net revenues 4,232 32,013 127,043 Net (loss) income (16,900) (37,565) 32,869 Net cash provided by operating activities 1,540 36,902 122,813 Net cash used in investing activities (24,083) (34,226) — Net cash provided by (used in) financing activities 23,625 (3,841) (121,692) All of the assets of Beijing Tarena and its subsidiaries can be used only to settle obligations of Beijing Tarena and its subsidiaries. None of the assets of Beijing Tarena and its subsidiaries have been pledged or collateralized. The creditors of Beijing Tarena and its subsidiaries do not have recourse to the general credit of Tarena International and its wholly-owned subsidiaries. Assets of Beijing Tarena and its subsidiaries that can be used only to settle obligations of Beijing Tarena and its subsidiaries and liabilities of Beijing Tarena and its subsidiaries for which creditors (or beneficial interest holders) do not have recourse to the general credit of Tarena International and its wholly owned subsidiaries have been presented parenthetically alongside each balance sheet caption on the face of the consolidated balance sheets. During the periods presented, Tarena International and its wholly-owned subsidiaries provided financial support to Beijing Tarena that it was not previously contractually required to provide in the form of advances. To the extent Beijing Tarena requires financial support, pursuant to the exclusive business cooperation agreements, the WFOE may, at its option and to the extent permitted under the PRC law, provide such support to Beijing Tarena through loans to Beijing Tarena’ nominee equity holders or entrustment loans to Beijing Tarena. (c) Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). All amounts in the accompanying consolidated financial statements and notes are expressed in Renminbi (“RMB”). Amounts in United States dollars (“US$”) are presented solely for the convenience of readers and use an exchange rate of RMB6.5250, representing the exchange rate as set forth in the H.10 statistical release of the U.S. Federal Reserve Board as of December 31, 2020. No representation is made that the RMB amounts could have been, or could be, converted into US$ at such rate. 1 DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (CONTINUED) (d) Significant concentrations and risks Revenue concentration A substantial portion of the Company’s total net revenues are generated from K-12 Computer Programming, Digital Arts, K-12 Robotics Programming and Java courses. The percentages of the Company’s total net revenues from K-12 Computer Programming, Digital Arts, K-12 Robotics Programming and Java courses are as follows: Year Ended December 31, 2018 2019 2020 K-12 Computer Programming 7.1 % 12.8 % 20.6 % Digital Arts 28.7 % 22.9 % 16.8 % K-12 Robotics Programming 2.1 % 9.3 % 15.7 % Java 18.3 % 19.0 % 13.8 % Total 56.2 % 64.0 % 66.9 % The Company expects net revenues from these four training courses to continue to represent a majority portion of its total net revenues in the future. Negative factors that adversely affect net revenues generated by these four training courses will have a material adverse effect on the Company’s business, financial condition and results of operations. There were no other courses that represented revenues greater than 10% of total revenues. A substantial portion of the Company’s students financed their tuition fees through the loans offered to them by financial service providers including Baidu Small Loan Co., Ltd., Bank of China Consumer Finance Co., Ltd. and Beijing Ronglian Century Information Technology Co., Ltd., during the 3-year period ended December 31, 2020. The Company expects students financed by these companies to continue to represent a major portion of its total students in the future. The Company believes other companies could provide similar loans to its students on comparable terms. However, negative factors that adversely affect these companies will have a material adverse effect on the Company’s business, financial condition and results of operations. Geographic concentration The percentages of the Company’s total net revenues generated from its business operations in Beijing are 13.5%, 13.8% and 17.2% for the years ended December 31, 2018, 2019 and 2020, respectively. The Company expects revenues derived from its business operations in Beijing to continue to be greater than 10% of total revenue in the future. Negative factors that adversely affect professional education services in Beijing will have a material adverse effect on the Company’s business, financial condition and results of operations. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Principles of consolidation The consolidated financial statements include the financial statements of Tarena International, its wholly-owned subsidiaries, VIE in which Tarena International is the primary beneficiary and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated upon consolidation. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (b) Liquidity Condition and going concern The Company incurred net losses from operations of RMB592 million, RMB1,039 million and RMB771 million for the year ended December 31, 2018, 2019 and 2020, respectively. For the years ended December 31, 2018, the Company generated net cash inflow from operating activities amounting to RMB163 million. For the year ended December 31, 2019 and 2020, the Company generated net cash outflows from operating activities amounting to RMB32 million and RMB109 million, respectively. As of December 31, 2020, the Company’s net current liability was RMB2,133 million. The Company’s cash balance as of December 31, 2020 is not sufficient to meet its cash obligations or liabilities when they become due over the next twelve months from the date of issuance of the consolidated financial statements. The Company’s operating results for future periods are subject to numerous uncertainties and it is uncertain if the Company will be able to reduce or eliminate its net losses for the foreseeable future. If management is not able to increase revenue and/or manage operating expenses in line with revenue forecasts, the Company may not be able to achieve profitability. As of December 31, 2020, the Company’s deferred revenue amounted to RMB1,998 million and does not represent potential cash outflows in the future but is expected to be recognized in revenues in the end. These adverse conditions and events indicate there could be substantial doubt about the Company’s ability to continue as a going concern. For the next 12 months from the issuance date of this report, the Company plans to continue implementing various measures to boost revenue and controlling the cost and expenses within an acceptable level by offering online courses to all students, implementing comprehensive budget control and operation assessment, implementing enhanced vendor review and selection processes as well as enhancing internal controls on payable management, creating synergy of the Company’s resources and improving cash inflow by debt financing and the sale of properties and treasury stocks. As of the date of issuance of the consolidated financial statements, the Company has unused the line of credit of RMB200 million with expiration date June 2021. Besides, the Company has two office buildings, which locate in Qingdao and Beijing, total amounted to RMB133 million available for sale for future operating fund shortage if any. In addition, the Company has treasury stocks of 7,099,141 Class A ordinary shares, which were purchased in prior years. The treasury stock can be resold by a purchase price of $4.00 per ADS if the privatization process of the Company has completed, or sold to public through stock exchange without restriction. The total amount of such treasury stocks will be around RMB185 million with the exchange rate of the RMB against the U.S. dollar at 6.5250. Given the considerable gross margin ratio in its operations, the balance of deferred revenue mentioned above and the three available funding sources mentioned above, the Company assesses current working capital is sufficient to meet its obligations for the next 12 months from the issuance date of this report. Accordingly, management continues to prepare the Company’s consolidated financial statements on going concern basis. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (c) Use of estimates The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the estimated stand-alone selling price under ASC 606, the guarantee liability under ASC Topic 460, the fair values of share-based compensation awards, goodwill impairment and long term investments, the allowance for credit losses of accounts receivable, amounts due from related parties, prepaid expenses and other current assets and other non-current assets under ASC 326, the realizability of deferred income tax assets, the accruals for other contingencies, the useful lives and the recoverability of the carrying amounts of property and equipment. The current economic environment has increased the degree of uncertainty inherent in those estimates and assumptions. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. To allocate the transaction price for contracts with multiple deliverables and estimate the standalone selling price, the Company considers market data, including its pricing strategies for the products being evaluated and other similar products it offers, competitor pricing to the extent data is available, and costs to determine whether the estimated selling price yields an appropriate profit margin. (d) Business combinations Business combinations are recorded using the acquisition method of accounting. The purchase price of the acquisition is allocated to the identifiable assets and liabilities based on their estimated fair values as of the acquisition date. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related expenses and restructuring costs are expensed as incurred. (e) Foreign currency The functional currency of Tarena International and Tarena Hong Kong Limited (“Tarena HK”) is the USD. The functional currency of Techarena Canada Inc. is the CAD. The functional currency of Taiwan Tarena Counseling Software Co., Ltd. is the TWD. The functional currency of Tarena International’s PRC subsidiaries, consolidated VIE, and the subsidiaries of the VIE is the RMB. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rate at the balance sheet date. The resulting exchange differences are recorded in foreign currency exchange gains (losses) in the consolidated statements of comprehensive loss. Assets and liabilities of entities with functional currencies other than RMB are translated into RMB using the exchange rate on the balance sheet date. Revenues and expenses are translated into RMB at average rates prevailing during the reporting period. The resulting foreign currency translation adjustment are recorded in accumulated other comprehensive loss within shareholders’ equity. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (e) Foreign currency (continued) Since the RMB is not a fully convertible currency, all foreign exchange transactions involving RMB must take place either through the People’s Bank of China (the “PBOC”) or other institutions authorized to buy and sell foreign exchange. The exchange rates adopted for the foreign exchange transactions are the rates of exchange quoted by the PBOC. (f) Cash, cash equivalents, restricted cash and time deposits Cash consists of cash in bank and deposits place in third party payment processors of Alipay, Wechat wallet and Baidu wallet, which are unrestricted as to withdrawal. Cash equivalents consist of interest-bearing certificates of deposit with initial term of no more than three months when purchased. Time deposits, which mature within one year as of the balance sheet date, represent interest-bearing certificates of deposit with an initial term of greater than three months when purchased. Time deposits which mature over one year as of the balance sheet date are included in non-current assets. The Company has no restricted cash as of December 31, 2019. Restricted cash is the cash received from financial service provider for students’ tuition fee, which will release to cash along with the service provided to the students. The balance as of December 31, 2020 is RMB38.4 million. Cash, cash equivalents, time deposits and restricted cash maintained at financial institutions consist of the following: December 31, 2019 2020 RMB RMB RMB denominated bank deposits with financial institutions in the PRC 470,673 278,789 US dollar denominated bank deposits with financial institutions in the PRC 136,640 81,283 US dollar denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) 9,939 793 HK dollar denominated bank deposits with financial institutions in HK SAR 74 50 RMB denominated bank deposits with a financial institution in HK SAR 132 2,022 US dollar denominated bank deposits with a financial institution in the U.S. 135 117 TWD denominated bank deposits with a financial institution in Taiwan 24 579 CAD denominated bank deposits with a financial institution in Canada 3,571 1,172 Total 621,188 364,805 To limit exposure to credit risk relating to bank deposits, the Company primarily places bank deposits only with large financial institutions in the PRC, HK SAR, Taiwan, Canada and the U.S. with acceptable credit rating. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (g) Accounts receivable In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Statements Accounts receivable primarily represent tuition fees due from students, universities and colleges and financial service providers. Accounts receivable which are due over one year as of the balance sheet date are presented as non-current assets. The unearned interest on accounts receivable which are due over one year is reported in the consolidated balance sheets as a direct deduction from the principal amount of accounts receivable. The Company maintains an allowance for credit losses for estimated losses resulting from the inability of its students, universities and colleges or financial service providers to make required payments. Accounts receivable is considered past due based on its contractual terms. In establishing the allowance, management considers historical losses, the financial condition, the accounts receivables aging, the payment patterns and the forecasted information in pooling basis upon the use of the Current Expected Credit Loss Model (“CECL Model”) in accordance with ASC topic 326, Financial Instruments - Credit Losses. Accounts receivable that are deemed to be uncollectible are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. There is a time lag between when the Company estimates a portion of or the entire account balances to be uncollectible and when a write off of the account balances is taken. The Company takes a write off of the account balances when the Company can demonstrate all means of collection on the outstanding balances have been exhausted. (h) Property and equipment Property and equipment are recorded at cost. Depreciation is calculated on the straight-line method over the estimated useful lives of the assets. The estimated useful life of property and equipment is as follows: Office buildings 45 years Furniture 5 years Office equipment 3 Leasehold improvements Shorter of the lease term or the estimated useful life of the assets Ordinary maintenance and repairs are charged to expenses as incurred, while replacements and betterments are capitalized. When items are retired or otherwise disposed of, income is charged or credited for the difference between net book value of the item disposed and proceeds realized thereon. Property and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Recoverability of a long-lived asset or asset group to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying value of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment loss is recognized by the amount that the carrying value exceeds the estimated fair value of the asset or asset group. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Assets to be disposed are reported at the lower of carrying amount or fair value less costs to sell, and are no longer depreciated. No impairment of long-lived assets was recognized for any of the years presented. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (i) Goodwill In January 2017, the FASB issued ASU 2017-04, simplifying the Test for Goodwill Impairment, which simplifies the accounting for goodwill impairment by eliminating Step two from the goodwill impairment test. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, versus determining an implied fair value in Step two to measure the impairment loss. We adopted this guidance on a prospective basis on January 1, 2020 with no material impact on its consolidated financial statements and related disclosures as a result of adopting the new standard. We assess goodwill for impairment on annual basis in accordance with ASC 350-20, Intangibles – Goodwill and Other: Goodwill Quantitative goodwill impairment test is used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit is greater than its carrying amount, goodwill is not considered impaired. If the fair value of the reporting unit is less than its carrying amount, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company performs the annual goodwill impairment assessment using qualitative and quantitative impairment test on September 30 and no goodwill impairment was identified. (j) Long-term investments ● Equity investments without readily determinable fair values Equity investments without readily determinable fair values are measured and recorded using a measurement alternative that measures the securities at cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes in accordance with ASC topic 321, Investments – Equity Securities. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (j) Long-term investments (continued) ● Equity method investments Under the equity method, the Company’s share of the post-acquisition profits or losses of the equity investment is recognized in the consolidated statements of comprehensive loss; and the Company’s share of post-acquisition movements in equity is recognized in equity in the consolidated balance sheets. Unrealized gains on transactions between the Company and an entity in which it has recorded an equity investment are eliminated to the extent of the Company’s interest in the entity. To the extent of the Company’s interest in the investment, unrealized losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. When the Company’s share of losses in an entity in which it has recorded an equity investment equals or exceeds the Company’s interest in the entity, it does not recognize further losses, unless it has incurred obligations or made payments on behalf of the equity investee. The Company evaluates the equity method investments for impairment. An impairment loss on the equity method investments is recognized in earnings when the decline in value is determined to be other-than-temporary. ● Available-for-sale debt securities Debt securities that the Company has positive intent and ability to hold to maturity are classified as held-to-maturity debt securities and are stated at amortized cost. Debt securities that the Company has the intent to hold the security for an indefinite period or may sell the security in response to the changes in economic conditions are classified as available for sale and reported at fair value. Unrealized gains and losses (other than impairment losses) are reported, net of the related tax effect, in other comprehensive income (OCI). Upon sale, realized gains and losses are reported in net income. The Company monitors the investments for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, the operating performance of the companies including current earnings trends and other company-specific information. (k) Revenue recognition The Company adopted ASC Topic 606 (“ASC 606”), Revenue from Contracts with Customers, with effect from January 1, 2018, using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Accordingly, revenues for the years ended December 31, 2018, 2019 and 2020 were presented under ASC 606. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (k) Revenue recognition (continued) The Company evaluated and recognized revenue based on the five steps set forth in ASC 606 by: ● identifying the contract(s) with the customer; ● identifying the performance obligations in the contract; ● determining the transaction price; ● allocating the transaction price to performance obligations in the contract; and ● recognizing revenue as each performance obligation is satisfied through the transfer of a promised good or service to a customer (i.e., “transfer of control”). These criteria as they relate to each of the following major revenue generating activities are described below. Revenue is presented net of business tax and value added taxes (“VAT”) at rates ranging between 3% and 6%, and surcharges. VAT and business tax to be collected from customers, net of VAT paid for purchases, is recorded as a liability in the consolidated balance sheets until it is paid to the tax authorities. Tuition revenue The Company provides IT and non-IT related training courses to both adult and K-12. The Company also cooperate with universities and colleges in China to offer joint-major degree programs in accordance with the higher education reform policies of each province. The Company integrates its selected courses into universities and colleges’ standard undergraduate curriculum for students enrolled in such joint-major programs. Students can attend part of the courses in our established on-campus learning sites and part of the courses at the Company’s learning centers. A majority of contract of tuition service is accounted for as a single performance obligation which is satisfied proportionately over the service period. Tuition fees are recognized as revenue proportionately as the training courses are delivered, with unearned portion of tuition fees being recorded as deferred revenue. For certain students who borrow the tuition fee from financial service providers, the Company also provides a guarantee service to financial service providers whereas in the event of default, the financial service providers are entitled to receive unpaid interest and principal from the Company. Given that the Company effectively takes on all of the credit risk of the borrowers and are compensated by the tuition fees charged, the guarantee is deemed as a service and the guarantee exposure is recognized as a stand-ready obligation in accordance with ASC Topic 460, Guarantees (see accounting policy for Guarantee Liabilities). The Company first allocates the transaction price to the guarantee liabilities, if any, in accordance with ASC Topic 460, Guarantees, which requires the guarantee to be measured initially at fair value based on the stand ready obligation. Then the remaining considerations are allocated to the tuition fees consistent with the guidance in ASC 606. Certain qualified students are allowed to pay their tuition fees on installment for a period of time exceeding one year. When tuition services are sold on installment terms that exceeds one year beyond the point in time that revenue is recognized, the contract contains a significant financing component, and the consideration promised by the customer is variable. The receivable, and therefore the revenue is recorded at the present value of the payments. The difference between the present value of the receivable and the nominal or principal value of the tuition fees is recognized as interest income over the contractual repayment period using the effective interest rate method. The interest rate used to determine the present value of total amount receivable is the rate subject to management decision on the date of the transaction and it reflects the rate that the students can obtain financing of a similar nature from other sources at the date of the transaction. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (k) Revenue recognition (continued) The Company enters into arrangements with certain students that purchase multiple services. The performance obligations identified include tuition service and practical tutoring service. The Company treats training contracts with multiple performance obligations as separate units of accounting for revenue recognition purposes and recognizes revenue during the contract period when each performance obligation is satisfied. The Company allocates the transaction price to each performance obligations based on stand-alone selling price. Refunds are provided to students if they withdraw from classes, and usually only those unearned portions of the fee which is available will be refunded. A refund liability represents the amounts of consideration received but are not expected to be entitled to earn, and thus are not included in the transaction price because these amounts are expected to be eventually refunded to students. The Company determines the transaction price to be earned by estimating the refund liability based on historical refund ratio on a portfolio basis using the expected value method. Reclassification was made from deferred revenue to refund liabilities, which was recorded under accrued expenses and other current liabilities. Certification service revenue The Company provides certification service to students who complete the training course and enroll for the exams. The Company is responsible for the certification service, including organization, proctoring and grading of exams, and providing the certificates to students. All certificates are issued by third parties to the students who pass the exam. The Company is the principal to end customers. The Company acts as the principal in providing the certificate service to the students and recognizes revenue on gross basis because the Company is able to determine the price, acts as the main obligor in the arrangement, and, is responsible for fulfilling the services ordered by the students. Cash received before the students taking the exam is recorded as deferred revenue. Each contract of certification service is accounted for as a single performance obligation which is satisfied at a point in time. The performance obligation is satisfied when the certificates are provided to the students and the consideration are received, then the received consideration is recognized as certification service revenue. Loan referral service revenue The Company promotes loan products of financial service providers to its students, who need financial assistance for the payment of their tuition fees, in exchange for a referral fee generally at a rate of the principal amount of the loans. Each contract of loan referral service is accounted for as a single performance obligation which is satisfied at a point in time. Generally, the early repayment and default loan are excluded from the effective principal amount of the loans, and thus are not included in the transaction price because these amounts are expected to be eventually refunded to financial service providers. The Company determines the transaction price to be earned by estimating the refund liability based on historical refund ratio on a portfolio basis using the expected value method. Refund liability was recorded under accrued expenses and other current liabilities. Historically, the Company has not had material refunds. Loan referral service revenue is recognized upon the initiation of the loans as the performance obligation is satisfied and confirmed with the financial service providers on a monthly basis. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (k) Revenue recognition (continued) Contract acquisition costs The Company has used practical expedients as allowed under ASC 606 to generally expenses sales commissions when incurred, because the amortization period would be one year or less. These costs are recorded as sales and marketing expenses. Contract liability The Company does not have amounts of contract assets since revenue is recognized as the transferred control of promised services to customers. The contract liabilities consist of deferred revenue, which represent the Company has received consideration but has not satisfied the related performance obligations. The revenue recognized for years ended December 31, 2019 and 2020 that was previously included in the deferred revenue balances as of December 31, 2018 and December 31, 2019 was RMB648,050 and RMB905,867, respectively. The Company’s deferred revenue amounting to RMB1,585,970 and RMB1,998,198 as of December 31, 2019 and 2020, respectively. Starting from second half year 2019, the Company enters into contracts that have an original expected length of more than one year with certain students. The remaining performance obligations of these contracts are as following: For the years ended December 31, 2021 2022 Total RMB RMB RMB Revenue expected to be recognized on these contracts 112,786 18,549 131,335 The Company has selected to apply the practical expedient in paragraph ASC 606-10-50-14 and does not disclose information about remaining performance obligations in contracts that have an original expected length of one year or less. Refund liability mainly related to the estimated refunds that are expected to be provided to students if they decide they no longer want to take the course. Refund liability estimates are based on historical refund ratio on a portfolio basis using the expected value method. Guarantee service revenue recognized under ASC 460 At the inception of each loan, the guarantee liabilities recorded at fair value based on ASC Topic 460 is determined on a loan by loan basis. The guarantee liabilities are generally reduced by recording a credit to guarantee service revenue as the guarantor is released from the underlying guaranteed risk. Subsequent to initial recognition, the guarantee obligation’s release from risk has typically been recognized over the term of the guarantee using a rational amortization method. (l) Cost of revenues Cost of revenues consists of payroll and employee benefits, rent expenses of learning centers, depreciation relating to property and equipment used for operating the learning centers, and other operating costs that are directly attributed to the provision of training services. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (m) Guarantee liabilities For certain students who borrow the tuition fee from financial service providers, the Company provides a guarantee service to financial service providers whereas in the event of default, the financial service providers are entitled to receive unpaid interest and principal from the Company. In general, any unpaid interest and principal are paid when the borrower does not repay as scheduled. For accounting purposes, at the inception of each loan, the Company recognizes the guarantee liability in accrued expenses and other current liabilities at fair value in accordance with ASC 460-10, which incorporates the expectation of potential future payments under the guarantee and takes into both non-contingent and contingent aspects of the guarantee. Subsequent to the loan’s inception, the guarantee liability is composed of two components: (i) ASC Topic 460 component; and (ii) ASC Topic 450 component. The liability recorded based on ASC Topic 460 is determined on a loan by loan basis and it is reduced when the Company is released from the underlying risk, i.e. as the loan is repaid by the borrower or when the investor is compensated in the event of a default. This component is a stand ready obligation which is not subject to the probable threshold used to record a contingent obligation. The guarantee liabilities are generally reduced by recording a credit to guarantee service revenue as the guarantor is released from the underlying guaranteed risk. Subsequent to initial recognition, the guarantee obligation’s release from risk has typically been recognized over the term of the guarantee using a rational amortization method. The other component is a contingent liability determined based on probable loss considering the actual historical performance and current conditions, representing the obligation to make future payouts under the guarantee liability in excess of the stand-ready liability, measured using the guidance in ASC Topic 450, loans with similar risk characteristics are pooled into cohorts. The ASC 450 contingent component is recognized as part of operating expenses. At all times the recognized liability (including the stand ready liability and contingent liability) is at least equal to the probable estimated losses of the guarantee portfolio. (n) Advertising costs Advertising costs are expensed as incurred and included in selling and marketing expenses. Advertising costs were RMB339,385, RMB416,814 and RMB297,484 for the years ended December 31, 2018, 2019 and 2020, respectively. (o) Operating lease The Company adopted Accounting Standards Update (“ASU”) 2016-02 Leases (“ASC 842”) as of January 1, 2019, using the non-comparative transition option pursuant to ASU 2018-11. Therefore, the Company has not restated comparative period financial information for the effects of ASC 842, and will not make the new required lease disclosures for comparative periods beginning before January 1, 2019. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among others things (i) allowed the Company to carry forward the historical lease classification; (ii) did not require the Company to reassess whether any expired or existing contracts are or contain leases; (iii) did not require the Company to reassess initial direct costs for any existing leases. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (o) Operating lease (continued) The Company identifies lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. For all operating leases except for short-term leases, the Company recognizes operating right-of-use assets and operating lease liabilities. Leases with an initial term of 12 months or less are short-term lease and not recognized as right-of-use assets and lease liabilities on the consolidated b |
ACCOUNTS RECEIVABLE, NET
ACCOUNTS RECEIVABLE, NET | 12 Months Ended |
Dec. 31, 2020 | |
ACCOUNTS RECEIVABLE, NET | |
ACCOUNTS RECEIVABLE, NET | 3 ACCOUNTS RECEIVABLE, NET Accounts receivable consists of the following: December 31, 2019 2020 RMB RMB Accounts receivable: Gross 34,634 43,191 Unearned interest (217) (995) Total accounts receivable 34,417 42,196 Less: allowance for credit losses 2,251 9,214 Accounts receivable, net 32,166 32,982 The classification of accounts receivable is as follows: December 31, 2019 2020 RMB RMB Accounts receivable – current portion 31,442 32,790 Accounts receivable – non-current portion 724 192 Total accounts receivable, net 32,166 32,982 The movements of the allowance for doubtful accounts are as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Balance at the beginning of the year — — 2,251 Additions charged to bad debt expense — 2,251 6,963 Balance at the end of the year — 2,251 9,214 |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2020 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 4 PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following: December 31, 2019 2020 RMB RMB Prepaid expenses and other current assets: Prepaid rental expenses 15,290 12,304 Interest receivable from time deposits 2,206 894 Prepaid deposits (a) 26,913 25,238 Prepaid advertising expenses 8,878 7,656 Prepaid value-added tax 28,545 40,352 Loans made to employees (b) 17,947 20,421 Professional fee 13,859 11,169 Inventory 5,325 4,626 Others 13,576 15,693 Total prepaid expenses and other current assets 132,539 138,353 (a) It mainly included prepaid advertising deposits. (b) The Company provides short-term interest-free loans to employees for their purchase of residence or other personal needs. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | 5 PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following: December 31, 2019 2020 RMB RMB Office buildings 285,867 285,867 Furniture 53,223 48,253 Office equipment 474,839 409,682 Leasehold improvements 242,122 243,407 Total property and equipment 1,056,051 987,209 Less: accumulated depreciation 479,418 522,719 Property and equipment, net 576,633 464,490 The office buildings with a total carrying value of RMB197,737 as of December 31, 2020 have been pledged for the Company’s short-term bank loans (see note 8). Depreciation expense for property and equipment was allocated to the following: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Cost of revenues 127,850 150,188 132,898 Selling and marketing expenses 11,211 19,303 18,137 General and administrative expenses 16,511 22,314 18,867 Research and development expenses 1,335 733 1,354 Total 156,907 192,538 171,256 |
LONG-TERM INVESTMENTS, NET
LONG-TERM INVESTMENTS, NET | 12 Months Ended |
Dec. 31, 2020 | |
LONG-TERM INVESTMENTS, NET | |
LONG-TERM INVESTMENTS, NET | 6 LONG-TERM INVESTMENTS, NET Long-term investments consist of the following: December 31, 2019 2020 RMB RMB Equity investments without readily determinable fair values A company providing mechanic training (a) 12,000 12,000 A company providing intelligent robot products (b) 24,000 24,000 A company providing information sharing IT platform (c) 22,500 22,500 Other equity investments without readily determinable fair values (d) 30,880 30,880 Impairment of equity investments without readily determinable fair values (37,000) (37,000) Total equity investments without readily determinable fair values, net 52,380 52,380 Equity method investments Companies providing hockey program management 2,223 2,132 A company providing Internet product solutions (e) 13,694 13,604 Impairment of equity method investments (524) (524) Total equity method investments, net 15,393 15,212 Available-for-sale investment (f) 15,000 15,000 Impairment of available-for-sale investments (f) (15,000) (15,000) Total available-for-sale investment, net — — Total long-term investments, net 67,773 67,592 (a) In October 2015, the Company paid RMB 12,000 in cash to acquire 2.86% of the total equity interest in an education company, which provides training for senior mechanic in vehicle maintenance and repair. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. (b) In May 2017, the Company paid RMB 24,000 in cash to acquire 6% of the total equity interest in a company, which provides intelligent robot product. Based on the fact that the business conditions of this investee deteriorated, the Company recognized impairment loss of RMB 24,000 for the years ended December 31, 2018, and with an impairment balance of RMB 24,000 as of December 31, 2019 and 2020, respectively. (c) In July 2017, the Company paid RMB 22,500 in cash to acquire 15% of the total equity interest in a company, which provides an information sharing IT platform. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. (d) During the years ended December 31, 2018 and 2019, the Company acquired minority equity interest in several third-party companies. The Company recognized impairment loss of RMB 2,000 and nil for the years ended December 31, 2019 and 2020, respectively, and with an impairment balance of RMB 13,000 as of December 31, 2019 and 2020, respectively. (e) In January 2018, the Company paid RMB 14,000 in cash to acquire 20% of equity interest of a company which provides IT consulting services and programming account for the investment using equity method. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. (f) In October 2016, the Company paid RMB 10,000 in cash to acquire 13.9% equity interest in a private company, which provides employment course trainings and recruitment services. As it was found that the investee provided overstated financial statements to the new investors during the private placement in 2017 and lost in a lawsuit sued by one of the shareholders. Accordingly, the Company determined it to be fully impaired in 2017. The Company recognized no impairment loss for the years ended December 31, 2019 and 2020, respectively, and with an impairment balance of RMB 15,000 as of December 31, 2019 and 2020, respectively. |
OTHER NON-CURRENT ASSETS, NET
OTHER NON-CURRENT ASSETS, NET | 12 Months Ended |
Dec. 31, 2020 | |
OTHER NON-CURRENT ASSETS, NET | |
OTHER NON-CURRENT ASSETS, NET | 7 OTHER NON-CURRENT ASSETS, NET Other non-current assets consist of the following: December 31, 2019 2020 RMB RMB Other non-current assets: Rent and property management deposits 55,607 51,786 Loans made to employees (a) 43,546 30,284 Prepayment for equipment and leasehold improvement 14,506 10,276 Others 7,858 3,479 Total other non-current assets, net 121,517 95,825 (a) Starting from 2016, the Company began to provide five-year loans with the annual interest rate of 3.325% and 5.0% to the employees for their purchase of houses and employees pledged by their share options respectively. The interest was paid monthly and the principal was repaid upon maturity . |
SHORT-TERM BANK LOANS
SHORT-TERM BANK LOANS | 12 Months Ended |
Dec. 31, 2020 | |
SHORT-TERM BANK LOANS | |
SHORT-TERM BANK LOANS | 8 SHORT-TERM BANK LOANS On August 9, 2019, the Company entered into two lines of credit contracts with Bank of Beijing to borrow RMB190,000 in total with validity period on August 8, 2021. The loan bears a fixed interest rate of one-year Loan Prime Rate (“LPR”) plus 1.15% per annum on the date of drawing. As of December 31, 2019, the Company has drawn RMB89,162, which will mature in 12 months from the drawdown date. The applicable interest rate for the loan is 5.3% per annum. The carrying value of office buildings pledged for the borrowing was RMB197,737. The loan was subsequently repaid in November and December 2020. In February 2021, the office buildings pledged were released. As of December 31, 2020, the Company has drawn RMB10,710, which will mature in 12 months from the drawdown date. The applicable interest rate for the loan is 5.3% per annum. The interest expenses of the loans were RMB19, RMB565 and RMB5,047 for the years ended December 31, 2018, 2019 and 2020, respectively. |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 9 ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES December 31, 2019 2020 RMB RMB Accrued payroll and employee benefits 141,955 194,862 Refund liability 67,625 71,843 Professional service fee 28,357 30,165 Payable for advertisement 40,652 23,287 Rental fee 9,943 11,153 VAT and other tax payables 11,111 9,535 Guarantee liability 10,921 5,808 Payable to a third-party individual 51,380 — Others 35,614 45,251 Total 397,558 391,904 |
NET REVENUES
NET REVENUES | 12 Months Ended |
Dec. 31, 2020 | |
NET REVENUES | |
NET REVENUES | 10 NET REVENUES (a) Net revenues recognized under ASC Topic 606 for the years ended December 31, 2018, 2019 and 2020 consist of the following: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Tuition fee 1,896,642 1,877,242 1,786,230 Certification service fee 82,376 75,403 41,961 Loan referral service fee 18,096 19,939 7,801 Others 12,444 42,786 53,135 Business taxes and surcharges (13,878) (11,205) (4,252) Total net revenues 1,995,680 2,004,165 1,884,875 Others mainly include franchise fee and miscellaneous revenues. Year Ended December 31, 2018 2019 2020 RMB RMB RMB Timing of revenue recognition Services transferred at a point in time 100,472 138,128 102,897 Services transferred over time 1,895,208 1,866,037 1,781,978 Total net revenues 1,995,680 2,004,165 1,884,875 (b) Net revenues recognized under ASC Topic 460 for the years ended December 31, 2018, 2019 and 2020 consist of the following: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Guarantee service 89,691 47,189 13,008 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
INCOME TAXES | 11 INCOME TAXES Under the current laws of the Cayman Islands, Tarena International is not subject to tax on its income or capital gains. For the period from its inception on October 22, 2012 to December 31, 2020, Tarena HK did not have any assessable profits arising in or derived from HK SAR. Tarena International’s PRC subsidiaries and consolidated VIEs and the subsidiaries of the VIEs file separate tax returns in the PRC. Effective from January 1, 2008, the PRC statutory income tax rate is 25% according to the Corporate Income Tax (“CIT”) Law which was passed by the National People’s Congress on March 16, 2007. Under the CIT Law, entities that qualify as “Advanced and New Technology Enterprise” (“ANTE”) are entitled to a preferential income tax rate of 15%. In 2015, the WFOE renewed its ANTE qualification, which entitled it to the preferential income tax rate of 15% from January 1, 2015 to December 31, 2017. In 2018, the WFOE renewed its ANTE qualification, which entitled it to the preferential income tax rate of 15% from January 1, 2018 to December 31, 2020. 11 INCOME TAXES (CONTINUED) One of the Chinese subsidiaries of the Company was established in 2013 and qualified as an eligible software enterprise. As a result of this qualification, it is entitled to a tax holiday of a two-year full exemption followed by a three-year 50% exemption, commencing from 2014 in which its taxable income is greater than zero. As a result, its income tax rate for the years ended December 31, 2018 was 12.5%. For the year ended December 2019, the tax holiday expired and the income tax rate was 25%. In 2020, the entity was qualified as “Advanced and New Technology Enterprise” (“ANTE”) and its income tax rate was 15%. In 2016, another Chinese subsidiary of the Company was qualified as an eligible software enterprise, and was entitled to a tax holiday of a two-year full exemption followed by a three-year 50% exemption, commencing from the year in which its taxable income is greater than zero. As a result, the income tax rate of this Chinese subsidiary for the year ended December 31, 2017 was nil, and for the years ended December 31, 2018, 2019 and 2020 was 12.5%. Certain Tarena International’s subsidiaries and branches in China qualified as “Small Profit Enterprises” in 2018, and therefore are subject to the preferential income tax rate of 20% followed by a 50% exemption. From January 1, 2019 to December 31, 2021, the first RMB 1 million of assessable profit before tax are subject to the preferential income tax rate of 20% followed by a 75% exemption, while the remaining assessable profit before tax are subject to the tax rate of 20% followed by a 50% exemption. In 2017, one of the Chinese subsidiaries of the Company was established in Horgus and qualified to be entitled to a special tax holiday that from the tax year of the first operating income, the subsidiary would be exempted from enterprise income tax for five years. As a result, the income tax rate of this Chinese subsidiary for the years ended December 31, 2018, 2019 and 2020 was nil. According to the approvals from the tax authorities in certain locations in the PRC, Tarena International’s subsidiaries and consolidated VIEs and the subsidiaries of the VIEs that are based in these locations are required to use the deemed profit method to determine their income tax. Under the deemed profit method, these subsidiaries are subject to income tax at 25% on its deemed profit which is calculated based on revenues less deemed expenses equal to 85% and 90% of revenues. Since the Company wound up some PRC subsidiaries for the year ended December 31, 2020, deferred tax assets consisting mainly of net operating loss carryforwards will no longer be utilizable in the future due to their cancellation. As a result, these deferred tax assets along with related valuation allowance provided from prior years were written-off by the management as of December 31, 2020. The components of income (loss) before income taxes are as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB PRC (467,953) (986,464) (739,036) Hong Kong (2,031) (876) (8,280) Cayman Islands (126,887) (87,470) (54,913) Taiwan (166) (2,292) (1,549) Canada (27) (3,335) (2,449) Total loss before income taxes (597,064) (1,080,437) (806,227) 11 INCOME TAXES (CONTINUED) Income tax (expense) benefit consists of the following: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Current income tax expense (16,058) (4,478) (7,397) Withholding tax expense (25,672) — — Deferred income tax benefit 46,595 46,037 42,431 Total 4,865 41,559 35,034 The actual income tax expense reported in the consolidated statements of comprehensive loss for each of the years ended December 31, 2018, 2019 and 2020 differs from the amount computed by applying the PRC statutory income tax rate to income before income taxes due to the following: Year Ended December 31, 2018 2019 2020 PRC statutory income tax rate 25.0 % 25.0 % 25.0 % Increase (decrease) in effective income tax rate resulting from: Impact of different tax rates in other jurisdictions (5.3) % (2.1) % (1.8) % Research and development bonus deduction 1.4 % 0.8 % 2.0 % Non-deductible expenses (1.4) % (1.3) % (1.6) % Preferential tax rates (0.3) % (10.8) % (11.2) % Change of tax rates 0.0 % (2.2) % (2.9) % Change in valuation allowance (14.3) % (5.6) % (5.2) % Withholding tax (4.3) % — — Actual income tax expense 0.8 % 3.8 % 4.3 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities were as follows: December 31, 2019 2020 RMB RMB Deferred income tax assets: Impairment of long-term investments 11,750 11,750 Tax loss carry forwards 209,716 253,796 Advertising expense 15,232 19,805 Others 2,268 3,240 Total deferred income tax assets 238,966 288,591 Valuation allowance (139,177) (146,371) Deferred income tax assets, net 99,789 142,220 Deferred income tax liabilities: Valuation appreciation of intangible assets 1,701 1,384 Deferred income tax liabilities* 1,701 1,384 * Deferred income tax liabilities are combined in other non-current liabilities. 11 INCOME TAXES (CONTINUED) The movements of the valuation allowance are as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Balance at the beginning of the year 72,271 169,543 139,177 Additions of valuation allowance 97,776 63,309 46,755 Reduction of valuation allowance (504) (2,553) (4,643) Change of tax rates — (71,090) (30,671) Change of decrease related to subsidiary disposals and expiration — (20,032) (4,247) Balance at the end of the year 169,543 139,177 146,371 The valuation allowance as of December 31, 2019 and 2020 was primarily provided for the deferred income tax assets of certain Tarena International’s PRC subsidiaries, consolidated VIE, and the subsidiaries of the VIE, which were at cumulative loss positions. In assessing the realizability of deferred income tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible or utilizable. Management considers projected future taxable income and tax planning strategies in making this assessment. As of December 31, 2020, the Company had tax losses carryforwards of RMB2,353,755, including which from Hong Kong subsidiary of RMB7,468 that does not have an expiring date. Tax losses of RMB5,164, RMB54,792, RMB420,616, RMB1,026,407, and RMB839,308 will expire, if unused, by 2021, 2022, 2023, 2024, and 2025, respectively. The CIT Law and its implementation rules impose a withholding income tax at 10%, unless reduced by a tax treaty or arrangement, on the amount of dividends distributed by a PRC-resident enterprise to its immediate holding company outside the PRC that are related to earnings accumulated beginning on January 1, 2008. Dividends relating to undistributed earnings generated prior to January 1, 2008 are exempt from such withholding income tax. The Company did not distribute any dividend for the year ended December 31, 2019 and 2020. The Company has considered temporary differences on the book to tax differences pertaining to all investment in subsidiaries including the determination of the indefinite reinvestment assertion that would apply to each foreign subsidiary. The Company evaluated each entity’s historical, current business environment and plans to indefinitely reinvest all earnings accumulated in its respective jurisdiction for purpose of future business expansion. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 12 RELATED PARTY TRANSACTIONS The following is a list of related parties which the Company has transactions with: (1) Chuanbang Business Consulting (Beijing) Co., Ltd. (“Chuanbang”), a company wholly owned by Mr. Han Shaoyun (“Mr. Han”), the founder, chairman of our board of directors and former chief executive officer of the Company. (2) Xi’an Beilin District Bolton vocational skill training school (“Bolton School”), a company controlled by Mr. Han’s brother-in-law. (3) Ningxia Tarena Technology Co., Ltd (“Ningxia Company”), a company wholly owned by Ms.Han Liping, a sister of Mr. Han. (4) Ms. Han Lijuan, a sister of Mr. Han. 12 RELATED PARTY TRANSACTIONS (CONTINUED) (5) Connion Capital Limited is a company ultimately owned by our chairman, Mr. Han through a trust. In 2018, the Company wired funds to and shortly received same funds back from Connion Capital Limited in five separate occasions with each no more than US$1 million in order for the Company to maintain the requisite minimum level of activity in its bank account. No amount was due from Connion Capital Limited as of December 31, 2019 and 2020, respectively. (6) Beijing Huimoer Technology Co., Ltd (“Beijing Huimoer”), a company provides IT consulting services and programming, which is 20% owned by the Company in January 2018. The Company had the following balances and transactions with related parties: Related party balances December 31, 2019 2020 RMB RMB Amounts due from related parties Chuanbang (i) 9,938 — Ms. Han Lijuan (ii) 6,512 — Ningxia Tarena Technology Co., Ltd (iii) — 204 Xi 'an Tongchengtongchuang Education Technology Co., LTD 38 60 Others 4 41 Total 16,492 305 Notes: (i) The balance resulted from the service fee to Chuanbang for providing cash collection service. (ii) The balance as of December 31, 2019 represented a long-term loan to Ms. Han Lijuan and upon the Company’s request to avoid any risk of possible violation of Sarbanes-Oxley Act, all of the balance was repaid to the Company on April 2, 2020. (iii) The balance resulted from the franchise service income. 12 RELATED PARTY TRANSACTIONS (CONTINUED) Related party transactions The major related party transactions for the years ended December 31, 2018, 2019 and 2020 are summarized as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Cash collection service expense to Chuanbang (a) 3,489 790 79 Franchise and training service income from Bolton School 529 1,379 518 Franchise, training and consulting service income from Ningxia Company 493 143 (11) Training service expense to Bolton School 798 1,112 305 Technical consulting service expenses and labor expenses to Beijing Huimoer 75 1,333 148 Interest income from loan to Ms. Han Lijuan 325 325 81 Notes: (a) Pursuant to an agreement between Chuanbang and the Company, beginning August 2013, Chuanbang provides cash collection service on the Company’s accounts receivable. The fee for the service is calculated based on 2% ~ 20% of the amount collected . |
ORDINARY SHARES AND STATUTORY R
ORDINARY SHARES AND STATUTORY RESERVE | 12 Months Ended |
Dec. 31, 2020 | |
ORDINARY SHARES AND STATUTORY RESERVE | |
ORDINARY SHARES AND STATUTORY RESERVE | 13 ORDINARY SHARES AND STATUTORY RESERVE (a) Treasury shares In the second quarter of 2018, the board of directors authorized an increase to the size of the share repurchase plan from US$30 million to US$70 million and an extension of the term of the plan to June 20, 2019. For the year ended December 31, 2018, 3,768,495 ordinary shares were repurchased on the open market in the amount of RMB202,066. No ordinary shares were repurchased for the year ended December 31, 2019. For the year ended December 31, 2020, 100,729 ordinary shares were repurchased with the amount of RMB2,646. 13 ORDINARY SHARES AND STATUTORY RESERVE (CONTINUED) (b) Statutory reserves and restricted net assets Under PRC rules and regulations, Tarena International’s PRC subsidiaries, consolidated VIEs, and the subsidiaries of the VIEs (the “PRC Entities”) are required to appropriate 10% of their net profit, as determined in accordance with PRC accounting rules and regulations, to a statutory surplus reserve until the reserve balance reaches 50% of their registered capital. In addition, private schools (held by the PRC Entities) which require reasonable returns are required to appropriate 25% of their net profit, as determined in accordance with PRC accounting rules and regulations, to a statutory development fund, whereas in the case of private schools which do not require reasonable return, 25% of the annual increase of their net assets. The appropriation to these statutory reserves must be made before distribution of dividends to Tarena International can be made. For the years ended December 31, 2018, 2019 and 2020, the PRC Entities made appropriations to the statutory reserves of RMB12,943, RMB313 and RMB5,307, respectively. As of December 31, 2019 and 2020, the accumulated balance of the statutory reserves was RMB153,521 and RMB158,828, respectively. Relevant PRC laws and regulations restrict the WFOE, VIE and VIE’s subsidiary from transferring a portion of their net assets, equivalent to the balance of their paid-in-capital, additional paid-in-capital and statutory reserves to the Company in the form of loans, advances or cash dividends. Relevant PRC statutory laws and regulations restrict the payments of dividends by the Company’s VIE and VIE’s subsidiary from their respective retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The balances of restricted net assets as of December 31, 2019 and 2020 were RMB1,438,505 and RMB1,483,411 respectively. Under applicable PRC laws, loans from PRC companies to their offshore affiliated entities require governmental approval, and advances by PRC companies to their offshore affiliated entities must be supported by bona fide business transactions. (c) Dividend On March 6, 2018, the Company’s board of directors approved to declare a cash dividend of RMB0.76 (US$0.12) per ordinary share to shareholders as of the close of trading on April 5, 2018. The aggregate amount of cash dividends was approximately RMB42,955, which was paid in June 2018. No cash dividend was declared for the years ended December 31, 2019 and 2020. |
SHARE BASED COMPENSATION
SHARE BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2020 | |
SHARE BASED COMPENSATION | |
SHARE BASED COMPENSATION | 14 SHARE BASED COMPENSATION Share incentive plans On September 22, 2008, Tarena International adopted the 2008 Share Plan (the “2008 Plan”), pursuant to which Tarena International is authorized to issue share options and other share-based awards to key employees, directors and consultants of the Company to purchase up to 6,002,020 of its Class A ordinary shares (being retroactively adjusted to reflect the effect of the share split) under the 2008 Plan. On November 28, 2012, the Company increased the number of Class A ordinary shares authorized for issuance under the 2008 Plan to 8,184,990 Class A ordinary shares. Share options issued before September 22, 2008 are also administered under the 2008 Plan. The plan was terminated in 2018. According to its terms and there were no outstanding granted options by the termination date. 14 SHARE BASED COMPENSATION (CONTINUED) Share incentive plans (continued) On February 1, 2014, Tarena International adopted the 2014 Share Plan (the “2014 Plan”), pursuant to which Tarena International was authorized to issue options, non-vested shares and non-vested share units to qualified employees, directors and consultants of the Company. The maximum aggregate number of shares which may be issued pursuant to all awards under the 2014 Plan, or the Award Pool, is 1,833,696, provided that the shares reserved in the Award Pool shall be increased on the first day of each fiscal year, commencing with January 1, 2015, if the unissued shares reserved in the Award Pool on such day account for less than 2% of the total number of shares issued and outstanding on a fully-diluted basis on December 31 of the immediately preceding fiscal year, as a result of which increase the shares unissued and reserved in the Award Pool immediately after each such increase shall equal 2% of the total number of shares issued and outstanding on a fully-diluted basis on December 31 of the immediately preceding fiscal year. Share options During the year ended December 31, 2018, the board of the directors of Tarena International approved the grant of options to certain officers and employees to purchase 1,085,094 ordinary shares of Tarena International at exercise prices ranging from US$0.06 to US$1.00 per share. These options vest over a period ranging between 0.33 and 1 year. The options have a contractual term of ten years. During the year ended December 31, 2019, the board of the directors of Tarena International approved the grant of options to certain officers and employees to purchase 1,028,728 ordinary shares of Tarena International at exercise prices ranging from US$0.89 to US$1.00 per share. These options vest over a period ranging between 0.25 and 5 years. The contractual term of options ranges from 9 to 10 years. During the year ended December 31, 2020, the board of the directors of Tarena International approved the grant of options to certain officers and employees to purchase 1,236,146 ordinary shares of Tarena International at exercise prices ranging from US$1.00 to US$2.51 per share. These options vest over a period ranging between 0.25 and 5 years. The options have a contractual term of ten years. 14 SHARE BASED COMPENSATION (CONTINUED) Share options (continued) A summary of share options activity for the years ended December 31, 2018, 2019 and 2020 is as follows: Weighted Weighted Average Number of Average Remaining Aggregate Share Exercise Price Contractual Intrinsic Options US$ Years Value US$ Outstanding at December 31, 2018 3,396,797 1.61 6.47 15,919 Granted 1,028,728 0.10 — — Exercised (753,936) 0.64 — — Forfeited (235,225) 0.63 — — Expired — — — — Outstanding at December 31, 2019 3,436,364 1.43 5.99 1,815 Granted 1,236,146 1.26 — — Exercised (1,485,763) 0.33 — — Forfeited (363,940) 1.64 — — Expired — — — — Outstanding at December 31, 2020 2,822,807 1.91 6.85 4,311 Vested and expected to vest as of December 31, 2020 2,572,024 1.87 6.45 3,717 Exercisable as of December 31, 2020 2,099,922 1.82 5.72 3,261 The total intrinsic value of options exercised during the years ended December 31, 2018, 2019 and 2020 were RMB22,710, RMB7,936 and RMB26,301, respectively. The Company calculated the fair value of the share options on the grant date using the Binomial option-pricing valuation model. The assumptions used in the valuation model are summarized in the following table. Year Ended December 31, 2018 2019 2020 Expected volatility 53.52%-55.70% 52.05%-59.74% 72.22%-78.51% Expected dividends yield 0% 0% 0% Exercise multiple 2.2-2.8 2.2-2.8 2.2-2.8 Risk-free interest rate per annum 2.54%-3.23% 1.58%-2.89% 0.79%-2.08% The fair value of underlying ordinary shares (per share) US$6.97-US$14.99 US$0.59-US$6.48 US$1.71-US$4.65 The expected volatility was based on the historical volatilities of the Company and comparable publicly traded companies engaged in the similar industry. No income tax benefit was recognized in the consolidated statements of comprehensive loss as the share-based compensation expense was not tax deductible. 14 SHARE BASED COMPENSATION (CONTINUED) Share options (continued) The fair values of the options granted for the years ended December 31, 2018, 2019 and 2020 are as follows: Year Ended December 31, 2018 2019 2020 US$ US$ US$ Weighted average grant date fair value of option per share 12.35 4.84 2.52 Aggregate grant date fair value of options 13,402 4,980 3,115 As of December 31, 2020, there was approximately RMB 13,376 of total unrecognized compensation cost related to unvested share options and the unrecognized compensation costs are expected to be recognized over a weighted average period of approximately 1.42 years. Non-vested shares On April 3, 2018, the board of directors of Tarena International approved the grant of 18,181 non-vested shares to three independent directors, 25% of which vest at the end of every quarter within one year. On April 1, 2018, the board of directors of Tarena International approved the grant of 193,796 non-vested shares to employees, of which the vesting period is five years. Grantees of non-vested shares have no voting rights or dividend rights with respect to shares that have not been vested. On January 1, 2019, the board of directors of Tarena International approved the grant of 136,581 shares to employees, of which 135,381 non-vested shares shall vest in a five-year period, and 1,200 shares shall vest immediately on the grant date. On April 3, 2019, the board of directors of Tarena International approved the grant of 41,666 non-vested shares to 1 independent director, 1 director and executive officer and 2 former independent directors, of which the vesting period is one year. On August 13, 2019, the board of directors of Tarena International approved the grant of 47,380 non-vested shares to employees, of which the vesting period is five years. On January 1, 2020, the board of directors of Tarena International approved the grant of 35,912 non-vested shares to 1 independent director, of which the vesting period is one year. On March 1, 2020, the board of directors of Tarena International approved the grant of 74,000 non-vested shares to 1 independent director and 1 executive officer, of which the vesting period is one year. On April 9, 2020, the board of directors of Tarena International approved the grant of 143,628 non-vested shares to 1 independent director, 1 director and executive officer, of which the vesting period is one year. 14 SHARE BASED COMPENSATION (CONTINUED) Non-vested shares (continued) A summary of the non-vested shares activity under the 2014 Share Plan for the years ended December 31, 2018, 2019, 2020 is summarized as follows: Number of Non- Weighted Average vested Shares Grant Date Fair Value US$ Outstanding as of December 31, 2017 106,767 14.75 Granted 211,977 11.20 Vested (16,557) 14.22 Forfeited (22,541) 12.39 Outstanding as of December 31, 2018 279,646 12.28 Granted 225,627 5.12 Vested (80,020) 8.53 Forfeited (60,475) 8.01 Outstanding as of December 31, 2019 364,778 9.39 Granted 253,540 3.28 Vested (253,957) 5.44 Forfeited (53,923) 9.25 Outstanding as of December 31, 2020 310,438 7.66 As of December 31, 2020, there was approximately RMB14,771 of total unrecognized compensation cost related to non-vested shares, which is expected to be recognized over a weighted average period of approximately 2.63 years. The total fair value of shares vested during the years ended December 31, 2018, 2019 and 2020 was RMB1,557, RMB4,707 and RMB9,013, respectively. |
LOSS PER SHARE
LOSS PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
LOSS PER SHARE | |
LOSS PER SHARE | 15 LOSS PER SHARE Basic and diluted loss per share is calculated as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Numerator: Net loss attributable to Class A and Class B ordinary shareholders (590,174) (1,036,086) (766,643) Net loss for basic and diluted earnings per share (590,174) (1,036,086) (766,643) Denominator: Denominator for basic earnings per share: Weighted average number of Class A and Class B ordinary shares outstanding 54,929,910 53,386,075 54,341,213 Dilutive effect of outstanding share options — — — Denominator for diluted loss per share 54,929,910 53,386,075 54,341,213 Basic loss per Class A and Class B ordinary share (10.74) (19.41) (14.11) Diluted loss per Class A and Class B ordinary share (10.74) (19.41) (14.11) |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
LEASES | 16 LEASES The Company’s leases consist of operating leases for learning centers and office spaces in different cities in the PRC. The Company reviews all options to extend, terminate, or purchase its right-of-use assets at the inception of the lease and accounts for these options when they are reasonably certain of being exercised. As of December 31, 2020, the Company had no long-term leases that were classified as a financing lease, and the Company’s lease contracts only contain fixed lease payments and do not contain any residual value guarantee. Leases with an initial term of twelve months or less are not recorded on the consolidated balance sheets. The Company recognizes rental expense on a straight-line basis over the lease term. The components of rental expense for the year ended December 31, 2019 and 2020 consist as follows: Year Ended December 31, 2019 2020 RMB RMB Short-term rental expense 93,548 114,723 Operating lease expense excluding short-term rental expense 218,314 170,022 Other information related to operating leases is as follows: Year Ended December 31, 2019 2020 RMB RMB Cash paid for amounts included in the measurement of lease liabilities: 314,300 244,491 Non-cash right-of-use assets in exchange for new lease liabilities: 432,898 484,202 Weighted average remaining lease term 3.74 3.20 Weighted average discount rate 5.86 % 5.72 % The Company’s lease agreements do not have a discount rate that is readily determinable. The incremental borrowing rate is determined at lease commencement or lease modification and represents the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar term and amount equal to the lease payments in a similar economic environment. The weighted-average discount rate was calculated using the discount rate for the lease that was used to calculate the lease liability balance for each lease and the remaining balance of the lease payments for each lease as of December 31, 2020. The weighted-average remaining lease terms were calculated using the remaining lease term and the lease liability balance for each lease as of December 31, 2020. 16 LEASES (CONTINUED) As of December 31, 2020, maturities of lease liabilities were as follows: RMB Year ending December 31, 2021 243,857 2022 197,984 2023 142,412 2024 71,696 2025 22,277 2026 and thereafter 8,467 Total lease payments 686,693 Less: imputed interest 81,359 Total 605,334 Less: current portion 199,083 Non-current portion 406,251 Gross rental expenses incurred under operating leases were RMB262,440, RMB311,862 and RMB284,745 for the years ended December 31, 2018, 2019, and 2020, respectively. Sublease rental income of RMB1,533, RMB1,587, and RMB971 for the years ended December 31, 2018, 2019, and 2020, respectively, were recognized as reductions of gross rental expenses. |
CONTINGENCIES
CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
CONTINGENCIES | |
CONTINGENCIES | 17 CONTINGENCIES From time to time, the Company may be subject to certain legal proceedings, claims and disputes that arise in the ordinary course of business. Although the outcomes of these legal proceedings cannot be predicted, the Company does not believe these actions, in the aggregate, will have a material adverse impact on its financial position, results of operations or liquidity. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 12 Months Ended |
Dec. 31, 2020 | |
BUSINESS COMBINATION | |
BUSINESS COMBINATION | 18 BUSINESS COMBINATION On March 1, 2018, the Company acquired 100% of equity interest of Wuhan Haoxiaozi Robot Technology Co., Ltd, (“RTEC”), which provides K-12 robotics programming education services. The total consideration was RMB58,200 in cash. 18 BUSINESS COMBINATION (CONTINUED) On the acquisition date, the allocation of the consideration of the assets acquired and liabilities assumed based on their fair value was as follows: RMB Amortization period Cash and cash equivalents 3,874 Financial receivables 7,550 Prepaid and other current assets 6,138 Inventory, net 803 Property and equipment 12,851 Intangible assets 12,688 10 Goodwill 49,417 Other non-current assets 114 Total assets 93,435 Deferred revenue (31,906) Accounts payable and other current liabilities (1,046) Deferred tax liabilities (2,283) Total 58,200 The excess of the purchase price over the tangible assets and identifiable intangible assets acquired reduced by liabilities assumed was initially recorded as goodwill and the goodwill is not deductible for tax purposes. The amount of goodwill resulted from the acquisition was RMB49,417 as of March 1, 2018. The acquired identifiable intangible assets were valued using discounted cash flow method. The goodwill acquired resulted primarily from the Company’s expected synergies from the integration of businesses acquired into the Company’s existing K-12 programs. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 19 SEGMENT INFORMATION The Company has organized its operations into two segments: Adult Training and Kid Training, which reflects the way the Company evaluates its business performance and manages its operations by the Company’s chief operating decision maker (“CODM”). The Company’s CODM has been identified as the CEO who reviews the financial information of separate operating segments when making decisions about allocating resources and assessing performance of the Company. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The CODM evaluates performance based on each reporting segment’s revenues, cost of revenues, and gross profit. The CODM does not review balance sheet information to measure the performance of the reportable segments, nor is this part of the segment information regularly provided to the CODM. It is not practicable to restate the information for year ended December 31, 2017 due to that the Kid Training business was launched by the end of 2015 and the Company’s internal operation structure, personnel structure and financial reporting structure was not setup to support the segments separately until early 2018, therefore the management determines that it applies to the practicality exception and does not present the numbers of year ended December 31, 2017. 19 SEGMENT INFORMATION (CONTINUED) Revenues, cost of revenues, and gross profit by segment for the years ended December 31, 2019 and 2020 were as follows. Year Ended December 31, 2020 Adult Kid Training Training Total RMB RMB RMB Revenue 1,136,043 761,840 1,897,883 Cost (420,349) (646,493) (1,066,842) Gross profit 715,694 115,347 831,041 Year Ended December 31, 2019 Adult Kid Training Training Total RMB RMB RMB Revenue 1,527,185 524,169 2,051,354 Cost (627,765) (546,069) (1,173,834) Gross profit (loss) 899,420 (21,900) 877,520 |
PARENT ONLY FINANCIAL INFORMATI
PARENT ONLY FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
PARENT ONLY FINANCIAL INFORMATION | |
PARENT ONLY FINANCIAL INFORMATION | 20 PARENT ONLY FINANCIAL INFORMATION The following presents condensed parent company financial information of Tarena International. Condensed Balance Sheets December 31, 2019 2020 2020 RMB RMB US$ ASSETS Current assets: Cash and cash equivalents 7,599 3,793 581 Prepaid expenses and other current assets 259 699 107 Total current assets 7,858 4,492 688 Total assets 7,858 4,492 688 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term bank loan — — — Accrued expenses and other current liabilities (1) 8,132 7,208 1,105 Total current liabilities 8,132 7,208 1,105 Total liabilities 8,132 7,208 1,105 Commitments and contingencies — — — Shareholders’ equity: Class A ordinary shares (US$0.001 par value,860,000,000 shares authorized, 53,806,534 and 55,546,254 shares issued, 46,707,393 and 48,346,384 shares outstanding as of December 31, 2019 and 2020, respectively) 337 349 53 Class B ordinary shares (US$0.001 par value, 40,000,000 shares authorized, 7,206,059 shares issued and outstanding as of December 31, 2019 and 2020, respectively) 74 74 11 Treasury shares (7,099,141 and 7,199,870 Class A ordinary shares as of December 31, 2019 and 2020, at cost) (457,169) (459,815) (70,470) Additional paid-in capital 1,284,573 1,324,161 202,937 Accumulated other comprehensive income 51,386 49,120 7,528 Accumulated deficit (879,475) (916,605) (140,476) Total shareholders’ deficit (274) (2,716) (417) Total liabilities and shareholders’ equity 7,858 4,492 688 (1) Mainly related to repurchase of treasury shares. 20 PARENT ONLY FINANCIAL INFORMATION (CONTINUED) Condensed Statements of Comprehensive Loss Year Ended December 31, 2018 2019 2020 2020 RMB RMB RMB US$ Selling and marketing expenses (403) — (693) (106) General and administrative expenses (5,536) (29,011) (35,380) (5,422) Operating loss (5,939) (29,011) (36,073) (5,528) Equity in loss of subsidiaries (589,564) (608,015) — — Foreign currency exchange (loss) gains 341 115 (1,112) (170) Interest income (expense) 413 (67) 55 8 Other income 2,550 665 — — Loss before income taxes (592,199) (636,313) (37,130) (5,690) Income tax expense — — — — Net loss (592,199) (636,313) (37,130) (5,690) Other comprehensive income (loss) Foreign currency translation adjustment 11,100 914 (2,266) (347) Comprehensive loss (581,099) (635,399) (39,396) (6,037) Condensed Statements of Cash Flows Year Ended December 31, 2018 2019 2020 2020 RMB RMB RMB US$ Operating activities: Net cash provided by (used in) operating activities 165,098 (3,249) (8,010) (1,228) Investing activities: Proceeds from maturity of time deposits 63,452 — — — Foreign currency exchange losses 1,890 — — — Net cash provided by investing activities 65,342 — — — Financing activities: Proceeds from bank loan 13,229 — — — Issuance of Class A ordinary shares in connection with exercise of share options 2,951 3,335 3,354 514 Payment of dividends (42,955) — — — Repayment of bank borrowings — (13,792) — — Repurchase of treasury shares (196,957) (5,058) — — Net cash (used in) provided by financing activities (223,732) (15,515) 3,354 514 Changes in cash and cash equivalents 6,708 (18,764) (4,656) (714) Effect of foreign currency exchange rate changes on cash and cash equivalents 1,141 856 850 130 Net increase (decrease) in cash and cash equivalents 7,849 (17,908) (3,806) (584) Cash and cash equivalents at beginning of year 17,658 25,507 7,599 1,165 Cash and cash equivalents at end of year 25,507 7,599 3,793 581 Non-cash financing activities: Payable for repurchase of treasury shares 5,109 — — — |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 21 SUBSEQUENT EVENTS The Company has not identified any events with material financial impact on the Company’s consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of consolidation | (a) Principles of consolidation The consolidated financial statements include the financial statements of Tarena International, its wholly-owned subsidiaries, VIE in which Tarena International is the primary beneficiary and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated upon consolidation. |
Liquidity Condition and going concern | (b) Liquidity Condition and going concern The Company incurred net losses from operations of RMB592 million, RMB1,039 million and RMB771 million for the year ended December 31, 2018, 2019 and 2020, respectively. For the years ended December 31, 2018, the Company generated net cash inflow from operating activities amounting to RMB163 million. For the year ended December 31, 2019 and 2020, the Company generated net cash outflows from operating activities amounting to RMB32 million and RMB109 million, respectively. As of December 31, 2020, the Company’s net current liability was RMB2,133 million. The Company’s cash balance as of December 31, 2020 is not sufficient to meet its cash obligations or liabilities when they become due over the next twelve months from the date of issuance of the consolidated financial statements. The Company’s operating results for future periods are subject to numerous uncertainties and it is uncertain if the Company will be able to reduce or eliminate its net losses for the foreseeable future. If management is not able to increase revenue and/or manage operating expenses in line with revenue forecasts, the Company may not be able to achieve profitability. As of December 31, 2020, the Company’s deferred revenue amounted to RMB1,998 million and does not represent potential cash outflows in the future but is expected to be recognized in revenues in the end. These adverse conditions and events indicate there could be substantial doubt about the Company’s ability to continue as a going concern. For the next 12 months from the issuance date of this report, the Company plans to continue implementing various measures to boost revenue and controlling the cost and expenses within an acceptable level by offering online courses to all students, implementing comprehensive budget control and operation assessment, implementing enhanced vendor review and selection processes as well as enhancing internal controls on payable management, creating synergy of the Company’s resources and improving cash inflow by debt financing and the sale of properties and treasury stocks. As of the date of issuance of the consolidated financial statements, the Company has unused the line of credit of RMB200 million with expiration date June 2021. Besides, the Company has two office buildings, which locate in Qingdao and Beijing, total amounted to RMB133 million available for sale for future operating fund shortage if any. In addition, the Company has treasury stocks of 7,099,141 Class A ordinary shares, which were purchased in prior years. The treasury stock can be resold by a purchase price of $4.00 per ADS if the privatization process of the Company has completed, or sold to public through stock exchange without restriction. The total amount of such treasury stocks will be around RMB185 million with the exchange rate of the RMB against the U.S. dollar at 6.5250. Given the considerable gross margin ratio in its operations, the balance of deferred revenue mentioned above and the three available funding sources mentioned above, the Company assesses current working capital is sufficient to meet its obligations for the next 12 months from the issuance date of this report. Accordingly, management continues to prepare the Company’s consolidated financial statements on going concern basis. |
Use of estimates | 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (c) Use of estimates The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the estimated stand-alone selling price under ASC 606, the guarantee liability under ASC Topic 460, the fair values of share-based compensation awards, goodwill impairment and long term investments, the allowance for credit losses of accounts receivable, amounts due from related parties, prepaid expenses and other current assets and other non-current assets under ASC 326, the realizability of deferred income tax assets, the accruals for other contingencies, the useful lives and the recoverability of the carrying amounts of property and equipment. The current economic environment has increased the degree of uncertainty inherent in those estimates and assumptions. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. To allocate the transaction price for contracts with multiple deliverables and estimate the standalone selling price, the Company considers market data, including its pricing strategies for the products being evaluated and other similar products it offers, competitor pricing to the extent data is available, and costs to determine whether the estimated selling price yields an appropriate profit margin. |
Business combinations | (d) Business combinations Business combinations are recorded using the acquisition method of accounting. The purchase price of the acquisition is allocated to the identifiable assets and liabilities based on their estimated fair values as of the acquisition date. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related expenses and restructuring costs are expensed as incurred. |
Foreign currency | (e) Foreign currency The functional currency of Tarena International and Tarena Hong Kong Limited (“Tarena HK”) is the USD. The functional currency of Techarena Canada Inc. is the CAD. The functional currency of Taiwan Tarena Counseling Software Co., Ltd. is the TWD. The functional currency of Tarena International’s PRC subsidiaries, consolidated VIE, and the subsidiaries of the VIE is the RMB. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rate at the balance sheet date. The resulting exchange differences are recorded in foreign currency exchange gains (losses) in the consolidated statements of comprehensive loss. Assets and liabilities of entities with functional currencies other than RMB are translated into RMB using the exchange rate on the balance sheet date. Revenues and expenses are translated into RMB at average rates prevailing during the reporting period. The resulting foreign currency translation adjustment are recorded in accumulated other comprehensive loss within shareholders’ equity. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (e) Foreign currency (continued) Since the RMB is not a fully convertible currency, all foreign exchange transactions involving RMB must take place either through the People’s Bank of China (the “PBOC”) or other institutions authorized to buy and sell foreign exchange. The exchange rates adopted for the foreign exchange transactions are the rates of exchange quoted by the PBOC. |
Cash, cash equivalents, restricted cash and time deposits | (f) Cash, cash equivalents, restricted cash and time deposits Cash consists of cash in bank and deposits place in third party payment processors of Alipay, Wechat wallet and Baidu wallet, which are unrestricted as to withdrawal. Cash equivalents consist of interest-bearing certificates of deposit with initial term of no more than three months when purchased. Time deposits, which mature within one year as of the balance sheet date, represent interest-bearing certificates of deposit with an initial term of greater than three months when purchased. Time deposits which mature over one year as of the balance sheet date are included in non-current assets. The Company has no restricted cash as of December 31, 2019. Restricted cash is the cash received from financial service provider for students’ tuition fee, which will release to cash along with the service provided to the students. The balance as of December 31, 2020 is RMB38.4 million. Cash, cash equivalents, time deposits and restricted cash maintained at financial institutions consist of the following: December 31, 2019 2020 RMB RMB RMB denominated bank deposits with financial institutions in the PRC 470,673 278,789 US dollar denominated bank deposits with financial institutions in the PRC 136,640 81,283 US dollar denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) 9,939 793 HK dollar denominated bank deposits with financial institutions in HK SAR 74 50 RMB denominated bank deposits with a financial institution in HK SAR 132 2,022 US dollar denominated bank deposits with a financial institution in the U.S. 135 117 TWD denominated bank deposits with a financial institution in Taiwan 24 579 CAD denominated bank deposits with a financial institution in Canada 3,571 1,172 Total 621,188 364,805 To limit exposure to credit risk relating to bank deposits, the Company primarily places bank deposits only with large financial institutions in the PRC, HK SAR, Taiwan, Canada and the U.S. with acceptable credit rating. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (g) Accounts receivable In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Statements Accounts receivable primarily represent tuition fees due from students, universities and colleges and financial service providers. Accounts receivable which are due over one year as of the balance sheet date are presented as non-current assets. The unearned interest on accounts receivable which are due over one year is reported in the consolidated balance sheets as a direct deduction from the principal amount of accounts receivable. The Company maintains an allowance for credit losses for estimated losses resulting from the inability of its students, universities and colleges or financial service providers to make required payments. Accounts receivable is considered past due based on its contractual terms. In establishing the allowance, management considers historical losses, the financial condition, the accounts receivables aging, the payment patterns and the forecasted information in pooling basis upon the use of the Current Expected Credit Loss Model (“CECL Model”) in accordance with ASC topic 326, Financial Instruments - Credit Losses. Accounts receivable that are deemed to be uncollectible are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. There is a time lag between when the Company estimates a portion of or the entire account balances to be uncollectible and when a write off of the account balances is taken. The Company takes a write off of the account balances when the Company can demonstrate all means of collection on the outstanding balances have been exhausted. |
Accounts receivable | 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
Property and equipment | (h) Property and equipment Property and equipment are recorded at cost. Depreciation is calculated on the straight-line method over the estimated useful lives of the assets. The estimated useful life of property and equipment is as follows: Office buildings 45 years Furniture 5 years Office equipment 3 Leasehold improvements Shorter of the lease term or the estimated useful life of the assets Ordinary maintenance and repairs are charged to expenses as incurred, while replacements and betterments are capitalized. When items are retired or otherwise disposed of, income is charged or credited for the difference between net book value of the item disposed and proceeds realized thereon. Property and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Recoverability of a long-lived asset or asset group to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying value of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment loss is recognized by the amount that the carrying value exceeds the estimated fair value of the asset or asset group. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Assets to be disposed are reported at the lower of carrying amount or fair value less costs to sell, and are no longer depreciated. No impairment of long-lived assets was recognized for any of the years presented. |
Goodwill | 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (i) Goodwill In January 2017, the FASB issued ASU 2017-04, simplifying the Test for Goodwill Impairment, which simplifies the accounting for goodwill impairment by eliminating Step two from the goodwill impairment test. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, versus determining an implied fair value in Step two to measure the impairment loss. We adopted this guidance on a prospective basis on January 1, 2020 with no material impact on its consolidated financial statements and related disclosures as a result of adopting the new standard. We assess goodwill for impairment on annual basis in accordance with ASC 350-20, Intangibles – Goodwill and Other: Goodwill Quantitative goodwill impairment test is used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit is greater than its carrying amount, goodwill is not considered impaired. If the fair value of the reporting unit is less than its carrying amount, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company performs the annual goodwill impairment assessment using qualitative and quantitative impairment test on September 30 and no goodwill impairment was identified. |
Long-term investments | (j) Long-term investments ● Equity investments without readily determinable fair values Equity investments without readily determinable fair values are measured and recorded using a measurement alternative that measures the securities at cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes in accordance with ASC topic 321, Investments – Equity Securities. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (j) Long-term investments (continued) ● Equity method investments Under the equity method, the Company’s share of the post-acquisition profits or losses of the equity investment is recognized in the consolidated statements of comprehensive loss; and the Company’s share of post-acquisition movements in equity is recognized in equity in the consolidated balance sheets. Unrealized gains on transactions between the Company and an entity in which it has recorded an equity investment are eliminated to the extent of the Company’s interest in the entity. To the extent of the Company’s interest in the investment, unrealized losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. When the Company’s share of losses in an entity in which it has recorded an equity investment equals or exceeds the Company’s interest in the entity, it does not recognize further losses, unless it has incurred obligations or made payments on behalf of the equity investee. The Company evaluates the equity method investments for impairment. An impairment loss on the equity method investments is recognized in earnings when the decline in value is determined to be other-than-temporary. ● Available-for-sale debt securities Debt securities that the Company has positive intent and ability to hold to maturity are classified as held-to-maturity debt securities and are stated at amortized cost. Debt securities that the Company has the intent to hold the security for an indefinite period or may sell the security in response to the changes in economic conditions are classified as available for sale and reported at fair value. Unrealized gains and losses (other than impairment losses) are reported, net of the related tax effect, in other comprehensive income (OCI). Upon sale, realized gains and losses are reported in net income. The Company monitors the investments for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, the operating performance of the companies including current earnings trends and other company-specific information. |
Revenue recognition | (k) Revenue recognition The Company adopted ASC Topic 606 (“ASC 606”), Revenue from Contracts with Customers, with effect from January 1, 2018, using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Accordingly, revenues for the years ended December 31, 2018, 2019 and 2020 were presented under ASC 606. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (k) Revenue recognition (continued) The Company evaluated and recognized revenue based on the five steps set forth in ASC 606 by: ● identifying the contract(s) with the customer; ● identifying the performance obligations in the contract; ● determining the transaction price; ● allocating the transaction price to performance obligations in the contract; and ● recognizing revenue as each performance obligation is satisfied through the transfer of a promised good or service to a customer (i.e., “transfer of control”). These criteria as they relate to each of the following major revenue generating activities are described below. Revenue is presented net of business tax and value added taxes (“VAT”) at rates ranging between 3% and 6%, and surcharges. VAT and business tax to be collected from customers, net of VAT paid for purchases, is recorded as a liability in the consolidated balance sheets until it is paid to the tax authorities. Tuition revenue The Company provides IT and non-IT related training courses to both adult and K-12. The Company also cooperate with universities and colleges in China to offer joint-major degree programs in accordance with the higher education reform policies of each province. The Company integrates its selected courses into universities and colleges’ standard undergraduate curriculum for students enrolled in such joint-major programs. Students can attend part of the courses in our established on-campus learning sites and part of the courses at the Company’s learning centers. A majority of contract of tuition service is accounted for as a single performance obligation which is satisfied proportionately over the service period. Tuition fees are recognized as revenue proportionately as the training courses are delivered, with unearned portion of tuition fees being recorded as deferred revenue. For certain students who borrow the tuition fee from financial service providers, the Company also provides a guarantee service to financial service providers whereas in the event of default, the financial service providers are entitled to receive unpaid interest and principal from the Company. Given that the Company effectively takes on all of the credit risk of the borrowers and are compensated by the tuition fees charged, the guarantee is deemed as a service and the guarantee exposure is recognized as a stand-ready obligation in accordance with ASC Topic 460, Guarantees (see accounting policy for Guarantee Liabilities). The Company first allocates the transaction price to the guarantee liabilities, if any, in accordance with ASC Topic 460, Guarantees, which requires the guarantee to be measured initially at fair value based on the stand ready obligation. Then the remaining considerations are allocated to the tuition fees consistent with the guidance in ASC 606. Certain qualified students are allowed to pay their tuition fees on installment for a period of time exceeding one year. When tuition services are sold on installment terms that exceeds one year beyond the point in time that revenue is recognized, the contract contains a significant financing component, and the consideration promised by the customer is variable. The receivable, and therefore the revenue is recorded at the present value of the payments. The difference between the present value of the receivable and the nominal or principal value of the tuition fees is recognized as interest income over the contractual repayment period using the effective interest rate method. The interest rate used to determine the present value of total amount receivable is the rate subject to management decision on the date of the transaction and it reflects the rate that the students can obtain financing of a similar nature from other sources at the date of the transaction. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (k) Revenue recognition (continued) The Company enters into arrangements with certain students that purchase multiple services. The performance obligations identified include tuition service and practical tutoring service. The Company treats training contracts with multiple performance obligations as separate units of accounting for revenue recognition purposes and recognizes revenue during the contract period when each performance obligation is satisfied. The Company allocates the transaction price to each performance obligations based on stand-alone selling price. Refunds are provided to students if they withdraw from classes, and usually only those unearned portions of the fee which is available will be refunded. A refund liability represents the amounts of consideration received but are not expected to be entitled to earn, and thus are not included in the transaction price because these amounts are expected to be eventually refunded to students. The Company determines the transaction price to be earned by estimating the refund liability based on historical refund ratio on a portfolio basis using the expected value method. Reclassification was made from deferred revenue to refund liabilities, which was recorded under accrued expenses and other current liabilities. Certification service revenue The Company provides certification service to students who complete the training course and enroll for the exams. The Company is responsible for the certification service, including organization, proctoring and grading of exams, and providing the certificates to students. All certificates are issued by third parties to the students who pass the exam. The Company is the principal to end customers. The Company acts as the principal in providing the certificate service to the students and recognizes revenue on gross basis because the Company is able to determine the price, acts as the main obligor in the arrangement, and, is responsible for fulfilling the services ordered by the students. Cash received before the students taking the exam is recorded as deferred revenue. Each contract of certification service is accounted for as a single performance obligation which is satisfied at a point in time. The performance obligation is satisfied when the certificates are provided to the students and the consideration are received, then the received consideration is recognized as certification service revenue. Loan referral service revenue The Company promotes loan products of financial service providers to its students, who need financial assistance for the payment of their tuition fees, in exchange for a referral fee generally at a rate of the principal amount of the loans. Each contract of loan referral service is accounted for as a single performance obligation which is satisfied at a point in time. Generally, the early repayment and default loan are excluded from the effective principal amount of the loans, and thus are not included in the transaction price because these amounts are expected to be eventually refunded to financial service providers. The Company determines the transaction price to be earned by estimating the refund liability based on historical refund ratio on a portfolio basis using the expected value method. Refund liability was recorded under accrued expenses and other current liabilities. Historically, the Company has not had material refunds. Loan referral service revenue is recognized upon the initiation of the loans as the performance obligation is satisfied and confirmed with the financial service providers on a monthly basis. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (k) Revenue recognition (continued) Contract acquisition costs The Company has used practical expedients as allowed under ASC 606 to generally expenses sales commissions when incurred, because the amortization period would be one year or less. These costs are recorded as sales and marketing expenses. Contract liability The Company does not have amounts of contract assets since revenue is recognized as the transferred control of promised services to customers. The contract liabilities consist of deferred revenue, which represent the Company has received consideration but has not satisfied the related performance obligations. The revenue recognized for years ended December 31, 2019 and 2020 that was previously included in the deferred revenue balances as of December 31, 2018 and December 31, 2019 was RMB648,050 and RMB905,867, respectively. The Company’s deferred revenue amounting to RMB1,585,970 and RMB1,998,198 as of December 31, 2019 and 2020, respectively. Starting from second half year 2019, the Company enters into contracts that have an original expected length of more than one year with certain students. The remaining performance obligations of these contracts are as following: For the years ended December 31, 2021 2022 Total RMB RMB RMB Revenue expected to be recognized on these contracts 112,786 18,549 131,335 The Company has selected to apply the practical expedient in paragraph ASC 606-10-50-14 and does not disclose information about remaining performance obligations in contracts that have an original expected length of one year or less. Refund liability mainly related to the estimated refunds that are expected to be provided to students if they decide they no longer want to take the course. Refund liability estimates are based on historical refund ratio on a portfolio basis using the expected value method. Guarantee service revenue recognized under ASC 460 At the inception of each loan, the guarantee liabilities recorded at fair value based on ASC Topic 460 is determined on a loan by loan basis. The guarantee liabilities are generally reduced by recording a credit to guarantee service revenue as the guarantor is released from the underlying guaranteed risk. Subsequent to initial recognition, the guarantee obligation’s release from risk has typically been recognized over the term of the guarantee using a rational amortization method. |
Cost of revenues | (l) Cost of revenues Cost of revenues consists of payroll and employee benefits, rent expenses of learning centers, depreciation relating to property and equipment used for operating the learning centers, and other operating costs that are directly attributed to the provision of training services. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (m) Guarantee liabilities For certain students who borrow the tuition fee from financial service providers, the Company provides a guarantee service to financial service providers whereas in the event of default, the financial service providers are entitled to receive unpaid interest and principal from the Company. In general, any unpaid interest and principal are paid when the borrower does not repay as scheduled. For accounting purposes, at the inception of each loan, the Company recognizes the guarantee liability in accrued expenses and other current liabilities at fair value in accordance with ASC 460-10, which incorporates the expectation of potential future payments under the guarantee and takes into both non-contingent and contingent aspects of the guarantee. Subsequent to the loan’s inception, the guarantee liability is composed of two components: (i) ASC Topic 460 component; and (ii) ASC Topic 450 component. The liability recorded based on ASC Topic 460 is determined on a loan by loan basis and it is reduced when the Company is released from the underlying risk, i.e. as the loan is repaid by the borrower or when the investor is compensated in the event of a default. This component is a stand ready obligation which is not subject to the probable threshold used to record a contingent obligation. The guarantee liabilities are generally reduced by recording a credit to guarantee service revenue as the guarantor is released from the underlying guaranteed risk. Subsequent to initial recognition, the guarantee obligation’s release from risk has typically been recognized over the term of the guarantee using a rational amortization method. The other component is a contingent liability determined based on probable loss considering the actual historical performance and current conditions, representing the obligation to make future payouts under the guarantee liability in excess of the stand-ready liability, measured using the guidance in ASC Topic 450, loans with similar risk characteristics are pooled into cohorts. The ASC 450 contingent component is recognized as part of operating expenses. At all times the recognized liability (including the stand ready liability and contingent liability) is at least equal to the probable estimated losses of the guarantee portfolio. |
Guarantee liabilities | 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) |
Advertising costs | (n) Advertising costs Advertising costs are expensed as incurred and included in selling and marketing expenses. Advertising costs were RMB339,385, RMB416,814 and RMB297,484 for the years ended December 31, 2018, 2019 and 2020, respectively. |
Operating lease | (o) Operating lease The Company adopted Accounting Standards Update (“ASU”) 2016-02 Leases (“ASC 842”) as of January 1, 2019, using the non-comparative transition option pursuant to ASU 2018-11. Therefore, the Company has not restated comparative period financial information for the effects of ASC 842, and will not make the new required lease disclosures for comparative periods beginning before January 1, 2019. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among others things (i) allowed the Company to carry forward the historical lease classification; (ii) did not require the Company to reassess whether any expired or existing contracts are or contain leases; (iii) did not require the Company to reassess initial direct costs for any existing leases. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (o) Operating lease (continued) The Company identifies lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. For all operating leases except for short-term leases, the Company recognizes operating right-of-use assets and operating lease liabilities. Leases with an initial term of 12 months or less are short-term lease and not recognized as right-of-use assets and lease liabilities on the consolidated balance sheet. The Company recognizes lease expense for short-term leases on a straight-line basis over the lease term. The operating lease liabilities are recognized based on the present value of the lease payments not yet paid, discounted using the Company’s incremental borrowing rate over a similar term of the lease payments at lease commencement. Some of the Company’s lease agreements contain renewal options; however, the Company do not recognize right-of-use assets or lease liabilities for renewal periods unless it is determined that the Company is reasonably certain of renewing the lease at inception or when a triggering event occurs. The right-of-use assets consist of the amount of the measurement of the lease liabilities and any prepaid lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. |
Government grant | (p) Government grant Government grant is recognized when there is reasonable assurance that the Company will comply with the conditions attached to it and the grant will be received. Government grant for the purpose of giving immediate financial support to the Company with no future related costs or obligation is recognized in the Company’s consolidated statements of comprehensive loss when the grant becomes receivable. Government grants of RMB2,292, RMB1,665 and RMB4,735 were recognized and included in other income (loss) for the years ended December 31, 2018, 2019 and 2020, respectively. |
Research and development expense | (q) Research and development expense Research and development costs are expensed as incurred. |
Employee benefits | (r) Employee benefits Pursuant to relevant PRC regulations, the Company is required to make contributions to various defined contribution plans organized by municipal and provincial PRC governments. The contributions are made for each PRC employee at rates ranging from 20.7% to 51.1% on a standard salary base as determined by local social security bureau. Contributions to the defined contribution plans are charged to the consolidated statements of comprehensive loss when the related service is provided. For the years ended December 31, 2018, 2019, and 2020, the costs of the Company’s obligations to the defined contribution plans amounted to RMB129,455, RMB143,438, and RMB53,750, respectively. The Company has no other obligation for the payment of employee benefits associated with these plans beyond the contributions described above. |
Income taxes | (s) Income taxes The Company follows the asset and liability method in accounting for income taxes in accordance to ASC topic 740 “Taxation” (“ASC 740”), Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the period in which the differences are expected to reverse. The Company records a valuation allowance against deferred tax assets if, based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (s) Income taxes (continued) The Company adopted ASC 740 to account for uncertainty in income taxes. ASC 740 clarifies the accounting for uncertainty in income taxes by prescribing the recognition threshold a tax position is required to meet before being recognized in the consolidated financial statements. The Company recognizes in the consolidated financial statements the impact of a tax position, if that position is more likely than not of being sustained upon examination, based on the technical merits of the position. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company has elected to classify interest and penalties related to an unrecognized tax benefits, if and when required, as part of income tax expense in the consolidated statements of comprehensive loss. For the year ended December 31, 2020, there were no uncertain tax positions and the Company does not expect that the position of unrecognized tax benefits will materially change within the next twelve months. In accordance with PRC Tax Administration Law on the Levying and Collection of Taxes, the PRC authorities generally have up to five years to assess underpaid tax plus penalties and interest for PRC entities’ tax filings. In case of tax evasion, which is not clearly defined in the law, there is no limitation on the tax years open for investigation. Accordingly, the PRC entities remain subject to examination by the tax authorities based on above. |
Share based compensation | (t) Share based compensation The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award and recognizes the cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, net of estimated forfeitures, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date. Forfeiture rates are estimated based on historical of employee turnover rates. |
Commitments and contingencies | (u) Commitments and contingencies In the normal course of business, the Company is subject to loss contingencies, such as legal proceedings and claims arising out of its business, that cover a wide range of matters, including, among others, government investigations, shareholder lawsuits, and non-income tax matters. An accrual for a loss contingency is recognized when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. If a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, is disclosed. |
Loss per share | (v) Loss per share Basic loss per Class A and Class B ordinary share is computed by dividing net loss attributable to Tarena International’s Class A and Class B ordinary shareholders by the weighted average number of Class A and Class B ordinary shares outstanding during the year using the two-class method. Under the two-class method, net loss attributable to Tarena International’s Class A and Class B ordinary shareholders is allocated between Class A and Class B ordinary shares and other participating securities, if any, based on participating rights in undistributed loss. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (v) Loss per share (continued) Diluted loss per share is calculated by dividing net loss attributable to Tarena International’s Class A and Class B ordinary shareholders as adjusted for the effect of dilutive Class A and Class B ordinary share equivalents, if any, by the weighted average number of Class A and Class B ordinary and dilutive Class A and Class B ordinary share equivalents outstanding during the year. Class A and Class B ordinary share equivalents include the Class A and Class B ordinary shares issuable upon the exercise of the outstanding share options (using the treasury stock method). Potential dilutive securities are not included in the calculation of diluted loss per Class A and Class B ordinary share if the impact is anti-dilutive. If there is a loss from continuing operations, diluted EPS would be computed in the same manner as basic EPS is computed, even if an entity has net income after adjusting for a discontinued operation or an extraordinary item. |
Segment reporting | (w) Segment reporting The Company uses the management approach in determining its operating segments. The management approach considers the internal reporting used by the Company’s chief operating decision maker for making decisions about the allocation of resources to and the assessment of the performance of the segments of the Company. Management has determined that the Company has two operating segments, which is the Adult Training segment and Kid Training segment. The majority of the Company’s operations and customers are located in the PRC. Consequently, no geographic information is presented. |
Fair value measurements | (x) Fair value measurements The Company applies the provisions of ASC Topic 820, Fair Value Measurements and Disclosures, ASC Topic 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC Topic 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: ● Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. ● Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. ● Level 3 inputs are unobservable inputs for the asset or liability. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (x) Fair value measurements (continued) The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety. In situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects management’s own judgments about the assumptions that market participants would use in pricing the asset or liability. Those judgments are developed by management based on the best information available in the circumstances. The carrying amounts of cash and cash equivalents, current time deposits, accounts receivable, loans to employees, amounts due from related parties, accounts payable, amounts due to related parties, accrued expenses and other current liabilities as of December 31, 2019 and 2020 approximate their fair value because of short maturity of these instruments. The carrying amounts of non-current time deposits as of December 31, 2019 and 2020 approximates their fair value since the interest rates of the time deposits did not differ significantly from the market interest rates for similar types of time deposits. The fair values of time deposits as of December 31, 2019 and 2020 are categorized as Level 2 measurement. |
Recently issued accounting standards | (y) Recently issued accounting standards In January 2020, the FASB issued ASU No. 2020-01, Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)-Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 Recently issued ASUs by the FASB, except for the ASU mentioned above, have no material impact on the Company’s consolidated results of operations or financial position. |
DESCRIPTION OF BUSINESS, ORGA_2
DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Concentration Risk [Line Items] | |
Schedule of Variable Interest Entity Information | December 31, 2019 2020 RMB RMB Cash 211 1,332 Amounts due from Tarena International and its wholly-owned subsidiaries 39,464 113,394 Amounts due from a related party 4 4 Prepaid expenses and other current assets 2,269 4,103 Total current assets 41,948 118,833 Property and equipment, net 2,121 1,552 Long term investments, net 48,380 48,380 Deferred income tax assets — 74 Right-of-use assets 7,083 5,540 Other non-current assets 363 539 Total assets 99,895 174,918 Accounts payable 282 8,610 Deferred revenue-current 51,808 138,529 Operating lease liabilities-current 2,574 3,377 Income taxes payable 2,049 8,037 Accrued expenses and other current liabilities 17,397 13,909 Amounts due to Tarena International and its wholly-owned subsidiaries 74,991 21,072 Amounts due to related parties 130 — Total current liabilities 149,231 193,534 Deferred revenue-non current 215 133 Operating lease liabilities-non current 3,843 1,536 Other non-current liabilities 122 122 Total liabilities 153,411 195,325 Year Ended December 31, 2018 2019 2020 RMB RMB RMB Net revenues 4,232 32,013 127,043 Net (loss) income (16,900) (37,565) 32,869 Net cash provided by operating activities 1,540 36,902 122,813 Net cash used in investing activities (24,083) (34,226) — Net cash provided by (used in) financing activities 23,625 (3,841) (121,692) |
Net revenues [Member] | Product concentration [Member] | |
Concentration Risk [Line Items] | |
Schedule of Revenue Concentration | Year Ended December 31, 2018 2019 2020 K-12 Computer Programming 7.1 % 12.8 % 20.6 % Digital Arts 28.7 % 22.9 % 16.8 % K-12 Robotics Programming 2.1 % 9.3 % 15.7 % Java 18.3 % 19.0 % 13.8 % Total 56.2 % 64.0 % 66.9 % |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Cash, cash equivalents, time deposits and restricted cash | December 31, 2019 2020 RMB RMB RMB denominated bank deposits with financial institutions in the PRC 470,673 278,789 US dollar denominated bank deposits with financial institutions in the PRC 136,640 81,283 US dollar denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) 9,939 793 HK dollar denominated bank deposits with financial institutions in HK SAR 74 50 RMB denominated bank deposits with a financial institution in HK SAR 132 2,022 US dollar denominated bank deposits with a financial institution in the U.S. 135 117 TWD denominated bank deposits with a financial institution in Taiwan 24 579 CAD denominated bank deposits with a financial institution in Canada 3,571 1,172 Total 621,188 364,805 |
Schedule of Property, Plant and Equipment, Useful Life | Office buildings 45 years Furniture 5 years Office equipment 3 Leasehold improvements Shorter of the lease term or the estimated useful life of the assets |
Schedule of Change In Refund Liability | For the years ended December 31, 2021 2022 Total RMB RMB RMB Revenue expected to be recognized on these contracts 112,786 18,549 131,335 |
ACCOUNTS RECEIVABLE, NET (Table
ACCOUNTS RECEIVABLE, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
ACCOUNTS RECEIVABLE, NET | |
Schedule of Accounts receivable | December 31, 2019 2020 RMB RMB Accounts receivable: Gross 34,634 43,191 Unearned interest (217) (995) Total accounts receivable 34,417 42,196 Less: allowance for credit losses 2,251 9,214 Accounts receivable, net 32,166 32,982 |
Summary of classification of accounts receivable | December 31, 2019 2020 RMB RMB Accounts receivable – current portion 31,442 32,790 Accounts receivable – non-current portion 724 192 Total accounts receivable, net 32,166 32,982 |
Summary of allowance for doubtful accounts | Year Ended December 31, 2018 2019 2020 RMB RMB RMB Balance at the beginning of the year — — 2,251 Additions charged to bad debt expense — 2,251 6,963 Balance at the end of the year — 2,251 9,214 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
Schedule of Prepaid expenses and other current assets | December 31, 2019 2020 RMB RMB Prepaid expenses and other current assets: Prepaid rental expenses 15,290 12,304 Interest receivable from time deposits 2,206 894 Prepaid deposits (a) 26,913 25,238 Prepaid advertising expenses 8,878 7,656 Prepaid value-added tax 28,545 40,352 Loans made to employees (b) 17,947 20,421 Professional fee 13,859 11,169 Inventory 5,325 4,626 Others 13,576 15,693 Total prepaid expenses and other current assets 132,539 138,353 (a) It mainly included prepaid advertising deposits. (b) The Company provides short-term interest-free loans to employees for their purchase of residence or other personal needs. |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of Property and Equipment | Property and equipment consist of the following: December 31, 2019 2020 RMB RMB Office buildings 285,867 285,867 Furniture 53,223 48,253 Office equipment 474,839 409,682 Leasehold improvements 242,122 243,407 Total property and equipment 1,056,051 987,209 Less: accumulated depreciation 479,418 522,719 Property and equipment, net 576,633 464,490 |
Schedule of Depreciation Expense | Depreciation expense for property and equipment was allocated to the following: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Cost of revenues 127,850 150,188 132,898 Selling and marketing expenses 11,211 19,303 18,137 General and administrative expenses 16,511 22,314 18,867 Research and development expenses 1,335 733 1,354 Total 156,907 192,538 171,256 |
LONG-TERM INVESTMENTS, NET (Tab
LONG-TERM INVESTMENTS, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LONG-TERM INVESTMENTS, NET | |
Schedule of Long-term investments | December 31, 2019 2020 RMB RMB Equity investments without readily determinable fair values A company providing mechanic training (a) 12,000 12,000 A company providing intelligent robot products (b) 24,000 24,000 A company providing information sharing IT platform (c) 22,500 22,500 Other equity investments without readily determinable fair values (d) 30,880 30,880 Impairment of equity investments without readily determinable fair values (37,000) (37,000) Total equity investments without readily determinable fair values, net 52,380 52,380 Equity method investments Companies providing hockey program management 2,223 2,132 A company providing Internet product solutions (e) 13,694 13,604 Impairment of equity method investments (524) (524) Total equity method investments, net 15,393 15,212 Available-for-sale investment (f) 15,000 15,000 Impairment of available-for-sale investments (f) (15,000) (15,000) Total available-for-sale investment, net — — Total long-term investments, net 67,773 67,592 (a) In October 2015, the Company paid RMB 12,000 in cash to acquire 2.86% of the total equity interest in an education company, which provides training for senior mechanic in vehicle maintenance and repair. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. (b) In May 2017, the Company paid RMB 24,000 in cash to acquire 6% of the total equity interest in a company, which provides intelligent robot product. Based on the fact that the business conditions of this investee deteriorated, the Company recognized impairment loss of RMB 24,000 for the years ended December 31, 2018, and with an impairment balance of RMB 24,000 as of December 31, 2019 and 2020, respectively. (c) In July 2017, the Company paid RMB 22,500 in cash to acquire 15% of the total equity interest in a company, which provides an information sharing IT platform. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. (d) During the years ended December 31, 2018 and 2019, the Company acquired minority equity interest in several third-party companies. The Company recognized impairment loss of RMB 2,000 and nil for the years ended December 31, 2019 and 2020, respectively, and with an impairment balance of RMB 13,000 as of December 31, 2019 and 2020, respectively. (e) In January 2018, the Company paid RMB 14,000 in cash to acquire 20% of equity interest of a company which provides IT consulting services and programming account for the investment using equity method. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. (f) In October 2016, the Company paid RMB 10,000 in cash to acquire 13.9% equity interest in a private company, which provides employment course trainings and recruitment services. As it was found that the investee provided overstated financial statements to the new investors during the private placement in 2017 and lost in a lawsuit sued by one of the shareholders. Accordingly, the Company determined it to be fully impaired in 2017. The Company recognized no impairment loss for the years ended December 31, 2019 and 2020, respectively, and with an impairment balance of RMB 15,000 as of December 31, 2019 and 2020, respectively. |
OTHER NON-CURRENT ASSETS, NET (
OTHER NON-CURRENT ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
OTHER NON-CURRENT ASSETS, NET | |
Schedule of Other non-current assets | December 31, 2019 2020 RMB RMB Other non-current assets: Rent and property management deposits 55,607 51,786 Loans made to employees (a) 43,546 30,284 Prepayment for equipment and leasehold improvement 14,506 10,276 Others 7,858 3,479 Total other non-current assets, net 121,517 95,825 (a) Starting from 2016, the Company began to provide five-year loans with the annual interest rate of 3.325% and 5.0% to the employees for their purchase of houses and employees pledged by their share options respectively. The interest was paid monthly and the principal was repaid upon maturity . |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
Schedule of Accrued Expenses and Other Current Liabilities | December 31, 2019 2020 RMB RMB Accrued payroll and employee benefits 141,955 194,862 Refund liability 67,625 71,843 Professional service fee 28,357 30,165 Payable for advertisement 40,652 23,287 Rental fee 9,943 11,153 VAT and other tax payables 11,111 9,535 Guarantee liability 10,921 5,808 Payable to a third-party individual 51,380 — Others 35,614 45,251 Total 397,558 391,904 |
NET REVENUES (Tables)
NET REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
NET REVENUES | |
Schedule of net revenues | Year Ended December 31, 2018 2019 2020 RMB RMB RMB Tuition fee 1,896,642 1,877,242 1,786,230 Certification service fee 82,376 75,403 41,961 Loan referral service fee 18,096 19,939 7,801 Others 12,444 42,786 53,135 Business taxes and surcharges (13,878) (11,205) (4,252) Total net revenues 1,995,680 2,004,165 1,884,875 Year Ended December 31, 2018 2019 2020 RMB RMB RMB Timing of revenue recognition Services transferred at a point in time 100,472 138,128 102,897 Services transferred over time 1,895,208 1,866,037 1,781,978 Total net revenues 1,995,680 2,004,165 1,884,875 Year Ended December 31, 2018 2019 2020 RMB RMB RMB Guarantee service 89,691 47,189 13,008 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
Schedule of Income (Loss) before Income Taxes | The components of income (loss) before income taxes are as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB PRC (467,953) (986,464) (739,036) Hong Kong (2,031) (876) (8,280) Cayman Islands (126,887) (87,470) (54,913) Taiwan (166) (2,292) (1,549) Canada (27) (3,335) (2,449) Total loss before income taxes (597,064) (1,080,437) (806,227) |
Schedule of Income Tax (expense) benefit | 11 INCOME TAXES (CONTINUED) Income tax (expense) benefit consists of the following: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Current income tax expense (16,058) (4,478) (7,397) Withholding tax expense (25,672) — — Deferred income tax benefit 46,595 46,037 42,431 Total 4,865 41,559 35,034 |
Schedule of Income Tax Rate Reconciliation | The actual income tax expense reported in the consolidated statements of comprehensive loss for each of the years ended December 31, 2018, 2019 and 2020 differs from the amount computed by applying the PRC statutory income tax rate to income before income taxes due to the following: Year Ended December 31, 2018 2019 2020 PRC statutory income tax rate 25.0 % 25.0 % 25.0 % Increase (decrease) in effective income tax rate resulting from: Impact of different tax rates in other jurisdictions (5.3) % (2.1) % (1.8) % Research and development bonus deduction 1.4 % 0.8 % 2.0 % Non-deductible expenses (1.4) % (1.3) % (1.6) % Preferential tax rates (0.3) % (10.8) % (11.2) % Change of tax rates 0.0 % (2.2) % (2.9) % Change in valuation allowance (14.3) % (5.6) % (5.2) % Withholding tax (4.3) % — — Actual income tax expense 0.8 % 3.8 % 4.3 % |
Schedule of Deferred Income Tax Assets | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities were as follows: December 31, 2019 2020 RMB RMB Deferred income tax assets: Impairment of long-term investments 11,750 11,750 Tax loss carry forwards 209,716 253,796 Advertising expense 15,232 19,805 Others 2,268 3,240 Total deferred income tax assets 238,966 288,591 Valuation allowance (139,177) (146,371) Deferred income tax assets, net 99,789 142,220 Deferred income tax liabilities: Valuation appreciation of intangible assets 1,701 1,384 Deferred income tax liabilities* 1,701 1,384 * Deferred income tax liabilities are combined in other non-current liabilities. |
Summary of Valuation Allowance | The movements of the valuation allowance are as follows: Year Ended December 31, 2018 2019 2020 RMB RMB RMB Balance at the beginning of the year 72,271 169,543 139,177 Additions of valuation allowance 97,776 63,309 46,755 Reduction of valuation allowance (504) (2,553) (4,643) Change of tax rates — (71,090) (30,671) Change of decrease related to subsidiary disposals and expiration — (20,032) (4,247) Balance at the end of the year 169,543 139,177 146,371 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
Schedule of Related Party Transactions | The Company had the following balances and transactions with related parties: Related party balances December 31, 2019 2020 RMB RMB Amounts due from related parties Chuanbang (i) 9,938 — Ms. Han Lijuan (ii) 6,512 — Ningxia Tarena Technology Co., Ltd (iii) — 204 Xi 'an Tongchengtongchuang Education Technology Co., LTD 38 60 Others 4 41 Total 16,492 305 Notes: (i) The balance resulted from the service fee to Chuanbang for providing cash collection service. (ii) The balance as of December 31, 2019 represented a long-term loan to Ms. Han Lijuan and upon the Company’s request to avoid any risk of possible violation of Sarbanes-Oxley Act, all of the balance was repaid to the Company on April 2, 2020. (iii) The balance resulted from the franchise service income. Related party transactions |
SHARE BASED COMPENSATION (Table
SHARE BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SHARE BASED COMPENSATION | |
Summary of share options activity | Weighted Weighted Average Number of Average Remaining Aggregate Share Exercise Price Contractual Intrinsic Options US$ Years Value US$ Outstanding at December 31, 2018 3,396,797 1.61 6.47 15,919 Granted 1,028,728 0.10 — — Exercised (753,936) 0.64 — — Forfeited (235,225) 0.63 — — Expired — — — — Outstanding at December 31, 2019 3,436,364 1.43 5.99 1,815 Granted 1,236,146 1.26 — — Exercised (1,485,763) 0.33 — — Forfeited (363,940) 1.64 — — Expired — — — — Outstanding at December 31, 2020 2,822,807 1.91 6.85 4,311 Vested and expected to vest as of December 31, 2020 2,572,024 1.87 6.45 3,717 Exercisable as of December 31, 2020 2,099,922 1.82 5.72 3,261 |
Summary of fair value assumptions | The Company calculated the fair value of the share options on the grant date using the Binomial option-pricing valuation model. The assumptions used in the valuation model are summarized in the following table. Year Ended December 31, 2018 2019 2020 Expected volatility 53.52%-55.70% 52.05%-59.74% 72.22%-78.51% Expected dividends yield 0% 0% 0% Exercise multiple 2.2-2.8 2.2-2.8 2.2-2.8 Risk-free interest rate per annum 2.54%-3.23% 1.58%-2.89% 0.79%-2.08% The fair value of underlying ordinary shares (per share) US$6.97-US$14.99 US$0.59-US$6.48 US$1.71-US$4.65 |
Schedule of fair values of the options granted | Year Ended December 31, 2018 2019 2020 US$ US$ US$ Weighted average grant date fair value of option per share 12.35 4.84 2.52 Aggregate grant date fair value of options 13,402 4,980 3,115 |
Summary of the non-vested shares activity | Number of Non- Weighted Average vested Shares Grant Date Fair Value US$ Outstanding as of December 31, 2017 106,767 14.75 Granted 211,977 11.20 Vested (16,557) 14.22 Forfeited (22,541) 12.39 Outstanding as of December 31, 2018 279,646 12.28 Granted 225,627 5.12 Vested (80,020) 8.53 Forfeited (60,475) 8.01 Outstanding as of December 31, 2019 364,778 9.39 Granted 253,540 3.28 Vested (253,957) 5.44 Forfeited (53,923) 9.25 Outstanding as of December 31, 2020 310,438 7.66 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LOSS PER SHARE | |
Schedule of basic and diluted loss per share | Year Ended December 31, 2018 2019 2020 RMB RMB RMB Numerator: Net loss attributable to Class A and Class B ordinary shareholders (590,174) (1,036,086) (766,643) Net loss for basic and diluted earnings per share (590,174) (1,036,086) (766,643) Denominator: Denominator for basic earnings per share: Weighted average number of Class A and Class B ordinary shares outstanding 54,929,910 53,386,075 54,341,213 Dilutive effect of outstanding share options — — — Denominator for diluted loss per share 54,929,910 53,386,075 54,341,213 Basic loss per Class A and Class B ordinary share (10.74) (19.41) (14.11) Diluted loss per Class A and Class B ordinary share (10.74) (19.41) (14.11) |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
Schedule of components of rental expense | The components of rental expense for the year ended December 31, 2019 and 2020 consist as follows: Year Ended December 31, 2019 2020 RMB RMB Short-term rental expense 93,548 114,723 Operating lease expense excluding short-term rental expense 218,314 170,022 |
Schedule of other information related to operating leases | Year Ended December 31, 2019 2020 RMB RMB Cash paid for amounts included in the measurement of lease liabilities: 314,300 244,491 Non-cash right-of-use assets in exchange for new lease liabilities: 432,898 484,202 Weighted average remaining lease term 3.74 3.20 Weighted average discount rate 5.86 % 5.72 % |
Schedule of maturities of lease liabilities | RMB Year ending December 31, 2021 243,857 2022 197,984 2023 142,412 2024 71,696 2025 22,277 2026 and thereafter 8,467 Total lease payments 686,693 Less: imputed interest 81,359 Total 605,334 Less: current portion 199,083 Non-current portion 406,251 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
BUSINESS COMBINATION | |
Schedule of allocation of the consideration of the assets acquired and liabilities assumed | RMB Amortization period Cash and cash equivalents 3,874 Financial receivables 7,550 Prepaid and other current assets 6,138 Inventory, net 803 Property and equipment 12,851 Intangible assets 12,688 10 Goodwill 49,417 Other non-current assets 114 Total assets 93,435 Deferred revenue (31,906) Accounts payable and other current liabilities (1,046) Deferred tax liabilities (2,283) Total 58,200 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SEGMENT INFORMATION | |
Schedule of segment information | Year Ended December 31, 2020 Adult Kid Training Training Total RMB RMB RMB Revenue 1,136,043 761,840 1,897,883 Cost (420,349) (646,493) (1,066,842) Gross profit 715,694 115,347 831,041 Year Ended December 31, 2019 Adult Kid Training Training Total RMB RMB RMB Revenue 1,527,185 524,169 2,051,354 Cost (627,765) (546,069) (1,173,834) Gross profit (loss) 899,420 (21,900) 877,520 |
PARENT ONLY FINANCIAL INFORMA_2
PARENT ONLY FINANCIAL INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PARENT ONLY FINANCIAL INFORMATION | |
Schedule of condensed balance sheets | December 31, 2019 2020 2020 RMB RMB US$ ASSETS Current assets: Cash and cash equivalents 7,599 3,793 581 Prepaid expenses and other current assets 259 699 107 Total current assets 7,858 4,492 688 Total assets 7,858 4,492 688 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term bank loan — — — Accrued expenses and other current liabilities (1) 8,132 7,208 1,105 Total current liabilities 8,132 7,208 1,105 Total liabilities 8,132 7,208 1,105 Commitments and contingencies — — — Shareholders’ equity: Class A ordinary shares (US$0.001 par value,860,000,000 shares authorized, 53,806,534 and 55,546,254 shares issued, 46,707,393 and 48,346,384 shares outstanding as of December 31, 2019 and 2020, respectively) 337 349 53 Class B ordinary shares (US$0.001 par value, 40,000,000 shares authorized, 7,206,059 shares issued and outstanding as of December 31, 2019 and 2020, respectively) 74 74 11 Treasury shares (7,099,141 and 7,199,870 Class A ordinary shares as of December 31, 2019 and 2020, at cost) (457,169) (459,815) (70,470) Additional paid-in capital 1,284,573 1,324,161 202,937 Accumulated other comprehensive income 51,386 49,120 7,528 Accumulated deficit (879,475) (916,605) (140,476) Total shareholders’ deficit (274) (2,716) (417) Total liabilities and shareholders’ equity 7,858 4,492 688 (1) Mainly related to repurchase of treasury shares. |
Schedule of condensed statements of comprehensive loss | Year Ended December 31, 2018 2019 2020 2020 RMB RMB RMB US$ Selling and marketing expenses (403) — (693) (106) General and administrative expenses (5,536) (29,011) (35,380) (5,422) Operating loss (5,939) (29,011) (36,073) (5,528) Equity in loss of subsidiaries (589,564) (608,015) — — Foreign currency exchange (loss) gains 341 115 (1,112) (170) Interest income (expense) 413 (67) 55 8 Other income 2,550 665 — — Loss before income taxes (592,199) (636,313) (37,130) (5,690) Income tax expense — — — — Net loss (592,199) (636,313) (37,130) (5,690) Other comprehensive income (loss) Foreign currency translation adjustment 11,100 914 (2,266) (347) Comprehensive loss (581,099) (635,399) (39,396) (6,037) |
Schedule of condensed statements of cash flows | Year Ended December 31, 2018 2019 2020 2020 RMB RMB RMB US$ Operating activities: Net cash provided by (used in) operating activities 165,098 (3,249) (8,010) (1,228) Investing activities: Proceeds from maturity of time deposits 63,452 — — — Foreign currency exchange losses 1,890 — — — Net cash provided by investing activities 65,342 — — — Financing activities: Proceeds from bank loan 13,229 — — — Issuance of Class A ordinary shares in connection with exercise of share options 2,951 3,335 3,354 514 Payment of dividends (42,955) — — — Repayment of bank borrowings — (13,792) — — Repurchase of treasury shares (196,957) (5,058) — — Net cash (used in) provided by financing activities (223,732) (15,515) 3,354 514 Changes in cash and cash equivalents 6,708 (18,764) (4,656) (714) Effect of foreign currency exchange rate changes on cash and cash equivalents 1,141 856 850 130 Net increase (decrease) in cash and cash equivalents 7,849 (17,908) (3,806) (584) Cash and cash equivalents at beginning of year 17,658 25,507 7,599 1,165 Cash and cash equivalents at end of year 25,507 7,599 3,793 581 Non-cash financing activities: Payable for repurchase of treasury shares 5,109 — — — |
DESCRIPTION OF BUSINESS, ORGA_3
DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (Organization) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | Dec. 31, 2020USD ($) | |
Variable Interest Entity [Line Items] | |||||
Cash | ¥ 320,179 | ¥ 537,701 | $ 49,070 | ||
Amounts due from related parties | 305 | 16,492 | 47 | ||
Prepaid expenses and other current assets | 138,353 | 132,539 | 21,204 | ||
Total current assets | 536,253 | 801,255 | 82,185 | ||
Property and equipment, net | 464,490 | 576,633 | 71,186 | ||
Long-term investments, net | 67,592 | 67,773 | 10,359 | ||
Right-of-use assets | 586,451 | 773,472 | 89,878 | ||
Other non-current assets | 95,825 | 121,517 | 14,685 | ||
Total assets | 1,959,249 | 2,512,020 | 300,267 | ||
Accounts payable | 10,293 | 16,563 | 1,577 | ||
Deferred revenue-current | 1,980,138 | 1,554,431 | 303,469 | ||
Operating lease liabilities-current | 199,083 | 241,710 | 30,511 | ||
Income taxes payable | 76,817 | 69,671 | 11,773 | ||
Accrued expenses and other current liabilities | 391,904 | 397,558 | 60,062 | ||
Amounts due to related parties | 180 | 239 | 28 | ||
Total current liabilities | 2,669,125 | 2,369,334 | 409,061 | ||
Deferred revenue-non current | 18,060 | 31,539 | 2,768 | ||
Operating lease liabilities-non current | 406,251 | 508,810 | 62,261 | ||
Other non-current liabilities | 5,082 | 5,401 | 779 | ||
Total liabilities | 3,098,518 | 2,915,084 | $ 474,869 | ||
Net revenues | 1,897,883 | $ 290,863 | 2,051,354 | ¥ 2,085,371 | |
Net (loss) income | ¥ (771,000) | $ (118,190) | (1,038,878) | (592,199) | |
Equity Method Investments, Percentage of Equity Acquired through Options | 100.00% | 100.00% | |||
Tarena Entities [Member] | |||||
Variable Interest Entity [Line Items] | |||||
Cash | ¥ 1,332 | 211 | |||
Amounts due from Tarena International and its wholly-owned subsidiaries | 113,394 | 39,464 | |||
Amounts due from related parties | 4 | 4 | |||
Prepaid expenses and other current assets | 4,103 | 2,269 | |||
Total current assets | 118,833 | 41,948 | |||
Property and equipment, net | 1,552 | 2,121 | |||
Long-term investments, net | 48,380 | 48,380 | |||
Deferred income tax assets | 74 | ||||
Right-of-use assets | 5,540 | 7,083 | |||
Other non-current assets | 539 | 363 | |||
Total assets | 174,918 | 99,895 | |||
Accounts payable | 8,610 | 282 | |||
Deferred revenue-current | 138,529 | 51,808 | |||
Operating lease liabilities-current | 3,377 | 2,574 | |||
Income taxes payable | 8,037 | 2,049 | |||
Accrued expenses and other current liabilities | 13,909 | 17,397 | |||
Amounts due to Tarena International and its wholly-owned subsidiaries | 21,072 | 74,991 | |||
Amounts due to related parties | 130 | ||||
Total current liabilities | 193,534 | 149,231 | |||
Deferred revenue-non current | 133 | 215 | |||
Operating lease liabilities-non current | 1,536 | 3,843 | |||
Other non-current liabilities | 122 | 122 | |||
Total liabilities | 195,325 | 153,411 | |||
Net revenues | 127,043 | 32,013 | 4,232 | ||
Net (loss) income | 32,869 | (37,565) | (16,900) | ||
Net cash provided by operating activities | 122,813 | 36,902 | 1,540 | ||
Net cash used in investing activities | (34,226) | (24,083) | |||
Net cash provided by (used in) financing activities | ¥ (121,692) | ¥ (3,841) | ¥ 23,625 | ||
Mr. Han [Member] | Tarena Entities [Member] | |||||
Variable Interest Entity [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 67.80% | 67.80% | |||
Mr. Li [Member] | Tarena Entities [Member] | |||||
Variable Interest Entity [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 0.10% | 0.10% | |||
Loan Agreements [Member] | |||||
Variable Interest Entity [Line Items] | |||||
Debt Instrument, Initial Expiration Year | 2026 | 2026 | |||
Loan Agreements [Member] | Equity Holders [Member] | |||||
Variable Interest Entity [Line Items] | |||||
Debt Instrument, Face Amount | ¥ 6,000 |
DESCRIPTION OF BUSINESS, ORGA_4
DESCRIPTION OF BUSINESS, ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (Significant Concentrations and Risks) (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Concentration Risk [Line Items] | |||
Exchange rate | 6.5250 | ||
Net revenues [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 10.00% | ||
Net revenues [Member] | Product concentration [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 66.90% | 64.00% | 56.20% |
Net revenues [Member] | Product concentration [Member] | Digital Arts [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 16.80% | 22.90% | 28.70% |
Net revenues [Member] | Product concentration [Member] | Java [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 13.80% | 19.00% | 18.30% |
Net revenues [Member] | Product concentration [Member] | K-12 Programming [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 20.60% | 12.80% | 7.10% |
Net revenues [Member] | Product concentration [Member] | K-12 Robotics Programming [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 15.70% | 9.30% | 2.10% |
Net revenues [Member] | Geographic concentration [Member] | Beijing [Member] | |||
Concentration Risk [Line Items] | |||
Concentration percentage | 17.20% | 13.80% | 13.50% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Liquidity Condition, Cash, cash equivalents and time deposits, Short-term investment, Property and equipment, Revenue Recognition, Advertising costs, Operating lease, Government grant and Employee benefits (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2020CNY (¥)item¥ / $shares | Dec. 31, 2020USD ($)item$ / shares | Dec. 31, 2019CNY (¥)shares | Dec. 31, 2018CNY (¥) | Dec. 31, 2022CNY (¥) | Dec. 31, 2021CNY (¥) | Dec. 31, 2020USD ($)¥ / $shares | |
Significant Accounting Policies [Line Items] | |||||||
Net loss | ¥ 771,000 | $ 118,190 | ¥ 1,038,878 | ¥ 592,199 | |||
Total shareholders deficit | 1,132,002 | 400,047 | $ 173,488 | ||||
Net current liability | 2,133,000 | ||||||
Net cash provided by (used in) operating activities | 109,000 | $ 16,677 | 31,730 | (163,081) | |||
Deferred revenue liability | 1,998,000 | 905,867 | 648,050 | ||||
Restricted cash | ¥ 38,369 | 0 | $ 5,880 | ||||
Number of office buildings | item | 2 | 2 | |||||
Value of office buildings available for sale for future operating fund shortage | ¥ 133,000 | ||||||
Treasury stock, value | ¥ 185,000 | ||||||
Purchase price of treasury stock per ADS | $ / shares | $ 4 | ||||||
Exchange price of RMB against US$ | ¥ / $ | 6.5250 | 6.5250 | |||||
Cash, cash equivalents, time deposits and restricted time deposits | ¥ 364,805 | 621,188 | |||||
Goodwill Impairment | 0 | 0 | |||||
Deferred revenue | 1,998,198 | 1,585,970 | |||||
Deferred income tax benefit | (42,431) | $ (6,503) | (46,037) | (46,595) | |||
Revenue expected to be recognized on these contracts | 131,335 | ||||||
Advertising costs | 297,484 | 416,814 | 339,385 | ||||
Net revenues | 1,897,883 | $ 290,863 | 2,051,354 | 2,085,371 | |||
Contributions to employee benefits | 53,750 | 143,438 | 129,455 | ||||
Line of credit | ¥ 200,000 | ||||||
Line of credit expiration date | 2021-06 | 2021-06 | |||||
Subsequent event | |||||||
Significant Accounting Policies [Line Items] | |||||||
Revenue expected to be recognized on these contracts | ¥ 18,549 | ¥ 112,786 | |||||
Grant | |||||||
Significant Accounting Policies [Line Items] | |||||||
Net revenues | ¥ 4,735 | 1,665 | ¥ 2,292 | ||||
PRC | RMB Denominated Bank Deposits | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | 278,789 | 470,673 | |||||
PRC | US Dollar Denominated Bank Deposits | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | 81,283 | 136,640 | |||||
Hong Kong | RMB Denominated Bank Deposits | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | 2,022 | 132 | |||||
Hong Kong | US Dollar Denominated Bank Deposits | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | 793 | 9,939 | |||||
Hong Kong | HK Dollar Denominated Bank Deposits | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | 50 | 74 | |||||
US | US Dollar Denominated Bank Deposits | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | 117 | 135 | |||||
Taiwan | TWD Denominated Bank Deposit | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | 579 | 24 | |||||
Canada | CAD | |||||||
Significant Accounting Policies [Line Items] | |||||||
Cash, cash equivalents, time deposits and restricted time deposits | ¥ 1,172 | ¥ 3,571 | |||||
Furniture | |||||||
Significant Accounting Policies [Line Items] | |||||||
Useful life | 5 years | 5 years | |||||
Minimum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Business and Value Added Taxes | 3.00% | 3.00% | |||||
Contributions to employee benefits, percentage of salary | 20.70% | 20.70% | |||||
Minimum | Office equipment | |||||||
Significant Accounting Policies [Line Items] | |||||||
Useful life | 3 years | 3 years | |||||
Maximum | |||||||
Significant Accounting Policies [Line Items] | |||||||
Business and Value Added Taxes | 6.00% | 6.00% | |||||
Contributions to employee benefits, percentage of salary | 51.10% | 51.10% | |||||
Maximum | Office equipment | |||||||
Significant Accounting Policies [Line Items] | |||||||
Useful life | 4 years | 4 years | |||||
Common Class A | |||||||
Significant Accounting Policies [Line Items] | |||||||
Treasury shares | shares | 7,199,870 | 7,099,141 | 7,199,870 |
ACCOUNTS RECEIVABLE, NET - Sche
ACCOUNTS RECEIVABLE, NET - Schedule of Accounts Receivable (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Accounts receivable: | ||
Gross | ¥ 43,191 | ¥ 34,634 |
Unearned interest | (995) | (217) |
Total accounts receivable | 42,196 | 34,417 |
Less: allowance for credit losses | 9,214 | 2,251 |
Accounts receivable, net | ¥ 32,982 | ¥ 32,166 |
ACCOUNTS RECEIVABLE, NET - Clas
ACCOUNTS RECEIVABLE, NET - Classification of Accounts Receivable (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
ACCOUNTS RECEIVABLE, NET | |||
Accounts receivable - current portion | ¥ 32,790 | $ 5,025 | ¥ 31,442 |
Accounts receivable - non-current portion | 192 | $ 29 | 724 |
Accounts receivable, net | ¥ 32,982 | ¥ 32,166 |
ACCOUNTS RECEIVABLE, NET - Summ
ACCOUNTS RECEIVABLE, NET - Summary of Allowance for Doubtful Accounts (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | |
ACCOUNTS RECEIVABLE, NET | |||
Balance at the beginning of the year | ¥ 2,251 | ||
Additions charged to bad debt expense | 13,900 | $ 2,130 | ¥ 2,251 |
Additions charged to bad debt expense | 6,963 | ||
Balance at the end of the year | ¥ 9,214 | ¥ 2,251 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |||
Prepaid rental expenses | ¥ 12,304 | ¥ 15,290 | |
Interest receivable from time deposits | 894 | 2,206 | |
Prepaid deposits | 25,238 | 26,913 | |
Prepaid advertising expenses | 7,656 | 8,878 | |
Prepaid value-added tax | 40,352 | 28,545 | |
Loans made to employees | 20,421 | 17,947 | |
Professional fee | 11,169 | 13,859 | |
Inventory | 4,626 | 5,325 | |
Others | 15,693 | 13,576 | |
Total prepaid expenses and other current assets | ¥ 138,353 | $ 21,204 | ¥ 132,539 |
PROPERTY AND EQUIPMENT, NET - S
PROPERTY AND EQUIPMENT, NET - Schedule of Property and Equipment (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
Property, Plant and Equipment [Line Items] | |||
Property and equipment | ¥ 987,209 | ¥ 1,056,051 | |
Less: accumulated depreciation | 522,719 | 479,418 | |
Property and equipment, net | 464,490 | $ 71,186 | 576,633 |
Office buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 285,867 | 285,867 | |
Assets pledged as collateral | 197,737 | ||
Furniture | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 48,253 | 53,223 | |
Office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 409,682 | 474,839 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | ¥ 243,407 | ¥ 242,122 |
PROPERTY AND EQUIPMENT, NET -_2
PROPERTY AND EQUIPMENT, NET - Schedule of Depreciation Expense (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | ¥ 171,256 | ¥ 192,538 | ¥ 156,907 |
Cost of revenues | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | 132,898 | 150,188 | 127,850 |
Selling and marketing expenses | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | 18,137 | 19,303 | 11,211 |
General and administrative expenses | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | 18,867 | 22,314 | 16,511 |
Research and development expenses | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | ¥ 1,354 | ¥ 733 | ¥ 1,335 |
LONG-TERM INVESTMENTS, NET (Det
LONG-TERM INVESTMENTS, NET (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2019CNY (¥) | Dec. 31, 2020USD ($) | ||
Equity investments without readily determinable fair values | ||||
Impairment balance of equity investments without readily determinable fair values | ¥ 37,000 | ¥ 37,000 | ||
Total equity investments without readily determinable fair values, net | 52,380 | 52,380 | ||
Equity method investments | ||||
Equity method investment | 15,212 | 15,393 | ||
Impairment of equity method investments | (524) | (524) | ||
Total equity method investments, net | 15,212 | 15,393 | ||
Available-for-sale investment | [1] | 15,000 | 15,000 | |
Impairment of available-for-sale investments | (15,000) | (15,000) | ||
Total available-for-sale investment, net | 0 | 0 | ||
Total long-term investments, net | 67,592 | 67,773 | $ 10,359 | |
A company providing mechanic training | ||||
Equity investments without readily determinable fair values | ||||
Equity investments without readily determinable fair values | [2] | 12,000 | 12,000 | |
A company providing intelligent robot products | ||||
Equity investments without readily determinable fair values | ||||
Equity investments without readily determinable fair values | [3] | 24,000 | 24,000 | |
Impairment balance of equity investments without readily determinable fair values | 24,000 | 24,000 | ||
A company providing information sharing IT platform | ||||
Equity investments without readily determinable fair values | ||||
Equity investments without readily determinable fair values | [4] | 22,500 | 22,500 | |
Other equity investments without readily determinable fair values | ||||
Equity investments without readily determinable fair values | ||||
Equity investments without readily determinable fair values | [5] | 30,880 | 30,880 | |
Impairment balance of equity investments without readily determinable fair values | 13,000 | 13,000 | ||
Companies providing hockey program management | ||||
Equity method investments | ||||
Equity method investment | [6] | 2,132 | 2,223 | |
Total equity method investments, net | [6] | 2,132 | 2,223 | |
A company providing Internet product solutions | ||||
Equity method investments | ||||
Equity method investment | 13,604 | 13,694 | ||
Total equity method investments, net | ¥ 13,604 | ¥ 13,694 | ||
[1] | In October 2016, the Company paid RMB 10,000 in cash to acquire 13.9% equity interest in a private company, which provides employment course trainings and recruitment services. As it was found that the investee provided overstated financial statements to the new investors during the private placement in 2017 and lost in a lawsuit sued by one of the shareholders. Accordingly, the Company determined it to be fully impaired in 2017. The Company recognized no impairment loss for the years ended December 31, 2019 and 2020, respectively, and with an impairment balance of RMB 15,000 | |||
[2] | In October 2015, the Company paid RMB 12,000 in cash to acquire 2.86% of the total equity interest in an education company, which provides training for senior mechanic in vehicle maintenance and repair. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. | |||
[3] | In May 2017, the Company paid RMB 24,000 in cash to acquire 6% of the total equity interest in a company, which provides intelligent robot product. Based on the fact that the business conditions of this investee deteriorated, the Company recognized impairment loss of RMB 24,000 for the years ended December 31, 2018, and with an impairment balance of RMB 24,000 as of December 31, 2019 and 2020, respectively. | |||
[4] | In July 2017, the Company paid RMB 22,500 in cash to acquire 15% of the total equity interest in a company, which provides an information sharing IT platform. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. | |||
[5] | During the years ended December 31, 2018 and 2019, the Company acquired minority equity interest in several third-party companies. The Company recognized impairment loss of RMB 2,000 and nil for the years ended December 31, 2019 and 2020, respectively, and with an impairment balance of RMB 13,000 as of December 31, 2019 and 2020, respectively. | |||
[6] | In January 2018, the Company paid RMB 14,000 in cash to acquire 20% of equity interest of a company which provides IT consulting services and programming account for the investment using equity method. No impairment loss was recognized as of December 31, 2019 and 2020, and for the years then ended. |
LONG-TERM INVESTMENTS, NET - Ad
LONG-TERM INVESTMENTS, NET - Additional information (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Jan. 31, 2018 | Jul. 31, 2017 | May 31, 2017 | Oct. 31, 2016 | Oct. 31, 2015 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Schedule of Investments and Cost Method Investments [Line Items] | ||||||||
Impairment balance of equity investments without readily determinable fair values | ¥ 37,000 | ¥ 37,000 | ||||||
Impairment of long-term investments | (524) | (524) | ||||||
A company providing mechanic training | ||||||||
Schedule of Investments and Cost Method Investments [Line Items] | ||||||||
Payment to acquire cost method investment | ¥ 12,000 | |||||||
Equity investment , cost method percentage | 2.86% | |||||||
Impairment of equity investments without readily determinable fair values | 0 | 0 | ||||||
A company providing intelligent robot products | ||||||||
Schedule of Investments and Cost Method Investments [Line Items] | ||||||||
Payment to acquire cost method investment | ¥ 24,000 | |||||||
Equity investment , cost method percentage | 6.00% | |||||||
Impairment of equity investments without readily determinable fair values | ¥ 24,000 | |||||||
Impairment balance of equity investments without readily determinable fair values | 24,000 | 24,000 | ||||||
A company providing information sharing IT platform | ||||||||
Schedule of Investments and Cost Method Investments [Line Items] | ||||||||
Payment to acquire cost method investment | ¥ 22,500 | |||||||
Equity investment , cost method percentage | 15.00% | |||||||
Impairment of equity investments without readily determinable fair values | 0 | 0 | ||||||
Other equity investments without readily determinable fair values | ||||||||
Schedule of Investments and Cost Method Investments [Line Items] | ||||||||
Impairment of equity investments without readily determinable fair values | 0 | 2,000 | ||||||
Impairment balance of equity investments without readily determinable fair values | 13,000 | 13,000 | ||||||
Companies providing hockey program management | ||||||||
Schedule of Investments and Cost Method Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 20.00% | |||||||
Impairment of equity investments without readily determinable fair values | 0 | 0 | ||||||
Payment to acquire investment | ¥ 14,000 | |||||||
Equity investment percentage | 20.00% | |||||||
A company providing employment course trainings and recruitment services | ||||||||
Schedule of Investments and Cost Method Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 13.90% | |||||||
Impairment of equity investments without readily determinable fair values | 0 | 0 | ||||||
Impairment balance of equity investments without readily determinable fair values | ¥ 15,000 | ¥ 15,000 | ||||||
Equity investment percentage | 13.90% | |||||||
Payment to acquire available for sale securities | ¥ 10,000 |
OTHER NON-CURRENT ASSETS, NET_2
OTHER NON-CURRENT ASSETS, NET (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
Other non-current assets: | |||
Rent and property management deposits | ¥ 51,786 | ¥ 55,607 | |
Loans made to employees | 30,284 | 43,546 | |
Prepayment for equipment and leasehold improvement | 10,276 | 14,506 | |
Others | 3,479 | 7,858 | |
Total other non-current assets, net | ¥ 95,825 | $ 14,685 | ¥ 121,517 |
OTHER NON-CURRENT ASSETS, NET -
OTHER NON-CURRENT ASSETS, NET - Additional information (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Other Assets, Noncurrent Disclosure [Line Items] | |
Term of loans receivable | 5 years |
Housing loans made to employees | |
Other Assets, Noncurrent Disclosure [Line Items] | |
Annual interest rate (as a percent) | 3.325% |
Loans to employees pledged by share options | |
Other Assets, Noncurrent Disclosure [Line Items] | |
Annual interest rate (as a percent) | 5.00% |
SHORT-TERM BANK LOANS (Details)
SHORT-TERM BANK LOANS (Details) ¥ in Thousands, $ in Thousands | Aug. 09, 2019CNY (¥)contract | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) |
SHORT-TERM BANK LOANS | |||||
Debt term | 12 months | 12 months | |||
Proceeds from bank loan | ¥ 10,710 | $ 1,641 | ¥ 89,162 | ¥ 13,229 | |
Interest rate for the loan | 5.30% | 5.30% | 5.30% | ||
Interest expense | ¥ 5,047 | ¥ 565 | ¥ 19 | ||
Carrying value of office buildings pledged for the loan | ¥ 197,737 | ||||
Line of credit contract with Bank of Beijing | |||||
SHORT-TERM BANK LOANS | |||||
Borrowing capacity | ¥ 190,000 | ||||
Number of line of credit contracts | contract | 2 | ||||
Margin on interest rate | 1.15% |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |||
Accrued payroll and employee benefits | ¥ 194,862 | ¥ 141,955 | |
Refund liability | 71,843 | 67,625 | |
Professional service fee | 30,165 | 28,357 | |
Payable for advertisement | 23,287 | 40,652 | |
Rental fee | 11,153 | 9,943 | |
VAT and other tax payables | 9,535 | 11,111 | |
Guarantee liability | 5,808 | 10,921 | |
Payable to a third-party individual | 51,380 | ||
Others | 45,251 | 35,614 | |
Total | ¥ 391,904 | $ 60,062 | ¥ 397,558 |
NET REVENUES (Details)
NET REVENUES (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
Disaggregation of Revenue [Line Items] | ||||
Business taxes and surcharges | ¥ (4,252) | ¥ (11,205) | ¥ (13,878) | |
Total net revenues | 1,897,883 | $ 290,863 | 2,051,354 | 2,085,371 |
Total net revenues | 1,884,875 | 2,004,165 | 1,995,680 | |
Services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 102,897 | 138,128 | 100,472 | |
Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,781,978 | 1,866,037 | 1,895,208 | |
Tuition fee | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 1,786,230 | 1,877,242 | 1,896,642 | |
Certification service fee | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 41,961 | 75,403 | 82,376 | |
Loan referral service fee | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 7,801 | 19,939 | 18,096 | |
Others | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenues | 53,135 | 42,786 | 12,444 | |
Guarantee service | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenues | ¥ 13,008 | ¥ 47,189 | ¥ 89,691 |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income loss before Income Taxes (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
Income Taxes [Line Items] | ||||
Total income (loss) before income taxes | ¥ (806,227) | $ (123,559) | ¥ (1,080,437) | ¥ (597,064) |
PRC | ||||
Income Taxes [Line Items] | ||||
Total income (loss) before income taxes | (739,036) | (986,464) | (467,953) | |
Hong Kong | ||||
Income Taxes [Line Items] | ||||
Total income (loss) before income taxes | (8,280) | (876) | (2,031) | |
Cayman Islands | ||||
Income Taxes [Line Items] | ||||
Total income (loss) before income taxes | (54,913) | (87,470) | (126,887) | |
Taiwan | ||||
Income Taxes [Line Items] | ||||
Total income (loss) before income taxes | (1,549) | (2,292) | (166) | |
Canada | ||||
Income Taxes [Line Items] | ||||
Total income (loss) before income taxes | ¥ (2,449) | ¥ (3,335) | ¥ (27) |
INCOME TAXES - Schedule of In_2
INCOME TAXES - Schedule of Income Tax Expense benefit (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
INCOME TAXES | ||||
Current income tax expense | ¥ (7,397) | ¥ (4,478) | ¥ (16,058) | |
Withholding tax expense | (25,672) | |||
Deferred income tax benefit | 42,431 | $ 6,503 | 46,037 | 46,595 |
Total | ¥ 35,034 | $ 5,369 | ¥ 41,559 | ¥ 4,865 |
INCOME TAXES - Schedule of In_3
INCOME TAXES - Schedule of Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME TAXES | |||
PRC statutory income tax rate | 25.00% | 25.00% | 25.00% |
Impact of different tax rates in other jurisdictions | (1.80%) | (2.10%) | (5.30%) |
Research and development bonus deduction | 2.00% | 0.80% | 1.40% |
Non-deductible selling, general and administrative expenses | |||
Non-deductible expenses | (1.60%) | (1.30%) | (1.40%) |
Preferential tax rates | (11.20%) | (10.80%) | (0.30%) |
Change of tax rates | (2.90%) | (2.20%) | 0.00% |
Change in valuation allowance | (5.20%) | (5.60%) | (14.30%) |
Withholding tax | (4.30%) | ||
Actual income tax expense | 4.30% | 3.80% | 0.80% |
INCOME TAXES - Schedule of Defe
INCOME TAXES - Schedule of Deferred Income Tax Assets And Liabilities (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred income tax assets: | ||||
Impairment of long-term investments | ¥ 11,750 | ¥ 11,750 | ||
Tax loss carry forwards | 253,796 | 209,716 | ||
Advertising expense | 19,805 | 15,232 | ||
Others | 3,240 | 2,268 | ||
Total non-current deferred income tax assets | 288,591 | 238,966 | ||
Valuation allowance | (146,371) | (139,177) | ¥ (169,543) | ¥ (72,271) |
Non-current deferred income tax assets, net | 142,220 | 99,789 | ||
Deferred income tax assets, net | ||||
Valuation appreciation of intangible assets | 1,384 | 1,701 | ||
Non-current deferred income tax liabilities | ¥ 1,384 | ¥ 1,701 |
INCOME TAXES - Summary of Valua
INCOME TAXES - Summary of Valuation Allowance (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME TAXES | |||
Balance at the beginning of the year | ¥ 139,177 | ¥ 169,543 | ¥ 72,271 |
Additions of valuation allowance | 46,755 | 63,309 | 97,776 |
Reduction of valuation allowance | (4,643) | (2,553) | (504) |
Change of tax rate | (30,671) | (71,090) | |
Change of decrease related to subsidiary disposals and expiration | (4,247) | (20,032) | |
Balance at the end of the year | ¥ 146,371 | ¥ 139,177 | ¥ 169,543 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | 36 Months Ended | |||||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2017 | |
Tax losses carry forwards | ¥ 2,353,755 | ¥ 2,353,755 | |||||||
PRC statutory income tax rate | 25.00% | 25.00% | 25.00% | ||||||
Income Taxes, Preferential Income Tax Rate Advanced and New Technology Enterprises | 15.00% | 15.00% | 15.00% | ||||||
Effective Income Tax Rate Reconciliation, Tax Exempt Income, Percent | 12.50% | 12.50% | 12.50% | 0.00% | |||||
Income Taxes, Calculation Basis under Deemed Profit Method | 25 | ||||||||
Withholding tax expense | ¥ 25,672 | ||||||||
Effective Income Tax Rate Reconciliation, Tax Holiday, Percent | 0.00% | 0.00% | 0.00% | 50.00% | |||||
State Administration of Taxation, China [Member] | |||||||||
Withholding Tax Percentage On Repatriated Earnings | 10.00% | ||||||||
Maximum | |||||||||
Income Taxes, Preferential Income Tax Rate Small Profit Enterprises | 20.00% | 20.00% | 20.00% | ||||||
Income Taxes, Following Preferential Income Tax Rate Small Profit Enterprises | 50.00% | 75.00% | 50.00% | ||||||
HK [Member] | |||||||||
Tax losses carry forwards | ¥ 7,468 | ¥ 7,468 | |||||||
Tarena Hangzhou [Member] | |||||||||
PRC statutory income tax rate | 15.00% | 25.00% | 12.50% | ||||||
Effective Income Tax Rate Reconciliation, Tax Exempt Income, Percent | 50.00% | ||||||||
Hanru Hangzhou [Member] | |||||||||
Effective Income Tax Rate Reconciliation, Tax Exempt Income, Percent | 50.00% | ||||||||
2021 [Member] | |||||||||
Tax losses carry forwards | ¥ 5,164 | 5,164 | |||||||
2022 [Member] | |||||||||
Tax losses carry forwards | 54,792 | 54,792 | |||||||
2023 [Member] | |||||||||
Tax losses carry forwards | 420,616 | 420,616 | |||||||
2024 [Member] | |||||||||
Tax losses carry forwards | 1,026,407 | 1,026,407 | |||||||
2025 [Member] | |||||||||
Tax losses carry forwards | ¥ 839,308 | ¥ 839,308 |
RELATED PARTY TRANSACTIONS - Re
RELATED PARTY TRANSACTIONS - Related Party balances (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
Amount due from related parties | |||
Due from Related Parties, Current, Total | ¥ 305 | $ 47 | ¥ 16,492 |
Chuanbang | |||
Amount due from related parties | |||
Due from Related Parties, Current, Total | 9,938 | ||
Ms. Han Lijuan | |||
Amount due from related parties | |||
Due from Related Parties, Current, Total | 6,512 | ||
Ningxia Company | |||
Amount due from related parties | |||
Due from Related Parties, Current, Total | 204 | ||
Xi 'an Tongchengtongchuang Education Technology Co., LTD | |||
Amount due from related parties | |||
Due from Related Parties, Current, Total | 60 | 38 | |
Others | |||
Amount due from related parties | |||
Due from Related Parties, Current, Total | ¥ 41 | ¥ 4 |
RELATED PARTY TRANSACTIONS - _2
RELATED PARTY TRANSACTIONS - Related Parties Transactions (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Chuanbang | Cash collection service | |||
Related Party Transaction [Line Items] | |||
Expenses from transactions with related party | ¥ 79 | ¥ 790 | ¥ 3,489 |
Bolton School | Franchise and training service | |||
Related Party Transaction [Line Items] | |||
Revenue from related party | 518 | 1,379 | 529 |
Bolton School | Training service | |||
Related Party Transaction [Line Items] | |||
Expenses from transactions with related party | 305 | 1,112 | 798 |
Ningxia Company | Franchise, training and consulting service | |||
Related Party Transaction [Line Items] | |||
Revenue from related party | (11) | 143 | 493 |
Beijing Huimoer Technology Co., Ltd | Technical consulting service and labour expenses | |||
Related Party Transaction [Line Items] | |||
Expenses from transactions with related party | 148 | 1,333 | 75 |
Ms. Han Lijuan | |||
Related Party Transaction [Line Items] | |||
Interest income derived from the loan to related party | ¥ 81 | ¥ 325 | ¥ 325 |
RELATED PARTY TRANSACTIONS - Si
RELATED PARTY TRANSACTIONS - Significant Related Party Transactions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2018 | |
Connion Capital Limited | Minimum level of activity in bank account | |||
Related Party Transaction [Line Items] | |||
Minimum amount of fund to be received at each time | $ 1 | $ 1 | |
Due from related parties | $ 0 | $ 0 | |
Beijing Huimoer Technology Co., Ltd | |||
Related Party Transaction [Line Items] | |||
Equity investment percentage | 20.00% | ||
Chuanbang | Service fee payable | Minimum | |||
Related Party Transaction [Line Items] | |||
Cash collection service fees percentage | 2.00% | ||
Chuanbang | Service fee payable | Maximum | |||
Related Party Transaction [Line Items] | |||
Cash collection service fees percentage | 20.00% |
ORDINARY SHARES AND STATUTORY_2
ORDINARY SHARES AND STATUTORY RESERVE (Treasury Shares) (Details) ¥ in Thousands, $ in Millions | 12 Months Ended | |||
Dec. 31, 2020CNY (¥)shares | Dec. 31, 2019shares | Dec. 31, 2018CNY (¥)shares | Jun. 30, 2018USD ($) | |
Class of Stock [Line Items] | ||||
Total consideration of Shares repurchased | ¥ | ¥ 2,646 | ¥ 202,066 | ||
Treasury Shares | ||||
Class of Stock [Line Items] | ||||
Shares repurchased | shares | 100,729 | 0 | 3,768,495 | |
Total consideration of Shares repurchased | ¥ | ¥ 2,646 | ¥ 202,066 | ||
Treasury Shares | Minimum | ||||
Class of Stock [Line Items] | ||||
Share repurchase plan, authorized amount | $ | $ 30 | |||
Treasury Shares | Maximum | ||||
Class of Stock [Line Items] | ||||
Share repurchase plan, authorized amount | $ | $ 70 |
ORDINARY SHARES AND STATUTORY_3
ORDINARY SHARES AND STATUTORY RESERVE (Statutory reserves and restricted net assets and Dividend) (Details) ¥ / shares in Units, ¥ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018CNY (¥) | Dec. 31, 2020CNY (¥) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | Mar. 06, 2018¥ / shares | Mar. 06, 2018$ / shares | |
ORDINARY SHARES AND STATUTORY RESERVE | ||||||
Statutory reserve | ¥ 158,828 | ¥ 153,521 | ||||
Statutory Reserves, Percentage of Appropriation From Net Profit | 10.00% | |||||
Statutory Reserves, Balance As Percentage to Capital | 50.00% | |||||
Statutory Reserves for Private Schools Requiring Reasonable Returns, Percentage of Appropriation From Net Profit | 25.00% | |||||
Statutory Reserves for Private Schools Not Requiring Reasonable Returns, Percentage of Expected Annual Increase in Net Assets | 25.00% | |||||
Appropriations | ¥ 5,307 | 313 | ¥ 12,943 | |||
Restricted net assets | 1,483,411 | 1,438,505 | ||||
Dividends Payable, Amount Per Share | (per share) | ¥ 0.76 | $ 0.12 | ||||
Dividends, Common Stock, Cash | ¥ 42,955 | ¥ 0 | ¥ 0 |
SHARE BASED COMPENSATION - Summ
SHARE BASED COMPENSATION - Summary of share options activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Number of Share Options | |||
Outstanding, beginning balance | 3,436,364 | 3,396,797 | |
Granted | 1,236,146 | 1,028,728 | 1,085,094 |
Exercised | (1,485,763) | (753,936) | |
Forfeited | (363,940) | (235,225) | |
Outstanding, ending balance | 2,822,807 | 3,436,364 | 3,396,797 |
Vested and expected to vest | 2,572,024 | ||
Exercisable | 2,099,922 | ||
Weighted Average Exercise Price | |||
Outstanding, beginning balance | $ 1.43 | $ 1.61 | |
Granted | 1.26 | 0.10 | |
Exercised | 0.33 | 0.64 | |
Forfeited | 1.64 | 0.63 | |
Outstanding, ending balance | 1.91 | $ 1.43 | $ 1.61 |
Vested and expected to vest | 1.87 | ||
Exercisable | $ 1.82 | ||
Weighted Average Remaining Contractual Years | |||
Outstanding | 6 years 10 months 6 days | 5 years 11 months 26 days | 6 years 5 months 19 days |
Vested and expected to vest | 6 years 5 months 12 days | ||
Exercisable | 5 years 8 months 19 days | ||
Outstanding, Aggregate Intrinsic Value | $ 4,311 | $ 1,815 | $ 15,919 |
Vested and expected to vest, Aggregate Intrinsic Value | 3,717 | ||
Exercisable, Aggregate Intrinsic Value | $ 3,261 |
SHARE BASED COMPENSATION - Su_2
SHARE BASED COMPENSATION - Summary of fair value assumptions (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividends yield | 0.00% | 0.00% | 0.00% |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 72.22% | 52.05% | 53.52% |
Exercise multiple | 2.2 | 2.2 | 2.2 |
Risk-free interest rate per annum | 0.79% | 1.58% | 2.54% |
The fair value of underlying ordinary shares (per share) | $ 1.71 | $ 0.59 | $ 6.97 |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 78.51% | 59.74% | 55.70% |
Exercise multiple | 2.8 | 2.8 | 2.8 |
Risk-free interest rate per annum | 2.08% | 2.89% | 3.23% |
The fair value of underlying ordinary shares (per share) | $ 4.65 | $ 6.48 | $ 14.99 |
SHARE BASED COMPENSATION - Sche
SHARE BASED COMPENSATION - Schedule fair values of the options granted (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
SHARE BASED COMPENSATION | |||
Weighted average grant date fair value of option per share | $ 2.52 | $ 4.84 | $ 12.35 |
Aggregate grant date fair value of options | $ 3,115 | $ 4,980 | $ 13,402 |
SHARE BASED COMPENSATION - Su_3
SHARE BASED COMPENSATION - Summary of the non-vested shares activity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Number of Non-vested Shares | |||
Outstanding, beginning balance | 364,778 | 279,646 | 106,767 |
Granted | 253,540 | 225,627 | 211,977 |
Vested | (253,957) | (80,020) | (16,557) |
Forfeited | (53,923) | (60,475) | (22,541) |
Outstanding, ending balance | 310,438 | 364,778 | 279,646 |
Weighted Average Grant Date Fair Value | |||
Outstanding, beginning balance | $ 9.39 | $ 12.28 | $ 14.75 |
Granted | 3.28 | 5.12 | 11.20 |
Vested | 5.44 | 8.53 | 14.22 |
Forfeited | 9.25 | 8.01 | 12.39 |
Outstanding, ending balance | $ 7.66 | $ 9.39 | $ 12.28 |
SHARE BASED COMPENSATION (Narra
SHARE BASED COMPENSATION (Narrative) (Details) ¥ in Thousands | Apr. 09, 2020shares | Mar. 01, 2020shares | Jan. 01, 2020 | Aug. 13, 2019shares | Apr. 03, 2019shares | Jan. 01, 2019shares | Apr. 03, 2018shares | Apr. 01, 2018shares | Dec. 31, 2020CNY (¥)shares | Dec. 31, 2019CNY (¥)shares | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2020$ / shares | Dec. 31, 2020CNY (¥) | Dec. 31, 2019$ / shares | Dec. 31, 2018$ / shares | Dec. 31, 2014shares | Nov. 28, 2012shares | Sep. 22, 2008shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Options granted | 1,236,146 | 1,028,728 | 1,085,094 | |||||||||||||||
Vesting period | 3 months | |||||||||||||||||
Total intrinsic value of options exercised | ¥ | ¥ 26,301 | ¥ 7,936 | ¥ 22,710 | |||||||||||||||
Non-vested shares granted | 253,540 | 225,627 | 211,977 | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 253,957 | 80,020 | 16,557 | |||||||||||||||
Unrecognized stock option compensation expense | ¥ | ¥ 13,376 | |||||||||||||||||
Unrecognized stock option compensation expense, period for recognition | 1 year 5 months 1 day | |||||||||||||||||
Unrecognized non-vested shares compensation expense | ¥ | ¥ 14,771 | |||||||||||||||||
Unrecognized non-vested shares compensation expense, period for recognition | 2 years 7 months 17 days | |||||||||||||||||
Fair value of vested restricted shares | ¥ | ¥ 9,013 | ¥ 4,707 | ¥ 1,557 | |||||||||||||||
Minimum | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Exercise prices | $ / shares | $ 1 | $ 0.89 | $ 0.06 | |||||||||||||||
Vesting period | 3 months | 3 months 29 days | ||||||||||||||||
Share price | $ / shares | 1.71 | 0.59 | 6.97 | |||||||||||||||
Maximum | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Exercise prices | $ / shares | 2.51 | 1 | 1 | |||||||||||||||
Vesting period | 5 years | 5 years | 1 year | |||||||||||||||
Share price | $ / shares | $ 4.65 | $ 6.48 | $ 14.99 | |||||||||||||||
Independent Directors [Member] | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Vesting period | 1 year | 5 years | 1 year | 5 years | ||||||||||||||
Non-vested shares granted | 143,628 | 74,000 | 47,380 | 41,666 | 193,796 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 1,200 | |||||||||||||||||
January 1 [Member] | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Vesting period | 1 year | |||||||||||||||||
Expiration period | 10 years | |||||||||||||||||
January 1 [Member] | Minimum | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Expiration period | 9 years | |||||||||||||||||
January 1 [Member] | Maximum | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Expiration period | 10 years | 10 years | ||||||||||||||||
January 1 [Member] | Independent Directors [Member] | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Vesting period | 1 year | 5 years | ||||||||||||||||
Non-vested shares granted | 136,581 | 35,912 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 135,381 | |||||||||||||||||
April 3 [Member] | Independent Directors [Member] | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Vesting percentage | 25.00% | |||||||||||||||||
Non-vested shares granted | 18,181 | |||||||||||||||||
2008 Plan [Member] | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Authorized | 8,184,990 | 6,002,020 | ||||||||||||||||
2014 Plan [Member] | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||
Authorized | 1,833,696 |
LOSS PER SHARE (Details)
LOSS PER SHARE (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥)¥ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019CNY (¥)¥ / sharesshares | Dec. 31, 2018CNY (¥)¥ / sharesshares | |
Numerator: | ||||
Net loss attributable to Class A and Class B ordinary shareholders | ¥ (766,643) | $ (117,493) | ¥ (1,036,086) | ¥ (590,174) |
Net loss for basic and diluted earnings per share | ¥ | ¥ (766,643) | ¥ (1,036,086) | ¥ (590,174) | |
Denominator: | ||||
Weighted average number of Class A and Class B ordinary shares outstanding | 54,341,213 | 54,341,213 | 53,386,075 | 54,929,910 |
Dilutive effect of outstanding share options | 0 | 0 | 0 | 0 |
Denominator for diluted loss per share | 54,341,213 | 54,341,213 | 53,386,075 | 54,929,910 |
Basic loss per Class A and Class B ordinary share | (per share) | ¥ (14.11) | $ (2.16) | ¥ (19.41) | ¥ (10.74) |
Diluted loss per Class A and Class B ordinary share | (per share) | ¥ (14.11) | $ (2.16) | ¥ (19.41) | ¥ (10.74) |
LEASES - Components of rental e
LEASES - Components of rental expense (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
LEASES | ||
Short-term rental expense | ¥ 114,723 | ¥ 93,548 |
Operating lease expense excluding short-term rental expense | ¥ 170,022 | ¥ 218,314 |
LEASES - Other information rela
LEASES - Other information related to operating leases (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | |
LEASES | |||
Cash paid for amounts included in the measurement of lease liabilities | ¥ 244,491 | ¥ 314,300 | |
Non-cash right-of-use assets in exchange for new lease liabilities | ¥ 484,202 | $ 74,207 | ¥ 432,898 |
Weighted average remaining lease term | 3 years 2 months 12 days | 3 years 2 months 12 days | 3 years 8 months 26 days |
Weighted average discount rate | 5.72% | 5.72% | 5.86% |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | Dec. 31, 2020USD ($) | |
LEASES | ||||
2021 | ¥ 243,857 | |||
2022 | 197,984 | |||
2023 | 142,412 | |||
2024 | 71,696 | |||
2025 | 22,277 | |||
2026 and thereafter | 8,467 | |||
Total lease payments | 686,693 | |||
Less: imputed interest | 81,359 | |||
Total | 605,334 | |||
Less: current portion | 199,083 | ¥ 241,710 | $ 30,511 | |
Non-current portion | 406,251 | 508,810 | $ 62,261 | |
Gross rental expenses incurred under operating leases | 284,745 | 311,862 | ¥ 262,440 | |
Sublease rental income | ¥ 971 | ¥ 1,587 | ¥ 1,533 |
BUSINESS COMBINATION (Details)
BUSINESS COMBINATION (Details) ¥ in Thousands, $ in Thousands | Mar. 01, 2018CNY (¥) | Dec. 31, 2018CNY (¥) | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) |
BUSINESS COMBINATION [Line Items] | |||||
Total consideration | ¥ 57,700 | ||||
Allocation of the consideration of the assets acquired and liabilities assumed | |||||
Goodwill | ¥ 52,782 | $ 8,089 | ¥ 52,782 | ||
RTEC | |||||
BUSINESS COMBINATION [Line Items] | |||||
Equity Interest acquired | 100.00% | ||||
Total consideration | ¥ 58,200,000 | ||||
Allocation of the consideration of the assets acquired and liabilities assumed | |||||
Cash and cash equivalents | 3,874 | ||||
Financial receivables | 7,550 | ||||
Prepaid and other current assets | 6,138 | ||||
Inventory, net | 803 | ||||
Property and equipment | 12,851 | ||||
Intangible assets | 12,688 | ||||
Goodwill | 49,417 | ||||
Other non-current assets | 114 | ||||
Total assets | 93,435 | ||||
Deferred revenue | (31,906) | ||||
Accounts payable and other current liabilities | (1,046) | ||||
Deferred tax liabilities | (2,283) | ||||
Total | ¥ 58,200 | ||||
Amortization period | 10 years |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥)segment | Dec. 31, 2020USD ($)segment | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
SEGMENT INFORMATION [Line Items] | ||||
Number of operating segments | segment | 2 | 2 | ||
Revenues, cost of revenues, and gross profit by segment | ||||
Revenue | ¥ 1,897,883 | $ 290,863 | ¥ 2,051,354 | ¥ 2,085,371 |
Cost | (1,066,842) | (163,501) | (1,173,834) | (918,549) |
Gross profit | 831,041 | $ 127,362 | 877,520 | ¥ 1,166,822 |
Adult Training | ||||
Revenues, cost of revenues, and gross profit by segment | ||||
Revenue | 1,136,043 | 1,527,185 | ||
Cost | (420,349) | (627,765) | ||
Gross profit | 715,694 | 899,420 | ||
Kid Training | ||||
Revenues, cost of revenues, and gross profit by segment | ||||
Revenue | 761,840 | 524,169 | ||
Cost | (646,493) | (546,069) | ||
Gross profit | ¥ 115,347 | ¥ (21,900) |
PARENT ONLY FINANCIAL INFORMA_3
PARENT ONLY FINANCIAL INFORMATION - Condensed Balance Sheets (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands | Dec. 31, 2020CNY (¥)¥ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019CNY (¥)¥ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018CNY (¥) | Dec. 31, 2017CNY (¥) | |
Current assets: | |||||||
Prepaid expenses and other current assets | ¥ 138,353 | $ 21,204 | ¥ 132,539 | ||||
Total current assets | 536,253 | 82,185 | 801,255 | ||||
Total assets | 1,959,249 | 300,267 | 2,512,020 | ||||
Current liabilities: | |||||||
Short-term bank loan | 10,710 | 1,641 | 89,162 | ||||
Accrued expenses and other current liabilities | 391,904 | 60,062 | 397,558 | ||||
Total current liabilities | 2,669,125 | 409,061 | 2,369,334 | ||||
Total liabilities | 3,098,518 | 474,869 | 2,915,084 | ||||
Commitments and contingencies | |||||||
Shareholders' equity: | |||||||
Additional paid-in capital | 1,324,161 | 202,937 | 1,284,573 | ||||
Accumulated other comprehensive income | 49,120 | 7,528 | 51,386 | ||||
Accumulated deficit | (2,045,891) | (313,547) | (1,279,248) | ||||
Total equity deficit to the shareholders of Tarena International, Inc. | (1,132,002) | (173,488) | (400,047) | ||||
Total liabilities and equity | 1,959,249 | 300,267 | 2,512,020 | ||||
Common Class A | |||||||
Shareholders' equity: | |||||||
Ordinary shares | 349 | 53 | 337 | ||||
Treasury shares (7,099,141 and 7,199,870 Class A ordinary shares as of December 31, 2019 and 2020, at cost) | ¥ (459,815) | $ (70,470) | ¥ (457,169) | ||||
Ordinary shares | |||||||
Ordinary shares, par value | $ / shares | $ 0.001 | $ 0.001 | |||||
Authorized | 860,000,000 | 860,000,000 | 860,000,000 | 860,000,000 | |||
Issued | 55,546,254 | 55,546,254 | 53,806,534 | 53,806,534 | |||
Outstanding | 48,346,384 | 48,346,384 | 46,707,393 | 46,707,393 | |||
Treasury shares | 7,199,870 | 7,199,870 | 7,099,141 | 7,099,141 | |||
Common Class B | |||||||
Shareholders' equity: | |||||||
Ordinary shares | ¥ 74 | $ 11 | ¥ 74 | ||||
Ordinary shares | |||||||
Ordinary shares, par value | $ / shares | $ 0.001 | $ 0.001 | |||||
Authorized | 40,000,000 | 40,000,000 | 40,000,000 | 40,000,000 | |||
Issued | 7,206,059 | 7,206,059 | 7,206,059 | 7,206,059 | |||
Outstanding | 7,206,059 | 7,206,059 | 7,206,059 | 7,206,059 | |||
Parent Company [Member] | |||||||
Current assets: | |||||||
Cash and cash equivalents | ¥ 3,793 | $ 581 | ¥ 7,599 | $ 1,165 | ¥ 25,507 | ¥ 17,658 | |
Prepaid expenses and other current assets | 699 | 107 | 259 | ||||
Total current assets | 4,492 | 688 | 7,858 | ||||
Total assets | 4,492 | 688 | 7,858 | ||||
Current liabilities: | |||||||
Accrued expenses and other current liabilities | [1] | 7,208 | 1,105 | 8,132 | |||
Total current liabilities | 7,208 | 1,105 | 8,132 | ||||
Total liabilities | 7,208 | 1,105 | 8,132 | ||||
Commitments and contingencies | |||||||
Shareholders' equity: | |||||||
Treasury shares (7,099,141 and 7,199,870 Class A ordinary shares as of December 31, 2019 and 2020, at cost) | (459,815) | (70,470) | (457,169) | ||||
Additional paid-in capital | 1,324,161 | 202,937 | 1,284,573 | ||||
Accumulated other comprehensive income | 49,120 | 7,528 | 51,386 | ||||
Accumulated deficit | (916,605) | (140,476) | (879,475) | ||||
Total equity deficit to the shareholders of Tarena International, Inc. | (2,716) | (417) | (274) | ||||
Total liabilities and equity | 4,492 | 688 | 7,858 | ||||
Parent Company [Member] | Common Class A | |||||||
Shareholders' equity: | |||||||
Ordinary shares | ¥ 349 | $ 53 | ¥ 337 | ||||
Ordinary shares | |||||||
Ordinary shares, par value | $ / shares | $ 0.001 | $ 0.001 | |||||
Authorized | 860,000,000 | 860,000,000 | 860,000,000 | 860,000,000 | |||
Issued | 55,546,254 | 55,546,254 | 53,806,534 | 53,806,534 | |||
Outstanding | 48,346,384 | 48,346,384 | 46,707,393 | 46,707,393 | |||
Treasury shares | 7,199,870 | 7,199,870 | 7,099,141 | 7,099,141 | |||
Parent Company [Member] | Common Class B | |||||||
Shareholders' equity: | |||||||
Ordinary shares | ¥ 74 | $ 11 | ¥ 74 | ||||
Ordinary shares | |||||||
Ordinary shares, par value | ¥ / shares | ¥ 0.001 | ¥ 0.001 | |||||
Authorized | 40,000,000 | 40,000,000 | 40,000,000 | 40,000,000 | |||
Issued | 7,206,059 | 7,206,059 | 7,206,059 | 7,206,059 | |||
Outstanding | 7,206,059 | 7,206,059 | 7,206,059 | 7,206,059 | |||
[1] | Mainly related to repurchase of treasury shares. |
PARENT ONLY FINANCIAL INFORMA_4
PARENT ONLY FINANCIAL INFORMATION - Condensed Statements of Comprehensive Loss (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
Condensed Income Statements, Captions [Line Items] | ||||
Selling and marketing expenses | ¥ 906,337 | $ 138,902 | ¥ 1,119,698 | ¥ 1,047,632 |
General and administrative expenses | (630,618) | (96,646) | (723,306) | (546,568) |
Operating loss | (806,380) | (123,583) | (1,098,156) | (594,632) |
Foreign currency exchange (loss) gains | (4,849) | (743) | 1,614 | 4,951 |
Interest income (expense) | (199) | (30) | 15,859 | 26,200 |
Other income | 5,201 | 797 | 246 | (33,583) |
Loss before income taxes | (806,227) | (123,559) | (1,080,437) | (597,064) |
Income tax expense | 35,034 | 5,369 | 41,559 | 4,865 |
Net loss | (771,000) | (118,190) | (1,038,878) | (592,199) |
Other comprehensive income (loss) | ||||
Foreign currency translation adjustment | (2,266) | (347) | 914 | 11,100 |
Comprehensive loss | (773,459) | (118,537) | (1,037,964) | (581,099) |
Parent Company [Member] | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Selling and marketing expenses | (693) | (106) | (403) | |
General and administrative expenses | (35,380) | (5,422) | (29,011) | (5,536) |
Operating loss | (36,073) | (5,528) | (29,011) | (5,939) |
Equity in loss of subsidiaries | (608,015) | (589,564) | ||
Foreign currency exchange (loss) gains | (1,112) | (170) | 115 | 341 |
Interest income (expense) | 55 | 8 | (67) | 413 |
Other income | 665 | 2,550 | ||
Loss before income taxes | (37,130) | (5,690) | (636,313) | (592,199) |
Net loss | (37,130) | (5,690) | (636,313) | (592,199) |
Other comprehensive income (loss) | ||||
Foreign currency translation adjustment | (2,266) | (347) | 914 | 11,100 |
Comprehensive loss | ¥ (39,396) | $ (6,037) | ¥ (635,399) | ¥ (581,099) |
PARENT ONLY FINANCIAL INFORMA_5
PARENT ONLY FINANCIAL INFORMATION - Condensed Statements of Cash Flows (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018CNY (¥) | |
Investing activities: | ||||
Proceeds from maturity of time deposits | ¥ 171,660 | $ 26,308 | ¥ 419,777 | ¥ 563,354 |
Foreign currency exchange losses | 4,849 | 743 | (1,614) | (4,440) |
Financing activities: | ||||
Proceeds from bank loan | 10,710 | 1,641 | 89,162 | 13,229 |
Issuance of Class A ordinary shares in connection with exercise of share options | 3,354 | 514 | 3,335 | 2,951 |
Payment of dividends | (42,955) | |||
Repurchase of treasury shares | (5,058) | (196,957) | ||
Changes in cash, cash equivalents an restricted cash | (177,777) | (27,246) | (8,550) | (151,578) |
Effect of foreign currency exchange rate changes on cash and cash equivalents | (1,376) | (210) | 567 | 10,571 |
Non-cash financing activities: | ||||
Payable for repurchase of treasury shares | 5,109 | |||
Parent Company [Member] | ||||
Operating activities: | ||||
Net cash (used in) provided by operating activities | (8,010) | (1,228) | (3,249) | 165,098 |
Investing activities: | ||||
Proceeds from maturity of time deposits | 63,452 | |||
Foreign currency exchange losses | 1,890 | |||
Net cash provided by investing activities | 65,342 | |||
Financing activities: | ||||
Proceeds from bank loan | 13,229 | |||
Issuance of Class A ordinary shares in connection with exercise of share options | 3,354 | 514 | 3,335 | 2,951 |
Payment of dividends | (42,955) | |||
Repayment of bank borrowings | 13,792 | |||
Repurchase of treasury shares | (5,058) | (196,957) | ||
Net cash (used in) provided by financing activities | 3,354 | 514 | (15,515) | (223,732) |
Changes in cash, cash equivalents an restricted cash | (4,656) | (714) | (18,764) | 6,708 |
Effect of foreign currency exchange rate changes on cash and cash equivalents | 850 | 130 | 856 | 1,141 |
Net increase (decrease) in cash and cash equivalents | (3,806) | (584) | (17,908) | 7,849 |
Cash and cash equivalents at beginning of year | 7,599 | 1,165 | 25,507 | 17,658 |
Cash and cash equivalents at end of year | ¥ 3,793 | $ 581 | ¥ 7,599 | 25,507 |
Non-cash financing activities: | ||||
Payable for repurchase of treasury shares | ¥ 5,109 |