Document And Entity Information
Document And Entity Information | 12 Months Ended |
Jun. 30, 2019shares | |
Document And Entity Information [Abstract] | |
Document Type | 20-F |
Document Period End Date | Jun. 30, 2019 |
Entity Registrant Name | Hailiang Education Group Inc. |
Entity Common Stock, Shares Outstanding | 412,450,256 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Accelerated Filer |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Shell Company | false |
Entity Central Index Key | 0001596964 |
Current Fiscal Year End Date | --06-30 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Trading Symbol | HLG |
CONSOLIDATED STATEMENTS OF PROF
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME | |||
Revenue | ¥ 1,499,025 | ¥ 1,169,348 | ¥ 853,295 |
Cost of revenue | (1,026,903) | (804,674) | (648,482) |
Gross profit | 472,122 | 364,674 | 204,813 |
Other income, net | 25,100 | 3,689 | 6,325 |
Selling expenses | (25,003) | (24,539) | (21,902) |
Administrative expenses | (72,661) | (63,374) | (28,385) |
Operating profit | 399,558 | 280,450 | 160,851 |
Gain on disposal of affiliated entities | 0 | 5,349 | 0 |
Net finance income | 24,935 | 11,391 | 6,892 |
Profit before tax | 424,493 | 297,190 | 167,743 |
Income tax expenses | (108,713) | (66,288) | 0 |
Net Profit | 315,780 | 230,902 | 167,743 |
Profit attributable to: | |||
Net profit attributable to non-controlling interests | 22,359 | 8,314 | 0 |
Net profit attributable to the Company's shareholders | 293,421 | 222,588 | 167,743 |
Net Profit | ¥ 315,780 | ¥ 230,902 | ¥ 167,743 |
Earnings per share | |||
Basic and diluted earnings per share | ¥ 0.71 | ¥ 0.54 | ¥ 0.41 |
Net Profit | ¥ 315,780 | ¥ 230,902 | ¥ 167,743 |
Other comprehensive income/(loss), net of nil income tax | 3,310 | (2,542) | 2,202 |
Total comprehensive income | 319,090 | 228,360 | 169,945 |
Total comprehensive income attributable to: | |||
Total comprehensive income attributable to non-controlling interests | 22,359 | 8,314 | 0 |
Total comprehensive income attributable to the Company's shareholders | 296,731 | 220,046 | 169,945 |
Total comprehensive income | ¥ 319,090 | ¥ 228,360 | ¥ 169,945 |
CONSOLIDATED STATEMENTS OF FINA
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 | |
Assets | |||
Property and equipment, net | ¥ 620,623 | ¥ 679,081 | |
Intangible assets and goodwill, net | 99,525 | 78,747 | |
Contract costs | 9,899 | 0 | |
Prepayments to third party suppliers | 94 | 92 | |
Non-current assets | 730,141 | 757,920 | |
Other receivables due from related parties | [1],[2],[3],[4],[5],[6] | 91,674 | 95,128 |
Other current assets | 31,706 | 15,182 | |
Term deposits held at a related party finance entity | [1] | 1,387,094 | 204,000 |
Restricted bank deposits | 1,613 | 0 | |
Cash and cash equivalents | 260,684 | 812,620 | |
Current assets | 1,772,771 | 1,126,930 | |
Total assets | 2,502,912 | 1,884,850 | |
Equity | |||
Share capital | 268 | 268 | |
Share premium | 134,583 | 134,583 | |
Contributed capital | 251,034 | 235,895 | |
Reserves | 360,914 | 312,667 | |
Retained earnings | 905,009 | 638,246 | |
Total Hailiang Education Group Inc. shareholders' equity | 1,651,808 | 1,321,659 | |
Non-controlling interests | 37,439 | 13,154 | |
Total equity | 1,689,247 | 1,334,813 | |
Liabilities | |||
Contract liabilities | 2,579 | 0 | |
Deferred tax liabilities | 4,691 | 0 | |
Non-current liabilities | 7,270 | 0 | |
Trade and other payables due to third parties | 218,122 | 141,504 | |
Other payables due to related parties | [2],[3],[6],[7],[8],[9] | 134,745 | 138,215 |
Contract liabilities | 398,951 | 0 | |
Deferred revenue | 0 | 212,969 | |
Income tax payable | 54,577 | 57,349 | |
Current liabilities | 806,395 | 550,037 | |
Total liabilities | 813,665 | 550,037 | |
Commitments and contingencies | |||
Total equity and liabilities | ¥ 2,502,912 | ¥ 1,884,850 | |
[1] | As of June 30, 2018 and 2019, the Group has cash held at a related party finance entity of RMB740,733 and RMB223,548, respectively. During the year ended June 30, 2018, net amount of RMB679,018 were placed with Hailiang Finance. During the years ended June 30, 2017 and 2019, net amount of RMB109,998 and RMB517,185 were withdrawn from Hailiang Finance, respectively. The cash held at a related party finance entity is held for the purpose of meeting short-term cash commitments, such as to pay for the Group’s operating expenses at any time.During the years ended June 30, 2017, 2018 and 2019, term deposits of RMB1,953,600, RMB204,000 and RMB4,709,697 were placed with Hailiang Finance, and RMB1,552,600, RMB401,000 and RMB3,526,603 were matured, respectively. The term deposits are held for investment purpose and can be withdrawn prior to their maturity without incurring significant penalties. Such amounts have been presented as investing activities in the statements of cash flows.As of June 30, 2018 and 2019, the Group has term deposits with maturities ranging from three months to one year amounting to RMB204,000 and RMB1,387,094 that are placed at Hailiang Finance, respectively.The interest income from the deposits during the years ended June 30, 2017, 2018 and 2019 amounted to RMB5,847, RMB11,464 and RMB24,313, respectively. Interest receivable as of June 30, 2018 and 2019 amounted to RMB1,038 and RMB4,916 respectively. | ||
[2] | During the years ended June 30, 2017, 2018 and 2019, the Group paid expenses, which mainly include staff related expenses, start-up costs and other miscellaneous expenses, of nil, RMB 9,401 and RMB10,312 respectively on behalf of the related parties. Such amount is receivable on demand, and the related parties repaid nil, RMB8,794 and RMB10,007 to the Group during the years ended June 30, 2017, 2018 and 2019, respectively.During the years ended June 30, 2017, 2018 and 2019, the related parties paid expenses, which mainly include staff related expenses and other miscellaneous expenses, of RMB3,836, RMB4,612 and RMB2,731 respectively on behalf of the Group. Such amount is due and payable on demand, and the Group repaid RMB4,536, RMB4,124 and RMB 4,663 to the related parties during the years ended June 30, 2017, 2018 and 2019, respectively.During the years ended June 30, 2017, 2018 and 2019, the Group collected amounts of RMB39,760, RMB47,070, and RMB46,453 on behalf of Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., a related party controlled by Mr. Feng. Such amount is due and payable on demand, and the Group repaid RMB37,541, RMB48,428 and RMB47,429 to Zhejiang Ming Kang Hui Food Co., Ltd. during the years ended June 30, 2017, 2018 and 2019, respectively.The above unsettled balances were included in “Amount due to related parties” and “Amount due from related parties” as of June 30, 2018 and 2019, respectively. | ||
[3] | On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid.On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit.During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company.As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. | ||
[4] | Other service and product provided to related parties mainly include daily consumables sold to related parties, hotel services and etc. | ||
[5] | Pursuant to the strategic cooperation agreement signed with Hailiang Group and Hailiang investment, the Group provided education and management services to Hailiang Kindgarten, Zhuji Hailiang Jinshan Kindgarten and Tianma Kindgarten, which were controlled by Hailiang Group, and other 19 schools controlled by Hailiang Investment, including Xiantao No.1 Middle School, Xinchang Nanrui Experimental School, Feicheng Hailiang Foreign Language school, Jinhua Hailiang Foreign Language School and etc.. Education and management service fees of nil, RMB12,275 and RMB28,344 were charged to the abovementioned schools during the years ended June 30, 2017, 2018 and 2019, respectively.The Group provided service to Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., controlled by Mr. Feng, in the Group’s campuses, amounting to RMB3,766, RMB4,556 and RMB4,878 during the years ended June 30, 2017, 2018 and 2019, respectively. | ||
[6] | The Group leases the school buildings and the related facilities in three campuses from Hailiang Investment, a related party controlled by Mr. Feng. In addition, Haibo Education and Haibo Logistics lease the office space and warehouse from Nanchang Hongtou Property Management Co., Ltd. (“Nanchang Hongtou”), a related party owned by Mr. Honggen Min, who is the controlling shareholder of Nanchang Baishu. The Group also leases some office spaces from Hangzhou Hailiang Real Estate Co., Ltd. (“Hailiang Real Estate”), a related party controlled by Mr. Feng. | ||
[7] | The Group entered into a series of leasehold improvement contracts with Heng Zhong Da Construction Limited Company (“Heng Zhong Da"), a company over which Mr. Feng has significant influence, for the leasehold improvement of classroom buildings, dining halls, student dormitories.During the years ended June 30, 2017, 2018 and 2019, the Group purchased leasehold improvement service from Heng Zhong Da of RMB37,231, RMB29,098 and RMB29,669, respectively.As of June 30, 2018 and 2019, the above unsettled balances of RMB19,508 and RMB11,260 were recognized in “Amount due to related parties”. | ||
[8] | The Group purchased food products from Zhejiang Ming Kang Hui E-Commerce Co., Ltd. and Ming Kang Hui Ecological Agriculture Group Co., Ltd. (collectively referred as “Ming Kang Hui”), two companies controlled by Mr. Feng, amounting to RMB48,298, RMB38,323 and RMB68,963 during the years ended June 30, 2017, 2018 and 2019, respectively.As of June 30, 2018 and 2019, the above unsettled balances of RMB5,386 and RMB18,516 were recognized in “Amount due to related parties”. | ||
[9] | The Group received IT services, physical examination services, travel services and other services from related parties controlled by Hailiang Group, amounting to nil, RMB6,884 and RMB23,263 during the years ended June 30, 2017, 2018 and 2019.As of June 30, 2018 and 2019, the above unsettled balances of RMB3,416 and RMB420 were recognized in “Amount due to related parties”. |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - CNY (¥) ¥ in Thousands | Share capital | Share premium | Contributed capital | Translation reserve | Statutory reserve | Retained earnings | Total Hailiang Education Group Inc. shareholders' equity | Non-controlling interests | Total |
Balance at Jun. 30, 2016 | ¥ 267 | ¥ 134,584 | ¥ 225,895 | ¥ 8,484 | ¥ 223,409 | ¥ 329,029 | ¥ 921,668 | ¥ 0 | ¥ 921,668 |
Total comprehensive income | |||||||||
Profit for the year | 0 | 0 | 0 | 0 | 0 | 167,743 | 167,743 | 0 | 167,743 |
Other comprehensive income | 0 | 0 | 0 | 2,202 | 0 | 0 | 2,202 | 0 | 2,202 |
Total comprehensive (loss)/income | 0 | 0 | 0 | 2,202 | 0 | 167,743 | 169,945 | 0 | 169,945 |
Transfer to statutory reserve | 43,949 | (43,949) | |||||||
Contributed capital | 0 | 0 | 10,000 | 0 | 0 | 0 | 10,000 | 0 | 10,000 |
Balance at Jun. 30, 2017 | 267 | 134,584 | 235,895 | 10,686 | 267,358 | 452,823 | 1,101,613 | 0 | 1,101,613 |
Total comprehensive income | |||||||||
Profit for the year | 0 | 0 | 0 | 0 | 0 | 222,588 | 222,588 | 8,314 | 230,902 |
Other comprehensive income | 0 | 0 | 0 | (2,542) | 0 | 0 | (2,542) | 0 | (2,542) |
Total comprehensive (loss)/income | 0 | 0 | 0 | (2,542) | 0 | 222,588 | 220,046 | 8,314 | 228,360 |
Transfer to statutory reserve | 37,165 | (37,165) | |||||||
Establishment of subsidiaries under common controlled by ultimate shareholder | 11,000 | 11,000 | 11,000 | ||||||
Transfer of equity interests in subsidiaries under common controlled by ultimate shareholder to the Company and non-controlling interests | (11,000) | (11,000) | 4,840 | (6,160) | |||||
Exercise of warrant | 1 | (1) | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Balance at Jun. 30, 2018 | 268 | 134,583 | 235,895 | 8,144 | 304,523 | 638,246 | 1,321,659 | 13,154 | 1,334,813 |
Total comprehensive income | |||||||||
Profit for the year | 315,780 | ||||||||
Total comprehensive (loss)/income | 319,090 | ||||||||
Dividends (Note 16) | (7,482) | ||||||||
Balance at Jun. 30, 2019 | 268 | 134,583 | 251,034 | 11,454 | 349,460 | 905,009 | 1,651,808 | 37,439 | 1,689,247 |
Adjustment on initial application of IFRS 15, net of income tax (Note 3(b)) at Jul. 01, 2018 | 18,279 | 18,279 | 18,279 | ||||||
Restated balance at Jul. 01, 2018 | 268 | 134,583 | 235,895 | 8,144 | 304,523 | 656,525 | 1,339,938 | 13,154 | 1,353,092 |
Total comprehensive income | |||||||||
Profit for the year | 0 | 0 | 0 | 0 | 0 | 293,421 | 293,421 | 22,359 | 315,780 |
Other comprehensive income | 0 | 0 | 0 | 3,310 | 0 | 0 | 3,310 | 0 | 3,310 |
Total comprehensive (loss)/income | 0 | 0 | 0 | 3,310 | 0 | 293,421 | 296,731 | 22,359 | 319,090 |
Transfer to statutory reserve | 0 | 0 | 0 | 0 | 44,937 | (44,937) | 0 | 0 | 0 |
Contributed capital | 15,139 | 15,139 | 15,139 | ||||||
Dividends (Note 16) | (7,482) | (7,482) | |||||||
Acquisition of business with non-controlling interests (Note 19) | 9,408 | 9,408 | |||||||
Balance at Jun. 30, 2019 | ¥ 268 | ¥ 134,583 | ¥ 251,034 | ¥ 11,454 | ¥ 349,460 | ¥ 905,009 | ¥ 1,651,808 | ¥ 37,439 | ¥ 1,689,247 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - CNY (¥) ¥ in Thousands | 12 Months Ended | |||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | ||||
Cash flows from operating activities | ||||||
Net profit for the year | ¥ 315,780 | ¥ 230,902 | ¥ 167,743 | |||
Adjustments for: | ||||||
Depreciation | 132,026 | 113,128 | 110,485 | |||
Gain on disposal of affiliated entities | 0 | (5,349) | 0 | |||
(Gain)/loss on the disposal of property and equipment | 342 | 371 | (41) | |||
Amortization of intangible assets | 1,494 | 446 | 662 | |||
Net foreign exchange (gain)/loss | (465) | 324 | (282) | |||
Interest income | (24,470) | (11,715) | (6,709) | |||
Income tax expenses | 108,713 | 66,288 | 0 | |||
Adjustments for Cash flows from operating activities | 533,420 | 394,395 | 271,858 | |||
Changes in operating assets and liabilities and other, net of effect of acquisitions and disposals: | ||||||
Other current assets and contract costs | (8,127) | (13,681) | (530) | |||
Prepayment to third party suppliers | 0 | 2,157 | 2,235 | |||
Trade and other payables due to third parties | 94,885 | 30,416 | 23,313 | |||
Other payables due to related parties | (5,275) | 18,000 | (27,636) | |||
Deferred revenue and contract liabilities | 186,731 | 165,583 | 17,713 | |||
Cash generated from operating activities | 801,634 | 596,870 | 286,953 | |||
Income tax paid | (111,317) | (8,939) | 0 | |||
Net cash generated from operating activities | 690,317 | 587,931 | 286,953 | |||
Cash flows from investing activities | ||||||
Interest received | 20,592 | 10,677 | 5,873 | |||
Proceeds from sale of property and equipment | 0 | 1,015 | 64 | |||
Purchase of property and equipment | (80,133) | (89,369) | (108,959) | |||
Purchase of intangible assets | (1,743) | 0 | 0 | |||
Restricted bank deposits | (1,613) | 0 | 0 | |||
Term deposits placed with a related party finance entity | (4,709,697) | (204,000) | (1,953,600) | |||
Maturity of term deposits placed with a related party finance entity | 3,526,603 | 401,000 | 1,552,600 | |||
A loan made to a related party | [1] | 0 | 0 | (98,229) | ||
Repayment of a loan from a related party | 12,412 | 0 | 0 | |||
Acquisition of subsidiaries or an affiliated entity, net of cash acquired | (627) | (6,160) | [2] | 0 | [2] | |
Net proceeds from disposal of affiliated entities, net of cash disposed | 0 | 17,982 | 0 | |||
Net cash (used in)/generated from investing activities | (1,234,206) | 131,145 | (602,251) | |||
Cash flows from financing activities | ||||||
Loans borrowed from a related party | [1] | 0 | 7,609 | 99,603 | ||
Capital contributions | 139 | 11,000 | 0 | |||
Dividends paid to a non-controlling shareholder of subsidiaries | (7,482) | 0 | 0 | |||
Net cash generated from/(used in) financing activities | (7,343) | 18,609 | 99,603 | |||
Net (decrease)/increase in cash and cash equivalents | (551,232) | 737,685 | (215,695) | |||
Cash and cash equivalents at beginning of the year | 812,620 | 77,801 | 291,011 | |||
Effect of movements in exchange rates on cash held | (704) | (2,866) | 2,485 | |||
Cash and cash equivalents at the end of the year | 260,684 | 812,620 | 77,801 | |||
Non cash transaction: | ||||||
Contributed capital through waived liability | 0 | 0 | 10,000 | |||
Deemed capital contribution for awards paid to the Group's teachers by the controlling shareholder | 15,000 | 0 | 0 | |||
Net settlement of a loan made to a related party with a loan borrowed from a related party | 0 | 7,609 | 0 | |||
Payables for purchase of property and equipment | ¥ 20,501 | ¥ 31,728 | ¥ 28,131 | |||
[1] | On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid.On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit.During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company.As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. | |||||
[2] | In August 2017, Haibo Education and Haibo Logistics were incorporated by Xinyu Baishu Technology Service Co., Ltd. (“Xinyu Baishu”), an entity ultimately controlled by Mr. Feng. The contributed capitals from Xinyu Baishu in Haibo Education and Haibo Logistics were RMB6,000 and RMB5,000, respectively. In January 2018, Xinyu Baishu transferred 56% equity interests in each of Haibo Education and Haibo Logistics to Ningbo Haoliang with considerations of RMB3,360 and RMB2,800, respectively. The considerations were equivalent to the cost of 56% of the contributed capital.In January 2018, Xinyu Baishu also transferred the remaining 44% equity interest in Haibo Education and Haibo Logistics to Nanchang Baishu, a related party of the Company. The 44% equity interests owned by Nanchang Baishu were recorded as non-controlling interests (see note 16).In November 2018, Haibo Education and Haibo Logistics declared and fully paid dividends amounting to RMB6,075 and RMB 1,407 to Nanchang Baishu, respectively (see note 16). |
Reporting entity and organizati
Reporting entity and organization | 12 Months Ended |
Jun. 30, 2019 | |
Reporting entity and organization | |
Reporting entity and organization | 1 Reporting entity and organization Hailiang Education Group Inc. (the “Company”) is a holding company and is ultimately controlled by Mr. Hailiang Feng (“Mr. Feng”). The Company, its subsidiaries and consolidated affiliated entities are collectively referred to as the “Group”. The Group is principally engaged in the provision of education and management services in People’s Republic of China (“PRC”). The Group mainly offers private K‑12 educational services in schools located in Zhuji, Zhejiang Province and Zhenjiang, Jiangsu Province, China, after-school enrichment services, education and management services, educational training services and study trip services. In February 2018, the Group disposed the ownership and controlling interest in Hailiang International Kindergarten and the kindergarten business unit of Tianma Experimental School (“Tianma Kindergarten”) since the kindergartens had been at a loss and the Group decided to focus on providing educational services for primary, middle and high school students. In June 2018, the Group disposed the ownership in Chuzhou Hailiang Foreign Language School ("Chuzhou School"), which was mainly based on the Group’s business assessment in response to current market conditions. In October 2018, the Group's consolidated affiliated entity, Hailiang Education Management Group Co., Ltd. (“Hailiang Management”), acquired 51% controlling interest in Zhenjiang Jianghe High School of Art Co., Ltd. (“Zhenjiang Jianghe High School of Art”) located in Jiangsu Province, which is a for-profit high school specializing in the arts education. As of June 30, 2019, the Company’s subsidiaries and consolidated affiliated entities are as follows: Place and year of Legal Subsidiary establishment ownership Principal activities Hailiang Education (HK) Limited (“Hailiang HK”) Hong Kong, China, 2011 100 % Investment holding Zhejiang Hailiang Education Consulting and Services Co., Ltd. ("Hailiang Consulting") Zhejiang, China, 2011 100 % Investment holding Ningbo Hailiang Education Logistics Management Co., Ltd. Zhejiang, China, 2017 100 % Education and management service Ningbo Haoliang Information Consulting Co., Ltd. (“Ningbo Haoliang”) Zhejiang, China, 2017 100 % Education and management service Zhuji Nianxin Lake Hotel Co., Ltd. Zhejiang, China, 2017 100 % Hotel management service Ningbo Hailiang Sports Development Co., Ltd. Zhejiang, China, 2018 100 % Educational training service Zhuji Hailiang Supply Chain Management Co., Ltd. Zhejiang, China, 2018 100 % Procurement and transportation services Zhuji Hailiang Logistics Service Co., Ltd. Zhejiang, China, 2018 100 % Accommodation service Jiangxi Haibo Education Management Co., Ltd. (“Haibo Education”) Jiangxi, China, 2017 56 % Educational training service Jiangxi Haibo Logistics Management Co., Ltd. (“Haibo Logistics”) Jiangxi, China, 2017 56 % Education and management service Zhuji Hailiang After-school Service Co., Ltd. Zhejiang, China, 2018 100 % After-school enrichment service Hailiang Education International Studying Service Limited Hongkong, China, 2018 100 % Overseas study consulting service Hangzhou Hailiang International Studying Service Co., Ltd. Zhejiang, China, 2018 100 % Overseas study consulting service Hangzhou Hailiang Study Trip Co., Ltd. Zhejiang, China, 2018 100 % Study trip service Pate’s-Hailiang International College Company Limited United Kingdom,2018 100 % Overseas study consulting service Place and year of Legal Consolidated affiliated entities establishment ownership Principal activities Hailiang Management (previously named “Zhejiang Hailiang Education Investment Group Co., Ltd.”) Zhejiang, China, 2012 N/A * Investment holding Zhejiang Hailiang Mingxin Education Technology Co., Ltd. Zhejiang, China, 2017 N/A * After-school enrichment service and overseas study consulting service Hangzhou Hailiang Education Management Co., Ltd. Zhejiang, China, 2018 N/A * Education and management service Hailiang Foreign Language School (“Foreign Language”) Zhejiang, China, 1995 N/A * K‑12 educational services Hailiang Experimental High School (“Experimental High”) Zhejiang, China, 2002 N/A * K‑12 educational services Tianma Experimental School (“Tianma Experimental”) Zhejiang, China, 1995 N/A * K‑12 educational services Hailiang Primary School Zhejiang, China, 2016 N/A * K‑12 educational services Hailiang Junior Middle School Zhejiang, China, 2016 N/A * K‑12 educational services Hailiang Senior Middle School Zhejiang, China, 2016 N/A * K‑12 educational services Hailiang High School of Art (previously named “Hailiang Art Middle School”) Zhejiang, China, 2017 N/A * K‑12 educational services Zhuji Hailiang Foreign Language High School Co., Ltd. (“Zhuji Hailiang Foreign Language High School”) Zhejiang, China, 2018 N/A * K-12 educational services Zhenjiang Jianghe High School of Art Jiangsu, China, 2018 N/A * K-12 educational services Zhejiang Mingxin International Travel Co., Ltd. Zhejiang, China, 2018 N/A * Study trip service Shaoxing Sihai International Travel Co., Ltd. (“Sihai International Travel”) Zhejiang, China, 2010 N/A * Study trip service * These entities are controlled by the Company pursuant to the contractual arrangements disclosed below in note 2(b). |
Basis of preparation
Basis of preparation | 12 Months Ended |
Jun. 30, 2019 | |
Basis of preparation | |
Basis of preparation | 2 Basis of preparation (a) Statement of compliance The consolidated financial statements of the Group as of June 30, 2018 and 2019 and for each of the years in the three-year period ended June 30, 2019 comprise the accounts of the Company, its subsidiaries and consolidated affiliated entities, in which all intercompany balances and transactions have been eliminated. The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRSs”) as issued by International Accounting Standards Board (“IASB”). The consolidated financial statements were authorized for issue by the Company’s board of directors on September 23, 2019. (b) Basis of presentation Since laws of PRC prohibit foreign ownership of companies and institutions in compulsory educational services at primary and middle school levels, and restrict foreign investment in educational services businesses at the high school level, the Group’s offshore holding companies are not allowed to directly own and operate schools in China. Thus, Hailiang Consulting, the Company’s wholly owned PRC subsidiary, entered into a series of contractual arrangements with Hailiang Management and the shareholder of Hailiang Management, Mr. Feng, on December 31, 2013. These contractual agreements were subsequently amended on June 30, 2017, to revise the original contractual arrangements among the said parties entered into in December 2013 in order to (i) reflect and accommodate additions of new affiliated entities of Hailiang Management since December 2013 as well as any future changes thereto, and (ii) to allow for potential arrangements, if any and when applicable, to be entered into by controlled affiliate(s) of Hailiang Consulting. On February 8, 2018, Zhejiang Beize Group Co., Ltd. (“Beize Group”), a PRC company controlled by Mr. Feng, subscribed 0.1% registered capital of Hailiang Management. Accordingly, on February 23, 2018, Hailiang Consulting, Hailiang Management, Mr. Feng and Beize Group entered into a series of contractual arrangement (“Contractual Agreements”) to reflect the abovementioned increase of shareholders while the terms of these agreements remained unchanged. The Contractual Arrangements include Call Option Agreement, Power of Attorney, Consulting Services Agreement, and Equity Pledge Agreement. The key terms of the Contractual Agreements are as follows: Call Option Agreement: Pursuant to the Call Option Agreement, Mr. Feng and Beize Group unconditionally and irrevocably granted Hailiang Consulting or its designee an exclusive option to purchase, to the extent permitted under PRC laws and regulations, in certain cases, including but not limited to the cancellation of any of the other agreements under the contractual arrangements or liquidation or dissolution of Hailiang Management, all or part of the equity interest in Hailiang Management at the lowest consideration permitted by PRC laws and regulations unless a valuation of the equity is required by the PRC laws. Hailiang Consulting has the sole discretion to decide when to exercise the option, and whether to exercise the option in part or in full. Without Hailiang Consulting’s written consent, Hailiang Management and Mr. Feng and Beize Group may not sell, transfer, pledge or otherwise dispose of or create any encumbrance on any of Hailiang Management’s assets, businesses or equity interests or merge with or acquire other businesses. Without obtaining Hailiang Consulting’s written consent, Hailiang Management may not enter into any material contracts, incur any indebtedness or provide any loan or guarantee to a third party, or alter the nature or scope of its business. This agreement may not be terminated by Hailiang Management or Mr. Feng or Beize Group, nor can it be terminated by Hailiang Consulting without cause. Unless terminated, this agreement shall remain in full force and effect until Hailiang Management’s term of operations expires in April 2042. Power of Attorney: Mr. Feng and Beize Group each executed an irrevocable Power of Attorney appointing Hailiang Consulting, or any person designated by Hailiang Consulting, as their attorney-in-fact to (i) exercise on their respective behalf all their respective rights as shareholders of Hailiang Management, including those rights under PRC laws and regulations and the articles of association of Hailiang Management, such as appointing, replacing or removing directors, declaring dividends and making decisions on operational and financial matters, (ii) act as the representative of Hailiang Management in its business operations, and (iii) unconditionally assign Mr. Feng and Beize’s shareholding rights to Hailiang Consulting, including dividends or other benefits that Mr. Feng and Beize Group receive from Hailiang Management as shareholders. Consulting Services Agreement. Pursuant to the Consulting Services Agreement between Hailiang Consulting, Hailiang Management and Mr. Feng and Beize Group, as the shareholders of Hailiang Management, Hailiang Consulting (or its controlled affiliate) has the exclusive right to provide comprehensive technical and business support services to Hailiang Management’s affiliated entities. In particular, such services include developing curriculum, conducting market research and offering strategic business advice, providing information technology services, providing public relations services, providing support for teacher hiring and training and providing other services that the affiliated entities may need from time to time. Without the prior consent of Hailiang Consulting, none of Hailiang Management’s affiliated entities may accept such services provided by any third party. Hailiang Consulting owns the exclusive intellectual property rights created as a result of the performance of this agreement. Hailiang Management’s affiliated entities agree to pay annual service fees, calculated as a percentage of their total revenue, to Hailiang Consulting (or its controlled affiliate). At the sole discretion of Hailiang Consulting, the percentage ratio for calculating the service fees may be adjusted from time to time based on the complexity of the services provided, the time and resources committed by Hailiang Consulting (or its controlled affiliate) and the commercial value of the services. The Consulting Services Agreement enables Hailiang Consulting (or its controlled affiliate) to charge an annual service fee, the maximum of which equals the net income of Hailiang Management’s affiliated entities after deducting the mandatory development reserve fund and other necessary costs prior to the payment of such service fees. As part of the Consulting Services Agreement, Hailiang Management and Mr. Feng and Beize Group agree that they will not take any actions, such as incurring indebtedness, disposing of material assets, materially changing the scope or nature of the business of Hailiang Management’s affiliated entities, disposing of their equity interests in Hailiang Management’s affiliated entities, or paying dividends to Mr. Feng or Beize Group without the written consent of Hailiang Consulting. This agreement may not be terminated by Hailiang Management or Mr. Feng or Beize Group, nor can it be terminated by Hailiang Consulting without cause. Unless terminated, the agreement shall remain in full force and effect during the term of operations of Hailiang Management’s affiliated entities. Equity Pledge Agreement. Pursuant to the Equity Pledge Agreement between Hailiang Consulting, Mr. Feng and Beize Group, and Hailiang Management, Mr. Feng and Beize Group unconditionally and irrevocably pledged all of their equity interests in Hailiang Management to Hailiang Consulting to guarantee performance of the obligations of Hailiang Management’s affiliated entities under the Call Option Agreement, Power of Attorney and Consulting Services Agreement , each as described above. Mr. Feng and Beize Group agreed that without prior written consent of Hailiang Consulting, they shall not transfer or dispose of the pledged equity interests, commence any bankruptcy or liquidation process of Hailiang Management or create or allow any encumbrance on the pledged equity interests. This agreement may not be terminated by Hailiang Management or Mr. Feng or Beize Group, nor can it be terminated by Hailiang Consulting without cause. Unless terminated, the Equity Pledge Agreement remains in full force and effect until all of the obligations of Hailiang Management’s affiliated entities under the Consulting Services Agreement have been duly performed and related payments are duly paid. The pledge of equity interests in Hailiang Management has been duly registered with the local branch of State Administration for Industry and Commerce of PRC (“SAIC”) and is effective upon such registration. The Contractual Agreements provide the Company, through Hailiang HK and Hailiang Consulting, the following, (i) the power over the Affiliated Entities; (ii) the exposure or rights to variable returns from its involvement with the Affiliated Entities; and (iii) the ability to affect those returns through its power over the Affiliated Entities. The Company has the power over the Affiliated Entities by virtue of the Power of Attorney, pursuant to which Hailiang Consulting has rights that give it the current ability to direct the activities that significantly affect the returns of the Affiliated Entities. Hailiang Consulting has the rights to appoint, replace or remove directors of Hailiang Management, as well as to make decisions on all operational and financial matters of the Affiliated Entities. The Company has the exposure or rights to variable returns from its involvement with the Affiliated Entities by virtue of the Power of Attorney and Consulting Services Agreement. Hailiang Consulting’s returns from its involvement with the Affiliated Entities have the potential to vary as a result of the performance of the Affiliated Entities. Pursuant to the Power of Attorney, Hailiang Consulting is the only party that can share in the distributed and undistributed earnings of the Affiliated Entities. Pursuant to the Consulting Services Agreement, Hailiang Consulting has the exclusive right to provide consulting, support and services to the Affiliated Entities in return for a fee that could be up to 100% of the profits of the Affiliated Entities. The Company has all decision-making rights over the Affiliated Entities to affect the amounts of its returns. By virtue of the Power of Attorney, Hailiang Consulting is the principal and is the only party that has the decision-making authority on all relevant activities of the Affiliated Entities. There are no substantive rights held by other parties that may affect or restrict Hailiang Consulting’s ability to direct the relevant activities of the Affiliated Entities. The Power of Attorney is irrevocable and no party can remove Hailiang Consulting without cause. Hailiang Consulting also has exposure to variability of returns of the Affiliated Entities from the Call Option Agreement. The following financial statement balances and amounts of the affiliated entities were included in the Group’s consolidated financial statements after the elimination of intercompany balances and transactions. 2018 2019 RMB RMB Total non-current assets 710,464 687,407 Total current assets 848,028 1,313,326 Total assets 1,558,492 2,000,733 Total non-current liabilities — 7,270 Total current liabilities 396,238 635,670 Total liabilities 396,238 642,940 2017 2018 2019 RMB RMB RMB Revenue 853,247 1,110,470 1,087,054 Profit before tax 165,300 221,057 202,157 Net profit 165,300 177,088 152,713 The affiliated entities contributed an aggregate of 100%, 95.0% and 72.5% of the Group’s consolidated revenue for the years ended June 30, 2017, 2018 and 2019, respectively. As of June 30, 2018 and 2019, the affiliated entities accounted for an aggregate of 82.7% and 79.9%, respectively, of the consolidated total assets, and 72.0% and 79.0%, respectively, of the consolidated total liabilities. Creditors do not have recourse to the general credit of the Company for the liabilities of the respective consolidated affiliated entities. There is currently no contractual arrangement that would require the Company to provide additional financial support to the consolidated affiliated entities. As the Group is conducting certain businesses in the PRC through the consolidated affiliated entities, the Group may provide additional financial support on a discretionary basis in the future, which could expose the Group to a loss. (c) Risks and uncertainties Risks and uncertainties of the Contractual Arrangements: The Company relies on the Contractual Agreements to control the Affiliated Entities. However, these Contractual Arrangements may not be as effective as direct equity ownership in providing the Company with control over the Affiliated Entities. Any failure by Hailiang Management, Mr. Feng or Beize Group, the nominee shareholders of Hailiang Management to perform the obligations under the Contractual Agreements would have a material adverse effect on the financial position and financial performance of the Company. Therefore, the enforceability of the Contractual Agreements represents a significant judgment and assumption. All the Contractual Agreements are governed by PRC law and provide for the resolution of disputes through arbitration in the PRC. Accordingly, these agreements 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 the Company’s ability to enforce these Contractual Arrangements. In addition, if the legal structure and the Contractual Agreements were found to be in violation of any existing or future PRC laws and regulations, the Company may be subject to fines or other legal or administrative sanctions. 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, the Company 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 Contractual Arrangements are found to be in violation of any existing or future PRC laws and regulations, the PRC government could: · require the Company to restructure its ownership structure and operations in the PRC to comply with the existing or future PRC laws and regulations; · revoke the Affiliated Entities’ business and operating licenses; · require the Affiliated Entities to discontinue or restrict operations; · block the Affiliated Entities’ websites; · impose additional conditions or requirements with which the Affiliated Entities may not be able to comply; or · take other regulatory or enforcement actions against the Affiliated Entities that could be harmful to the Affiliated Entities’ business. If the imposition of any of these government actions causes the Company to lose its right to direct the activities of the Affiliated Entities or to lose its right to the variable returns from its involvement with the Affiliated Entities and the Company is not able to restructure its ownership structure of the Affiliated Entities (such as acquiring controlling equity interests), the Company would not be able to consolidate the financial results of the Affiliated Entities in the Company’s consolidated financial statements. A substantial part of the assets, liabilities and results of operations reported in the accompanying consolidated financial statements comprise the assets, liabilities and results of operations of the Affiliated Entities. In the opinion of management, the likelihood of loss in respect of the Company’s current ownership structure or Contractual Arrangements is remote based on current facts and circumstances. The equity interests of Hailiang Management are legally held by Mr. Feng and Beize Group on behalf of the Company. Mr. Feng is also the ultimate controlling shareholder of the Company. The Company cannot assure that Mr. Feng and Beize Group will act in the best interests of the Company. The Company relies on Mr. Feng and Beize Group to comply with the terms and conditions of the Contractual Agreements. If Mr. Feng and Beize Group are in breach of their contractual obligations under the Contractual Agreements and the Company cannot resolve any dispute between the Company, Mr. Feng and Beize Group, 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. (d) Functional and presentation currency The functional currency of each of the Group’s entities is the currency of the primary economic environment in which the entity operates (the “functional currency”). The Company’s functional currency is the United States dollar (“USD”), whereas the functional currency of the PRC entities of the Group is the Renminbi ("RMB”), respectively. The Group’s presentation currency is RMB. All financial information presented has been rounded to the nearest thousands, except when otherwise indicated. (e) Use of estimates The preparation of the consolidated financial statements in conformity with IFRSs requires management to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period. Significant items subject to such estimates and assumptions include the consolidation of the Affiliated Entities, assumptions used to determine the fair value of the favorable lease acquired, the useful lives and the recoverability of the carrying amounts of property and equipment and intangible assets (including goodwill), the collectability of a loan made to a related party and cash and term deposits placed with a related party finance entity, income tax, and the assessment of contingent liabilities. These estimates are often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable. Actual results may differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Assumptions and estimation uncertainties Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial year are included in the following notes: · Note 2 (c), risks and uncertainties (the enforceability of the Contractual Agreements) · Note 9, income tax expenses · Note 11, property and equipment · Note 12, intangible assets and goodwill · Note 18(a), credit risk · Note 19, acquisition of business Measurement of fair values A number of the Group’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. Management regularly reviews significant unobservable inputs and valuation adjustments. If third party information, such as broker quotes or pricing services, is used to measure fair values, then management assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of IFRSs, including the level in the fair value hierarchy in which such valuations should be classified. When measuring the fair value of an asset or a liability, the Group uses market observable data as far as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows. Level 1: inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. Level 2: inputs are inputs, other than quoted prices included within Level 1, those are observable for the asset or liability, either directly or indirectly; and Level 3: inputs are unobservable inputs for asset or liability. If the inputs used to measure the fair value of an asset or a liability might be categorized in different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. The Group recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred. Further information about assumptions made in measuring fair values is included in the following notes: · Note 18(d), fair value · Note 19, acquisition of business |
Changes in accounting policies
Changes in accounting policies | 12 Months Ended |
Jun. 30, 2019 | |
Changes in accounting policies | |
Changes in accounting policies | 3 Changes in accounting policies The IASB has issued a number of new IFRSs and amendments to IFRSs that are first effective for the current accounting period of the Group. Of these, the following developments are relevant to the Group’s financial statements: (a) IFRS 9, Financial instruments (b) IFRS 15, Revenue from contracts with customers (c) IFRIC 22, Foreign currency transactions and advance consideration The Group has not applied any new standard or interpretation that is not yet effective for the current accounting period, except for the amendments to IFRS 9, Prepayment features with negative compensation which have been adopted at the same time as IFRS 9. The adoption of IFRIC 22 does not have any material impact on the Group’s financial statements. (a) IFRS 9 replaces IAS 39, Financial instruments: recognition and measurement. It sets out the requirements for recognizing and measuring financial assets, financial liabilities and some contracts to buy or sell non-financial items. The Group has applied IFRS 9 retrospectively to items that existed at July 1, 2018 in accordance with the transition requirements. The Group has recognized the cumulative effect of initial application as an adjustment to the opening equity at July 1, 2018. Therefore, comparative information continues to be reported under IAS 39. Further details of the nature and effect of the changes to previous accounting policies and the transition approach are set out below: (i) IFRS 9 categorises financial assets into three principal classification categories: measured at amortised cost, at fair value through other comprehensive income (FVOCI) and at fair value through profit or loss (FVTPL). These supersede IAS 39’s categories of held-to-maturity investments, loans and receivables, available-for-sale financial assets and financial assets measured at FVTPL. The classification of financial assets under IFRS 9 is based on the business model under which the financial asset is managed and its contractual cash flow characteristics. Under IFRS 9, derivatives embedded in contracts where the host is a financial asset in the scope of the standard are not separated from the host. Instead, the hybrid instrument as a whole is assessed for classification. On initial recognition, the Group may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise. IFRS 9 largely retains the existing requirements in IAS 39 for the classification and measurement of financial liabilities. The adoption of IFRS 9 did not have a material impact on the classification of the Group’s financial assets and financial liabilities. For an explanation of how the Group classifies and measures financial assets and financial liabilities and recognises related gains and losses under IFRS 9, see note 4(c). The Group did not designate or de-designate any financial asset or financial liability at FVTPL at July 1, 2018. (ii) IFRS 9 replaces the “incurred loss” model in IAS 39 with the “expected credit loss” (ECL) model. The ECL model requires an ongoing measurement of credit risk associated with a financial asset and therefore recognizes ECLs earlier than under the “incurred loss” accounting model in IAS 39. The Group applies the new ECL model to the financial assets measured at amortized cost (including cash and cash equivalents, term deposits held at a related party finance entity, other receivables due from related parties and other receivables due from third parties). For further details on the Group’s accounting policy for accounting for credit losses, see note 4(f). As a result of this change in accounting policy, there are no additional ECLs recognized at July 1, 2018. (b) IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaced IAS 18 Revenue, IAS 11 Construction Contracts and related interpretations. Under IFRS 15, revenue is recognised when a customer obtains control of the goods or services. Determining the timing of the transfer of control – at a point in time or over time – requires judgement. The Group has adopted IFRS 15 using the cumulative effect method, with the effect of initially applying this standard recognised at the date of initial application (i.e. July 1, 2018). Accordingly, the information presented for the year ended June 30, 2018 has not been restated – i.e. it is presented, as previously reported, under IAS 18, IAS 11 and related interpretations. Additionally, the disclosure requirements in IFRS 15 have not generally been applied to comparative information. As allowed by IFRS 15, the Group has applied the new requirements only to contracts that were not completed before July 1, 2018. The following table summarizes the impact of transition to IFRS 15 on retained earnings and the related tax impact at July 1, 2018: RMB’000 Retained earnings Capitalization of sales commissions 18,279 Related income taxes — Net increase in retained earnings at July 1, 2018 18,279 The following tables summarise the estimated impact of adoption of IFRS 15 on the Group’s consolidated financial statements for the year ended June 30, 2019, by comparing the amounts reported under IFRS 15 in these consolidated financial statements with estimates of the hypothetical amounts that would have been recognised under IAS 18 and IAS 11 if those superseded standards had continued to apply to the year ended June 30, 2019 instead of IFRS 15. These tables show only those line items impacted by the adoption of IFRS 15: Difference: Estimated impact of adoption of Amounts reported Hypothetical IFRS 15 for in accordance amounts under year ended Note with IFRS 15 IASs18 and 11 June 30, 2019 (A) (B) (A)-(B) RMB’000 RMB’000 RMB’000 Line items in the consolidated statement of profit or loss and other comprehensive income for year ended June 30, 2019 impacted by the adoption of IFRS 15: Selling expenses (i) (25,003) (25,983) 980 Profit before tax 424,493 423,513 980 Income tax expenses (i) (108,713) (108,384) (329) Net profit 315,780 315,129 651 Net profit attributable to the Company’s shareholders 293,421 292,770 651 Total comprehensive income for the year 319,090 318,439 651 Total comprehensive income attributable to the Company’s shareholders 296,731 296,080 651 Earnings per share Basic (i) RMB 0.71 RMB 0.71 — Diluted (i) RMB 0.71 RMB 0.71 — Line items in the consolidated statement of financial position as of June 30, 2019 impacted by the adoption of IFRS 15: Contract costs (i) 9,899 — 9,899 Total non-current assets 730,141 720,242 9,899 Other current assets (i) 31,706 22,346 9,360 Total current assets 1,772,771 1,763,411 9,360 Total assets 2,502,912 2,483,653 19,259 Trade and other payables due to third parties (ii) 218,122 212,253 5,869 Deferred revenue (ii) — 407,399 (407,399) Contract liabilities (ii) 398,951 — 398,951 Total current liabilities 806,395 808,974 (2,579) Contract liabilities (ii) 2,579 — 2,579 Deferred tax liabilities (i) 4,691 4,362 329 Total non-current liabilities 7,270 4,362 2,908 Total liabilities 813,665 813,336 329 Reserves (i) 360,914 360,473 441 Retain earnings 905,009 886,520 18,489 Total Hailiang Education Group Inc. shareholders' equity 1,651,808 1,632,878 18,930 Total equity 1,689,247 1,670,317 18,930 Total equity and liabilities 2,502,912 2,483,653 19,259 Line items in the reconciliation of net profit to cash generated from operations for year ended June 30, 2019 impacted by the adoption of IFRS 15: Net profit 315,780 315,129 651 Change in other current assets and contract costs (8,127) (7,147) (980) Change in trade and other payables due to third parties 94,885 89,016 5,869 Change in deferred revenue and contract liabilities 186,731 192,600 (5,869) The significant differences arise as a result of the changes in accounting policies described above. (i) Prior to the adoption of IFRS 15, sales commissions related to the acquisitions of new service contracts relating to the provision of K-12 educational services were expensed when incurred. Upon the adoption of IFRS 15 on July 1, 2018, the Group capitalized sales commissions related to the acquisitions of new K-12 educational service contracts of RMB18,279 as contract costs, which would be amortized over the expected student relationship period. At the same time, the Group increased retained earnings by the same amount. The Group applied the practical expedient IFRS 15 and recognized the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Group otherwise would have recognized is one year or less from the initial recognition of the asset. The current portion of capitalized sales commissions that is expected to be amortised within one year is included in “other current assets” and the non-current portion is included in “contract costs”. The amortization of capitalized sales commissions of RMB13,052 was recorded in “selling expenses” during the year ended June 30, 2019. (ii) The Group receives up-front payments from its customers. Prior to the adoption of IFRS 15, up-front payments not yet earned, inclusive of value-added tax (“VAT”), are recorded as deferred revenue and recognized as revenue as related services are rendered or goods are delivered. Upon the adoption of IFRS 15 on July 1, 2018, up-front payments not yet earned, net of VAT, are recorded as contract liabilities. The current portion of contract liabilities that is expected to be recognized as revenue is included in current liabilities, and the non-current portion is included in non-current contract liabilities. Using the practical expedient in IFRS 15, the Group does not adjust the promised amount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between the transfer of the promised services or goods to the customer and when the customer pays for that services or goods will be one year or less. For additional information about the Group’s accounting policies relating to revenue recognition, see Note 4(m). |
Significant accounting policies
Significant accounting policies | 12 Months Ended |
Jun. 30, 2019 | |
Significant accounting policies | |
Significant accounting policies | 4 Significant accounting policies The accounting policies set out below have been applied consistently to all periods presented in the consolidated financial statements, and have been applied by each of the entities comprising the Group. (a) Basis of consolidation (i) Business combinations The Group accounts for business combinations (except entities acquired under common control) using the acquisition method when control is transferred to the Group. The consideration transferred in the acquisition is generally measured at fair value, as well as the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment (see note 4(f)(ii)). Any gain on a bargain purchase is recognized in profit or loss immediately. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities. Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not re-measured and settlement is accounted for within equity. Otherwise, other contingent consideration is re-measured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognized in profit or loss. (ii) Subsidiaries Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases. (iii) Entities acquired under common control Entities acquired under common control or transactions accounted for in a manner similar to a pooling-of-interests (for example, a reorganization of entities under common control) are accounted under the “book value” accounting, where the Company recognizes the assets acquired and liabilities assumed using the book values of the transferor. When the consolidated financial statements are issued for a period that includes the date the common control transaction occurred, the Company’s consolidated financial statements of all prior periods are retrospectively revised to the earliest date presented. (iv) Non-controlling interests Non-controlling interests are measured initially at the proportionate share of the acquiree’s identifiable net assets at the date of acquisition, or at the fair value at the date of acquisition, on a transaction by transaction basis. Profit or loss and each component of other comprehensive income ("OCI") are attributed to the owners of the parent and to non-controlling interests in proportion to their ownership interests in the subsidiary. Losses applicable to the non-controlling interests in a subsidiary (including components of OCI) are allocated to the non-controlling interests even if this causes the non-controlling interests to have a deficit balance. Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. (b) Foreign currency transactions Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates ruling at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated to the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated to the functional currency at the exchange rate when the fair value was determined. Foreign currency differences are generally recognized in profit or loss. Non-monetary items that are measured based on historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into RMB at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into RMB at the exchange rates at the dates of the transactions. Foreign currency differences are recognized in other comprehensive income and accumulated in the translation reserve. (c) Financial instruments Policy applicable from July 1, 2018 (i) Trade receivables and debt securities issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Group becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price. (ii) Non-derivative financial assets On initial recognition, a financial asset is classified as measured at: amortized cost; FVOCI - debt investment; FVOCI - equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model. A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL: - It is held within a business model whose objective is to hold assets to collect contractual cash flows; and - Its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interests on the principal amount outstanding. On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent changes in the investment's fair value on OCI. This election is made on an investment-by-investment basis. All financial assets not classified as measured at amortized cost or FVOCI as described above are measured at FVTPL. This includes all derivative financial assets. On initial recognition, the Group may irrevocably designate a financial asset that, otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise. Non-derivative financial assets - Business model assessment The Group makes an assessment of the objective of the business model in which a financial asset is held at a portfolio level because this best reflects the way the business is managed and information is provided to management. The information considered includes: - The stated policies and objectives for the portfolio and the operation of those policies in practice. These include whether management's strategy focused on earning contractual interest income, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected cash outflows or realizing cash flows through the sale of the assets; - how the performance of the portfolio is evaluated and reported to the Group's management; - the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; - how managers of the business are compensated - e.g. whether compensation is based on the fair value of the assets managed or the contractual cash flows collected; and - The frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and expectations about future sales activity. Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales for this purpose, consistent with the Group's continuing recognition of the assets. Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are measured at FVTPL. Non-derivative financial assets - Assessment whether contractual cash flows are solely payments of principal and interest For the purposes of this assessment, 'principal' is defined as the fair value of the financial asset on initial recognition. 'Interest' is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a profit margin. In assessing whether the contractual cash flows are solely payments of principal and interest, the Group considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making this assessment, the Group considers: - contingent events that would change the amount or timing of cash flows; - terms that may adjust the contractual coupon rate, including variable-rate features; - prepayment and extension features; and - terms that limit the Group's claim to cash flows from specified assets (e.g. non-recourse features). A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding, which may include reasonable additional compensation for early termination of the contract. Additionally, for a financial asset acquired at a discount or premium to its contractual par amount, a feature that permits or requires prepayment at an amount that substantially represents the contractual par amount plus accrued (but unpaid) contractual interest (which may also include reasonable additional compensation for early termination) is treated as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition. Non-derivative financial assets - Subsequent measurement and gains and losses Financial assets at amortized cost are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss. Non-derivative financial liabilities - Classification, subsequent measurement and gains and losses Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss. (iii) Non-derivative financial assets The Group derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. The Group enters into transactions whereby it transfers assets recognized in its statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognized. Non-derivative financial liabilities The Group derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. The Group also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in profit or loss. (iv) Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously. Policy applicable before July 1, 2018 The Group classifies non-derivative financial assets into the following categories: financial assets at fair value through profit or loss, held-to-maturity financial assets, loans and receivables and available-for-sale financial assets. The Group classifies non-derivative financial liabilities into the following categories: financial liabilities at fair value through profit or loss and other financial liabilities. (v) Non-derivative financial assets and financial liabilities – Recognition and de-recognition The Group initially recognizes loans and receivables and debt securities issued on the date when they are originated. All other financial assets and financial liabilities are initially recognized on the trade date when the entity becomes a party to the contractual provisions of the instrument. The Group derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognized financial assets that is created or retained by the Group is recognized as a separate asset or liability. The Group derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group currently has a legally enforceable right to offset the amounts and intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously. (vi) Non-derivative financial assets – Measurement A financial asset is classified as at fair value through profit or loss if it is classified as held-for-trading or is designated as such on initial recognition. Directly attributable transaction costs are recognized in profit or loss as incurred. Financial assets at fair value through profit or loss are measured at fair value and changes therein, including any interest or dividend income, are recognized in profit or loss. Held-to-maturity financial assets are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortized cost using the effective interest method. Loans and receivables are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortized cost using the effective interest method. Available-for-sale financial assets are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at fair value and changes therein, other than impairment losses and foreign currency differences on debt instruments, are recognized in other comprehensive income and accumulated in the fair value reserve. When these assets are derecognized, the gain or loss accumulated in equity is reclassified to profit or loss. (vii) Non-derivative financial liabilities – Measurement A financial liability is classified as at fair value through profit or loss if it is classified as held-for-trading or is designated as such on initial recognition. Directly attributable transaction costs are recognized in profit or loss as incurred. Financial liabilities at fair value through profit or loss are measured at fair value and changes therein, including any interest expense, are recognized in profit or loss. Other non-derivative financial liabilities are initially measured at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortized cost using the effective interest method. (d) Property and equipment (i) Recognition and measurement Items of property and equipment are measured at cost less accumulated depreciation and accumulated impairment losses (Note 4(f)). Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and any other costs directly attributable to bringing the asset to a working condition for its intended use. Construction in progress represents property under construction and equipment pending installation, and is stated at cost less impairment losses (Note 4(f)). Capitalization of these costs ceases and the construction in progress is transferred to property and equipment when the asset is substantially ready for its intended use. No depreciation is provided in respect of construction in progress. Gains or losses arising from the retirement or disposal of an item of property and equipment are determined as the difference between the net disposal proceeds and the carrying amount of the item and are recognized in profit or loss on the date of retirement or disposal. (ii) Subsequent costs The cost of replacing a component of an item of property and equipment is recognized in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Group, and its cost can be measured reliably. The carrying amount of the replaced component is derecognized. The costs of the day-to-day servicing of property, and equipment are recognized in profit or loss as incurred. (iii) Depreciation Items of property and equipment are depreciated from the date that they are available for use or, in respect of self-constructed assets, from the date that the asset is completed and ready for use. Depreciation is calculated to write off the cost of items of property and equipment less their estimated residual values using the straight-line basis over their estimated useful lives. Leasehold improvements are depreciated over the shorter of the lease term or their useful lives. The estimated useful lives for the current and comparative years of significant property and equipment are as follows: Motor vehicles 5~10 years Furniture, fixtures and other equipment 3~10 years Leasehold improvements Shorter of the remaining lease terms or estimated useful lives Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate. (e) Intangible assets and goodwill (i) Goodwill Goodwill is presented with intangible assets and represent the excess of: (i) the aggregate of the fair value of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the Group’s previously held equity interests in the acquiree; over (ii) the net fair value of the acquiree’s identifiable assets and liabilities measured as at the acquisition date. When (ii) is greater than (i), then this excess is recognized immediately in profit or loss as a gain on a bargain purchase. Goodwill is stated at cost less accumulated impairment losses. Goodwill arising on a business combination is allocated to each cash-generating unit, or groups of cash generating units, that is expected to benefit from the synergies of the combination and is tested annually for impairment (see note 4(f)). On disposal of a cash generating unit during the year, any attributable amount of purchased goodwill is included in the calculation of profit or loss on disposal. (ii) Trademark Trademark is not amortized when their useful life is assessed to be indefinite, which is reviewed annually to determine whether events and circumstances continue to support the indefinite useful life assessment. The change in the useful life assessment from indefinite to finite is accounted for prospectively from the date of change and in accordance with the policy for amortization of intangible assets with finite lives. (iii) Other intangible assets Other intangible assets that have finite useful lives are measured at cost less accumulated amortization and any accumulated impairment losses (Note 4(f)). Other intangible assets include software, student relationships that arose from the acquisition of Tianma Experimental, favorable lease that arose from the acquisition of Zhenjiang Jianghe High School of Art. (iv) Amortization Amortization of intangible assets with finite useful lives is charged to profit or loss on a straight-line basis over the assets’ estimated useful lives. The following intangible assets with finite useful lives are amortized from the date they are available for use and their estimated useful lives are as follows: Student relationships 1~15 years Favorable lease 20 years Others 3 years Amortization methods and useful lives are reviewed at each reporting date and adjusted if appropriate. (f) Impairment (i) Non-derivative financial assets Policy applicable from July 1, 2018 The Group recognizes loss allowances for ECLs on financial assets measured at amortised cost. The Group measures loss allowances at an amount equal to lifetime ECLs, except for the following, which are measured at 12-month ECLs: - debt securities that are determined to have low credit risk at the reporting date; and - other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition. Loss allowances for trade receivables are always measured at an amount equal to lifetime ECLs. When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECLs, the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Group’s historical experience and informed credit assessment and including forward-looking information. The Group assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Group considers a financial asset to be in default when: - the borrower is unlikely to pay its credit obligations to the Group in full, without recourse by the Group to actions such as realising security (if any is held); or - the financial asset is more than 90 days past due. Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument. 12-month ECLs are the portion of ECLs that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months). The maximum period considered when estimating ECLs is the maximum contractual period over which the Group is exposed to credit risk. Measurement of ECLs ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Group expects to receive). ECLs are discounted at the effective interest rate of the financial asset. Credit-impaired financial assets At each reporting date, the Group assesses whether financial assets carried at amortized cost are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following observable data: - significant financial difficulty of the borrower or issuer; - a breach of contract such as a default or being more than 90 days past due; - the restructuring of a loan or advance by the Group on terms that the Group would not consider otherwise; - it is probable that the borrower will enter bankruptcy or other financial reorganization; or - the disappearance of an active market for a security because of financial difficulties. Presentation of allowance for ECL in the statement of financial position Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. For debt securities at FVOCI, the loss allowance is charged to profit or loss and is recognized in OCI. Policy applicable before July 1, 2018 A financial asset not classified as at fair value through profit or loss, including an interest in an equity-accounted investee, is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset, and that loss event had an impact on the estimated future cash flows of that asset that can be estimated reliably. Objective evidence that financial assets are impaired includes: · default or delinquency by a debtor; · restructuring of an amount due to the Group on terms that the Group would not consider otherwise; · indications that a debtor or issuer will enter bankruptcy; · adverse changes in the payment status of borrowers or issuers; · the disappearance of an active market for a security because of financial difficulties; or · observable data indicating that there is a measurable decrease in the expected cash flows from a group of financial assets. The Group considers evidence of impairment for financial assets measured at amortized cost (other receivables) at both a specific asset and collective level. All individually significant receivables are assessed for specific impairment. All individually significant receivables found not to be specifically impaired are then collectively assessed for any impairment that has been incurred but not yet identified. Receivables that are not individually significant are collectively assessed for impairment by grouping together receivables with similar risk characteristics. In assessing collective impairment the Group uses historical trends of the probability of default, timing of recoveries and the amount of loss incurred, adjusted for management’s judgment as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than suggested by historical trends. An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. Losses are recognized in profit or loss and reflected in an allowance account against receivables. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss. (ii) Non-financial assets The carrying amounts of the Group’s non-financial assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill and indefinite-lived intangible assets are tested annually for impairment. For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating units (“CGU”s). Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination. The recoverable amount of an asset or CGU is the greater of its value in use and fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. An impairment loss in respect of goodwill is not reversed. In respect of other non-financial assets, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized. (g) Contract costs Contract costs are either the incremental costs of obtaining a contract with a customer or the costs to fulfil a contract with a customer which are not capitalized as inventory, property and equipment (see note 4(d)) or intangible assets (see note 4(e)). Incremental costs of obtaining a contract are those costs that the Group incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained (e.g. an incremental sales commission). Incremental costs of obtaining a contract are capitalized when incurred if the costs relate to revenue which will be recognized in a future reporting period and the costs are expected to be recovered. Contract costs are amortized over the expected customer relationship period, generally from one to six years. Other costs of obtaining a contract are expensed when incurred. The Group applies the practical expedient in paragraph 94 of IFRS 15 and recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Group otherwise would have recognized is one year or less from the initial recognition of the asset. Capitalized contract costs are stated at cost less accumulated amortization and impairment losses. Impairment losses are recognized to the extent that the carrying amount of the contract cost asset exceeds the net of (i) remaining amount of consideration that the Group expects to receive in exchange for the goods or services to which the asset relates, less (ii) any costs that relate directly to providing those goods or services that have not yet been recognized as expenses. Amortization of capitalized contract costs is charged to "selling expenses" in the consolidated statements of profit or loss and other comprehensive income when the revenue to which the asset relates is recognized. (h) Contract liability A contract liability is the obligation to provide services or goods to a customer for which the Group has received consideration from the customer. If a customer pays the consideration before the Group provides services or goods to the customer, a contract liability is recognized when the payment is made or the payment is due. (i) Cash and cash equivalents Cash and cash equivalents in the consolidated statements of financial position comprise cash at banks and on hand and cash equivalents with an original maturity of three months or less that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value and are held for the purpose of meeting short |
Revenue and segment reporting
Revenue and segment reporting | 12 Months Ended |
Jun. 30, 2019 | |
Revenue and segment reporting | |
Revenue and segment reporting | 5 Revenue and segment reporting (i) Revenue (a) 2017 2018 2019 RMB RMB RMB K-12 educational services 853,295 1,093,933 1,217,007 Educational training services — 36,395 144,188 Study trip services — 13,791 81,495 Education and management services — 19,021 40,942 Others — 6,208 15,393 853,295 1,169,348 1,499,025 (b) 2019 RMB Timing of revenue recognition Revenue recognized over time 1,304,361 Revenue recognized point in time 194,664 1,499,025 (c) The following table provides information about contract liabilities from contracts with customers. July 1, 2018 June 30, 2019 Note RMB’000 RMB’000 Current liabilities Contract liabilities 3(b)(ii) 209,720 398,951 Non-current liabilities Contract liabilities 3(b)(ii) — 2,579 The Group has initially applied IFRS 15 using the cumulative effect method and adjusted the opening balance at July 1, 2018. The contract liabilities primarily relate to up-front payments from the Group's customers for the K-12 educational services, educational training services, study trip services and overseas study consulting services. The amount of RMB 209,720 recognized in contract liabilities as of July 1, 2018 has been recognized as revenue for the year ended June 30, 2019. (d) The Group has applied the practical expedient in IFRS 15 such that the Group does not disclose the information about revenue that the Group will be entitled to when it satisfies the remaining performance obligations under all sales contracts that had an original expected duration of one year or less. (ii) The Group’s chief operating decision maker (“CODM”) has been identified as Mr. Ming Wang, the chief executive officer of the Group, who reviews the financial information of operating segments when making decisions to allocate resources and assess performance of the Group. For the year ended June 30, 2017, the Group identified one operating segment, which was the provision of private K-12 educational services. For the year ended June 30, 2018, the Group identified seven segments, including K-12 educational services, after-school enrichment services, management consulting services, logistic services, educational training services, overseas study consulting services and hotel management services. For the year ended June 30, 2019, the Group optimized its management structure for efficient resource allocation and high-quality management for affiliated and managed schools. Thus, K-12 educational services, after-school enrichment services, management consulting services and logistic services were merged into an operating segment “K-12 educational and management services” considering the integration of operation and the financial result of the above business was reviewed as a whole. As a result, four operating segments were identified for the year ended June 30, 2019, including K-12 educational and management services, educational training services, study trip and overseas study consulting services and hotel management services. K-12 educational and management services and educational training services were identified as reportable segments, respectively. Study trip and overseas study consulting services and hotel management services were aggregated as “others” since individually they do not exceed 10% quantitative threshold of combined revenue. Prior period segment information has been restated to conform to the current period presentation. (a) Segment results The revenue and operating results by segments were as follows: For the year ended June 30, 2017 K‑12 educational and management services Others Unallocated* Consolidated RMB RMB RMB RMB Revenues from external customers 853,295 — — 853,295 Total segment revenues 853,295 — — 853,295 Segment income 165,353 — 2,390 167,743 Interest income 5,980 729 6,709 Depreciation and amortization 111,147 — — 111,147 * Unallocated income is primarily related to government grants, corporate interest income and other miscellaneous items that are not allocated to individual segment. For the year ended June 30, 2018 K‑12 educational and Educational management training services services Others Unallocated* Consolidated RMB RMB RMB RMB RMB Revenues from external customers 1,112,954 36,395 19,999 — 1,169,348 Inter-segment revenues — 14,678 260 — 14,938 Total segment revenues 1,112,954 51,073 20,259 — 1,184,286 Segment income/ (loss) 276,587 28,820 1,157 (9,374) 297,190 Interest income 7,083 151 119 4,362 11,715 Depreciation and amortization 104,254 1 9,319 — 113,574 * Unallocated income (expenses) are primarily related to corporate administrative costs, interest income and other miscellaneous items that are not allocated to individual segment. For the year ended June 30, 2019 K‑12 educational and Educational management training services services Others Unallocated* Consolidated RMB RMB RMB RMB RMB Revenues from external customers 1,257,949 144,188 96,888 — 1,499,025 Inter-segment revenues 422 2,767 6,135 — 9,324 Total segment revenues 1,258,371 146,955 103,023 — 1,508,349 Segment income/ (loss) 320,639 91,720 18,773 (6,639) 424,493 Interest income 21,244 519 1,110 1,597 24,470 Depreciation and amortization 125,676 526 7,318 — 133,520 * The Group’s CODM does not review the financial position by operating segments, thus no total assets or liabilities of each operating segment are presented. All of the Group’s operations and customers are located in the PRC. The Group’s customer base is diversified and no customer with whom transactions have exceeded 10% of the Group’s revenues. The Group’s non-current assets are all located in mainland China. The geographical location of the Group’s non-current assets is based on the physical location of the asset, in the case of property and equipment, the location of the operation to which they are allocated, in the case of intangible assets and goodwill. |
Other income, net
Other income, net | 12 Months Ended |
Jun. 30, 2019 | |
Other income, net | |
Other income, net | 6 Other income, net 2017 2018 2019 RMB RMB RMB Government grants 6,253 5,832 25,437 Others 72 (2,143) (337) 6,325 3,689 25,100 |
Employee benefit expenses
Employee benefit expenses | 12 Months Ended |
Jun. 30, 2019 | |
Employee benefit expenses | |
Employee benefit expenses | 7 Employee benefit expenses 2017 2018 2019 RMB RMB RMB Wages and salaries 280,786 388,238 533,505 Contributions to defined contribution plans 44,884 52,898 64,118 325,670 441,136 597,623 |
Profit before tax
Profit before tax | 12 Months Ended |
Jun. 30, 2019 | |
Profit before tax | |
Profit before tax | 8 Profit before tax (i) Net finance income 2017 2018 2019 RMB RMB RMB Interest income 6,709 11,715 24,470 Others 183 (324) 465 Net finance income 6,892 11,391 24,935 Interest income was mainly generated from deposits placed with a related party finance entity (Note 20(a)(ii)). (ii) Expenses by nature 2017 2018 2019 RMB RMB RMB Employee benefit expenses (Note 7) 325,670 441,136 597,623 Students related cost 116,273 147,571 199,478 Transportation 31,823 36,110 49,137 Marketing and promotion 21,240 24,019 24,490 Depreciation (Note 11) 110,485 113,128 132,026 Utilities 23,286 26,100 26,162 Amortization of intangible assets (Note 12) 662 446 1,494 Operating lease charges 30,030 33,290 35,639 Others 39,300 70,787 58,518 Total cost of revenue, selling expenses and administrative expenses 698,769 892,587 1,124,567 Students related costs are mainly comprised of costs for textbooks, uniforms, dining services, living accommodations and costs relating to educational training services, study trip services and overseas study consulting services. For the year ended June 30, 2018, RMB14,263 of costs relating to study trip services and overseas study consulting services have been combined with students related cost to conform the presentation of the year ended June 30, 2019. (iii) Gain on disposal of affiliated entities On July 10, 2017, the Group entered into an Educational Cooperative Partnership Agreement (the “Chuzhou Agreement”) with Nanqiao government. Pursuant to the Chuzhou Agreement, Hailiang Management shall launch and operate Chuzhou School for 30 years beginning on September 1, 2017. On February 28, 2018, the Group entered into agreements with Hailiang Preschool Education Group Co., Ltd. (“Hailiang Preschool”), controlled by Mr. Feng transferred the Tianma Kindergarten and the sponsorship and 100% equity interest in Hailiang Kindergarten. The consideration of disposing Tianma Kindergarten and Hailiang Kindergarten was RMB1,666 and RMB20,049, respectively. On the disposal date, the carrying amount of the net liabilities of Tianma Kindergarten was RMB17, and the carrying amount of the net assets of Hailiang Kindergarten was RMB16,764. The Group recognized a gain of RMB1,683 and RMB3,285 on the disposal of Tianma Kindergarten and Hailiang Kindergarten, respectively. In addition, in June 2018, Hailiang Management entered into a Change of Operator Agreement and transferred the sponsorship and 100% equity interest in Chuzhou School to Chuzhou Zhengxu Education Information Consulting Co., Ltd., a wholly owned subsidiary of Hailiang Group Co., Ltd. ("Hailiang Group"). The consideration was RMB1,793, and the carrying amount of its net assets was RMB1,412 on disposal date. The Group recognized a gain of RMB381 on the disposal. The deals were not strategic shifts of the business and these transactions will not have major impact on the Group’s business, therefore the transactions were not qualified as discontinued operation. |
Income tax expenses
Income tax expenses | 12 Months Ended |
Jun. 30, 2019 | |
Income tax expenses | |
Income tax expenses. | 9 Income tax expenses The Company is incorporated in the Cayman Islands and conducts its primary business operations through its subsidiaries and consolidated affiliated entities in the PRC. It also has a wholly-owned subsidiary in Hong Kong. Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gains. Additionally, upon payments of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed. Hong Kong Under the Hong Kong tax laws, subsidiaries in Hong Kong are subject to the Hong Kong profits tax rate at 16.5% and they are exempted from income tax on their foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends. A two-tiered profits tax rates regime was introduced in 2018 where the first HK$2 million of assessable profits earned by a company will be taxed at half of the current tax rate (8.25)% while the remaining profits will continue to be taxed at 16.5%. There is an anti-fragmentation measure where each group will have to nominate only one company in the group to benefit from the progressive rates. China Under the Enterprise Income Tax (“EIT”) Law, domestic enterprises and Foreign Investment Enterprises (the “FIE”) are subject to a unified 25% enterprise income tax rate, except for certain entities that are entitled to tax holidays or exemptions. According to the Implementation Rules for the Law for Promoting Private Education in 2004, or the 2004 Implementing Rules, private schools, whether requiring reasonable returns or not, may enjoy preferential tax treatment. The 2004 Implementing Rules provide that the relevant authorities under the State Council may introduce preferential tax treatments and related policies applicable to private schools requiring reasonable returns. According to the current laws and regulations, preferential tax treatments and related policies applicable to private schools requiring reasonable returns have not been introduced. According to the Law on the Promotion of Private Education (“2016 Private Education Law”) effective as of September 1, 2017, private schools, whether non-profit or for-profit, may enjoy preferential tax treatment, and non-profit private schools will be entitled to similar tax benefits as public schools. In addition, taxation policies for for-profit private schools are still unclear as more specific provisions are not yet introduced. For Zhenjiang Jianghe High School of Art and Zhuji Hailiang Foreign Language High School, two private schools incorporated in 2018, the Group elected to register their statuses as for-profit. Accordingly, these two schools are subject to unified 25% enterprise income tax rate. Except for Zhenjiang Jianghe High School of Art and Zhuji Hailiang Foreign Language High School, other affiliated schools within the Group are registered as private schools requiring reasonable return under the 2004 Implementing Rules, the Group had not elected to change or re-register their statuses as of June 30, 2019. Confirmed by the local tax authorities and the Company’s PRC counsel, the Company’s affiliated private schools other than Zhenjiang Jianghe High School of Art and Zhuji Hailiang Foreign Language High School are exempt from income taxes for the years ended June 30, 2017, 2018 and 2019, and all the Company's affiliated private schools did not violate any tax laws or regulations and are exempt from income taxes for the years ended June 30, 2017, 2018 and 2019. The PRC tax system is subject to substantial uncertainties. There can be no assurance that changes in PRC tax laws or their interpretation or their application will not subject the Company’s PRC entities to substantial PRC taxes in the future. As of June 30, 2019, the Group had unused tax loss of RMB14,417 available for offset against future taxable profits, of which RMB230 will expire as of June 30, 2021, RMB4,879 will expire as of June 30, 2023, RMB9,241 will expire as of June 30, 2024 (As of June 30, 2018, the Group had unused tax loss of RMB2,516 available for offset against future taxable profits, of which RMB1,748 will expire as of June 30, 2020, RMB427 will expire as of June 30, 2021, RMB275 will expire as of June 30, 2023). No deferred tax assets have been recognized in respect of such tax losses due to the unpredictability of future taxable profit streams. Under the current EIT Law, dividends paid by an FIE to any of its foreign non-resident enterprise investors are subject to a 10% withholding tax. Thus, the dividends, if and when payable by the Company’s PRC subsidiaries to their offshore parent entities, would be subject to 10% withholding tax. A lower tax rate will be applied if such foreign non-resident enterprise investor’s jurisdiction of incorporation has signed a tax treaty or arrangement for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income with China. Furthermore, pursuant to the applicable circular and interpretations of the current EIT Law, dividends from earnings created prior to 2008 but distributed after 2008 are not subject to withholding income tax. The Company has not provided for deferred income tax liabilities on the PRC entities’ undistributed earnings of RMB820,456 as of June 30, 2019, because the Company controls the timing of the undistributed earnings and it is probable that such earnings will not be distributed. The Company plans to reinvest those earnings in the PRC indefinitely in the foreseeable future. (i) Income tax expenses in the consolidated statements of profit or loss and other comprehensive income represents: 2017 2018 2019 RMB RMB RMB Current —PRC income tax expenses — 66,288 108,545 Deferred —PRC income tax expenses — — 168 Income tax expenses for the year — 66,288 108,713 (ii) Reconciliation between the provision for income tax computed by applying applicable tax rates in fiscal year 2017, 2018 and 2019 to income before income taxes and the actual provision for income tax was as follow: 2017 2018 2019 RMB RMB RMB Profit before tax 167,743 297,190 424,493 Notional tax on profit before taxation, calculated at the applicable rates in the tax jurisdictions concerned 41,936 74,298 108,122 Effect of expenses that are not deductible in determining taxable profit — 373 524 Effect of incomes that are not taxable in determining taxable profit — (956) — Unrecognized tax losses 2 70 2,054 Utilization of tax losses previously not recognized (579) (46) (486) Effect of income tax exemptions (41,359) (7,451) (1,501) Income tax expense recognized in profit or loss — 66,288 108,713 (ii) Capitalized contract Favorable costs lease Total Deferred tax liabilities At June 30, 2018 — — — Acquisition through a business combination (note 19) — 4,523 4,523 Charged/(credited) to profit or loss 328 (160) 168 At June 30, 2019 328 4,363 4,691 |
Earnings per share
Earnings per share | 12 Months Ended |
Jun. 30, 2019 | |
Earnings per share | |
Earnings per share | 10 Earnings per share The calculation of basic EPS has been based on the following net profit attributable to the Company’s shareholders and weighted-average number of ordinary shares outstanding. The calculation of diluted EPS has been based on the following net profit attributable to the Company’s shareholders and weighted-average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares. (i) Net profit attributable to the Company’s shareholders 2017 2018 2019 RMB RMB RMB Net profit attributable to the Company's shareholders (basic and diluted) 167,743 222,588 293,421 (ii) Weighted-average number of ordinary shares 2017 2018 2019 Weighted average number of ordinary shares for basic EPS 411,208,000 411,878,478 412,450,256 Effects of dilution from warrants — 638,292 — Weighted average number of ordinary shares adjusted for the effect of dilution 411,208,000 412,516,770 412,450,256 (iii) Earnings per share 2017 2018 2019 Basic and diluted earnings per share 0.41 0.54 0.71 |
Property and equipment
Property and equipment | 12 Months Ended |
Jun. 30, 2019 | |
Property and equipment | |
Property and equipment | 11 Property and equipment Furniture, fixtures Motor and other Leasehold Construction vehicles equipment improvement in progress Total RMB RMB RMB RMB RMB Cost Balance at June 30, 2017 18,515 244,189 704,126 8,878 975,708 Additions 4,454 22,331 21,415 48,209 96,409 Transferred from construction in progress — 5,098 45,446 (50,544) — Disposals (1,566) (8,584) (23,446) (1,013) (34,609) Balance at June 30, 2018 21,403 263,034 747,541 5,530 1,037,508 Additions 190 21,970 12,137 29,325 63,622 Acquisition through a business combination (Note 19) — 3,954 8,772 — 12,726 Transferred from construction in progress — 22,962 1,051 (24,013) — Transferred to intangible assets — — — (2,438) (2,438) Disposals — (5,236) — — (5,236) Balance at June 30, 2019 21,593 306,684 769,501 8,404 1,106,182 Accumulated depreciation Balance at June 30, 2017 (9,879) (82,124) (163,086) — (255,089) Depreciation for the year (4,476) (33,414) (75,238) — (113,128) Disposals 338 4,340 5,112 — 9,790 Balance at June 30, 2018 (14,017) (111,198) (233,212) — (358,427) Depreciation for the year (3,669) (62,121) (66,236) — (132,026) Disposals — 4,894 — — 4,894 Balance at June 30, 2019 (17,686) (168,425) (299,448) — (485,559) Net book value At June 30, 2018 7,386 151,836 514,329 5,530 679,081 At June 30, 2019 3,907 138,259 470,053 8,404 620,623 During the year ended June 30, 2018, property and equipment with net book value of RMB23,433 were transferred out by the Group due to the disposal of Hailiang Kindergarten, Tianma Kindergarten and Chuzhou School. |
Intangible assets and goodwill
Intangible assets and goodwill | 12 Months Ended |
Jun. 30, 2019 | |
Intangible assets and goodwill. | |
Intangible assets and goodwill | 12 Intangible assets and goodwill Student Favorable Goodwill Trademark relationship lease Others Total RMB RMB RMB RMB RMB RMB Cost Balance at June 30, 2017 62,046 16,540 45,037 — — 123,623 Disposals of kindergarten business (406) — — — — (406) Balance at June 30, 2018 61,640 16,540 45,037 — — 123,217 Addition — — — — 1,743 1,743 Acquisitions through a business combination (Note 19) — — — 18,091 — 18,091 Transferred from construction in progress — — — — 2,438 2,438 Balance at June 30, 2019 61,640 16,540 45,037 18,091 4,181 145,489 Accumulated Amortization Balance at June 30, 2017 — — (44,024) — — (44,024) Amortization for the year — — (446) — — (446) Balance at June 30, 2018 — — (44,470) — — (44,470) Amortization for the year — — (260) (640) (594) (1,494) Balance at June 30, 2019 — — (44,730) (640) (594) (45,964) Net book value At June 30, 2018 61,640 16,540 567 — — 78,747 At June 30, 2019 61,640 16,540 307 17,451 3,587 99,525 Student relationship, trademark and goodwill arose from the acquisition of Tianma Experimental on July 1, 2009. In February 2018, the Group entered into an asset restructuring agreement, pursuant to which all the assets and liabilities related to the Tianma Kindergarten was sold to Zhuji Hailiang Preschool Investment Co., Ltd., a related party of the Group. Thus, the goodwill with an amount of RMB406 allocated to Tianma Kindergarten was written off in connection with the disposal. Goodwill and trademark with indefinite useful lives For the purpose of impairment testing, goodwill and trademark are allocated to a group of CGUs which represents the lowest level within the Group at which the goodwill and trademark are monitored for internal management purpose. The recoverable amount of goodwill is estimated based on discounted cash flows forecast, which is based upon a combination of long term trends, industry forecasts and in house estimates. For the purpose of impairment testing, the carrying amounts of goodwill and trademark are allocated to the business relating to Tianma Experimental, which is the lowest level for which the assets are monitored for internal management purpose. The aggregated carrying amounts of goodwill and trademark are as follows: 2018 2019 RMB RMB Goodwill 61,640 61,640 Trademark 16,540 16,540 Total 78,180 78,180 The recoverable amount of this CGU was based on value in use, which was estimated using discounted cash flow projections. The key assumptions used in the estimation of the recoverable amount are set out below. The values assigned to the key assumptions represented management’s assessment of future trends in the relevant industry and were based on historical data from both external and internal sources. In percent 2017 2018 2019 Discount rate 24 % 15 % 15.5 % Terminal value growth rate 3 % 3 % 3 % The discount rate was a pre-tax measure estimated based on the historical industry average weighted-average cost of capital, with a possible debt leveraging of 0%. The cash flow projections included the following specific estimates for five years and a terminal growth rate thereafter. The terminal growth rate was determined based on management’s estimate, consistent with the assumption that a market participant would make. · Revenue growth was projected considering the average growth levels experienced over the past five years and the estimated student headcount and tuition growth for the next five years. It was assumed that tuition would increase in line with forecast inflation over the next five years. · Growth of cost of sales, selling expenses and administrative expenses were projected considering inflation and estimated student headcount for the next five years. The estimated recoverable amount of the CGU exceeded its carrying amount as of June 30, 2017, 2018 and 2019, respectively. The recoverable amount of trademark is determined using the relief from royalty method, which was based on post-tax cash flow projections for 5 years based on financial budgets approved by management, including royalty rate of 3% (2018 and 2017: 3%), terminal growth rate of 3% (2018 and 2017: 3%) and the applicable discount rate of 15.5% (2018: 15% and 2017: 24%). Management determined the expected growth rates and the operating results based on the past performance and its expectations in relation to market developments. The discount rate used is pre-tax and reflects specific risks relating to the Company. Based on management’s assessment results, there was no impairment of goodwill and trademark as of June 30, 2017, 2018 and 2019. Student relationship The amortization of student relationship is included in “selling expenses”. No impairment loss of the student relationship intangible asset was recognized in the statements of profit or loss and other comprehensive income for the years ended June 30, 2017, 2018 and 2019. Favorable lease Favorable lease arose from the acquisition of Zhenjiang Jianghe High School of Art in October 2018. The amortization was recognized in “cost of revenue” over the period of leasing. |
Other current assets
Other current assets | 12 Months Ended |
Jun. 30, 2019 | |
Other current assets. | |
Other current assets | 13 Other current assets 2018 2019 Note RMB RMB Prepayments Contract costs 3(b) — Advances to employees Deductible VAT — Other receivables due from third parties Total 15,182 31,706 |
Cash and cash equivalents
Cash and cash equivalents | 12 Months Ended |
Jun. 30, 2019 | |
Cash and cash equivalents. | |
Cash and cash equivalents | 14 Cash and cash equivalents (i) Cash and cash equivalents comprise: 2018 2019 Note RMB RMB Cash on hand 30 309 Cash at bank 71,857 36,827 Cash held at a related party finance entity 20(b) 740,733 223,548 Total 812,620 260,684 As of June 30, 2018 and 2019, the cash and cash equivalents of the Group denominated in RMB amount to RMB799,147 and RMB248,438, respectively. (ii) Reconciliation of liabilities arising from financing activities Loans due to related parties RMB (Note 17) At July 1, 2017 99,603 Changes from financing cash flows: Proceeds from a loan from a related party 7,609 Total changes from financing cash flows 7,609 Other non-cash change: Net settlement of a loan made to a related party with a loan borrowed from a related party (7,609) Total other non-cash change (7,609) At June 30, 2018 and 2019 99,603 Dividends payable to a non-controlling shareholder RMB At June 30, 2018 and July 1, 2018 — Changes from financing cash flows: Dividends declared to be payable to a non-controlling shareholder of subsidiaries 7,482 Dividends paid to a non-controlling shareholder of subsidiaries (7,482) Total changes from financing cash flows — At June 30, 2019 — |
Capital and reserve
Capital and reserve | 12 Months Ended |
Jun. 30, 2019 | |
Capital and reserve | |
Capital and reserve | 15 Capital and reserve (a) Share capital and share premium 2017 2018 2019 At June 30 par value USD0.0001‑authorized 1,000,000,000 1,000,000,000 1,000,000,000 -issued and outstanding 411,208,000 412,450,256 412,450,256 All ordinary shares rank equally. (i) Ordinary shares Holders of these shares are entitled to dividends as declared from time to time and are entitled to one vote per share at general meetings of the Company. In March 2012, in connection with a private placement by a third party investor, the Board resolved to increase the authorized ordinary shares from 360,000,000 shares to 365,000,000 shares. Concurrently, 5,000,000 newly authorized ordinary shares were issued to Maxida International Company Limited (“Maxida”). The Company received cash proceeds of USD3,000 (equivalent to RMB18,867) from Maxida in exchange for 1.4% equity interest in the Company. In December 2014, the Board resolved to increase the authorized ordinary shares from 365,000,000 shares to 1,000,000,000 shares. In July 2015, the Company completed an IPO in the US market, in which the Company issued 2,858,000 American depositary shares, or ADSs (equal to 45,728,000 ordinary shares), at a public offering price of US$7 per ADS. Each ADS represents 16 ordinary shares, par value USD0.0001 per share. In September 2015, the Company granted 480,000 restricted shares to a consultant as a consideration for its service rendered. Per valuation of the restricted shares, the fair value of 480,000 shares is USD229 (equivalent to RMB1,459). On December 15, 2017, all the warrants issued to the underwriter were exercised into 77,641 ADSs (equal to 1,242,256 ordinary shares). (ii) Share premium Share premium relates to the following issuances of the Company’s ordinary shares: (1) Share deficit of RMB236 for ordinary shares issued by the Company to Mr. Feng for nil consideration upon the Company’s incorporation in 2011. (2) The capital contributed by Maxida in excess of the par value of the ordinary shares issued in the private placement of RMB18,864 in 2012. (3) The gross proceeds of RMB122,369 received from IPO deducting the issuance cost of RMB9,551 and par value of ordinary shares issued to public of RMB28, with net proceed of RMB112,790 in July, 2015. (4) The fair value of warrants issued to the underwriter of RMB1,707 upon completion of IPO. On December 15, 2017, all the warrants issued to the underwriter were exercised into 77,641 ADSs (equal to 1,242,256 ordinary shares). (5) The fair value of restricted shares issued to consultant in September, 2015, in excess of par value of ordinary shares issued of RMB1,459. (iii) Contributed capital Contributed capital represented the following capital transactions with the Company’s shareholders: (1) Upon completion of the IPO restructure in October 2014, contributed capital arose from below transactions: - The contributions of the registered capital of 100% of Foreign Language and 60% of Experimental High made by Mr. Feng totaling RMB82,800. - The consideration of RMB110,000 made by Mr. Feng for the acquisition of 80% equity interest in Tianma Experimental. - The share capital of HKD10 (equivalent to RMB9) contributed by Mr. Feng upon incorporation of Hailiang HK. - RMB32,906 arising from acquisition of non-controlling interests. In November 2011, Mr. Feng acquired 40% registered capital equity interest in Experimental High and 20% registered capital equity interest in Tianma Experimental from Mr. Meng, the non-controlling shareholder of both schools for cash considerations of RMB35,000 and RMB6,000, respectively. Upon the acquisitions, Mr. Feng became the sole sponsor of Experimental High and Tianma Experimental and owned 100% registered capital equity interest in each of the two schools. The non-controlling interests’ proportionate shares of the net identifiable assets of Experimental High and Tianma Experimental on the date of the acquisitions were RMB28,790 and RMB4,116, respectively. The aggregate cash consideration of RMB41,000 paid by Mr. Feng for the acquisitions was recorded in contributed capital. The difference between the cash consideration paid of RMB41,000 and the total carrying amount of the non-controlling interests of RMB32,906, which amounted to RMB8,094, was charge to deduct contributed capital within equity. - The capital contributions of RMB139,980 paid by Mr. Feng upon incorporation of Hailiang Management. - Cash consideration of RMB139,800 paid to Mr. Feng for the transfer of 100% registered capital equity interest in each of the Foreign Language, Experimental High and Tianma Experimental. (2) Capital contribution of RMB10,000 from Hailiang Investment, a related party controlled by Mr. Feng, through waiving liability during the year ended June 30, 2017. (3) Capital contribution of RMB139 from Beize Group through subscribing 0.1% registered capital of Hailiang Management during the year ended June 30, 2019. (4) Deemed capital contribution of RMB15,000 from Mr. Feng, through payment of awards to the Group's outstanding teachers to recognize their outstanding performance and contributions during the year ended June 30, 2019. (b) Reserves (i) Statutory reserve As stipulated by relevant PRC laws and regulations, the Company’s subsidiaries and affiliated entities in the PRC must take appropriations from after-tax profit to non-distributive funds. These reserves include general reserve and the development reserve. The general reserve requires annual appropriation 10% of after-tax profits at each year-end until the balance reaches 50% of the PRC company’s registered capital. Other reserve is set aside at the Company’s discretion. These reserves can only be used for general enterprise expansion and are not distributable as cash dividends. The general reserve as of June 30, 2018 and 2019 was RMB20,096 and RMB43,024, respectively. Each of the schools is required to appropriate 25% of its after-tax profits to a non-distributable education development reserve, which could only be used for school construction, maintenance and upgrade of educational equipment in accordance with the Law of Promoting Private Education. The development reserve is restricted net assets of the schools which are un-distributable to the Company in the form of dividends or loans. The education development reserve as of June 30, 2018 and 2019 was RMB284,427 and RMB306,436, respectively. (ii) Translation reserve The translation reserve comprises foreign currency differences arising from the translation of the financial statements of the Company and its subsidiaries into the presentation currency. ( c) Dividends No dividends were declared and paid by the Company during the years ended June 30, 2017, 2018 and 2019. |
Non-controlling interests
Non-controlling interests | 12 Months Ended |
Jun. 30, 2019 | |
Non-controlling interests. | |
Non-controlling interests | 16 Non -controlling interests Non-controlling interests (“NCI”) represent 44% non-controlling interests in Haibo Education and Haibo Logistics, which are held by Nanchang Baishu Education Group (“Nanchang Baishu”), a related party of the Group, and 49% non-controlling interests in Zhenjiang Jianghe High School of Art, which is held by third parties. The following table summarizes the changes in non-controlling interests from June 30, 2018 through June 30, 2019. Zhenjiang Jianghe High Haibo Education Haibo Logistics School of Art Total RMB RMB RMB RMB Balance at June 30, 2018 9,390 3,764 — 13,154 Acquisition through a business combination, including deemed cash consideration to NCI — — 9,408 9,408 Net profit/(loss) and total comprehensive income attributable to NCI 19,535 3,808 (984) 22,359 Dividends paid to NCI (6,075) (1,407) — (7,482) Balance at June 30, 2019 22,850 6,165 8,424 37,439 The following table lists out the financial information relating to Haibo Education, whose non-controlling interest are considered material. The summarized financial information presented below represents the amounts before any inter-company elimination. 2018 2019 RMB’000 RMB’000 NCI percentage 44 % 44 % Current assets 41,577 61,639 Non-current assets 22 1,540 Current liabilities 20,259 11,248 Net assets 21,340 51,931 Carrying amount of NCI 9,390 22,850 Revenue 35,532 87,655 Net profit for the year 15,340 44,397 Total comprehensive income 15,340 44,397 Net profit and total comprehensive income attributable to NCI 6,750 19,535 Dividend paid to NCI — 6,075 Cash flows from operating activities 35,462 32,649 Cash flows generated from/(used in) investing activities 14 (41,603) Cash flows generated from/(used in) financing activities 6,000 (13,806) |
Trade and other payables
Trade and other payables | 12 Months Ended |
Jun. 30, 2019 | |
Trade and other payables | |
Trade and other payables | 17 Trade and other payables 2018 2019 RMB RMB Trade payable 22,309 20,556 Accrued payroll 68,351 130,744 Amounts due to third parties 50,844 66,822 Trade and other payables due to third parties 141,504 218,122 Loans due to related parties 99,603 99,603 Amounts due to related parties 38,612 35,142 Other payables due to related parties 138,215 134,745 Total 279,719 352,867 The Group’s exposure to liquidity risk related to trade and other payables is disclosed in Note 18. |
Financial risk management and f
Financial risk management and fair values | 12 Months Ended |
Jun. 30, 2019 | |
Financial risk management and fair values | |
Financial risk management and fair values | 18 Financial risk management and fair values The Group has exposure to the following risks from financial instruments: · credit risk · liquidity risk · market rate risk This note presents information about the Group’s exposure to each of the above risks, the Group’s objectives, policies and processes for measuring and managing risk, and the Group’s management of capital. The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. (a) Credit risk The Group’s credit risk is primarily attributable to cash at bank, cash and term deposits held at a related party finance entity, loans receivable due from a related party. The carrying amount of financial assets represents the maximum credit exposure. The Group does not provide any other guarantees which would expose the Group to credit risk. Cash at bank All of the Group’s cash at bank is held by third-party financial institutions located in the PRC, Hong Kong SAR. The bank deposits with financial institutions in the PRC are insured by the government authority for up to RMB500. The bank deposits with financial institutions in the Hong Kong SAR are insured by the government authority for up to HK$500. The Company has not experienced any losses in uninsured bank deposits and does not believe that it is exposed to any significant risks on cash held in bank accounts. To limit exposure to credit risk, the Company primarily places bank deposits with large financial institutions in the PRC, Hong Kong SAR with acceptable credit rating. Cash and term deposits placed with a related party finance entity As of June 30, 2019, the Group had cash of RMB223,548 and term deposits of RMB1,387,094 at Hailiang Group Finance Co., Ltd. (“Hailiang Finance”), which represented 91% of the Group’s consolidated current assets as of June 30, 2019. Hailiang Group, an entity controlled by Mr. Feng, established a finance group, namely, Hailiang Finance, which is licensed to provide intra-group financing arrangements within Hailiang Group’s subsidiaries and other related party companies. The establishment of Hailiang Finance was approved by the China Banking Regulatory Commission (“CBRC”) as a non-banking financial institution to solely facilitate Hailiang Group’s internal financing transactions including issuing loans to and accepting cash deposits from its subsidiaries and other related party entities. Pursuant to the license issued by CBRC, Hailiang Finance is not permitted to make any loans or accept any deposits from any parties that are unrelated to Hailiang Group, except for inter-bank transactions with other unrelated commercial banks. Since September 2014, Hailiang Group and Mr. Feng provided an annual guarantee on the Group’s deposits with Hailiang Finance, and the guarantee was renewed annually. Based on one most recent PRC credit rating organizations, Hailiang Group has been rated AA+ which indicates strong ability to make payments on debts as they become due. Management believes that the credit risk on the Group’s cash of RMB223,548 and term deposits of RMB1,387,094 is low considering Hailiang Group’s guarantee and credit rating. To reduce its credit exposure with Hailiang Finance, the Group provided an annual budget for the aggregate amount deposits with Hailiang Finance as RMB2,100,000 based on current policy effective since September 2019. Loans receivable due from a related party The Company received an annual guarantee from a related party, incorporated in British Virgin Island and controlled by Hailiang Group, on the Company’s loan due from Hong Kong Leonit Limited (“Leonit”), a related party controlled by Hailiang Group. The Group considers that the credit risk arising from the loan is significantly mitigated by the guarantee. (b) Liquidity risk Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. The following are the contractual maturities of financial liabilities, which are based on contractual undiscounted cash flows and the earliest date the Group can be required to pay: June 30, 2018 Carrying Contractual amount cash flows 1 year or less Non-derivative financial instruments RMB RMB RMB Trade and other payables 279,719 279,719 279,719 June 30, 2019 Carrying Contractual amount cash flows 1 year or less Non-derivative financial instruments RMB RMB RMB Trade and other payables 352,867 352,867 352,867 (c) Market rate risk Interest rate risk The interest rates of cash held in bank and cash and term deposits placed with Hailiang Finance ranged from 0.35% to 1.82% per annum for the year ended June 30, 2018, and ranged from 0.30% to 2.1% for the year ended June 30, 2019. The Group does not have any fixed-rate or variable-rate interest bearing financial instrument other than cash and cash equivalent, and term deposits placed with a related party finance entity. A change of 10 basis point in interest rate would not be expected to have a significant impact on the Group’s financial condition or results of operations. (d) Fair value The carrying amounts of financial assets and liabilities approximate their respective fair values as of June 30, 2018 and 2019, respectively, due to their short-term maturities. As of June 30, 2018 and 2019, the Group did not have financial instruments carried at fair value. During the years ended June 30, 2018 and 2019, there were no transfers between Level 1 and Level 2, or transfers into or out of Level 3. The Group’s policy is to recognize transfers between levels of fair value hierarchy as at the end of the reporting period in which they occur. (e) Capital management The Group actively and regularly reviews and manages its capital structure to maintain a balance between higher shareholders’ return that might be possible with higher levels of borrowings, and makes adjustments to the capital structure in light of changes in economic conditions. The Group is not subject to externally imposed capital requirements. |
Acquisition of business
Acquisition of business | 12 Months Ended |
Jun. 30, 2019 | |
Acquisition of business | |
Acquisition of an affiliated entity | 19 Acquisition of business Acquisition of Zhenjiang Jianghe High School of Art On September 28, 2018, Hailiang Management entered into an agreement to acquire 51% controlling interest in Zhenjiang Jianghe High School of Art. The Company paid cash of RMB 1,530 to the former three individual shareholders in October 2018 and injected cash of RMB 10,710 to Zhenjiang Jianghe High School of Art in November 2018. The transaction was completed on October 31, 2018. Zhenjiang Jianghe High School of Art is principally engaged in art education programs including painting, music and media. Total consideration transferred was determined to be RMB6,778, being the sum of i) cash consideration of RMB 1,530 paid to the former shareholders in October 2018 and ii) deemed cash consideration to former shareholders of RMB 5,248, which was calculated based on capital injected to the acquiree of RMB10,710 multiplied by the percentage of equity interests retained by the former shareholders of 49% in November 2018. Acquisition related costs, which were not material, have been expensed and included in the administrative expenses. The acquisition has been accounted for using the acquisition method. The results of operation have been included in the Group’s consolidated financial statements since the date of acquisition. Consideration transferred RMB Cash consideration paid to former shareholders 1,530 Deemed cash consideration to former shareholders 5,248 Total consideration transferred 6,778 The following table summarizes the acquisition-date fair value of the identifiable assets acquired, liabilities assumed and non-controlling interests (excluding the effect of the RMB10,710 cash capital injection) in connection with the business combination: RMB Cash and cash equivalents 903 Other current assets 16 Property and equipment, net 12,726 Intangible assets 18,091 Trade and other payables (14,445) Contract liabilities (1,830) Deferred tax liabilities (4,523) Total identifiable net assets acquired 10,938 Non-controlling interests arising from the acquisition (4,160) Total consideration 6,778 Analysis of the net cash outflow in respect of the acquisition Cash consideration 6,778 Less: Deemed cash consideration to former shareholders (5,248) Cash acquired (903) 627 The values of identifiable assets and liabilities, and non-controlling interests recognized on acquisition are their estimated fair values. Intangible assets represented a favorable lease acquired related to the lease of the campus. The Company estimated the fair value of the favorable lease using discounted cash flow techniques which included an estimate of future cash flows discounted to present value with an appropriate risk-adjusted discount rate. The non-controlling interest fair value reflects the fair value of purchase price consideration for a controlling interest, less discounts for lack of control and marketability. The post-acquisition revenue and net loss that Zhenjiang Jianghe High School of Art contributed to the Group for the period from November 1, 2018 to June 30, 2019 are RMB5,018 and RMB2,009, respectively. Had the acquisition occurred on July 1, 2018, management estimates that the Group's consolidated revenue and consolidated profit for the year ended June 30, 2019 would have been RMB1,500,496 and RMB314,513 respectively. |
Related parties transactions
Related parties transactions | 12 Months Ended |
Jun. 30, 2019 | |
Related parties transactions | |
Related parties transactions | 20 Related parties transactions Except for related party transactions disclosed in other notes of the financial statements, the Group entered into the following significant transactions with related parties during the years ended June 30, 2017, 2018 and 2019. (a) The significant related party transactions are summarized as follows: 2017 2018 2019 Note RMB RMB RMB Loans borrowed from a related party (i) 99,603 7,609 — A loan made to a related party (i) 98,229 — — Repayment of a loan made to a related party (i) — — 12,412 Interest income from deposits placed with a related party finance entity (ii) 5,847 11,464 24,313 Net (withdrawals)/deposits of cash at a related party finance entity (ii) (109,998) 679,018 (517,185) Term deposits placed with a related party finance entity (ii) 1,953,600 204,000 4,709,697 Maturity of term deposits placed with a related party finance entity (ii) 1,552,600 401,000 3,526,603 Rental expenses (iii) 30,030 32,486 33,814 Payments of expenses by the Group on behalf of related parties (iv) — 9,401 10,312 Payments of expenses by related parties on behalf of the Group (iv) 3,836 4,612 2,731 Collection by the Group on behalf of related parties (iv) 39,760 47,070 46,453 Purchase of leasehold improvement from a related party (v) 37,231 29,098 29,669 Purchase of food products from related parties (vi) 48,298 38,323 68,963 Education and management service provided to related parties (vii) 3,766 16,831 33,222 Other service and product provided to related parties (viii) — 416 3,254 Service provided by related parties (ix) — 6,884 23,263 Waive of liability to a related party (iii) 10,000 — — Gains from disposal of affiliated entities to a related party (x) — 5,349 — Acquisition of subsidiaries (xi) — 6,160 — Dividends paid to a non-controlling shareholder of subsidiaries (xi) — — 7,482 Capital contribution (xii) — — 15,000 (b) The significant related party balances are summarized as follows: 2018 2019 Note RMB RMB Amounts due from related parties (i)(ii)(iii)(iv)(vii) (viii) 95,128 91,674 Cash held at a related party finance entity (ii) 740,733 223,548 Term deposits placed with a related party finance entity (ii) 204,000 1,387,094 Amounts due to related parties (i)(iii)(iv)(v)(vi)(ix) 138,215 134,745 The Company’s majority shareholder, Mr. Feng owns or controls other non-educational services businesses (“Related Party Companies”) that from time to time require short-term financing to support their business operations and working capital needs. After considering the cash on hand and forecasted cash flows to fund its operations, the Group issued financing to Related Party Companies during the periods presented. (i) On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid. On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit. During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company. As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. (ii) As of June 30, 2018 and 2019, the Group has cash held at a related party finance entity of RMB740,733 and RMB223,548, respectively. During the year ended June 30, 2018, net amount of RMB679,018 were placed with Hailiang Finance. During the years ended June 30, 2017 and 2019, net amount of RMB109,998 and RMB517,185 were withdrawn from Hailiang Finance, respectively. The cash held at a related party finance entity is held for the purpose of meeting short-term cash commitments, such as to pay for the Group’s operating expenses at any time. During the years ended June 30, 2017, 2018 and 2019, term deposits of RMB1,953,600, RMB204,000 and RMB4,709,697 were placed with Hailiang Finance, and RMB1,552,600, RMB401,000 and RMB3,526,603 were matured, respectively. The term deposits are held for investment purpose and can be withdrawn prior to their maturity without incurring significant penalties. Such amounts have been presented as investing activities in the statements of cash flows. As of June 30, 2018 and 2019, the Group has term deposits with maturities ranging from three months to one year amounting to RMB204,000 and RMB1,387,094 that are placed at Hailiang Finance, respectively. The interest income from the deposits during the years ended June 30, 2017, 2018 and 2019 amounted to RMB5,847, RMB11,464 and RMB24,313, respectively. Interest receivable as of June 30, 2018 and 2019 amounted to RMB1,038 and RMB4,916 respectively. (iii) The Group leases the school buildings and the related facilities in three campuses from Hailiang Investment, a related party controlled by Mr. Feng. In addition, Haibo Education and Haibo Logistics lease the office space and warehouse from Nanchang Hongtou Property Management Co., Ltd. (“Nanchang Hongtou”), a related party owned by Mr. Honggen Min, who is the controlling shareholder of Nanchang Baishu. The Group also leases some office spaces from Hangzhou Hailiang Real Estate Co., Ltd. (“Hailiang Real Estate”), a related party controlled by Mr. Feng. The leasing terms and rental amounts are as follows: 2017 2018 2019 Leasing Period RMB RMB RMB Rental from Hailiang Investment October 11, 2017 ~ June 30, 2037 30,030 30,965 31,504 Rental from Nanchang Hongtou July 1, 2017 ~ June 30, 2022 — 1,521 1,580 Rental from Hailiang Real Estate June 11, 2018 ~ June 10, 2023 — — 730 Total 30,030 32,486 33,814 Hailiang Investment waived the 2013 and 2014 rental fees with an amount of RMB10,000 during the year ended June 30, 2017. (iv) During the years ended June 30, 2017, 2018 and 2019, the Group paid expenses, which mainly include staff related expenses, start-up costs and other miscellaneous expenses, of nil, RMB 9,401 and RMB10,312 respectively on behalf of the related parties. Such amount is receivable on demand, and the related parties repaid nil, RMB8,794 and RMB10,007 to the Group during the years ended June 30, 2017, 2018 and 2019, respectively. During the years ended June 30, 2017, 2018 and 2019, the related parties paid expenses, which mainly include staff related expenses and other miscellaneous expenses, of RMB3,836, RMB4,612 and RMB2,731 respectively on behalf of the Group. Such amount is due and payable on demand, and the Group repaid RMB4,536, RMB4,124 and RMB 4,663 to the related parties during the years ended June 30, 2017, 2018 and 2019, respectively. During the years ended June 30, 2017, 2018 and 2019, the Group collected amounts of RMB39,760, RMB47,070, and RMB46,453 on behalf of Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., a related party controlled by Mr. Feng. Such amount is due and payable on demand, and the Group repaid RMB37,541, RMB48,428 and RMB47,429 to Zhejiang Ming Kang Hui Food Co., Ltd. during the years ended June 30, 2017, 2018 and 2019, respectively. The above unsettled balances were included in “Amount due to related parties” and “Amount due from related parties” as of June 30, 2018 and 2019, respectively. (v) The Group entered into a series of leasehold improvement contracts with Heng Zhong Da Construction Limited Company (“Heng Zhong Da"), a company over which Mr. Feng has significant influence, for the leasehold improvement of classroom buildings, dining halls, student dormitories. During the years ended June 30, 2017, 2018 and 2019, the Group purchased leasehold improvement service from Heng Zhong Da of RMB37,231, RMB29,098 and RMB29,669, respectively. As of June 30, 2018 and 2019, the above unsettled balances of RMB19,508 and RMB11,260 were recognized in “Amount due to related parties”. (vi) The Group purchased food products from Zhejiang Ming Kang Hui E-Commerce Co., Ltd. and Ming Kang Hui Ecological Agriculture Group Co., Ltd. (collectively referred as “Ming Kang Hui”), two companies controlled by Mr. Feng, amounting to RMB48,298, RMB38,323 and RMB68,963 during the years ended June 30, 2017, 2018 and 2019, respectively. As of June 30, 2018 and 2019, the above unsettled balances of RMB5,386 and RMB18,516 were recognized in “Amount due to related parties”. (vii) Education and management service provided to related parties are as follow: 2017 2018 2019 RMB RMB RMB Education and management service provided to managed schools — 12,275 28,344 Service provided to Ming Kang Hui 3,766 4,556 4,878 Total 3,766 16,831 33,222 Pursuant to the strategic cooperation agreement signed with Hailiang Group and Hailiang investment, the Group provided education and management services to Hailiang Kindgarten, Zhuji Hailiang Jinshan Kindgarten and Tianma Kindgarten, which were controlled by Hailiang Group, and other 19 schools controlled by Hailiang Investment, including Xiantao No.1 Middle School, Xinchang Nanrui Experimental School, Feicheng Hailiang Foreign Language school, Jinhua Hailiang Foreign Language School and etc.. Education and management service fees of nil, RMB12,275 and RMB28,344 were charged to the abovementioned schools during the years ended June 30, 2017, 2018 and 2019, respectively. The Group provided service to Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., controlled by Mr. Feng, in the Group’s campuses, amounting to RMB3,766, RMB4,556 and RMB4,878 during the years ended June 30, 2017, 2018 and 2019, respectively. (viii) Other service and product provided to related parties mainly include daily consumables sold to related parties, hotel services and etc. (ix) The Group received IT services, physical examination services, travel services and other services from related parties controlled by Hailiang Group, amounting to nil, RMB6,884 and RMB23,263 during the years ended June 30, 2017, 2018 and 2019. As of June 30, 2018 and 2019, the above unsettled balances of RMB3,416 and RMB420 were recognized in “Amount due to related parties”. (x) The gains were recognized from disposal of Hailiang Kindergarten, Tianma Kindergarten and Chuzhou School (see Note 8 (iii) for additional details), amounting to RMB3,285, RMB1,683 and RMB381 during the year ended June 30, 2018, respectively. (xi) In August 2017, Haibo Education and Haibo Logistics were incorporated by Xinyu Baishu Technology Service Co., Ltd. (“Xinyu Baishu”), an entity ultimately controlled by Mr. Feng. The contributed capitals from Xinyu Baishu in Haibo Education and Haibo Logistics were RMB6,000 and RMB5,000, respectively. In January 2018, Xinyu Baishu transferred 56% equity interests in each of Haibo Education and Haibo Logistics to Ningbo Haoliang with considerations of RMB3,360 and RMB2,800, respectively. The considerations were equivalent to the cost of 56% of the contributed capital. In January 2018, Xinyu Baishu also transferred the remaining 44% equity interest in Haibo Education and Haibo Logistics to Nanchang Baishu, a related party of the Company. The 44% equity interests owned by Nanchang Baishu were recorded as non-controlling interests (see note 16). In November 2018, Haibo Education and Haibo Logistics declared and fully paid dividends amounting to RMB6,075 and RMB 1,407 to Nanchang Baishu, respectively (see note 16). (xii) Mr. Feng, paid awards of RMB 15,000 to the Group's outstanding teachers to recognize their outstanding performance and contributions during the year ended June 30, 2019. The transaction is accounted for as a deemed contribution from a controlling shareholder. (c) Transactions with key management personnel Remuneration of the directors and key management personnel of the Group for the years ended June 30, 2017, 2018 and 2019 are as follows: 2017 2018 2019 RMB RMB RMB Short-term benefits 7,614 8,162 5,713 Total remuneration is included in “employee benefit expenses” (Note 7). |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Jun. 30, 2019 | |
Commitments and contingencies | |
Commitments and contingencies | 21 Commitments and contingencies (a) Capital commitments Capital commitments, which are primarily related to the campus decoration are as follows: 2018 2019 RMB RMB Contracted, but not provided for: Leasehold improvement 14,988 12,525 (b) Operating lease commitments, which are primarily with related parties, are as follows: 2018 2019 RMB RMB within one year 33,764 36,376 one year to five years 145,016 155,254 Five years thereafter 497,468 496,794 676,248 688,424 |
Subsequent events
Subsequent events | 12 Months Ended |
Jun. 30, 2019 | |
Subsequent events | |
Subsequent events | 22 Subsequent events (a) Prepayment of rental fees The Group's affiliated schools and subsidiaries and Hailiang Investment entered into a series lease supplemental agreements, pursuant to which the Group agreed to prepay rental fees of RMB540,453 for the entire remaining lease period from July 1, 2019 to June 30, 2037. On September 12, 2019, the rental fees of RMB540,453 were fully paid. (b) Lawsuit On May 21, 2019, the Group filed a lawsuit in the People’s Court of Zhuji City of China against Ronghuai Education Group and Zhuji Ronghuai School (collectively, “Ronghuai”), asserting claims of infringement of registered trademarks and unfair competition under the Trademark Law and Anti-Unfair Competition Law of the PRC. The Group alleged in the complaint that Ronghuai manipulated settings of certain popular search engines in China, such as www.360.cn , hao.360.com and www.so.com , which caused confusion for the Group's potential clients/students. Ronghuai’s alleged misconduct directed these students to Ronghuai’s website instead of the websites when the students searched key terms such as “Hailiang”, “Hailiang education”, “Hailiang senior middle school”, and “Hailiang primary school”. Therefore, the Group claimed damages of RMB 3.0 million against Ronghuai. Based on new evidence the Group collected through discovery, the Group subsequently amended the complaint and increase the amount of damages to RMB 7.5 million. On July 8, 2019, Ronghuai filed a lawsuit in the People’s Court of Zhuji City of China against Hailiang Group, the Company’s related party, and Hailiang Senior Middle School, one of the Company's affiliated schools, asserting claims of infringement of registered trademarks and unfair competition under the Trademark Law and Anti-Unfair Competition Law of the PRC. Ronghuai alleged, in a way similar to the Group's original complaint as described above, that Hailiang Group and Hailiang Senior Middle School employed manipulative measures to direct potential clients/students to the websites instead of theirs and requested monetary damages in the amount of RMB 3.01 million. Based on new evidence Ronghuai claimed to have collected through discovery, Ronghuai later amended their complaint to increase the amount of damages to RMB 7.51 million. On July 17, 2019, Ronghuai filed a separate lawsuit in the People’s Court of Zhuji City of China against the Company’s seven affiliated entities and three of the Company’s related parties, including Hailiang Group, Hailiang Investment and Zhejiang Hailiang Limited, on the ground of defamation. Ronghuai alleged that the Group’s public announcement regarding the filing of a complaint against Ronghuai contained defamatory remarks against Ronghuai and affected its reputation, and requested monetary damages in the amount of RMB10 million in total. As the above cases remain in their preliminary stages, after consultation with the Group's external legal counsel, the Group assessed the probability of the potential liability to be not probable and the amount of loss cannot be reasonably estimated at current stage. As a result, the Group did not record any liabilities pertaining to this. |
Comparative figures
Comparative figures | 12 Months Ended |
Jun. 30, 2019 | |
Comparative figures | |
Comparative figures | 23 Comparative figures The Group has initially applied IFRS 15 and IFRS 9 at July 1, 2018. Under the cumulative effect method, comparative information is not restated. Further details of the changes in accounting policies are disclosed in note 3. |
Immediate and ultimate controll
Immediate and ultimate controlling party | 12 Months Ended |
Jun. 30, 2019 | |
Immediate and ultimate controlling party | |
Immediate and ultimate controlling party | 24 Immediate and ultimate controlling party At June 30, 2019, the Directors consider the immediate parent of the Group to be Jet Victory International Limited, which is incorporated in British Virgin Island, and the ultimate controlling party to be Mr. Feng. Neither of the parties produce financial statements available for public use. |
Parent company financial statem
Parent company financial statement | 12 Months Ended |
Jun. 30, 2019 | |
Parent company financial statement | |
Parent company financial statement | 25 Parent company financial statement The following condensed parent company financial information of Hailiang Education Group Inc. has been prepared using the same accounting policies as set out in the accompanying consolidated financial statements. HAILIANG EDUCATION GROUP INC. CONDENSED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS FOR THE YEARS ENDED JUNE 30, 2017, 2018 AND 2019 (Amounts in thousands) 2017 2018 2019 RMB RMB RMB Cost of revenue — (2,299) — Gross loss — (2,299) — Administrative expenses (4,148) (9,124) (8,176) Operating loss (4,148) (11,423) (8,176) Net finance expenses (8) (17) — Loss before tax (4,156) (11,440) (8,176) Loss (4,156) (11,440) (8,176) Other comprehensive income/(loss)-foreign currency translation differences 2,643 (3,016) 4,086 Total comprehensive loss (1,513) (14,456) (4,090) HAILIANG EDUCATION GROUP INC. CONDENSED STATEMENTS OF FINANCIAL POSITION AS OF JUNE 30, 2018 AND 2019 (Amounts in thousands) 2018 2019 RMB RMB Assets Other receivables due from subsidiaries 20,330 24,994 Non-current assets 20,330 24,994 Other receivables due from related parties 86,997 79,265 Cash 526 390 Current assets 87,523 79,655 Total assets 107,853 104,649 Shareholders’ equity Share capital 268 268 Share premium 134,583 134,583 Translation reserve 9,110 13,195 Accumulated losses (37,503) (45,679) Total shareholders’ equity 106,458 102,367 Liabilities Other payables due to third parties 1,393 2,280 Other payables due to related parties 2 2 Current liabilities 1,395 2,282 Total liabilities 1,395 2,282 Total shareholders’ equity and liabilities 107,853 104,649 HAILIANG EDUCATION GROUP INC. CONDENSED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED JUNE 30, 2017, 2018 AND 2019 (Amounts in thousands) 2017 2018 2019 RMB RMB RMB Cash flows from operating activities Loss for the year (4,156) (11,440) (8,176) Adjustments for: Change in other payables due to third parties (1,851) 1,393 887 Change in other payables due to a related party (651) 1 — Change in other receivable due from subsidiaries (347) (152) (4,664) Change in other receivable due from related parties — 3,623 (201) Net cash used in operating activities (7,005) (6,575) (12,154) Cash flows from investing activities A Loan made to a related party (98,229) — — Repayment of a loan from a related party — — 12,412 Net cash used in investing activities (98,229) — 12,412 Cash flows from financing activities A Loan made from a related party — 7,609 — Net cash from financing activities — 7,609 — Net foreign exchange loss/(gain) 2,642 (3,016) (394) Net decrease in cash (102,592) (1,982) (136) Cash at the beginning of the year 105,100 2,508 526 Cash at end of the year 2,508 526 390 Non-cash transaction: Net settlement of a loan made to a related party with a loan borrowed from a related party — (7,609) — |
Significant accounting polici_2
Significant accounting policies (Policies) | 12 Months Ended |
Jun. 30, 2019 | |
Significant accounting policies | |
Business combinations | (a) Basis of consolidation (i) Business combinations The Group accounts for business combinations (except entities acquired under common control) using the acquisition method when control is transferred to the Group. The consideration transferred in the acquisition is generally measured at fair value, as well as the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment (see note 4(f)(ii)). Any gain on a bargain purchase is recognized in profit or loss immediately. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities. Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not re-measured and settlement is accounted for within equity. Otherwise, other contingent consideration is re-measured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognized in profit or loss. (ii) Subsidiaries Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases. (iii) Entities acquired under common control Entities acquired under common control or transactions accounted for in a manner similar to a pooling-of-interests (for example, a reorganization of entities under common control) are accounted under the “book value” accounting, where the Company recognizes the assets acquired and liabilities assumed using the book values of the transferor. When the consolidated financial statements are issued for a period that includes the date the common control transaction occurred, the Company’s consolidated financial statements of all prior periods are retrospectively revised to the earliest date presented. (iv) Non-controlling interests Non-controlling interests are measured initially at the proportionate share of the acquiree’s identifiable net assets at the date of acquisition, or at the fair value at the date of acquisition, on a transaction by transaction basis. Profit or loss and each component of other comprehensive income ("OCI") are attributed to the owners of the parent and to non-controlling interests in proportion to their ownership interests in the subsidiary. Losses applicable to the non-controlling interests in a subsidiary (including components of OCI) are allocated to the non-controlling interests even if this causes the non-controlling interests to have a deficit balance. Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. |
Foreign currency transactions | (b) Foreign currency transactions Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates ruling at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated to the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated to the functional currency at the exchange rate when the fair value was determined. Foreign currency differences are generally recognized in profit or loss. Non-monetary items that are measured based on historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated into RMB at the exchange rates at the reporting date. The income and expenses of foreign operations are translated into RMB at the exchange rates at the dates of the transactions. Foreign currency differences are recognized in other comprehensive income and accumulated in the translation reserve. |
Financial instruments | (c) Financial instruments Policy applicable from July 1, 2018 (i) Trade receivables and debt securities issued are initially recognized when they are originated. All other financial assets and financial liabilities are initially recognized when the Group becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price. (ii) Non-derivative financial assets On initial recognition, a financial asset is classified as measured at: amortized cost; FVOCI - debt investment; FVOCI - equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model. A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL: - It is held within a business model whose objective is to hold assets to collect contractual cash flows; and - Its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interests on the principal amount outstanding. On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent changes in the investment's fair value on OCI. This election is made on an investment-by-investment basis. All financial assets not classified as measured at amortized cost or FVOCI as described above are measured at FVTPL. This includes all derivative financial assets. On initial recognition, the Group may irrevocably designate a financial asset that, otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise. Non-derivative financial assets - Business model assessment The Group makes an assessment of the objective of the business model in which a financial asset is held at a portfolio level because this best reflects the way the business is managed and information is provided to management. The information considered includes: - The stated policies and objectives for the portfolio and the operation of those policies in practice. These include whether management's strategy focused on earning contractual interest income, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of any related liabilities or expected cash outflows or realizing cash flows through the sale of the assets; - how the performance of the portfolio is evaluated and reported to the Group's management; - the risks that affect the performance of the business model (and the financial assets held within that business model) and how those risks are managed; - how managers of the business are compensated - e.g. whether compensation is based on the fair value of the assets managed or the contractual cash flows collected; and - The frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and expectations about future sales activity. Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales for this purpose, consistent with the Group's continuing recognition of the assets. Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are measured at FVTPL. Non-derivative financial assets - Assessment whether contractual cash flows are solely payments of principal and interest For the purposes of this assessment, 'principal' is defined as the fair value of the financial asset on initial recognition. 'Interest' is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a profit margin. In assessing whether the contractual cash flows are solely payments of principal and interest, the Group considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making this assessment, the Group considers: - contingent events that would change the amount or timing of cash flows; - terms that may adjust the contractual coupon rate, including variable-rate features; - prepayment and extension features; and - terms that limit the Group's claim to cash flows from specified assets (e.g. non-recourse features). A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding, which may include reasonable additional compensation for early termination of the contract. Additionally, for a financial asset acquired at a discount or premium to its contractual par amount, a feature that permits or requires prepayment at an amount that substantially represents the contractual par amount plus accrued (but unpaid) contractual interest (which may also include reasonable additional compensation for early termination) is treated as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition. Non-derivative financial assets - Subsequent measurement and gains and losses Financial assets at amortized cost are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss. Non-derivative financial liabilities - Classification, subsequent measurement and gains and losses Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss. (iii) Non-derivative financial assets The Group derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. The Group enters into transactions whereby it transfers assets recognized in its statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognized. Non-derivative financial liabilities The Group derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. The Group also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in profit or loss. (iv) Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously. Policy applicable before July 1, 2018 The Group classifies non-derivative financial assets into the following categories: financial assets at fair value through profit or loss, held-to-maturity financial assets, loans and receivables and available-for-sale financial assets. The Group classifies non-derivative financial liabilities into the following categories: financial liabilities at fair value through profit or loss and other financial liabilities. (v) Non-derivative financial assets and financial liabilities – Recognition and de-recognition The Group initially recognizes loans and receivables and debt securities issued on the date when they are originated. All other financial assets and financial liabilities are initially recognized on the trade date when the entity becomes a party to the contractual provisions of the instrument. The Group derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognized financial assets that is created or retained by the Group is recognized as a separate asset or liability. The Group derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group currently has a legally enforceable right to offset the amounts and intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously. (vi) Non-derivative financial assets – Measurement A financial asset is classified as at fair value through profit or loss if it is classified as held-for-trading or is designated as such on initial recognition. Directly attributable transaction costs are recognized in profit or loss as incurred. Financial assets at fair value through profit or loss are measured at fair value and changes therein, including any interest or dividend income, are recognized in profit or loss. Held-to-maturity financial assets are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortized cost using the effective interest method. Loans and receivables are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortized cost using the effective interest method. Available-for-sale financial assets are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, they are measured at fair value and changes therein, other than impairment losses and foreign currency differences on debt instruments, are recognized in other comprehensive income and accumulated in the fair value reserve. When these assets are derecognized, the gain or loss accumulated in equity is reclassified to profit or loss. (vii) Non-derivative financial liabilities – Measurement A financial liability is classified as at fair value through profit or loss if it is classified as held-for-trading or is designated as such on initial recognition. Directly attributable transaction costs are recognized in profit or loss as incurred. Financial liabilities at fair value through profit or loss are measured at fair value and changes therein, including any interest expense, are recognized in profit or loss. Other non-derivative financial liabilities are initially measured at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortized cost using the effective interest method. |
Property and equipment | (d) Property and equipment (i) Recognition and measurement Items of property and equipment are measured at cost less accumulated depreciation and accumulated impairment losses (Note 4(f)). Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and any other costs directly attributable to bringing the asset to a working condition for its intended use. Construction in progress represents property under construction and equipment pending installation, and is stated at cost less impairment losses (Note 4(f)). Capitalization of these costs ceases and the construction in progress is transferred to property and equipment when the asset is substantially ready for its intended use. No depreciation is provided in respect of construction in progress. Gains or losses arising from the retirement or disposal of an item of property and equipment are determined as the difference between the net disposal proceeds and the carrying amount of the item and are recognized in profit or loss on the date of retirement or disposal. (ii) Subsequent costs The cost of replacing a component of an item of property and equipment is recognized in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Group, and its cost can be measured reliably. The carrying amount of the replaced component is derecognized. The costs of the day-to-day servicing of property, and equipment are recognized in profit or loss as incurred. (iii) Depreciation Items of property and equipment are depreciated from the date that they are available for use or, in respect of self-constructed assets, from the date that the asset is completed and ready for use. Depreciation is calculated to write off the cost of items of property and equipment less their estimated residual values using the straight-line basis over their estimated useful lives. Leasehold improvements are depreciated over the shorter of the lease term or their useful lives. The estimated useful lives for the current and comparative years of significant property and equipment are as follows: Motor vehicles 5~10 years Furniture, fixtures and other equipment 3~10 years Leasehold improvements Shorter of the remaining lease terms or estimated useful lives Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate. |
Intangible assets | (e) Intangible assets and goodwill (i) Goodwill Goodwill is presented with intangible assets and represent the excess of: (i) the aggregate of the fair value of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the Group’s previously held equity interests in the acquiree; over (ii) the net fair value of the acquiree’s identifiable assets and liabilities measured as at the acquisition date. When (ii) is greater than (i), then this excess is recognized immediately in profit or loss as a gain on a bargain purchase. Goodwill is stated at cost less accumulated impairment losses. Goodwill arising on a business combination is allocated to each cash-generating unit, or groups of cash generating units, that is expected to benefit from the synergies of the combination and is tested annually for impairment (see note 4(f)). On disposal of a cash generating unit during the year, any attributable amount of purchased goodwill is included in the calculation of profit or loss on disposal. (ii) Trademark Trademark is not amortized when their useful life is assessed to be indefinite, which is reviewed annually to determine whether events and circumstances continue to support the indefinite useful life assessment. The change in the useful life assessment from indefinite to finite is accounted for prospectively from the date of change and in accordance with the policy for amortization of intangible assets with finite lives. (iii) Other intangible assets Other intangible assets that have finite useful lives are measured at cost less accumulated amortization and any accumulated impairment losses (Note 4(f)). Other intangible assets include software, student relationships that arose from the acquisition of Tianma Experimental, favorable lease that arose from the acquisition of Zhenjiang Jianghe High School of Art. (iv) Amortization Amortization of intangible assets with finite useful lives is charged to profit or loss on a straight-line basis over the assets’ estimated useful lives. The following intangible assets with finite useful lives are amortized from the date they are available for use and their estimated useful lives are as follows: Student relationships 1~15 years Favorable lease 20 years Others 3 years Amortization methods and useful lives are reviewed at each reporting date and adjusted if appropriate. |
Impairment | (f) Impairment (i) Non-derivative financial assets Policy applicable from July 1, 2018 The Group recognizes loss allowances for ECLs on financial assets measured at amortised cost. The Group measures loss allowances at an amount equal to lifetime ECLs, except for the following, which are measured at 12-month ECLs: - debt securities that are determined to have low credit risk at the reporting date; and - other debt securities and bank balances for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition. Loss allowances for trade receivables are always measured at an amount equal to lifetime ECLs. When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECLs, the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Group’s historical experience and informed credit assessment and including forward-looking information. The Group assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Group considers a financial asset to be in default when: - the borrower is unlikely to pay its credit obligations to the Group in full, without recourse by the Group to actions such as realising security (if any is held); or - the financial asset is more than 90 days past due. Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument. 12-month ECLs are the portion of ECLs that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months). The maximum period considered when estimating ECLs is the maximum contractual period over which the Group is exposed to credit risk. Measurement of ECLs ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Group expects to receive). ECLs are discounted at the effective interest rate of the financial asset. Credit-impaired financial assets At each reporting date, the Group assesses whether financial assets carried at amortized cost are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following observable data: - significant financial difficulty of the borrower or issuer; - a breach of contract such as a default or being more than 90 days past due; - the restructuring of a loan or advance by the Group on terms that the Group would not consider otherwise; - it is probable that the borrower will enter bankruptcy or other financial reorganization; or - the disappearance of an active market for a security because of financial difficulties. Presentation of allowance for ECL in the statement of financial position Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. For debt securities at FVOCI, the loss allowance is charged to profit or loss and is recognized in OCI. Policy applicable before July 1, 2018 A financial asset not classified as at fair value through profit or loss, including an interest in an equity-accounted investee, is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset, and that loss event had an impact on the estimated future cash flows of that asset that can be estimated reliably. Objective evidence that financial assets are impaired includes: · default or delinquency by a debtor; · restructuring of an amount due to the Group on terms that the Group would not consider otherwise; · indications that a debtor or issuer will enter bankruptcy; · adverse changes in the payment status of borrowers or issuers; · the disappearance of an active market for a security because of financial difficulties; or · observable data indicating that there is a measurable decrease in the expected cash flows from a group of financial assets. The Group considers evidence of impairment for financial assets measured at amortized cost (other receivables) at both a specific asset and collective level. All individually significant receivables are assessed for specific impairment. All individually significant receivables found not to be specifically impaired are then collectively assessed for any impairment that has been incurred but not yet identified. Receivables that are not individually significant are collectively assessed for impairment by grouping together receivables with similar risk characteristics. In assessing collective impairment the Group uses historical trends of the probability of default, timing of recoveries and the amount of loss incurred, adjusted for management’s judgment as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than suggested by historical trends. An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. Losses are recognized in profit or loss and reflected in an allowance account against receivables. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss. (ii) Non-financial assets The carrying amounts of the Group’s non-financial assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. Goodwill and indefinite-lived intangible assets are tested annually for impairment. For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating units (“CGU”s). Goodwill arising from a business combination is allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the combination. The recoverable amount of an asset or CGU is the greater of its value in use and fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. An impairment loss in respect of goodwill is not reversed. In respect of other non-financial assets, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized. |
Contract costs | (g) Contract costs Contract costs are either the incremental costs of obtaining a contract with a customer or the costs to fulfil a contract with a customer which are not capitalized as inventory, property and equipment (see note 4(d)) or intangible assets (see note 4(e)). Incremental costs of obtaining a contract are those costs that the Group incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained (e.g. an incremental sales commission). Incremental costs of obtaining a contract are capitalized when incurred if the costs relate to revenue which will be recognized in a future reporting period and the costs are expected to be recovered. Contract costs are amortized over the expected customer relationship period, generally from one to six years. Other costs of obtaining a contract are expensed when incurred. The Group applies the practical expedient in paragraph 94 of IFRS 15 and recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Group otherwise would have recognized is one year or less from the initial recognition of the asset. Capitalized contract costs are stated at cost less accumulated amortization and impairment losses. Impairment losses are recognized to the extent that the carrying amount of the contract cost asset exceeds the net of (i) remaining amount of consideration that the Group expects to receive in exchange for the goods or services to which the asset relates, less (ii) any costs that relate directly to providing those goods or services that have not yet been recognized as expenses. Amortization of capitalized contract costs is charged to "selling expenses" in the consolidated statements of profit or loss and other comprehensive income when the revenue to which the asset relates is recognized. |
Contract liability | (h) Contract liability A contract liability is the obligation to provide services or goods to a customer for which the Group has received consideration from the customer. If a customer pays the consideration before the Group provides services or goods to the customer, a contract liability is recognized when the payment is made or the payment is due. |
Cash and cash equivalents | (i) Cash and cash equivalents Cash and cash equivalents in the consolidated statements of financial position comprise cash at banks and on hand and cash equivalents with an original maturity of three months or less that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value and are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. |
Term Deposit | (j) Term deposits Term deposits comprise highly liquid investments with original maturities of three months or greater than three months, but within twelve months, which are held for the purpose of investment. |
Employee benefits | (k) Employee benefits (i) Defined contribution plan Obligations for contributions to defined contribution plans, pursuant to which certain pension benefits, medical care, employee housing fund are provided to employees, are recognized as an employee benefit expense in profit or loss in the period during which services are rendered by employees. Pursuant to the relevant labor rules and regulations in the PRC, the Group participates in defined contribution plans (the “Plans”) organized by the relevant local government authorities for its eligible employees whereby the Group is required to make contributions to the Plans at 25.3% to 38.64% of the deemed salary rate announced annually by the local government authorities. The Group has no other material obligation associated with those Plans beyond the annual contributions described above. (ii) Short-term employee benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A provision is recognized for the amount expected to be paid under short-term cash bonus or other short-term benefits if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably. |
Provisions and contingent liabilities | (l) Provisions and contingent liabilities A provision is recognized if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as finance cost. Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events, are also disclosed as contingent liabilities unless the probability of outflow of economic benefits is remote. |
Revenue | (m) Revenue recognition Policy applicable from July 1, 2018 Revenue is recognized when control of promised goods or services is transferred to the Group’s customers in an amount of consideration to which the Group expects to be entitled to in exchange for those goods or services. The Group follows the five steps approach for revenue recognition under IFRS 15: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the Group satisfies a performance obligation. The primary sources of the Group’s revenues are as follows: K-12 educational services The Group’s revenue is principally derived from the provision of boarding school educational services to students. The Group offers basic educational and international programs at the primary school, middle school and high school. The basic educational program provides curricula and coursework mandated by the PRC government. The international program provides students the opportunity to earn both their PRC school diplomas and to prepare for admissions to overseas educational institutions. Tuition fees are generally collected before the beginning of each school year. Each school year is comprised of two semesters. The first semester starts in September and ends in January. The second semester starts the following month in February and ends in June. Each contract with a student in respect of the educational programs contains multiple performance obligations consisting of the provision of the curriculum education services, after-school enrichment services, accommodations, transportation services and other ancillary school activities (collectively as "educational services"), and delivery of educational books and related materials (collectively as "educational materials”), and meal catering services. These performance obligations are distinct in the context of the contract. The consideration expected to be received is allocated at contract inception among the performance obligations based on their stand-alone selling prices. Revenue attributable to educational services is recognized over time, based on a straight-line basis over the school year, as customers simultaneously receive and consume the benefits of these services throughout the service period. Revenue attributable to educational materials and meal catering services is recognized at point in time, when the control of the educational materials or underlying goods is passed to customers. The Group considers that it is acting as the principal in the transaction and recognizes revenue from sales of the educational materials on a gross basis. Education and management services The Group also provides education and management services to schools, including but not limited to branding, academic management, basic and international education resources, school culture, admission, finance, human resources, procurement, IT, internal audit, property and logistics management services. The promised services in each education and management service contract are combined and accounted as a single performance obligation, as the promised services in a contract are not distinct and are considered as a significant integrated service. The revenue is recognized on a straight-line basis over the period of the education and management service, as customers simultaneously receive and consume the benefits of these services throughout the service period. Invoices are usually settled within 30 days from billing date. Educational training services The Group provides various extracurricular courses to arouse students’ interest and broaden their both academic and nonacademic outlook. Each contract of educational training service contains a single performance obligation. Educational training tuition fee is generally collected in advance and is initially recorded as contract liability. Educational training tuition revenue is recognized over time, proportionately as the tutoring sessions are delivered, as customers simultaneously receive and consume the benefits of these services throughout the service period. The Group is the principal in providing educational training services as it controls such services before the services are transferred to the customer. Study trip services The Group provides overseas study tours and summer and winter camps to students. Each contract of study strip service contains a single performance obligation. Study trip service fee is generally collected in advance and is initially recorded as contract liability. Study trip service revenue is recognized on a straight-line basis over the period of the study trip services, as customers simultaneously receive and consume the benefits of these services throughout the service period. Others Others mainly include revenue derived from overseas study consulting services and hotel management services. Revenue is recognized when control of promised services is transferred to the customers in an amount of consideration to which the Group expects to be entitled to in exchange for those services. VAT collected from customers is excluded from revenue. The Company’s PRC subsidiaries and affiliated companies are subject to VAT. The deductible input VAT balance is reflected in the other current assets, and VAT payable balance is recorded in the trade and other payables due to third parties. Policy applicable before July 1, 2018 Revenue is measured at the fair value of the consideration received or receivable under the contract or agreement. Where the outcome of a transaction involving the rendering of services can be estimated reliably at the balance sheet date, revenue is recognized by reference to the stage of completion based on the progress of work performed. Where the outcome cannot be estimated reliably, revenues are recognized to the extent of the costs incurred that are expected to be recoverable, and an equivalent amount is charged to profit or loss as service cost; otherwise, the costs incurred are recognized in profit or loss and no service revenue is recognized. K-12 educational services Tuition fees are allocated to multiple components based on their relative fair value. Revenue attributable to educational services is recognized on a straight-line basis over the school year. Revenue attributable to educational materials and meal catering services are recognized upon the delivery of the products and services to the students, which is when the risks and rewards have been transferred to the students. Tuition fees not yet earned are recorded as deferred revenue. Educational training services Tuition is generally collected in advance and is initially recorded as deferred revenue. Revenue derived from providing educational training services is recognized over the period of the courses delivered. Education and management services, study trip services and others Revenue is recognized upon the delivery progress of services. |
Government grants | (n) Government grants Government grants are recognized in the statements of profit or loss and other comprehensive income when the grants are unconditional and become receivable. Grants that compensate the Group for expenses incurred are recognized as income in profit or loss on a systematic basis in the same periods in which the expenses are incurred. |
Leases | (o) Leases (i) Leases of property and equipment that transfer to the Group substantially all of the risks and rewards of ownership are classified as finance leases. The leased assets are measured initially at an amount equal to the lower of their fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the assets are accounted for in accordance with the accounting policy applicable to that asset. Assets held under other leases are classified as operating leases and are not recognized in the Group’s statement of financial position. (ii) Payments made under operating lease are recognized in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognized as an integral part of the total lease expenses over the term of the lease. |
Finance income and finance costs | (p) Finance income Finance income comprises interest income. Foreign currency gains and losses are reported on a net basis as either finance income or finance expense depending on whether foreign currency changes are in a net gain or net loss position. Interest income is recognized using the effective interest method. The ‘effective interest rate’ is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument to the gross carrying amount of the financial asset. In calculating interest income, the effective interest rate is applied to the gross carrying amount of the asset (when the asset is not credit-impaired). However, for financial assets that have become credit-impaired subsequent to initial recognition, interest income is calculated by applying the effective interest rate to the amortised cost of the financial asset. If the asset is no longer credit-impaired, then the calculation of interest income reverts to the gross basis. |
Income tax expense | (q) Income tax expense Income tax expense comprises current tax and movements in deferred tax assets and liabilities. Current tax and movements in deferred tax assets and liabilities are recognized in profit or loss except to the extent that they relate to a business combination, or items recognized directly in equity or in other comprehensive income. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Deferred tax assets and liabilities arise from deductible and taxable temporary differences respectively, being the differences between the carrying amounts of assets and liabilities for financial reporting purposes and their tax bases. Deferred tax assets also arise from unused tax losses and unused tax credits. Deferred tax is not recognized for the following temporary differences: taxable temporary differences arising on the initial recognition of goodwill; the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that, in the case of taxable differences, the Group controls the timing of the reversal and it is probable they will not reverse in the foreseeable future, or in the case of deductible differences, unless it is probable that they will reverse in the future. The amount of deferred tax recognized is measured based on the expected manner of realization or settlement of the carrying amount of the assets and liabilities, using tax rates enacted or substantively enacted at the reporting date. Current tax balances and deferred tax balances, and movements therein, are presented separately from each other and are not offset. Current tax assets are offset against current tax liabilities, and deferred tax assets are offset against deferred tax liabilities, if there is a legal enforceable right to offset current tax assets and current tax liabilities, and in the case of current tax assets and liabilities, the Group intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously, or in the case of deferred tax assets and liabilities, if they relate to income taxes levied by the same tax authority on the same taxable entity. Deferred tax assets are recognized for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be utilized. The carrying amount of a deferred tax asset is reviewed at each reporting date and is reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow the related tax benefit to be utilized. Any such reduction is reversed to the extent that it becomes probable that sufficient taxable profits will be available. In determining the amount of current and deferred tax, the Group takes into account the impact of uncertain tax positions and whether additional taxes and interest may be due. This assessment relies on estimates and assumptions and may involve a series of judgments about future events. New information may become available that causes the Group to change its judgment regarding the adequacy of existing tax liabilities; such changes to tax liabilities will impact tax expense in the period that such determination is made. |
Earnings per share | (r) Earnings per share Basic earnings per share (“basic EPS”) is calculated by dividing the profit by the weighted-average number of ordinary shares outstanding during the period. Diluted earnings per share (“diluted EPS”) is similar to basic earnings per share but presents the dilutive effect on a per share basis of potential ordinary shares (e.g. warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. |
Related parties | (s) Related parties For the purposes of these consolidated financial statements, a person or entity is considered to be related to the Group if: (a) A person, or a close member of that person’s family, is related to the Group if that person: (i) has control or joint control over the Group. (ii) has significant influence over the Group; or of a parent of the Group. (iii) is a member of the key management personnel of the Group or of a parent of the Group. (b) An entity is related to the Group if any of the following conditions applies: (i) the entity and the Group are members of the same Group (which means that each parent, subsidiary and fellow subsidiary is related to the other). (ii) one entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of the Group of which the other entity is a member). (iii) both entities are joint ventures of the same third party. (iv) one entity is a joint venture of a third entity and the other entity is an associate of the third entity. (v) the entity is a post-employment benefit plan for the benefit of employees of either the Group or an entity related to the Group. (vi) the entity is controlled or jointly controlled by a person identified in (a). (vii) a person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity). (viii) the entity, or any member of a group of which it is a part, provides key management personnel services to the Group or to the Group's parent. Close members of the family of a person are those family members who may be expected to influence, or be influenced by, that person in their dealings with the entity. |
Possible impact of amendments, new standards and interpretations issued but not yet effective for the year ended June 30, 2019 | (t) Possible impact of amendments, new standards and interpretations issued but not yet effective for the year ended June 30, 2019 Up to the date of issue of these consolidated financial statements, the IASB has issued a number of amendments, new standards and interpretations which are not yet effective for the year ended June 30, 2019 and which have not been adopted in these consolidated financial statements. These include the following which may be relevant to the Group. Effective for IFRS 16, Leases January 1, 2019 IFRIC 23, Uncertainty over Tax Treatments January 1, 2019 Annual Improvements to IFRS Standards 2015–2017 Cycle January 1, 2019 Amendments to IAS 19, Employee Benefit January 1, 2019 Amendments to IAS 28, Investments in Associates and Joint January 1, 2019 Amendments to References to Conceptual Framework in IFRS Standards January 1, 2020 Amendments to IFRS 3, Definition of a Business January 1, 2020 Amendments to IAS 1 and IAS 8, Definition of Material January 1, 2020 IFRS 17, Insurance Contracts January 1, 2021 Amendments to IFRS 10 and IAS 28, Sale and contribution of Assets between an Investor and its Associate or Joint Venture Available for optional adoption/effective date deferred indefinitely For those other new standards with effective date beginning on January 1, 2019, the Group is in the process of making an assessment of what the impact of these amendments, new standards and interpretations is expected to be in the period of initial application. IFRS 16 Leases IFRS 16 introduces a single, on‑balance sheet lease accounting model for lessees. A lessee recognizes a right‑of‑use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease payments. There are recognition exemptions for short‑term leases and leases of low‑value items. The standard should be applied in an entity’s IFRS financial statements for annual reporting periods beginning on or after 1 January 2019. Earlier application is permitted. The Company plans to adopt IFRS 16 in the financial reporting period commencing July 1, 2019 and elects to use the modified retrospective approach. As allowed by IFRS 16, the Group plans to use the practical expedient to grandfather the previous assessment of which existing arrangements are, or contain, leases. The Group will therefore apply the new definition of a lease in IFRS 16 only to contracts that are entered into on or after the date of initial application. In addition, the Group plans to elect the practical expedient for not applying the new accounting model to short-term leases and leases of low-value assets. IFRS 16 will primarily affect the Group’s accounting as a lessee of leased campuses and office space which are currently classified as operating leases. The application of the new accounting model is expected to lead to an increase in both assets and liabilities, and to impact on the timing of the expense recognition in the statement of profit or loss over the period of the lease, and to impact on the disclosure about the Group's leasing activities. As disclosed in note 21(b), the Group’s operating lease commitment amounted to RMB688,424 as of June 30, 2019. The majority of the operating lease commitment amounting to RMB663,953 was related to the campus rental agreements entered into between the Group’s affiliated schools and subsidiaries and Hailiang Education Investment Group Co., Ltd. (“Hailiang Investment”) regarding three campuses in Zhuji City on April 28, 2019. The lease period is until June 30, 2037. On September 6, 2019, the Group’s affiliated schools and subsidiaries and Hailiang Investment entered into a series of lease supplemental agreements, pursuant to which the Group agreed to prepay rental fees of RMB540,453 for the entire remaining lease period from July 1, 2019 to June 30, 2037. On September 12, 2019, the rental fees of RMB540,453 were fully paid. As of June 30, 2019, a preliminary assessment indicates that these arrangements will meet the definition of a lease under IFRS 16, and hence the Group will recognize a right-of-use asset and a corresponding liability in respect of all these leases unless they qualify for low value or short-term leases upon the application of IFRS 16. The new requirement to recognize a right-of use asset and a related lease liability is expected to have a significant impact on the amounts recognized in the Group's consolidated financial statements and the Group is currently assessing its potential impact. As of the date of the authorization of these consolidated financial statements, the Group is still assessing the appropriate discount rate, therefore the Group is unable to reliably estimate the amount of impact of the application of IFRS 16 on the Group's consolidated financial statements regarding leases where the Group is the lessee. IFRIC 23 This Interpretation provides guidance on how to apply IAS 12, Income taxes when there is uncertainty over whether a tax treatment will be accepted by the tax authority. Under the Interpretation, the key test is whether it is probable that the tax authority will accept the entity’s tax treatment. If it is probable, then the entity should measure current and deferred tax consistently with the tax treatment in its tax return. If it is not probable, then the entity should reflect the effect of uncertainty in its accounting for income tax by using the “expected value” approach or the “the most likely amount” approach – whichever better predicts the resolution of the uncertainty and in that case the tax amounts in the financial statements will not be the same as the amounts in the tax return. The interpretation is to be applied retrospectively, either fully retrospectively without the use of hindsight or retrospectively with the cumulative effect of application as an adjustment to the opening equity at the date of initial application, without the restatement of comparative information. The Group expects to adopt the interpretation from July 1, 2019. The interpretation is not expected to have any significant impact on the Group’s financial statements. |
Reporting entity and organiza_2
Reporting entity and organization (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Reporting entity and organization | |
Schedule of entities subsidiaries and affiliates | As of June 30, 2019, the Company’s subsidiaries and consolidated affiliated entities are as follows: Place and year of Legal Subsidiary establishment ownership Principal activities Hailiang Education (HK) Limited (“Hailiang HK”) Hong Kong, China, 2011 100 % Investment holding Zhejiang Hailiang Education Consulting and Services Co., Ltd. ("Hailiang Consulting") Zhejiang, China, 2011 100 % Investment holding Ningbo Hailiang Education Logistics Management Co., Ltd. Zhejiang, China, 2017 100 % Education and management service Ningbo Haoliang Information Consulting Co., Ltd. (“Ningbo Haoliang”) Zhejiang, China, 2017 100 % Education and management service Zhuji Nianxin Lake Hotel Co., Ltd. Zhejiang, China, 2017 100 % Hotel management service Ningbo Hailiang Sports Development Co., Ltd. Zhejiang, China, 2018 100 % Educational training service Zhuji Hailiang Supply Chain Management Co., Ltd. Zhejiang, China, 2018 100 % Procurement and transportation services Zhuji Hailiang Logistics Service Co., Ltd. Zhejiang, China, 2018 100 % Accommodation service Jiangxi Haibo Education Management Co., Ltd. (“Haibo Education”) Jiangxi, China, 2017 56 % Educational training service Jiangxi Haibo Logistics Management Co., Ltd. (“Haibo Logistics”) Jiangxi, China, 2017 56 % Education and management service Zhuji Hailiang After-school Service Co., Ltd. Zhejiang, China, 2018 100 % After-school enrichment service Hailiang Education International Studying Service Limited Hongkong, China, 2018 100 % Overseas study consulting service Hangzhou Hailiang International Studying Service Co., Ltd. Zhejiang, China, 2018 100 % Overseas study consulting service Hangzhou Hailiang Study Trip Co., Ltd. Zhejiang, China, 2018 100 % Study trip service Pate’s-Hailiang International College Company Limited United Kingdom,2018 100 % Overseas study consulting service Place and year of Legal Consolidated affiliated entities establishment ownership Principal activities Hailiang Management (previously named “Zhejiang Hailiang Education Investment Group Co., Ltd.”) Zhejiang, China, 2012 N/A * Investment holding Zhejiang Hailiang Mingxin Education Technology Co., Ltd. Zhejiang, China, 2017 N/A * After-school enrichment service and overseas study consulting service Hangzhou Hailiang Education Management Co., Ltd. Zhejiang, China, 2018 N/A * Education and management service Hailiang Foreign Language School (“Foreign Language”) Zhejiang, China, 1995 N/A * K‑12 educational services Hailiang Experimental High School (“Experimental High”) Zhejiang, China, 2002 N/A * K‑12 educational services Tianma Experimental School (“Tianma Experimental”) Zhejiang, China, 1995 N/A * K‑12 educational services Hailiang Primary School Zhejiang, China, 2016 N/A * K‑12 educational services Hailiang Junior Middle School Zhejiang, China, 2016 N/A * K‑12 educational services Hailiang Senior Middle School Zhejiang, China, 2016 N/A * K‑12 educational services Hailiang High School of Art (previously named “Hailiang Art Middle School”) Zhejiang, China, 2017 N/A * K‑12 educational services Zhuji Hailiang Foreign Language High School Co., Ltd. (“Zhuji Hailiang Foreign Language High School”) Zhejiang, China, 2018 N/A * K-12 educational services Zhenjiang Jianghe High School of Art Jiangsu, China, 2018 N/A * K-12 educational services Zhejiang Mingxin International Travel Co., Ltd. Zhejiang, China, 2018 N/A * Study trip service Shaoxing Sihai International Travel Co., Ltd. (“Sihai International Travel”) Zhejiang, China, 2010 N/A * Study trip service * These entities are controlled by the Company pursuant to the contractual arrangements disclosed below in note 2(b). |
Basis of preparation (Tables)
Basis of preparation (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Basis of preparation | |
Schedule of Information About Financial Statements and Amounts of Affiliated Entities Explanatory | 2018 2019 RMB RMB Total non-current assets 710,464 687,407 Total current assets 848,028 1,313,326 Total assets 1,558,492 2,000,733 Total non-current liabilities — 7,270 Total current liabilities 396,238 635,670 Total liabilities 396,238 642,940 2017 2018 2019 RMB RMB RMB Revenue 853,247 1,110,470 1,087,054 Profit before tax 165,300 221,057 202,157 Net profit 165,300 177,088 152,713 |
Changes in accounting policies
Changes in accounting policies (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Changes in accounting policies | |
Summary of impact of transition to IFRS 15 on retained earnings and the related tax impact | The following table summarizes the impact of transition to IFRS 15 on retained earnings and the related tax impact at July 1, 2018: RMB’000 Retained earnings Capitalization of sales commissions 18,279 Related income taxes — Net increase in retained earnings at July 1, 2018 18,279 |
Summary of line items impacted by the adoption of IFRS 15 | The following tables summarise the estimated impact of adoption of IFRS 15 on the Group’s consolidated financial statements for the year ended June 30, 2019, by comparing the amounts reported under IFRS 15 in these consolidated financial statements with estimates of the hypothetical amounts that would have been recognised under IAS 18 and IAS 11 if those superseded standards had continued to apply to the year ended June 30, 2019 instead of IFRS 15. These tables show only those line items impacted by the adoption of IFRS 15: Difference: Estimated impact of adoption of Amounts reported Hypothetical IFRS 15 for in accordance amounts under year ended Note with IFRS 15 IASs18 and 11 June 30, 2019 (A) (B) (A)-(B) RMB’000 RMB’000 RMB’000 Line items in the consolidated statement of profit or loss and other comprehensive income for year ended June 30, 2019 impacted by the adoption of IFRS 15: Selling expenses (i) (25,003) (25,983) 980 Profit before tax 424,493 423,513 980 Income tax expenses (i) (108,713) (108,384) (329) Net profit 315,780 315,129 651 Net profit attributable to the Company’s shareholders 293,421 292,770 651 Total comprehensive income for the year 319,090 318,439 651 Total comprehensive income attributable to the Company’s shareholders 296,731 296,080 651 Earnings per share Basic (i) RMB 0.71 RMB 0.71 — Diluted (i) RMB 0.71 RMB 0.71 — Line items in the consolidated statement of financial position as of June 30, 2019 impacted by the adoption of IFRS 15: Contract costs (i) 9,899 — 9,899 Total non-current assets 730,141 720,242 9,899 Other current assets (i) 31,706 22,346 9,360 Total current assets 1,772,771 1,763,411 9,360 Total assets 2,502,912 2,483,653 19,259 Trade and other payables due to third parties (ii) 218,122 212,253 5,869 Deferred revenue (ii) — 407,399 (407,399) Contract liabilities (ii) 398,951 — 398,951 Total current liabilities 806,395 808,974 (2,579) Contract liabilities (ii) 2,579 — 2,579 Deferred tax liabilities (i) 4,691 4,362 329 Total non-current liabilities 7,270 4,362 2,908 Total liabilities 813,665 813,336 329 Reserves (i) 360,914 360,473 441 Retain earnings 905,009 886,520 18,489 Total Hailiang Education Group Inc. shareholders' equity 1,651,808 1,632,878 18,930 Total equity 1,689,247 1,670,317 18,930 Total equity and liabilities 2,502,912 2,483,653 19,259 Line items in the reconciliation of net profit to cash generated from operations for year ended June 30, 2019 impacted by the adoption of IFRS 15: Net profit 315,780 315,129 651 Change in other current assets and contract costs (8,127) (7,147) (980) Change in trade and other payables due to third parties 94,885 89,016 5,869 Change in deferred revenue and contract liabilities 186,731 192,600 (5,869) |
Significant accounting polici_3
Significant accounting policies (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Significant accounting policies | |
Schedule of property and equipment | The estimated useful lives for the current and comparative years of significant property and equipment are as follows: Motor vehicles 5~10 years Furniture, fixtures and other equipment 3~10 years Leasehold improvements Shorter of the remaining lease terms or estimated useful lives |
Schedule of estimated useful lives of intangible assets | The following intangible assets with finite useful lives are amortized from the date they are available for use and their estimated useful lives are as follows: Student relationships 1~15 years Favorable lease 20 years Others 3 years |
Revenue and segment reporting (
Revenue and segment reporting (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Revenue and segment reporting | |
Schedule of disaggregation of revenue from contracts with customers by major service lines | (a) 2017 2018 2019 RMB RMB RMB K-12 educational services 853,295 1,093,933 1,217,007 Educational training services — 36,395 144,188 Study trip services — 13,791 81,495 Education and management services — 19,021 40,942 Others — 6,208 15,393 853,295 1,169,348 1,499,025 (b) 2019 RMB Timing of revenue recognition Revenue recognized over time 1,304,361 Revenue recognized point in time 194,664 1,499,025 |
Schedule of contract liabilities from contracts with customers | July 1, 2018 June 30, 2019 Note RMB’000 RMB’000 Current liabilities Contract liabilities 3(b)(ii) 209,720 398,951 Non-current liabilities Contract liabilities 3(b)(ii) — 2,579 |
Schedule of the revenue and operating results by segments | The revenue and operating results by segments were as follows: For the year ended June 30, 2017 K‑12 educational and management services Others Unallocated* Consolidated RMB RMB RMB RMB Revenues from external customers 853,295 — — 853,295 Total segment revenues 853,295 — — 853,295 Segment income 165,353 — 2,390 167,743 Interest income 5,980 729 6,709 Depreciation and amortization 111,147 — — 111,147 * Unallocated income is primarily related to government grants, corporate interest income and other miscellaneous items that are not allocated to individual segment. For the year ended June 30, 2018 K‑12 educational and Educational management training services services Others Unallocated* Consolidated RMB RMB RMB RMB RMB Revenues from external customers 1,112,954 36,395 19,999 — 1,169,348 Inter-segment revenues — 14,678 260 — 14,938 Total segment revenues 1,112,954 51,073 20,259 — 1,184,286 Segment income/ (loss) 276,587 28,820 1,157 (9,374) 297,190 Interest income 7,083 151 119 4,362 11,715 Depreciation and amortization 104,254 1 9,319 — 113,574 * Unallocated income (expenses) are primarily related to corporate administrative costs, interest income and other miscellaneous items that are not allocated to individual segment. For the year ended June 30, 2019 K‑12 educational and Educational management training services services Others Unallocated* Consolidated RMB RMB RMB RMB RMB Revenues from external customers 1,257,949 144,188 96,888 — 1,499,025 Inter-segment revenues 422 2,767 6,135 — 9,324 Total segment revenues 1,258,371 146,955 103,023 — 1,508,349 Segment income/ (loss) 320,639 91,720 18,773 (6,639) 424,493 Interest income 21,244 519 1,110 1,597 24,470 Depreciation and amortization 125,676 526 7,318 — 133,520 * |
Other income, net (Tables)
Other income, net (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Other income, net | |
Schedule of other income, net | 2017 2018 2019 RMB RMB RMB Government grants 6,253 5,832 25,437 Others 72 (2,143) (337) 6,325 3,689 25,100 |
Employee benefit expenses (Tabl
Employee benefit expenses (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Employee benefit expenses | |
Schedule of employee benefit expenses | 2017 2018 2019 RMB RMB RMB Wages and salaries 280,786 388,238 533,505 Contributions to defined contribution plans 44,884 52,898 64,118 325,670 441,136 597,623 |
Profit before tax (Tables)
Profit before tax (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Profit before tax | |
Schedule of net finance income | (i) Net finance income 2017 2018 2019 RMB RMB RMB Interest income 6,709 11,715 24,470 Others 183 (324) 465 Net finance income 6,892 11,391 24,935 |
Disclosure of expenses by nature | (ii) Expenses by nature 2017 2018 2019 RMB RMB RMB Employee benefit expenses (Note 7) 325,670 441,136 597,623 Students related cost 116,273 147,571 199,478 Transportation 31,823 36,110 49,137 Marketing and promotion 21,240 24,019 24,490 Depreciation (Note 11) 110,485 113,128 132,026 Utilities 23,286 26,100 26,162 Amortization of intangible assets (Note 12) 662 446 1,494 Operating lease charges 30,030 33,290 35,639 Others 39,300 70,787 58,518 Total cost of revenue, selling expenses and administrative expenses 698,769 892,587 1,124,567 |
Income tax expenses (Tables)
Income tax expenses (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Income tax expenses | |
Schedule of income tax expenses in the consolidated statements of profit or loss and other comprehensive income | 2017 2018 2019 RMB RMB RMB Current —PRC income tax expenses — 66,288 108,545 Deferred —PRC income tax expenses — — 168 Income tax expenses for the year — 66,288 108,713 |
Schedule of reconciliation between the provision for income tax | Reconciliation between the provision for income tax computed by applying applicable tax rates in fiscal year 2017, 2018 and 2019 to income before income taxes and the actual provision for income tax was as follow: 2017 2018 2019 RMB RMB RMB Profit before tax 167,743 297,190 424,493 Notional tax on profit before taxation, calculated at the applicable rates in the tax jurisdictions concerned 41,936 74,298 108,122 Effect of expenses that are not deductible in determining taxable profit — 373 524 Effect of incomes that are not taxable in determining taxable profit — (956) — Unrecognized tax losses 2 70 2,054 Utilization of tax losses previously not recognized (579) (46) (486) Effect of income tax exemptions (41,359) (7,451) (1,501) Income tax expense recognized in profit or loss — 66,288 108,713 |
Schedule of deferred tax assets and liabilities | Capitalized contract Favorable costs lease Total Deferred tax liabilities At June 30, 2018 — — — Acquisition through a business combination (note 19) — 4,523 4,523 Charged/(credited) to profit or loss 328 (160) 168 At June 30, 2019 328 4,363 4,691 |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Earnings per share | |
Schedule of earnings per share | (i) Net profit attributable to the Company’s shareholders 2017 2018 2019 RMB RMB RMB Net profit attributable to the Company's shareholders (basic and diluted) 167,743 222,588 293,421 (ii) Weighted-average number of ordinary shares 2017 2018 2019 Weighted average number of ordinary shares for basic EPS 411,208,000 411,878,478 412,450,256 Effects of dilution from warrants — 638,292 — Weighted average number of ordinary shares adjusted for the effect of dilution 411,208,000 412,516,770 412,450,256 (iii) Earnings per share 2017 2018 2019 Basic and diluted earnings per share 0.41 0.54 0.71 |
Property and equipment (Tables)
Property and equipment (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Property and equipment | |
Summary of property and equipment | Furniture, fixtures Motor and other Leasehold Construction vehicles equipment improvement in progress Total RMB RMB RMB RMB RMB Cost Balance at June 30, 2017 18,515 244,189 704,126 8,878 975,708 Additions 4,454 22,331 21,415 48,209 96,409 Transferred from construction in progress — 5,098 45,446 (50,544) — Disposals (1,566) (8,584) (23,446) (1,013) (34,609) Balance at June 30, 2018 21,403 263,034 747,541 5,530 1,037,508 Additions 190 21,970 12,137 29,325 63,622 Acquisition through a business combination (Note 19) — 3,954 8,772 — 12,726 Transferred from construction in progress — 22,962 1,051 (24,013) — Transferred to intangible assets — — — (2,438) (2,438) Disposals — (5,236) — — (5,236) Balance at June 30, 2019 21,593 306,684 769,501 8,404 1,106,182 Accumulated depreciation Balance at June 30, 2017 (9,879) (82,124) (163,086) — (255,089) Depreciation for the year (4,476) (33,414) (75,238) — (113,128) Disposals 338 4,340 5,112 — 9,790 Balance at June 30, 2018 (14,017) (111,198) (233,212) — (358,427) Depreciation for the year (3,669) (62,121) (66,236) — (132,026) Disposals — 4,894 — — 4,894 Balance at June 30, 2019 (17,686) (168,425) (299,448) — (485,559) Net book value At June 30, 2018 7,386 151,836 514,329 5,530 679,081 At June 30, 2019 3,907 138,259 470,053 8,404 620,623 |
Intangible assets and goodwill
Intangible assets and goodwill (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Intangible assets and goodwill. | |
Summary of intangible assets and goodwill | Student Favorable Goodwill Trademark relationship lease Others Total RMB RMB RMB RMB RMB RMB Cost Balance at June 30, 2017 62,046 16,540 45,037 — — 123,623 Disposals of kindergarten business (406) — — — — (406) Balance at June 30, 2018 61,640 16,540 45,037 — — 123,217 Addition — — — — 1,743 1,743 Acquisitions through a business combination (Note 19) — — — 18,091 — 18,091 Transferred from construction in progress — — — — 2,438 2,438 Balance at June 30, 2019 61,640 16,540 45,037 18,091 4,181 145,489 Accumulated Amortization Balance at June 30, 2017 — — (44,024) — — (44,024) Amortization for the year — — (446) — — (446) Balance at June 30, 2018 — — (44,470) — — (44,470) Amortization for the year — — (260) (640) (594) (1,494) Balance at June 30, 2019 — — (44,730) (640) (594) (45,964) Net book value At June 30, 2018 61,640 16,540 567 — — 78,747 At June 30, 2019 61,640 16,540 307 17,451 3,587 99,525 |
Summary of aggregated carrying amounts of goodwill and trademark | For the purpose of impairment testing, the carrying amounts of goodwill and trademark are allocated to the business relating to Tianma Experimental, which is the lowest level for which the assets are monitored for internal management purpose. The aggregated carrying amounts of goodwill and trademark are as follows: 2018 2019 RMB RMB Goodwill 61,640 61,640 Trademark 16,540 16,540 Total 78,180 78,180 |
Summary of key assumptions for the 2019 fiscal year used in the estimation of the recoverable amount | The key assumptions used in the estimation of the recoverable amount are set out below. In percent 2017 2018 2019 Discount rate 24 % 24 % 15.5 % Terminal value growth rate 3 % 3 % 3 % |
Other current assets (Tables)
Other current assets (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Other current assets. | |
Summary of other current assets | 2018 2019 Note RMB RMB Prepayments Contract costs 3(b) — Advances to employees Deductible VAT — Other receivables due from third parties Total 15,182 31,706 |
Cash and cash equivalents (Tabl
Cash and cash equivalents (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Cash and cash equivalents. | |
Schedule of detailed information about Cash and cash equivalents | 2018 2019 Note RMB RMB Cash on hand 30 309 Cash at bank 71,857 36,827 Cash held at a related party finance entity 20(b) 740,733 223,548 Total 812,620 260,684 |
Schedule of reconciliation of liabilities arising from financing activities | Loans due to related parties RMB (Note 17) At July 1, 2017 99,603 Changes from financing cash flows: Proceeds from a loan from a related party 7,609 Total changes from financing cash flows 7,609 Other non-cash change: Net settlement of a loan made to a related party with a loan borrowed from a related party (7,609) Total other non-cash change (7,609) At June 30, 2018 and 2019 99,603 Dividends payable to a non-controlling shareholder RMB At June 30, 2018 and July 1, 2018 — Changes from financing cash flows: Dividends declared to be payable to a non-controlling shareholder of subsidiaries 7,482 Dividends paid to a non-controlling shareholder of subsidiaries (7,482) Total changes from financing cash flows — At June 30, 2019 — |
Capital and reserve (Tables)
Capital and reserve (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Capital and reserve | |
Summary of Share capital and share premium | 2017 2018 2019 At June 30 par value USD0.0001‑authorized 1,000,000,000 1,000,000,000 1,000,000,000 -issued and outstanding 411,208,000 412,450,256 412,450,256 |
Non-controlling interests (Tabl
Non-controlling interests (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Non-controlling interests. | |
Schedule of information of changes in noncontrolling interests | The following table summarizes the changes in non-controlling interests from June 30, 2018 through June 30, 2019. Zhenjiang Jianghe High Haibo Education Haibo Logistics School of Art Total RMB RMB RMB RMB Balance at June 30, 2018 9,390 3,764 — 13,154 Acquisition through a business combination, including deemed cash consideration to NCI — — 9,408 9,408 Net profit/(loss) and total comprehensive income attributable to NCI 19,535 3,808 (984) 22,359 Dividends paid to NCI (6,075) (1,407) — (7,482) Balance at June 30, 2019 22,850 6,165 8,424 37,439 |
Summary of financial information relating to Haibo Education | 2018 2019 RMB’000 RMB’000 NCI percentage 44 % 44 % Current assets 41,577 61,639 Non-current assets 22 1,540 Current liabilities 20,259 11,248 Net assets 21,340 51,931 Carrying amount of NCI 9,390 22,850 Revenue 35,532 87,655 Net profit for the year 15,340 44,397 Total comprehensive income 15,340 44,397 Net profit and total comprehensive income attributable to NCI 6,750 19,535 Dividend paid to NCI — 6,075 Cash flows from operating activities 35,462 32,649 Cash flows generated from/(used in) investing activities 14 (41,603) Cash flows generated from/(used in) financing activities 6,000 (13,806) |
Trade and other payables (Table
Trade and other payables (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Trade and other payables | |
Schedule of Trade and other payables | 2018 2019 RMB RMB Trade payable 22,309 20,556 Accrued payroll 68,351 130,744 Amounts due to third parties 50,844 66,822 Trade and other payables due to third parties 141,504 218,122 Loans due to related parties 99,603 99,603 Amounts due to related parties 38,612 35,142 Other payables due to related parties 138,215 134,745 Total 279,719 352,867 |
Financial risk management and_2
Financial risk management and fair values (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Financial risk management and fair values | |
Schedule of Contractual maturities of financial liabilities | The following are the contractual maturities of financial liabilities, which are based on contractual undiscounted cash flows and the earliest date the Group can be required to pay: June 30, 2018 Carrying Contractual amount cash flows 1 year or less Non-derivative financial instruments RMB RMB RMB Trade and other payables 279,719 279,719 279,719 June 30, 2019 Carrying Contractual amount cash flows 1 year or less Non-derivative financial instruments RMB RMB RMB Trade and other payables 352,867 352,867 352,867 |
Acquisition of business (Tables
Acquisition of business (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Acquisition of business | |
Schedule of consideration, identifiable assets acquired and liabilities assumed | Consideration transferred RMB Cash consideration paid to former shareholders 1,530 Deemed cash consideration to former shareholders 5,248 Total consideration transferred 6,778 The following table summarizes the acquisition-date fair value of the identifiable assets acquired, liabilities assumed and non-controlling interests (excluding the effect of the RMB10,710 cash capital injection) in connection with the business combination: RMB Cash and cash equivalents 903 Other current assets 16 Property and equipment, net 12,726 Intangible assets 18,091 Trade and other payables (14,445) Contract liabilities (1,830) Deferred tax liabilities (4,523) Total identifiable net assets acquired 10,938 Non-controlling interests arising from the acquisition (4,160) Total consideration 6,778 Analysis of the net cash outflow in respect of the acquisition Cash consideration 6,778 Less: Deemed cash consideration to former shareholders (5,248) Cash acquired (903) 627 |
Related parties transactions (T
Related parties transactions (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Related parties transactions | |
Schedule of Significant transactions between related parties | (a) The significant related party transactions are summarized as follows: 2017 2018 2019 Note RMB RMB RMB Loans borrowed from a related party (i) 99,603 7,609 — A loan made to a related party (i) 98,229 — — Repayment of a loan made to a related party (i) — — 12,412 Interest income from deposits placed with a related party finance entity (ii) 5,847 11,464 24,313 Net (withdrawals)/deposits of cash at a related party finance entity (ii) (109,998) 679,018 (517,185) Term deposits placed with a related party finance entity (ii) 1,953,600 204,000 4,709,697 Maturity of term deposits placed with a related party finance entity (ii) 1,552,600 401,000 3,526,603 Rental expenses (iii) 30,030 32,486 33,814 Payments of expenses by the Group on behalf of related parties (iv) — 9,401 10,312 Payments of expenses by related parties on behalf of the Group (iv) 3,836 4,612 2,731 Collection by the Group on behalf of related parties (iv) 39,760 47,070 46,453 Purchase of leasehold improvement from a related party (v) 37,231 29,098 29,669 Purchase of food products from related parties (vi) 48,298 38,323 68,963 Education and management service provided to related parties (vii) 3,766 16,831 33,222 Other service and product provided to related parties (viii) — 416 3,254 Service provided by related parties (ix) — 6,884 23,263 Waive of liability to a related party (iii) 10,000 — — Gains from disposal of affiliated entities to a related party (x) — 5,349 — Acquisition of subsidiaries (xi) — 6,160 — Dividends paid to a non-controlling shareholder of subsidiaries (xi) — — 7,482 Capital contribution (xii) — — 15,000 (b) The significant related party balances are summarized as follows: 2018 2019 Note RMB RMB Amounts due from related parties (i)(ii)(iii)(iv)(vii) (viii) 95,128 91,674 Cash held at a related party finance entity (ii) 740,733 223,548 Term deposits placed with a related party finance entity (ii) 204,000 1,387,094 Amounts due to related parties (i)(iii)(iv)(v)(vi)(ix) 138,215 134,745 The Company’s majority shareholder, Mr. Feng owns or controls other non-educational services businesses (“Related Party Companies”) that from time to time require short-term financing to support their business operations and working capital needs. After considering the cash on hand and forecasted cash flows to fund its operations, the Group issued financing to Related Party Companies during the periods presented. (i) On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid. On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit. During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company. As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. (ii) As of June 30, 2018 and 2019, the Group has cash held at a related party finance entity of RMB740,733 and RMB223,548, respectively. During the year ended June 30, 2018, net amount of RMB679,018 were placed with Hailiang Finance. During the years ended June 30, 2017 and 2019, net amount of RMB109,998 and RMB517,185 were withdrawn from Hailiang Finance, respectively. The cash held at a related party finance entity is held for the purpose of meeting short-term cash commitments, such as to pay for the Group’s operating expenses at any time. During the years ended June 30, 2017, 2018 and 2019, term deposits of RMB1,953,600, RMB204,000 and RMB4,709,697 were placed with Hailiang Finance, and RMB1,552,600, RMB401,000 and RMB3,526,603 were matured, respectively. The term deposits are held for investment purpose and can be withdrawn prior to their maturity without incurring significant penalties. Such amounts have been presented as investing activities in the statements of cash flows. As of June 30, 2018 and 2019, the Group has term deposits with maturities ranging from three months to one year amounting to RMB204,000 and RMB1,387,094 that are placed at Hailiang Finance, respectively. The interest income from the deposits during the years ended June 30, 2017, 2018 and 2019 amounted to RMB5,847, RMB11,464 and RMB24,313, respectively. Interest receivable as of June 30, 2018 and 2019 amounted to RMB1,038 and RMB4,916 respectively. (iii) The Group leases the school buildings and the related facilities in three campuses from Hailiang Investment, a related party controlled by Mr. Feng. In addition, Haibo Education and Haibo Logistics lease the office space and warehouse from Nanchang Hongtou Property Management Co., Ltd. (“Nanchang Hongtou”), a related party owned by Mr. Honggen Min, who is the controlling shareholder of Nanchang Baishu. The Group also leases some office spaces from Hangzhou Hailiang Real Estate Co., Ltd. (“Hailiang Real Estate”), a related party controlled by Mr. Feng. The leasing terms and rental amounts are as follows: 2017 2018 2019 Leasing Period RMB RMB RMB Rental from Hailiang Investment October 11, 2017 ~ June 30, 2037 30,030 30,965 31,504 Rental from Nanchang Hongtou July 1, 2017 ~ June 30, 2022 — 1,521 1,580 Rental from Hailiang Real Estate June 11, 2018 ~ June 10, 2023 — — 730 Total 30,030 32,486 33,814 Hailiang Investment waived the 2013 and 2014 rental fees with an amount of RMB10,000 during the year ended June 30, 2017. (iv) During the years ended June 30, 2017, 2018 and 2019, the Group paid expenses, which mainly include staff related expenses, start-up costs and other miscellaneous expenses, of nil, RMB 9,401 and RMB10,312 respectively on behalf of the related parties. Such amount is receivable on demand, and the related parties repaid nil, RMB8,794 and RMB10,007 to the Group during the years ended June 30, 2017, 2018 and 2019, respectively. During the years ended June 30, 2017, 2018 and 2019, the related parties paid expenses, which mainly include staff related expenses and other miscellaneous expenses, of RMB3,836, RMB4,612 and RMB2,731 respectively on behalf of the Group. Such amount is due and payable on demand, and the Group repaid RMB4,536, RMB4,124 and RMB 4,663 to the related parties during the years ended June 30, 2017, 2018 and 2019, respectively. During the years ended June 30, 2017, 2018 and 2019, the Group collected amounts of RMB39,760, RMB47,070, and RMB46,453 on behalf of Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., a related party controlled by Mr. Feng. Such amount is due and payable on demand, and the Group repaid RMB37,541, RMB48,428 and RMB47,429 to Zhejiang Ming Kang Hui Food Co., Ltd. during the years ended June 30, 2017, 2018 and 2019, respectively. The above unsettled balances were included in “Amount due to related parties” and “Amount due from related parties” as of June 30, 2018 and 2019, respectively. (v) The Group entered into a series of leasehold improvement contracts with Heng Zhong Da Construction Limited Company (“Heng Zhong Da"), a company over which Mr. Feng has significant influence, for the leasehold improvement of classroom buildings, dining halls, student dormitories. During the years ended June 30, 2017, 2018 and 2019, the Group purchased leasehold improvement service from Heng Zhong Da of RMB37,231, RMB29,098 and RMB29,669, respectively. As of June 30, 2018 and 2019, the above unsettled balances of RMB19,508 and RMB11,260 were recognized in “Amount due to related parties”. (vi) The Group purchased food products from Zhejiang Ming Kang Hui E-Commerce Co., Ltd. and Ming Kang Hui Ecological Agriculture Group Co., Ltd. (collectively referred as “Ming Kang Hui”), two companies controlled by Mr. Feng, amounting to RMB48,298, RMB38,323 and RMB68,963 during the years ended June 30, 2017, 2018 and 2019, respectively. As of June 30, 2018 and 2019, the above unsettled balances of RMB5,386 and RMB18,516 were recognized in “Amount due to related parties”. (vii) Education and management service provided to related parties are as follow: 2017 2018 2019 RMB RMB RMB Education and management service provided to managed schools — 12,275 28,344 Service provided to Ming Kang Hui 3,766 4,556 4,878 Total 3,766 16,831 33,222 Pursuant to the strategic cooperation agreement signed with Hailiang Group and Hailiang investment, the Group provided education and management services to Hailiang Kindgarten, Zhuji Hailiang Jinshan Kindgarten and Tianma Kindgarten, which were controlled by Hailiang Group, and other 19 schools controlled by Hailiang Investment, including Xiantao No.1 Middle School, Xinchang Nanrui Experimental School, Feicheng Hailiang Foreign Language school, Jinhua Hailiang Foreign Language School and etc.. Education and management service fees of nil, RMB12,275 and RMB28,344 were charged to the abovementioned schools during the years ended June 30, 2017, 2018 and 2019, respectively. The Group provided service to Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., controlled by Mr. Feng, in the Group’s campuses, amounting to RMB3,766, RMB4,556 and RMB4,878 during the years ended June 30, 2017, 2018 and 2019, respectively. (viii) Other service and product provided to related parties mainly include daily consumables sold to related parties, hotel services and etc. (ix) The Group received IT services, physical examination services, travel services and other services from related parties controlled by Hailiang Group, amounting to nil, RMB6,884 and RMB23,263 during the years ended June 30, 2017, 2018 and 2019. As of June 30, 2018 and 2019, the above unsettled balances of RMB3,416 and RMB420 were recognized in “Amount due to related parties”. (x) The gains were recognized from disposal of Hailiang Kindergarten, Tianma Kindergarten and Chuzhou School (see Note 8 (iii) for additional details), amounting to RMB3,285, RMB1,683 and RMB381 during the year ended June 30, 2018, respectively. (xi) In August 2017, Haibo Education and Haibo Logistics were incorporated by Xinyu Baishu Technology Service Co., Ltd. (“Xinyu Baishu”), an entity ultimately controlled by Mr. Feng. The contributed capitals from Xinyu Baishu in Haibo Education and Haibo Logistics were RMB6,000 and RMB5,000, respectively. In January 2018, Xinyu Baishu transferred 56% equity interests in each of Haibo Education and Haibo Logistics to Ningbo Haoliang with considerations of RMB3,360 and RMB2,800, respectively. The considerations were equivalent to the cost of 56% of the contributed capital. In January 2018, Xinyu Baishu also transferred the remaining 44% equity interest in Haibo Education and Haibo Logistics to Nanchang Baishu, a related party of the Company. The 44% equity interests owned by Nanchang Baishu were recorded as non-controlling interests (see note 16). In November 2018, Haibo Education and Haibo Logistics declared and fully paid dividends amounting to RMB6,075 and RMB 1,407 to Nanchang Baishu, respectively (see note 16). (xii) Mr. Feng, paid awards of RMB 15,000 to the Group's outstanding teachers to recognize their outstanding performance and contributions during the year ended June 30, 2019. The transaction is accounted for as a deemed contribution from a controlling shareholder. |
Schedule of Transactions with key management personnel | (c) Transactions with key management personnel Remuneration of the directors and key management personnel of the Group for the years ended June 30, 2017, 2018 and 2019 are as follows: 2017 2018 2019 RMB RMB RMB Short-term benefits 7,614 8,162 5,713 |
Schedule of detailed information about leasing term and rental amount | (iii) The Group leases the school buildings and the related facilities in three campuses from Hailiang Investment, a related party controlled by Mr. Feng. In addition, Haibo Education and Haibo Logistics lease the office space and warehouse from Nanchang Hongtou Property Management Co., Ltd. (“Nanchang Hongtou”), a related party owned by Mr. Honggen Min, who is the controlling shareholder of Nanchang Baishu. The Group also leases some office spaces from Hangzhou Hailiang Real Estate Co., Ltd. (“Hailiang Real Estate”), a related party controlled by Mr. Feng. The leasing terms and rental amounts are as follows: 2017 2018 2019 Leasing Period RMB RMB RMB Rental from Hailiang Investment October 11, 2017 ~ June 30, 2037 30,030 30,965 31,504 Rental from Nanchang Hongtou July 1, 2017 ~ June 30, 2022 — 1,521 1,580 Rental from Hailiang Real Estate June 11, 2018 ~ June 10, 2023 — — 730 Total 30,030 32,486 33,814 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Commitments and contingencies | |
Schedule of Capital commitments | Capital commitments, which are primarily related to the campus decoration are as follows: 2018 2019 RMB RMB Contracted, but not provided for: Leasehold improvement 14,988 12,525 |
Schedule of Operating lease commitments | b) Operating lease commitments, which are primarily with related parties, are as follows: 2018 2019 RMB RMB within one year 33,764 36,376 one year to five years 145,016 155,254 Five years thereafter 497,468 496,794 676,248 688,424 |
Parent company financial stat_2
Parent company financial statement (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Parent company financial statement | |
Schedule of condensed statement of financials | The following condensed parent company financial information of Hailiang Education Group Inc. has been prepared using the same accounting policies as set out in the accompanying consolidated financial statements. HAILIANG EDUCATION GROUP INC. CONDENSED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS FOR THE YEARS ENDED JUNE 30, 2017, 2018 AND 2019 (Amounts in thousands) 2017 2018 2019 RMB RMB RMB Cost of revenue — (2,299) — Gross loss — (2,299) — Administrative expenses (4,148) (9,124) (8,176) Operating loss (4,148) (11,423) (8,176) Net finance expenses (8) (17) — Loss before tax (4,156) (11,440) (8,176) Loss (4,156) (11,440) (8,176) Other comprehensive income/(loss)-foreign currency translation differences 2,643 (3,016) 4,086 Total comprehensive loss (1,513) (14,456) (4,090) HAILIANG EDUCATION GROUP INC. CONDENSED STATEMENTS OF FINANCIAL POSITION AS OF JUNE 30, 2018 AND 2019 (Amounts in thousands) 2018 2019 RMB RMB Assets Other receivables due from subsidiaries 20,330 24,994 Non-current assets 20,330 24,994 Other receivables due from related parties 86,997 79,265 Cash 526 390 Current assets 87,523 79,655 Total assets 107,853 104,649 Shareholders’ equity Share capital 268 268 Share premium 134,583 134,583 Translation reserve 9,110 13,195 Accumulated losses (37,503) (45,679) Total shareholders’ equity 106,458 102,367 Liabilities Other payables due to third parties 1,393 2,280 Other payables due to related parties 2 2 Current liabilities 1,395 2,282 Total liabilities 1,395 2,282 Total shareholders’ equity and liabilities 107,853 104,649 HAILIANG EDUCATION GROUP INC. CONDENSED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED JUNE 30, 2017, 2018 AND 2019 (Amounts in thousands) 2017 2018 2019 RMB RMB RMB Cash flows from operating activities Loss for the year (4,156) (11,440) (8,176) Adjustments for: Change in other payables due to third parties (1,851) 1,393 887 Change in other payables due to a related party (651) 1 — Change in other receivable due from subsidiaries (347) (152) (4,664) Change in other receivable due from related parties — 3,623 (201) Net cash used in operating activities (7,005) (6,575) (12,154) Cash flows from investing activities A Loan made to a related party (98,229) — — Repayment of a loan from a related party — — 12,412 Net cash used in investing activities (98,229) — 12,412 Cash flows from financing activities A Loan made from a related party — 7,609 — Net cash from financing activities — 7,609 — Net foreign exchange loss/(gain) 2,642 (3,016) (394) Net decrease in cash (102,592) (1,982) (136) Cash at the beginning of the year 105,100 2,508 526 Cash at end of the year 2,508 526 390 Non-cash transaction: Net settlement of a loan made to a related party with a loan borrowed from a related party — (7,609) — |
Reporting entity and organiza_3
Reporting entity and organization (Details) | 12 Months Ended |
Jun. 30, 2019 | |
Hailiang Management (previously named "Zhejiang Hailiang Education Investment Group Co., Ltd.") [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2012 |
Description of nature of entity's operations and principal activities | Investment holding |
Proportion of ownership interest in associate | |
Zhejiang Hailiang Mingxin Education Technology Co., Ltd. [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2017 |
Description of nature of entity's operations and principal activities | After-school enrichment service and overseas study consulting service |
Proportion of ownership interest in associate | |
Hangzhou Hailiang Education Management Co., Ltd. [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | Education and management service |
Proportion of ownership interest in associate | |
Hailiang Foreign Language School (Foreign Language) [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 1995 |
Description of nature of entity's operations and principal activities | K‑12 educational services |
Proportion of ownership interest in associate | |
Hailiang Experimental High School (Experimental High) [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2002 |
Description of nature of entity's operations and principal activities | K‑12 educational services |
Proportion of ownership interest in associate | |
Tianma Experimental School ("Tianma Experimental") [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 1995 |
Description of nature of entity's operations and principal activities | K‑12 educational services |
Proportion of ownership interest in associate | |
Hailiang Primary School [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2016 |
Description of nature of entity's operations and principal activities | K‑12 educational services |
Proportion of ownership interest in associate | |
Hailiang Junior Middle School [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2016 |
Description of nature of entity's operations and principal activities | K‑12 educational services |
Proportion of ownership interest in associate | |
Hailiang Senior Middle School [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2016 |
Description of nature of entity's operations and principal activities | K‑12 educational services |
Proportion of ownership interest in associate | |
Hailiang High School of Art (previously named Hailiang Art Middle School) [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2017 |
Description of nature of entity's operations and principal activities | K‑12 educational services |
Proportion of ownership interest in associate | |
Zhuji Hailiang Foreign Language High School Co., Ltd. (Zhuji Hailiang Foreign Language High School) [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | K-12 educational services |
Proportion of ownership interest in associate | |
Zhenjiang Jianghe High School of Art [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Jiangsu, China, 2018 |
Description of nature of entity's operations and principal activities | K-12 educational services |
Proportion of ownership interest in associate | |
Zhejiang Mingxin International Travel Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | Study trip service |
Proportion of ownership interest in associate | |
Shaoxing Sihai International Travel Co., Ltd ("Sihai International Travel") [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of associate and year of establishment | Zhejiang, China, 2010 |
Description of nature of entity's operations and principal activities | Study trip service |
Proportion of ownership interest in associate | |
Hailiang Education (HK) Limited (Hailiang HK) [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Hong Kong, China, 2011 |
Description of nature of entity's operations and principal activities | Investment holding |
Proportion of ownership interest in subsidiary | 100.00% |
Zhejiang Hailiang Education Consulting and Services Co., Ltd. ("Hailiang Consulting") [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2011 |
Description of nature of entity's operations and principal activities | Investment holding |
Proportion of ownership interest in subsidiary | 100.00% |
Ningbo Hailiang Education Logistics Management Co Ltd [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2017 |
Description of nature of entity's operations and principal activities | Education and management service |
Proportion of ownership interest in subsidiary | 100.00% |
Ningbo Haoliang Information Consulting Co., Ltd. ("Ningbo Haoliang") [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2017 |
Description of nature of entity's operations and principal activities | Education and management service |
Proportion of ownership interest in subsidiary | 100.00% |
Zhuji Nianxin Lake Hotel Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2017 |
Description of nature of entity's operations and principal activities | Hotel management service |
Proportion of ownership interest in subsidiary | 100.00% |
Ningbo Hailiang Sports Development Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | Educational training service |
Proportion of ownership interest in subsidiary | 100.00% |
Zhuji Hailiang Supply Chain Management Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | Procurement and transportation services |
Proportion of ownership interest in subsidiary | 100.00% |
Zhuji Hailiang Logistics Service Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | Accommodation service |
Proportion of ownership interest in subsidiary | 100.00% |
Jiangxi Haibo Education Management Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Jiangxi, China, 2017 |
Description of nature of entity's operations and principal activities | Educational training service |
Proportion of ownership interest in subsidiary | 56.00% |
Jiangxi Haibo Logistics Management Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Jiangxi, China, 2017 |
Description of nature of entity's operations and principal activities | Education and management service |
Proportion of ownership interest in subsidiary | 56.00% |
Zhuji Hailiang After-school Service Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | After-school enrichment service |
Proportion of ownership interest in subsidiary | 100.00% |
Hailiang Education International Studying Service Limited [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Hongkong, China, 2018 |
Description of nature of entity's operations and principal activities | Overseas study consulting service |
Proportion of ownership interest in subsidiary | 100.00% |
Hangzhou Hailiang International Studying Service Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | Overseas study consulting service |
Proportion of ownership interest in subsidiary | 100.00% |
Hangzhou Hailiang Study Trip Co Ltd [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | Zhejiang, China, 2018 |
Description of nature of entity's operations and principal activities | Study trip service |
Proportion of ownership interest in subsidiary | 100.00% |
Pates-Hailiang International College Company Limited [Member] | |
Disclosure of reporting entity and organization [Line Items] | |
Principal place of business of subsidiary and year of establishment | United Kingdom,2018 |
Description of nature of entity's operations and principal activities | Overseas study consulting service |
Proportion of ownership interest in subsidiary | 100.00% |
Reporting entity and organiza_4
Reporting entity and organization - Additional Information (Details) | Oct. 31, 2018 |
Zhenjiang Jianghe High School of Art [member] | |
Disclosure of reporting entity and organization [Line Items] | |
Percentage of voting equity interests acquired | 51.00% |
Basis of preparation (Details)
Basis of preparation (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disclosure of Basis of preparation [Line Items] | ||||
Total non-current assets | ¥ 730,141 | ¥ 730,141 | ¥ 757,920 | |
Total current assets | 1,772,771 | 1,772,771 | 1,126,930 | |
Total assets | 2,502,912 | 2,502,912 | 1,884,850 | |
Total non-current liabilities | 7,270 | 7,270 | 0 | |
Total current liabilities | 806,395 | 806,395 | 550,037 | |
Total liabilities | 813,665 | 813,665 | 550,037 | |
Revenue | 1,499,025 | 1,169,348 | ¥ 853,295 | |
Profit before tax | 424,493 | 297,190 | 167,743 | |
Net Profit | 315,780 | 315,780 | 230,902 | 167,743 |
Affiliated entities [Member] | ||||
Disclosure of Basis of preparation [Line Items] | ||||
Total non-current assets | 687,407 | 687,407 | 710,464 | |
Total current assets | 1,313,326 | 1,313,326 | 848,028 | |
Total assets | 2,000,733 | 2,000,733 | 1,558,492 | |
Total non-current liabilities | 7,270 | 7,270 | 0 | |
Total current liabilities | 635,670 | 635,670 | 396,238 | |
Total liabilities | ¥ 642,940 | 642,940 | 396,238 | |
Revenue | 1,087,054 | 1,110,470 | 853,247 | |
Profit before tax | 202,157 | 221,057 | 165,300 | |
Net Profit | ¥ 152,713 | ¥ 177,088 | ¥ 165,300 |
Basis of preparation - Addition
Basis of preparation - Additional Information (Details) | Feb. 08, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 |
Affiliated entities [Member] | ||||
Basis of Preparation [Line Items] | ||||
Percentage of entity's revenue | 72.50% | 95.00% | 100.00% | |
Percentage of entity's assets | 79.90% | 82.70% | ||
Percentage of entitys liabilities | 79.00% | 72.00% | ||
Beize Group [Member] | ||||
Basis of Preparation [Line Items] | ||||
Capital contribution percentage | 0.10% |
Changes in accounting policie_2
Changes in accounting policies - Impact of IFRS 15 on retained earnings (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jul. 01, 2018 | Jun. 30, 2018 |
Disclosure of expected impact of initial application of new standards or interpretations [line items] | |||
Net increase in retained earnings at July 1, 2018 | ¥ 905,009 | ¥ 638,246 | |
IFRS 15 | |||
Disclosure of expected impact of initial application of new standards or interpretations [line items] | |||
Capitalization of sales commissions | ¥ 18,279 | ||
Net increase in retained earnings at July 1, 2018 | ¥ 905,009 | ¥ 18,279 |
Changes in accounting policie_3
Changes in accounting policies - Impact of IFRS 15 on Financial statements (Details) - CNY (¥) ¥ / shares in Units, ¥ in Thousands | 12 Months Ended | |||||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Jul. 01, 2018 | Jun. 30, 2016 | |
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME | ||||||
Selling expenses | ¥ (25,003) | ¥ (24,539) | ¥ (21,902) | |||
Profit before tax | 424,493 | 297,190 | 167,743 | |||
Income tax expenses | 108,713 | 66,288 | 0 | |||
Net Profit | ¥ 315,780 | 315,780 | 230,902 | 167,743 | ||
Net profit attributable to the Company's shareholders | 293,421 | 222,588 | 167,743 | |||
Total comprehensive income for the year | 319,090 | 319,090 | 228,360 | 169,945 | ||
Total comprehensive income attributable to the Company's shareholders | 296,731 | 220,046 | 169,945 | |||
Line items in the consolidated statement of financial position as of June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Contract costs | 9,899 | 9,899 | 0 | |||
Total non-current assets | 730,141 | 730,141 | 757,920 | |||
Other current assets | 31,706 | 31,706 | 15,182 | |||
Total current assets | 1,772,771 | 1,772,771 | 1,126,930 | |||
Total assets | 2,502,912 | 2,502,912 | 1,884,850 | |||
Trade and other payables due to third parties | 218,122 | 218,122 | 141,504 | |||
Deferred revenue | 0 | 0 | 212,969 | |||
Contract liabilities | 398,951 | 398,951 | 0 | ¥ 209,720 | ||
Total current liabilities | 806,395 | 806,395 | 550,037 | |||
Contract liabilities | 2,579 | 2,579 | 0 | |||
Deferred tax liabilities | 4,691 | 4,691 | 0 | |||
Total non-current liabilities | 7,270 | 7,270 | 0 | |||
Total liabilities | 813,665 | 813,665 | 550,037 | |||
Reserves | 360,914 | 360,914 | 312,667 | |||
Retained earnings | 905,009 | 905,009 | 638,246 | |||
Total Hailiang Education Group Inc. shareholders' equity | 1,651,808 | 1,651,808 | 1,321,659 | |||
Total equity | 1,689,247 | 1,689,247 | 1,334,813 | 1,101,613 | ¥ 921,668 | |
Total equity and liabilities | 2,502,912 | 2,502,912 | 1,884,850 | |||
Line items in the reconciliation of net profit to cash generated from operations for year ended June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Net Profit | 315,780 | 315,780 | 230,902 | 167,743 | ||
Other current assets and contract costs | (8,127) | (13,681) | (530) | |||
Change in trade and other payables due to third parties | 94,885 | 30,416 | 23,313 | |||
Change in deferred revenue and contract liabilities | 186,731 | ¥ 165,583 | ¥ 17,713 | |||
Amortization Of Capitalized Sales Commissions | 13,052 | |||||
IFRS 15 | ||||||
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME | ||||||
Selling expenses | (25,003) | |||||
Profit before tax | 424,493 | |||||
Income tax expenses | (108,713) | |||||
Net Profit | 315,780 | |||||
Net profit attributable to the Company's shareholders | 293,421 | |||||
Total comprehensive income for the year | 319,090 | |||||
Total comprehensive income attributable to the Company's shareholders | ¥ 296,731 | |||||
Earnings per share | ||||||
Basic | ¥ 0.71 | |||||
Diluted | ¥ 0.71 | |||||
Line items in the consolidated statement of financial position as of June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Contract costs | 9,899 | ¥ 9,899 | ||||
Total non-current assets | 730,141 | 730,141 | ||||
Other current assets | 31,706 | 31,706 | ||||
Total current assets | 1,772,771 | 1,772,771 | ||||
Total assets | 2,502,912 | 2,502,912 | ||||
Trade and other payables due to third parties | 218,122 | 218,122 | ||||
Contract liabilities | 398,951 | 398,951 | ||||
Total current liabilities | 806,395 | 806,395 | ||||
Contract liabilities | 2,579 | 2,579 | ||||
Deferred tax liabilities | 4,691 | 4,691 | ||||
Total non-current liabilities | 7,270 | 7,270 | ||||
Total liabilities | 813,665 | 813,665 | ||||
Reserves | 360,914 | 360,914 | ||||
Retained earnings | 905,009 | 905,009 | ¥ 18,279 | |||
Total Hailiang Education Group Inc. shareholders' equity | 1,651,808 | 1,651,808 | ||||
Total equity | 1,689,247 | 1,689,247 | ||||
Total equity and liabilities | 2,502,912 | 2,502,912 | ||||
Line items in the reconciliation of net profit to cash generated from operations for year ended June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Net Profit | 315,780 | |||||
Other current assets and contract costs | (8,127) | |||||
Change in trade and other payables due to third parties | 94,885 | |||||
Change in deferred revenue and contract liabilities | 186,731 | |||||
Hypothetical amounts under IASs18 and 11 | ||||||
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME | ||||||
Selling expenses | (25,983) | |||||
Profit before tax | 423,513 | |||||
Income tax expenses | (108,384) | |||||
Net Profit | 315,129 | |||||
Net profit attributable to the Company's shareholders | 292,770 | |||||
Total comprehensive income for the year | 318,439 | |||||
Total comprehensive income attributable to the Company's shareholders | ¥ 296,080 | |||||
Earnings per share | ||||||
Basic | ¥ 0.71 | |||||
Diluted | ¥ 0.71 | |||||
Line items in the consolidated statement of financial position as of June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Total non-current assets | 720,242 | ¥ 720,242 | ||||
Other current assets | 22,346 | 22,346 | ||||
Total current assets | 1,763,411 | 1,763,411 | ||||
Total assets | 2,483,653 | 2,483,653 | ||||
Trade and other payables due to third parties | 212,253 | 212,253 | ||||
Deferred revenue | 407,399 | 407,399 | ||||
Total current liabilities | 808,974 | 808,974 | ||||
Deferred tax liabilities | 4,362 | 4,362 | ||||
Total non-current liabilities | 4,362 | 4,362 | ||||
Total liabilities | 813,336 | 813,336 | ||||
Reserves | 360,473 | 360,473 | ||||
Retained earnings | 886,520 | 886,520 | ||||
Total Hailiang Education Group Inc. shareholders' equity | 1,632,878 | 1,632,878 | ||||
Total equity | 1,670,317 | 1,670,317 | ||||
Total equity and liabilities | 2,483,653 | 2,483,653 | ||||
Line items in the reconciliation of net profit to cash generated from operations for year ended June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Net Profit | 315,129 | |||||
Other current assets and contract costs | (7,147) | |||||
Change in trade and other payables due to third parties | 89,016 | |||||
Change in deferred revenue and contract liabilities | 192,600 | |||||
Difference: Estimated impact of adoption of IFRS 15 on 2019 | ||||||
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME | ||||||
Selling expenses | 980 | |||||
Profit before tax | 980 | |||||
Income tax expenses | (329) | |||||
Net Profit | 651 | |||||
Net profit attributable to the Company's shareholders | 651 | |||||
Total comprehensive income for the year | 651 | |||||
Total comprehensive income attributable to the Company's shareholders | 651 | |||||
Line items in the consolidated statement of financial position as of June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Contract costs | 9,899 | 9,899 | ||||
Total non-current assets | 9,899 | 9,899 | ||||
Other current assets | 9,360 | 9,360 | ||||
Total current assets | 9,360 | 9,360 | ||||
Total assets | 19,259 | 19,259 | ||||
Trade and other payables due to third parties | 5,869 | 5,869 | ||||
Deferred revenue | (407,399) | (407,399) | ||||
Contract liabilities | 398,951 | 398,951 | ||||
Total current liabilities | (2,579) | (2,579) | ||||
Contract liabilities | 2,579 | 2,579 | ||||
Deferred tax liabilities | 329 | 329 | ||||
Total non-current liabilities | 2,908 | 2,908 | ||||
Total liabilities | 329 | 329 | ||||
Reserves | 441 | 441 | ||||
Retained earnings | 18,489 | 18,489 | ||||
Total Hailiang Education Group Inc. shareholders' equity | 18,930 | 18,930 | ||||
Total equity | 18,930 | 18,930 | ||||
Total equity and liabilities | ¥ 19,259 | 19,259 | ||||
Line items in the reconciliation of net profit to cash generated from operations for year ended June 30, 2019 impacted by the adoption of IFRS 15: | ||||||
Net Profit | 651 | |||||
Other current assets and contract costs | (980) | |||||
Change in trade and other payables due to third parties | 5,869 | |||||
Change in deferred revenue and contract liabilities | ¥ (5,869) |
Significant accounting polici_4
Significant accounting policies (Details) | 12 Months Ended |
Jun. 30, 2019 | |
Motor vehicles [member] | Minimum [member] | |
Significant Accounting Policies [Line Items] | |
Useful lives or depreciation rates, property, plant and equipment | 5 |
Motor vehicles [member] | Maximum [member] | |
Significant Accounting Policies [Line Items] | |
Useful lives or depreciation rates, property, plant and equipment | 10 |
Furniture, fixtures and other equipment [member] | Minimum [member] | |
Significant Accounting Policies [Line Items] | |
Useful lives or depreciation rates, property, plant and equipment | 3 |
Furniture, fixtures and other equipment [member] | Maximum [member] | |
Significant Accounting Policies [Line Items] | |
Useful lives or depreciation rates, property, plant and equipment | 10 |
Leasehold Improvements [Member] | |
Significant Accounting Policies [Line Items] | |
Useful lives or depreciation rates, property, plant and equipment | Shorter of the remaining lease terms or estimated useful lives |
Significant accounting polici_5
Significant accounting policies - Additional Information (Details) - CNY (¥) ¥ in Thousands | Sep. 12, 2019 | Sep. 06, 2019 | Jun. 30, 2019 |
Significant Accounting Policies [Line Items] | |||
Operating Lease Commitments, Payable | ¥ 688,424 | ||
Operating Lease Minimum Lease Payments Payable | ¥ 663,953 | ||
Prepayment of rental fee | ¥ 540,453 | ||
Payment of Rental Fees | ¥ 540,453 | ||
Favorable lease [Member] | |||
Significant Accounting Policies [Line Items] | |||
Amortization period | P20Y | ||
Others | |||
Significant Accounting Policies [Line Items] | |||
Amortization period | P3Y | ||
Minimum [member] | |||
Significant Accounting Policies [Line Items] | |||
Percent of contributions expected to be paid to plan for annual reporting period | 25.30% | ||
Minimum [member] | Student relationships | |||
Significant Accounting Policies [Line Items] | |||
Amortization period | P1Y | ||
Maximum [member] | |||
Significant Accounting Policies [Line Items] | |||
Percent of contributions expected to be paid to plan for annual reporting period | 38.64% | ||
Maximum [member] | Student relationships | |||
Significant Accounting Policies [Line Items] | |||
Amortization period | P15Y |
Revenue and segment reporting -
Revenue and segment reporting - (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | ¥ 1,499,025 | ¥ 1,169,348 | ¥ 853,295 |
Goods or services transferred over time [member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | 1,304,361 | ||
Goods or services transferred at point in time [member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | 194,664 | ||
K-12 educational services [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | 1,217,007 | 1,093,933 | ¥ 853,295 |
Educational training services [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | 144,188 | 36,395 | |
Study trip services | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | 81,495 | 13,791 | |
Education And Management Services [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | 40,942 | 19,021 | |
Others [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Revenue | ¥ 15,393 | ¥ 6,208 |
Revenue and segment reporting_2
Revenue and segment reporting - Schedule of contract liabilities from contract with customers (Details) - CNY (¥) ¥ in Thousands | Jul. 01, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Current liabilities | |||
Contract liabilities | ¥ 209,720 | ¥ 398,951 | ¥ 0 |
Contract liabilities recognized as revenue | ¥ 209,720 | ||
Non-current liabilities | |||
Non-current contract liability | ¥ 2,579 | ¥ 0 |
Revenue and segment reporting_3
Revenue and segment reporting - Schedule of the revenue and operating results by segments (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disclosure of operating segments [line items] | |||
Revenues | ¥ 1,499,025 | ¥ 1,169,348 | ¥ 853,295 |
Segment income/ (loss) | 424,493 | 297,190 | 167,743 |
Interest income | 24,470 | 11,715 | 6,709 |
Depreciation and amortization | 133,520 | 113,574 | 111,147 |
Operating Segments [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 1,508,349 | 1,184,286 | |
Elimination of intersegment amounts [member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 9,324 | 14,938 | |
K-12 educational services [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 1,257,949 | 1,112,954 | 853,295 |
Segment income/ (loss) | 320,639 | 276,587 | 165,353 |
Interest income | 21,244 | 7,083 | 5,980 |
Depreciation and amortization | 125,676 | 104,254 | 111,147 |
K-12 educational services [Member] | Operating Segments [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 1,258,371 | 1,112,954 | |
K-12 educational services [Member] | Elimination of intersegment amounts [member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 422 | 0 | |
Educational training services [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 144,188 | 36,395 | |
Segment income/ (loss) | 91,720 | 28,820 | |
Interest income | 519 | 151 | |
Depreciation and amortization | 526 | 1 | |
Educational training services [Member] | Operating Segments [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 146,955 | 51,073 | |
Educational training services [Member] | Elimination of intersegment amounts [member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 2,767 | 14,678 | |
Others [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 96,888 | 19,999 | |
Segment income/ (loss) | 18,773 | 1,157 | |
Interest income | 1,110 | 119 | |
Depreciation and amortization | 7,318 | 9,319 | |
Others [Member] | Operating Segments [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 103,023 | 20,259 | |
Others [Member] | Elimination of intersegment amounts [member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 6,135 | 260 | |
Unallocated [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 0 | 0 | 0 |
Segment income/ (loss) | (6,639) | (9,374) | 2,390 |
Interest income | 1,597 | 4,362 | 729 |
Depreciation and amortization | 0 | 0 | ¥ 0 |
Unallocated [Member] | Operating Segments [Member] | |||
Disclosure of operating segments [line items] | |||
Revenues | 0 | 0 | |
Unallocated [Member] | Elimination of intersegment amounts [member] | |||
Disclosure of operating segments [line items] | |||
Revenues | ¥ 0 | ¥ 0 |
Revenue and segment reporting_4
Revenue and segment reporting - Additional information (Details) - segment | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue and segment reporting | |||
Number of operating segments | 4 | 7 | 1 |
Percentage of Quantity thresholds | 10.00% |
Other income, net (Details)
Other income, net (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Other income, net | |||
Government grants | ¥ 25,437 | ¥ 5,832 | ¥ 6,253 |
Others | (337) | (2,143) | 72 |
Other income, net | ¥ 25,100 | ¥ 3,689 | ¥ 6,325 |
Employee benefit expenses (Deta
Employee benefit expenses (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Employee benefit expenses | |||
Wages and salaries | ¥ 533,505 | ¥ 388,238 | ¥ 280,786 |
Contributions to defined contribution plans | 64,118 | 52,898 | 44,884 |
Employee benefit expenses | ¥ 597,623 | ¥ 441,136 | ¥ 325,670 |
Profit before tax - Net finance
Profit before tax - Net finance income (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Profit before tax | |||
Interest income | ¥ 24,470 | ¥ 11,715 | ¥ 6,709 |
Others | 465 | (324) | 183 |
Net finance income | ¥ 24,935 | ¥ 11,391 | ¥ 6,892 |
Profit before tax - Expenses by
Profit before tax - Expenses by nature (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Profit before tax | |||
Employee benefit expenses (Note 7) | ¥ 597,623 | ¥ 441,136 | ¥ 325,670 |
Students related cost | 199,478 | 147,571 | 116,273 |
Transportation | 49,137 | 36,110 | 31,823 |
Marketing and promotion | 24,490 | 24,019 | 21,240 |
Depreciation (Note 11) | 132,026 | 113,128 | 110,485 |
Utilities | 26,162 | 26,100 | 23,286 |
Amortization of intangible assets (Note 12) | 1,494 | 446 | 662 |
Operating lease charges | 35,639 | 33,290 | 30,030 |
Cost related to educational trips and overseas study consulting services | 14,263 | ||
Others | 58,518 | 70,787 | 39,300 |
Total cost of revenue, selling expenses and administrative expenses | ¥ 1,124,567 | ¥ 892,587 | ¥ 698,769 |
Profit before tax - Additional
Profit before tax - Additional Information (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings [Line Items] | ||||
Gain (loss) recognised on measurement to fair value less costs to sell or on disposal of assets or disposal groups constituting discontinued operation | ¥ 0 | ¥ 5,349 | ¥ 0 | |
Chuzhou School [Member] | ||||
Earnings [Line Items] | ||||
Percentage of voting equity interest transferred | 100.00% | |||
Gain (loss) recognised on measurement to fair value less costs to sell or on disposal of assets or disposal groups constituting discontinued operation | ¥ 381 | |||
Disposal group assets carrying value | 1,412 | |||
Consideration paid (received) | ¥ 1,793 | |||
Hailiang Kindergarten [Member] | ||||
Earnings [Line Items] | ||||
Gain (loss) recognised on measurement to fair value less costs to sell or on disposal of assets or disposal groups constituting discontinued operation | ¥ 3,285 | |||
Disposal group assets carrying value | 16,764 | |||
Consideration paid (received) | ¥ 20,049 | |||
Tianma kindergarten [Member] | ||||
Earnings [Line Items] | ||||
Percentage of voting equity interest transferred | 100.00% | |||
Gain (loss) recognised on measurement to fair value less costs to sell or on disposal of assets or disposal groups constituting discontinued operation | ¥ 1,683 | |||
Disposal group liabilities carrying value | 17 | |||
Consideration paid (received) | ¥ 1,666 |
Income tax expenses - Income ta
Income tax expenses - Income tax expenses in profit or loss and other comprehensive income (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Current | |||
PRC income tax expenses | ¥ 108,545 | ¥ 66,288 | ¥ 0 |
Deferred | |||
PRC income tax expenses | 168 | 0 | 0 |
Income tax expenses for the year | ¥ 108,713 | ¥ 66,288 | ¥ 0 |
Income tax expenses - Schedule
Income tax expenses - Schedule of Reconciliation Between the Provision for income tax (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income tax expenses | |||
Profit before tax | ¥ 424,493 | ¥ 297,190 | ¥ 167,743 |
Notional tax on profit before taxation, calculated at the applicable rates in the tax jurisdictions concerned | 108,122 | 74,298 | 41,936 |
Effect of expenses that are not deductible in determining taxable profit | 524 | 373 | 0 |
Effect of incomes that are not taxable in determining taxable profit | 0 | (956) | 0 |
Unrecognized tax losses | 2,054 | 70 | 2 |
Utilization of tax losses previously not recognized | (486) | (46) | (579) |
Effect of income tax exemptions | (1,501) | (7,451) | (41,359) |
Income tax expense recognized in profit or loss | ¥ 108,713 | ¥ 66,288 | ¥ 0 |
Income tax expenses - Deferred
Income tax expenses - Deferred tax assets and liabilities (Details) ¥ in Thousands | 12 Months Ended |
Jun. 30, 2019CNY (¥) | |
Reconciliation of changes in deferred tax liability (asset) [abstract] | |
Balance at the beginning | ¥ 0 |
Acquisition through a business combination (note 19) | 4,523 |
Charged/(credited) to profit or loss | 168 |
Balance at the end | 4,691 |
Capitalized Contract Costs [Member] | |
Reconciliation of changes in deferred tax liability (asset) [abstract] | |
Balance at the beginning | 0 |
Acquisition through a business combination (note 19) | 0 |
Charged/(credited) to profit or loss | 328 |
Balance at the end | 328 |
Favorable Lease [Member] | |
Reconciliation of changes in deferred tax liability (asset) [abstract] | |
Balance at the beginning | 0 |
Acquisition through a business combination (note 19) | 4,523 |
Charged/(credited) to profit or loss | (160) |
Balance at the end | ¥ 4,363 |
Income tax expenses Additional
Income tax expenses Additional information (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Withholding Tax Rate | 10.00% | |
Adjustments for undistributed profits of associates | ¥ 820,456 | |
Hong Kong [member] | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Applicable tax rate | 16.50% | |
China [member] | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Applicable tax rate | 25.00% | |
China [member] | Unused tax losses [member] | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Tax credit carryforward amounts | ¥ 14,417 | ¥ 2,516 |
Unused tax losses expiration on June 30 2020 | 1,748 | |
Unused tax losses expiration on June 30 2021 | 230 | 427 |
Unused tax losses expiration on June 30 2023 | 4,879 | ¥ 275 |
Unused tax losses expiration on June 30 2024 | ¥ 9,241 |
Earnings per share (Details)
Earnings per share (Details) - CNY (¥) ¥ / shares in Units, ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings per share | |||
Net profit attributable to the Company's shareholders | ¥ 293,421 | ¥ 222,588 | ¥ 167,743 |
Weighted average number of ordinary shares for basic EPS | 412,450,256 | 411,878,478 | 411,208,000 |
Effects of dilution from warrants | 0 | 638,292 | 0 |
Weighted average number of ordinary shares adjusted for the effect of dilution | 412,450,256 | 412,516,770 | 411,208,000 |
Basic and diluted earnings per share | ¥ 0.71 | ¥ 0.54 | ¥ 0.41 |
Property and equipment - Proper
Property and equipment - Property and Equipment (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | ¥ 679,081 | |
Ending Balance | 620,623 | ¥ 679,081 |
Cost | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 1,037,508 | 975,708 |
Additions | 63,622 | 96,409 |
Acquisition through business combination (Note 19) | 12,726 | |
Transferred from construction in progress | 0 | 0 |
Transferred to intangible assets | (2,438) | |
Disposals | (5,236) | (34,609) |
Ending Balance | 1,106,182 | 1,037,508 |
Accumulated Amortization | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | (358,427) | (255,089) |
Depreciation for the year | (132,026) | (113,128) |
Disposals | (4,894) | (9,790) |
Ending Balance | (485,559) | (358,427) |
Motor vehicles [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 7,386 | |
Ending Balance | 3,907 | 7,386 |
Motor vehicles [member] | Cost | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 21,403 | 18,515 |
Additions | 190 | 4,454 |
Acquisition through business combination (Note 19) | 0 | |
Transferred from construction in progress | 0 | 0 |
Transferred to intangible assets | 0 | |
Disposals | 0 | (1,566) |
Ending Balance | 21,593 | 21,403 |
Motor vehicles [member] | Accumulated Amortization | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | (14,017) | (9,879) |
Depreciation for the year | (3,669) | (4,476) |
Disposals | 0 | (338) |
Ending Balance | (17,686) | (14,017) |
Furniture, fixtures and other equipment | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 151,836 | |
Ending Balance | 138,259 | 151,836 |
Furniture, fixtures and other equipment | Cost | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 263,034 | 244,189 |
Additions | 21,970 | 22,331 |
Acquisition through business combination (Note 19) | 3,954 | |
Transferred from construction in progress | 22,962 | 5,098 |
Transferred to intangible assets | 0 | |
Disposals | (5,236) | (8,584) |
Ending Balance | 306,684 | 263,034 |
Furniture, fixtures and other equipment | Accumulated Amortization | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | (111,198) | (82,124) |
Depreciation for the year | (62,121) | (33,414) |
Disposals | (4,894) | (4,340) |
Ending Balance | (168,425) | (111,198) |
Leasehold Improvements [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 514,329 | |
Ending Balance | 470,053 | 514,329 |
Leasehold Improvements [Member] | Cost | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 747,541 | 704,126 |
Additions | 12,137 | 21,415 |
Acquisition through business combination (Note 19) | 8,772 | |
Transferred from construction in progress | 1,051 | 45,446 |
Transferred to intangible assets | 0 | |
Disposals | 0 | (23,446) |
Ending Balance | 769,501 | 747,541 |
Leasehold Improvements [Member] | Accumulated Amortization | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | (233,212) | (163,086) |
Depreciation for the year | (66,236) | (75,238) |
Disposals | 0 | (5,112) |
Ending Balance | (299,448) | (233,212) |
Construction in progress | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 5,530 | |
Ending Balance | 8,404 | 5,530 |
Construction in progress | Cost | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 5,530 | 8,878 |
Additions | 29,325 | 48,209 |
Acquisition through business combination (Note 19) | 0 | |
Transferred from construction in progress | (24,013) | (50,544) |
Transferred to intangible assets | (2,438) | |
Disposals | 0 | (1,013) |
Ending Balance | 8,404 | 5,530 |
Construction in progress | Accumulated Amortization | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Beginning Balance | 0 | 0 |
Depreciation for the year | 0 | 0 |
Disposals | 0 | 0 |
Ending Balance | ¥ 0 | ¥ 0 |
Property and equipment - Additi
Property and equipment - Additional Information (Details) ¥ in Thousands | 12 Months Ended |
Jun. 30, 2018CNY (¥) | |
Property and equipment | |
Disposal Group Net Book Value Property and Equipment Transferred Out | ¥ 23,433 |
Intangible assets and goodwil_2
Intangible assets and goodwill - Intangible Assets and Goodwill (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | ¥ 78,747 | |
Ending Balance | 99,525 | ¥ 78,747 |
Goodwill [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 61,640 | |
Ending Balance | 61,640 | 61,640 |
Student relationship [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 567 | |
Ending Balance | 307 | 567 |
Trademark [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 16,540 | |
Ending Balance | 16,540 | 16,540 |
Favorable lease [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Ending Balance | 17,451 | |
Others | ||
Disclosure of detailed information about intangible assets [line items] | ||
Ending Balance | 3,587 | |
Cost | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 123,217 | 123,623 |
Addition | 1,743 | |
Acquisitions through business combinations (Note 19) | 18,091 | |
Disposals of kindergarten business | (406) | |
Transferred from construction in progress | 2,438 | |
Ending Balance | 145,489 | 123,217 |
Cost | Goodwill [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 61,640 | 62,046 |
Addition | 0 | |
Acquisitions through business combinations (Note 19) | 0 | |
Disposals of kindergarten business | (406) | |
Transferred from construction in progress | 0 | |
Ending Balance | 61,640 | 61,640 |
Cost | Student relationship [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 45,037 | 45,037 |
Addition | 0 | |
Acquisitions through business combinations (Note 19) | 0 | |
Disposals of kindergarten business | 0 | |
Transferred from construction in progress | 0 | |
Ending Balance | 45,037 | 45,037 |
Cost | Trademark [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 16,540 | 16,540 |
Addition | 0 | |
Acquisitions through business combinations (Note 19) | 0 | |
Disposals of kindergarten business | 0 | |
Transferred from construction in progress | 0 | |
Ending Balance | 16,540 | 16,540 |
Cost | Favorable lease [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Acquisitions through business combinations (Note 19) | 18,091 | |
Disposals of kindergarten business | 0 | |
Ending Balance | 18,091 | |
Cost | Others | ||
Disclosure of detailed information about intangible assets [line items] | ||
Addition | 1,743 | |
Disposals of kindergarten business | 0 | |
Transferred from construction in progress | 2,438 | |
Ending Balance | 4,181 | |
Accumulated Amortization | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | (44,470) | (44,024) |
Amortization for the year | (1,494) | (446) |
Ending Balance | (45,964) | (44,470) |
Accumulated Amortization | Goodwill [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 0 | 0 |
Amortization for the year | 0 | 0 |
Ending Balance | 0 | 0 |
Accumulated Amortization | Student relationship [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | (44,470) | (44,024) |
Amortization for the year | (260) | (446) |
Ending Balance | (44,730) | (44,470) |
Accumulated Amortization | Trademark [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 0 | 0 |
Amortization for the year | 0 | 0 |
Ending Balance | 0 | 0 |
Accumulated Amortization | Favorable lease [Member] | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 0 | 0 |
Amortization for the year | (640) | 0 |
Ending Balance | (640) | 0 |
Accumulated Amortization | Others | ||
Disclosure of detailed information about intangible assets [line items] | ||
Beginning Balance | 0 | 0 |
Amortization for the year | (594) | 0 |
Ending Balance | ¥ (594) | ¥ 0 |
Intangible assets and goodwil_3
Intangible assets and goodwill - Aggregated Carrying Amount of Goodwill and Trademark (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 |
Intangible assets and goodwill. | ||
Goodwill | ¥ 61,640 | ¥ 61,640 |
Trademark | 16,540 | 16,540 |
Total | ¥ 78,180 | ¥ 78,180 |
Intangible assets and goodwil_4
Intangible assets and goodwill - Key Assumptions (Details) | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 |
Intangible assets and goodwill. | |||
Discount rate | 15.50% | 15.00% | 24.00% |
Terminal value growth rate | 3.00% | 3.00% | 3.00% |
Intangible assets and goodwil_5
Intangible assets and goodwill - Additional Information (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disclosure of detailed information about intangible assets [line items] | ||||
Debt Leverage Rate | 0.00% | |||
Description Of Royalty Rates Applied To Cash Flow Projections | 3.00% | 3.00% | 3.00% | |
Growth rate used to extrapolate cash flow projections | 3.00% | 3.00% | 3.00% | |
Discount rate applied to cash flow projections | 15.50% | 15.00% | 24.00% | |
Description Of Royalty Applied To Cash Flow Projections | 5 years | |||
Tianma kindergarten [Member] | ||||
Disclosure of detailed information about intangible assets [line items] | ||||
Goodwill derecognised without having previously been included in disposal group classified as held for sale | ¥ 406 |
Other current assets (Details)
Other current assets (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 |
Other current assets. | ||
Prepayments | ¥ 15,476 | ¥ 11,913 |
Contract costs | 9,360 | |
Advances to employees | 3,687 | 2,122 |
Deductible VAT | 1,091 | |
Other receivables due from third parties | 2,092 | 1,147 |
Total | ¥ 31,706 | ¥ 15,182 |
Cash and cash equivalents (Deta
Cash and cash equivalents (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 | |
Cash and cash equivalents. | |||||
Cash on hand | ¥ 309 | ¥ 30 | |||
Cash at bank | 36,827 | 71,857 | |||
Cash held at a related party finance entity | [1] | 223,548 | 740,733 | ||
Total | ¥ 260,684 | ¥ 812,620 | ¥ 77,801 | ¥ 291,011 | |
[1] | As of June 30, 2018 and 2019, the Group has cash held at a related party finance entity of RMB740,733 and RMB223,548, respectively. During the year ended June 30, 2018, net amount of RMB679,018 were placed with Hailiang Finance. During the years ended June 30, 2017 and 2019, net amount of RMB109,998 and RMB517,185 were withdrawn from Hailiang Finance, respectively. The cash held at a related party finance entity is held for the purpose of meeting short-term cash commitments, such as to pay for the Group’s operating expenses at any time.During the years ended June 30, 2017, 2018 and 2019, term deposits of RMB1,953,600, RMB204,000 and RMB4,709,697 were placed with Hailiang Finance, and RMB1,552,600, RMB401,000 and RMB3,526,603 were matured, respectively. The term deposits are held for investment purpose and can be withdrawn prior to their maturity without incurring significant penalties. Such amounts have been presented as investing activities in the statements of cash flows.As of June 30, 2018 and 2019, the Group has term deposits with maturities ranging from three months to one year amounting to RMB204,000 and RMB1,387,094 that are placed at Hailiang Finance, respectively.The interest income from the deposits during the years ended June 30, 2017, 2018 and 2019 amounted to RMB5,847, RMB11,464 and RMB24,313, respectively. Interest receivable as of June 30, 2018 and 2019 amounted to RMB1,038 and RMB4,916 respectively. |
Cash and cash equivalents - Add
Cash and cash equivalents - Additional Information (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | 24 Months Ended | |||||||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2019 | Jun. 30, 2016 | ||||
Cash and Equivalents [Line Items] | |||||||||
Cash and cash equivalents | ¥ 260,684 | ¥ 260,684 | ¥ 812,620 | ¥ 77,801 | ¥ 260,684 | ¥ 291,011 | |||
Reconciliation of liabilities arising from financing activities | |||||||||
Beginning balance | 99,603 | 99,603 | |||||||
Changes from financing cash flows: | |||||||||
Proceeds from a loan from a related party | 0 | [1] | 7,609 | [1] | 99,603 | [1] | 7,609 | ||
Dividends declared to be payable to a non-controlling shareholder of subsidiaries | 7,482 | 7,482 | |||||||
Dividends paid to a non-controlling shareholder of subsidiaries | (7,482) | 0 | 0 | ||||||
Total changes from financing cash flows | 7,609 | ||||||||
Other non-cash change: | |||||||||
Net settlement of a loan made to a related party with a loan borrowed from a related party | 0 | (7,609) | 0 | (7,609) | |||||
Total other non-cash change | (7,609) | ||||||||
Ending balance | 99,603 | 99,603 | ¥ 99,603 | 99,603 | |||||
Group denominated [member] | |||||||||
Cash and Equivalents [Line Items] | |||||||||
Cash and cash equivalents | ¥ 248,438 | ¥ 248,438 | ¥ 799,147 | ¥ 248,438 | |||||
[1] | On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid.On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit.During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company.As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. |
Capital and reserve - Share Cap
Capital and reserve - Share Capital and Share Premium (Details) - shares | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2014 | Dec. 31, 2013 | Mar. 12, 2012 | Apr. 07, 2011 |
Capital and reserve | |||||||
Number of shares authorised | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 365,000,000 | 365,000,000 | 360,000,000 |
Number of shares outstanding | 412,450,256 | 412,450,256 | 411,208,000 |
Capital and reserve - Additiona
Capital and reserve - Additional Information (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands, $ in Thousands | Dec. 15, 2017 | Mar. 12, 2012USD ($)shares | Mar. 12, 2012CNY (¥)shares | Sep. 30, 2015USD ($) | Sep. 30, 2015CNY (¥) | Jul. 31, 2015CNY (¥) | Nov. 30, 2011CNY (¥) | Jun. 30, 2019HKD ($) | Jun. 30, 2019CNY (¥) | Jun. 30, 2018CNY (¥)shares | Jun. 30, 2017CNY (¥)shares | Jun. 30, 2016CNY (¥) | Jun. 30, 2012shares | Jun. 30, 2011CNY (¥) | Jun. 30, 2019USD ($)shares | Jun. 30, 2019CNY (¥)shares | Jul. 31, 2015$ / sharesshares | Jul. 31, 2015¥ / sharesshares | Dec. 31, 2014shares | Dec. 31, 2013shares | Apr. 30, 2012CNY (¥) | Apr. 07, 2011shares | Jul. 31, 2009 | Jun. 30, 2001 |
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Number of shares authorised | shares | 365,000,000 | 365,000,000 | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 365,000,000 | 360,000,000 | |||||||||||||||
Number of ordinary share in exchange of each other share | shares | 16 | 16 | ||||||||||||||||||||||
Par value per share | $ / shares | $ 0.0001 | |||||||||||||||||||||||
Number of instruments granted in share-based payment arrangement | 480,000 | 480,000 | ||||||||||||||||||||||
Value of instruments granted in share-based payment arrangement | $ 229 | ¥ 1,459 | ||||||||||||||||||||||
Proceeds from issuing shares | ¥ 122,369 | |||||||||||||||||||||||
Share issue related cost | ¥ 9,551 | |||||||||||||||||||||||
Par value of ordinary shares issued to public | ¥ / shares | ¥ 28 | |||||||||||||||||||||||
Net proceeds from issuing shares | ¥ 112,790 | |||||||||||||||||||||||
Contributed registered capital | ¥ 41,000 | ¥ 82,800 | ||||||||||||||||||||||
Proceeds from contributions of non-controlling interests | ¥ 1,459 | 32,906 | ¥ 139 | ¥ 11,000 | ¥ 0 | |||||||||||||||||||
Charge to deduct capital | 8,094 | |||||||||||||||||||||||
Capital contribution | 235,895 | 251,034 | ||||||||||||||||||||||
Description of annual appropriation for general reserve | general reserve requires annual appropriation 10% of after-tax profits at each year-end until the balance reaches 50% of the PRC company's registered capital | general reserve requires annual appropriation 10% of after-tax profits at each year-end until the balance reaches 50% of the PRC company's registered capital | ||||||||||||||||||||||
General reserve | 20,096 | 43,024 | ||||||||||||||||||||||
Education development reserve, percentage | 25.00% | 25.00% | ||||||||||||||||||||||
Education development reserve | 284,427 | 306,436 | ||||||||||||||||||||||
Dividend declared and paid | ¥ 0 | ¥ 0 | 0 | |||||||||||||||||||||
warrants [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Number of other equity instruments exercised or vested in share-based payment arrangement | 1,242,256 | |||||||||||||||||||||||
American depositary shares [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Public offering price per share | $ / shares | $ 7 | |||||||||||||||||||||||
Issue of equity in number | shares | 2,858,000 | 2,858,000 | ||||||||||||||||||||||
American depositary shares [Member] | warrants [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Number of other equity instruments exercised or vested in share-based payment arrangement | 77,641 | |||||||||||||||||||||||
Share capital | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Issue of equity in number | shares | 45,728,000 | 45,728,000 | ||||||||||||||||||||||
Non-controlling interests | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Consideration For Acquisition Equity Interest | 32,906 | |||||||||||||||||||||||
Hailiang HK [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Proceeds from contributions of non-controlling interests | $ 10 | ¥ 9 | ||||||||||||||||||||||
Mr. Feng [member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Share deficit | ¥ 236 | |||||||||||||||||||||||
Net proceeds from issuing shares | ¥ 0 | |||||||||||||||||||||||
Deemed capital contribution | ¥ 15,000 | |||||||||||||||||||||||
Hailiang Education Investment Group Co Ltd [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Capital contribution | ¥ 10,000 | ¥ 139,980 | ||||||||||||||||||||||
Beize Group [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Percentage of contribution to registered capital | 0.10% | 0.10% | ||||||||||||||||||||||
Capital contribution | ¥ 139 | |||||||||||||||||||||||
Independent Appraiser [member] | Network 1 Financial Securities, Inc. [member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Fair Value of Adjustment of Warrants | ¥ 1,707 | |||||||||||||||||||||||
Maxida International Company Limited [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Increase (decrease) in number of ordinary shares issued | shares | 5,000,000 | 5,000,000 | 18,864 | |||||||||||||||||||||
Proceeds from issue of ordinary shares | $ 3,000 | ¥ 18,867 | ||||||||||||||||||||||
Proportion of equity interest held by third party | 1.40% | 1.40% | ||||||||||||||||||||||
Foreign Language [member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Percentage of contribution to registered capital | 100.00% | 100.00% | ||||||||||||||||||||||
Tianma Experimental School [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Consideration transferred, acquisition-date fair value | 6,000 | |||||||||||||||||||||||
Percentage of voting equity interests acquired | 80.00% | |||||||||||||||||||||||
Financial assets recognised as of acquisition date | ¥ 4,116 | |||||||||||||||||||||||
Percentage of Noncontrolling Interests Acquired | 20.00% | |||||||||||||||||||||||
Consideration For Acquisition Equity Interest | $ | $ 110,000 | |||||||||||||||||||||||
Three Schools [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Percentage of contribution to registered capital | 100.00% | |||||||||||||||||||||||
Equity interest transferred , Cash Consideration | ¥ 139,800 | |||||||||||||||||||||||
Hailiang Experimental High School (Experimental High) [Member] | ||||||||||||||||||||||||
Disclosure Of Capital and reserve [Line Items] | ||||||||||||||||||||||||
Consideration transferred, acquisition-date fair value | ¥ 35,000 | |||||||||||||||||||||||
Percentage of voting equity interests acquired | 60.00% | |||||||||||||||||||||||
Financial assets recognised as of acquisition date | ¥ 28,790 | |||||||||||||||||||||||
Percentage of Noncontrolling Interests Acquired | 40.00% |
Non-controlling interests (Deta
Non-controlling interests (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disclosure Of Non controlling Interest [Line Items] | |||
Balance at June 30, 2018 | ¥ 13,154 | ||
Acquisition through a business combination, including deemed cash consideration to NCI | 9,408 | ||
Net profit/(loss) and total comprehensive income attributable to NCI | 22,359 | ¥ 8,314 | ¥ 0 |
Dividend paid to NCI | (7,482) | ||
Balance at June 30, 2019 | 37,439 | 13,154 | |
Haibo Education [Member] | |||
Disclosure Of Non controlling Interest [Line Items] | |||
Balance at June 30, 2018 | 9,390 | ||
Acquisition through a business combination, including deemed cash consideration to NCI | 0 | ||
Net profit/(loss) and total comprehensive income attributable to NCI | 19,535 | 6,750 | |
Dividend paid to NCI | (6,075) | ||
Balance at June 30, 2019 | 22,850 | 9,390 | |
Haibo Logistic [Member] | |||
Disclosure Of Non controlling Interest [Line Items] | |||
Balance at June 30, 2018 | 3,764 | ||
Acquisition through a business combination, including deemed cash consideration to NCI | 0 | ||
Net profit/(loss) and total comprehensive income attributable to NCI | 3,808 | ||
Dividend paid to NCI | (1,407) | ||
Balance at June 30, 2019 | 6,165 | 3,764 | |
Zhenjiang Jianghe High School of Art [Member] | |||
Disclosure Of Non controlling Interest [Line Items] | |||
Balance at June 30, 2018 | 0 | ||
Acquisition through a business combination, including deemed cash consideration to NCI | 9,408 | ||
Net profit/(loss) and total comprehensive income attributable to NCI | (984) | ||
Dividend paid to NCI | 0 | ||
Balance at June 30, 2019 | ¥ 8,424 | ¥ 0 |
Non-controlling interests - Sum
Non-controlling interests - Summarized financial information and additional information (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Non-controlling interest Considered material | ||||
Current assets | ¥ 1,772,771 | ¥ 1,772,771 | ¥ 1,126,930 | |
Non-current assets | 730,141 | 730,141 | 757,920 | |
Current liabilities | 806,395 | 806,395 | 550,037 | |
Revenues | 1,499,025 | 1,169,348 | ¥ 853,295 | |
Net profit for the year | 315,780 | 315,780 | 230,902 | 167,743 |
Total comprehensive income | 319,090 | 319,090 | 228,360 | 169,945 |
Net profit and total comprehensive income attributable to NCI | 22,359 | 8,314 | 0 | |
Dividend paid to NCI | 7,482 | |||
Cash flows from operating activities | 690,317 | 587,931 | 286,953 | |
Cash flows generated from /(used in) investing activities | (1,234,206) | 131,145 | (602,251) | |
Cash flows generated from /(used in) financing activities | ¥ (7,343) | ¥ 18,609 | ¥ 99,603 | |
Haibo Logistic [Member] | ||||
Non-controlling interest Considered material | ||||
Proportion of ownership interests held by non-controlling interests | 44.00% | |||
Net profit and total comprehensive income attributable to NCI | ¥ 3,808 | |||
Dividend paid to NCI | ¥ 1,407 | |||
Haibo Education [Member] | ||||
Non-controlling interest Considered material | ||||
Proportion of ownership interests held by non-controlling interests | 44.00% | 44.00% | ||
Current assets | 61,639 | ¥ 61,639 | ¥ 41,577 | |
Non-current assets | 1,540 | 1,540 | 22 | |
Current liabilities | 11,248 | 11,248 | 20,259 | |
Net assets | 51,931 | 51,931 | 21,340 | |
Carrying amount of NCI | ¥ 22,850 | 22,850 | 9,390 | |
Revenues | 87,655 | 35,532 | ||
Net profit for the year | 44,397 | 15,340 | ||
Total comprehensive income | 44,397 | 15,340 | ||
Net profit and total comprehensive income attributable to NCI | 19,535 | 6,750 | ||
Dividend paid to NCI | 6,075 | |||
Cash flows from operating activities | 32,649 | 35,462 | ||
Cash flows generated from /(used in) investing activities | (41,603) | 14 | ||
Cash flows generated from /(used in) financing activities | ¥ (13,806) | ¥ 6,000 | ||
Zhenjiang Jianghe High School of Art [Member] | ||||
Non-controlling interest Considered material | ||||
Proportion of ownership interests held by non-controlling interests | 49.00% | |||
Net profit and total comprehensive income attributable to NCI | ¥ (984) | |||
Dividend paid to NCI | ¥ 0 |
Trade and other payables (Detai
Trade and other payables (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 | |
Trade and other payables | |||
Trade payable | ¥ 20,556 | ¥ 22,309 | |
Accrued payroll | 130,744 | 68,351 | |
Amounts due to third parties | 66,822 | 50,844 | |
Trade and other payables due to third parties | 218,122 | 141,504 | |
Loans due to related parties | 99,603 | 99,603 | |
Amounts due to related parties | 35,142 | 38,612 | |
Other payables due to related parties | [1],[2],[3],[4],[5],[6] | 134,745 | 138,215 |
Total | ¥ 352,867 | ¥ 279,719 | |
[1] | During the years ended June 30, 2017, 2018 and 2019, the Group paid expenses, which mainly include staff related expenses, start-up costs and other miscellaneous expenses, of nil, RMB 9,401 and RMB10,312 respectively on behalf of the related parties. Such amount is receivable on demand, and the related parties repaid nil, RMB8,794 and RMB10,007 to the Group during the years ended June 30, 2017, 2018 and 2019, respectively.During the years ended June 30, 2017, 2018 and 2019, the related parties paid expenses, which mainly include staff related expenses and other miscellaneous expenses, of RMB3,836, RMB4,612 and RMB2,731 respectively on behalf of the Group. Such amount is due and payable on demand, and the Group repaid RMB4,536, RMB4,124 and RMB 4,663 to the related parties during the years ended June 30, 2017, 2018 and 2019, respectively.During the years ended June 30, 2017, 2018 and 2019, the Group collected amounts of RMB39,760, RMB47,070, and RMB46,453 on behalf of Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., a related party controlled by Mr. Feng. Such amount is due and payable on demand, and the Group repaid RMB37,541, RMB48,428 and RMB47,429 to Zhejiang Ming Kang Hui Food Co., Ltd. during the years ended June 30, 2017, 2018 and 2019, respectively.The above unsettled balances were included in “Amount due to related parties” and “Amount due from related parties” as of June 30, 2018 and 2019, respectively. | ||
[2] | On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid.On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit.During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company.As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. | ||
[3] | The Group entered into a series of leasehold improvement contracts with Heng Zhong Da Construction Limited Company (“Heng Zhong Da"), a company over which Mr. Feng has significant influence, for the leasehold improvement of classroom buildings, dining halls, student dormitories.During the years ended June 30, 2017, 2018 and 2019, the Group purchased leasehold improvement service from Heng Zhong Da of RMB37,231, RMB29,098 and RMB29,669, respectively.As of June 30, 2018 and 2019, the above unsettled balances of RMB19,508 and RMB11,260 were recognized in “Amount due to related parties”. | ||
[4] | The Group leases the school buildings and the related facilities in three campuses from Hailiang Investment, a related party controlled by Mr. Feng. In addition, Haibo Education and Haibo Logistics lease the office space and warehouse from Nanchang Hongtou Property Management Co., Ltd. (“Nanchang Hongtou”), a related party owned by Mr. Honggen Min, who is the controlling shareholder of Nanchang Baishu. The Group also leases some office spaces from Hangzhou Hailiang Real Estate Co., Ltd. (“Hailiang Real Estate”), a related party controlled by Mr. Feng. | ||
[5] | The Group purchased food products from Zhejiang Ming Kang Hui E-Commerce Co., Ltd. and Ming Kang Hui Ecological Agriculture Group Co., Ltd. (collectively referred as “Ming Kang Hui”), two companies controlled by Mr. Feng, amounting to RMB48,298, RMB38,323 and RMB68,963 during the years ended June 30, 2017, 2018 and 2019, respectively.As of June 30, 2018 and 2019, the above unsettled balances of RMB5,386 and RMB18,516 were recognized in “Amount due to related parties”. | ||
[6] | The Group received IT services, physical examination services, travel services and other services from related parties controlled by Hailiang Group, amounting to nil, RMB6,884 and RMB23,263 during the years ended June 30, 2017, 2018 and 2019.As of June 30, 2018 and 2019, the above unsettled balances of RMB3,416 and RMB420 were recognized in “Amount due to related parties”. |
Financial risk management and_3
Financial risk management and fair values (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 |
Financial risk management and fair values | ||
Carrying amount | ¥ 352,867 | ¥ 279,719 |
Contractual cash flows | 352,867 | 279,719 |
1 year or less | ¥ 352,867 | ¥ 279,719 |
Financial risk management and_4
Financial risk management and fair values - Additional Information (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||||
Jun. 30, 2019CNY (¥) | Jun. 30, 2018CNY (¥) | Sep. 30, 2019CNY (¥) | Jun. 30, 2019HKD ($) | Jun. 30, 2019CNY (¥) | ||
Financial risk management and fair values [Line Items] | ||||||
Cash held at a related party finance entity | [1] | ¥ 740,733 | ¥ 223,548 | |||
Term deposits held by related party | [1] | 204,000 | ¥ 1,387,094 | |||
Percentage of consolidated current assets | 91.00% | 91.00% | ||||
Annual budget for the aggregate amount deposit with Hailiang Finance | ¥ 2,100,000 | |||||
Borrowings, interest rate basis | 10 | |||||
Transfers out of Level 1 into Level 2 of fair value hierarchy, assets held at end of reporting period | ¥ 0 | 0 | ||||
Transfers out of Level 2 into Level 1 of fair value hierarchy, assets held at end of reporting period | 0 | 0 | ||||
Transfers into Level 3 of fair value hierarchy, assets | 0 | 0 | ||||
Transfers out of Level 3 of fair value hierarchy, assets | 0 | 0 | ||||
Transfers out of Level 1 into Level 2 of fair value hierarchy, liabilities held at end of reporting period | 0 | 0 | ||||
Transfers out of Level 2 into Level 1 of fair value hierarchy, liabilities held at end of reporting period | 0 | 0 | ||||
Transfers into Level 3 of fair value hierarchy, liabilities | 0 | 0 | ||||
Transfers out of Level 3 of fair value hierarchy, liabilities | ¥ 0 | ¥ 0 | ||||
Minimum [member] | ||||||
Financial risk management and fair values [Line Items] | ||||||
Interest rate on bank deposits | 0.30% | 0.35% | ||||
Maximum [member] | ||||||
Financial risk management and fair values [Line Items] | ||||||
Interest rate on bank deposits | 2.10% | 1.82% | ||||
China [member] | ||||||
Financial risk management and fair values [Line Items] | ||||||
Bank Deposits, Government Authority Insured Amount | ¥ 500 | |||||
Hong Kong [member] | ||||||
Financial risk management and fair values [Line Items] | ||||||
Bank Deposits, Government Authority Insured Amount | $ | $ 500 | |||||
[1] | As of June 30, 2018 and 2019, the Group has cash held at a related party finance entity of RMB740,733 and RMB223,548, respectively. During the year ended June 30, 2018, net amount of RMB679,018 were placed with Hailiang Finance. During the years ended June 30, 2017 and 2019, net amount of RMB109,998 and RMB517,185 were withdrawn from Hailiang Finance, respectively. The cash held at a related party finance entity is held for the purpose of meeting short-term cash commitments, such as to pay for the Group’s operating expenses at any time.During the years ended June 30, 2017, 2018 and 2019, term deposits of RMB1,953,600, RMB204,000 and RMB4,709,697 were placed with Hailiang Finance, and RMB1,552,600, RMB401,000 and RMB3,526,603 were matured, respectively. The term deposits are held for investment purpose and can be withdrawn prior to their maturity without incurring significant penalties. Such amounts have been presented as investing activities in the statements of cash flows.As of June 30, 2018 and 2019, the Group has term deposits with maturities ranging from three months to one year amounting to RMB204,000 and RMB1,387,094 that are placed at Hailiang Finance, respectively.The interest income from the deposits during the years ended June 30, 2017, 2018 and 2019 amounted to RMB5,847, RMB11,464 and RMB24,313, respectively. Interest receivable as of June 30, 2018 and 2019 amounted to RMB1,038 and RMB4,916 respectively. |
Acquisition of business (Detail
Acquisition of business (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | 8 Months Ended | 12 Months Ended | |||
Nov. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2019 | Oct. 31, 2018 | Sep. 28, 2018 | Jun. 30, 2018 | |
Disclosure of detailed information about business combination [line items] | ||||||
Consolidated revenue | ¥ 1,500,496 | |||||
Consolidated profit | 314,513 | |||||
Goodwill | ¥ 61,640 | ¥ 61,640 | ¥ 61,640 | |||
Zhenjiang Jianghe High School of Art [Member] | ||||||
Disclosure of detailed information about business combination [line items] | ||||||
Percentage of voting equity interests acquired | 51.00% | |||||
Post-acquisition revenue | 5,018 | |||||
Post-acquisition net loss | ¥ (2,009) | |||||
Percentage of equity interests | 49.00% | |||||
Consideration transferred | ||||||
Cash consideration paid to former shareholders | ¥ 1,530 | |||||
Deemed cash consideration to former shareholders | 5,248 | |||||
Total consideration | ¥ 10,710 | 6,778 | ||||
Identifiable assets acquired and liabilities assumed as of the date of acquisition | ||||||
Cash and cash equivalents | 903 | |||||
Other current assets | 16 | |||||
Property and equipment, net | 12,726 | |||||
Intangible assets | 18,091 | |||||
Trade and other payables | (14,445) | |||||
Contract liabilities | (1,830) | |||||
Deferred tax liabilities recognised as of acquisition date | (4,523) | |||||
Total identifiable net assets acquired | 10,938 | |||||
Non-controlling interests arising from the acquisition | (4,160) | |||||
Total consideration | 10,710 | 6,778 | ||||
Analysis of the net cash outflow in respect of the acquisition | ||||||
Cash consideration | ¥ 10,710 | 6,778 | ||||
Less: Deemed cash consideration to former shareholders | (5,248) | |||||
Cash acquired | (903) | |||||
Cash transferred | ¥ 627 |
Related parties transactions (D
Related parties transactions (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | 24 Months Ended | ||||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2019 | |||||
Related parties transactions | ||||||||
Loans borrowed from a related party | ¥ 0 | [1] | ¥ 7,609 | [1] | ¥ 99,603 | [1] | ¥ 7,609 | |
A loan made to a related party | [1] | 0 | 0 | 98,229 | ||||
Repayment of a loan made to a related party | [1] | 12,412 | 0 | 0 | ||||
Interest income from deposits placed with a related party finance entity | [2] | 24,313 | 11,464 | 5,847 | ||||
Net (withdrawals)/deposits of cash at a related party finance entity | [2] | (517,185) | 679,018 | (109,998) | ||||
Term deposits placed with a related party finance entity | [2] | 4,709,697 | 204,000 | 1,953,600 | ||||
Maturity of term deposits placed with a related party finance entity | [2] | 3,526,603 | 401,000 | 1,552,600 | ||||
Rental expenses | [3] | 33,814 | 32,486 | 30,030 | ||||
Payments of expenses by the Group on behalf of related parties | [4] | 10,312 | 9,401 | 0 | ||||
Payments of expenses by related parties on behalf of the Group | [4] | 2,731 | 4,612 | 3,836 | ||||
Collection by the Group on behalf of related parties | [4] | 46,453 | 47,070 | 39,760 | ||||
Purchase of leasehold improvement from a related party | [5] | 29,669 | 29,098 | 37,231 | ||||
Purchase of food products from related parties | [6] | 68,963 | 38,323 | 48,298 | ||||
Education and management service provided to related parties | [7] | 33,222 | 16,831 | 3,766 | ||||
Other service and product provided to related parties | [8] | 3,254 | 416 | 0 | ||||
Service provided by related parties | [9] | 23,263 | 6,884 | 0 | ||||
Waive of liability to a related party | [3] | 0 | 0 | 10,000 | ||||
Gains from disposal of affiliated entities to a related party | [10] | 0 | 5,349 | 0 | ||||
Acquisition of subsidiaries | 627 | 6,160 | [11] | 0 | [11] | |||
Dividends paid to a non-controlling shareholder of subsidiaries | [11] | 7,482 | 0 | 0 | ||||
Capital contribution | [12] | 15,000 | 0 | ¥ 0 | 15,000 | |||
Amounts due from related parties | [1],[2],[3],[4],[7],[8] | 91,674 | 95,128 | 91,674 | ||||
Cash held at a related party finance entity | [2] | 223,548 | 740,733 | 223,548 | ||||
Term deposits placed with a related party finance entity | [2] | 1,387,094 | 204,000 | 1,387,094 | ||||
Amount due to related parties | [1],[3],[4],[5],[6],[9] | ¥ 134,745 | ¥ 138,215 | ¥ 134,745 | ||||
[1] | On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid.On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit.During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company.As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. | |||||||
[2] | As of June 30, 2018 and 2019, the Group has cash held at a related party finance entity of RMB740,733 and RMB223,548, respectively. During the year ended June 30, 2018, net amount of RMB679,018 were placed with Hailiang Finance. During the years ended June 30, 2017 and 2019, net amount of RMB109,998 and RMB517,185 were withdrawn from Hailiang Finance, respectively. The cash held at a related party finance entity is held for the purpose of meeting short-term cash commitments, such as to pay for the Group’s operating expenses at any time.During the years ended June 30, 2017, 2018 and 2019, term deposits of RMB1,953,600, RMB204,000 and RMB4,709,697 were placed with Hailiang Finance, and RMB1,552,600, RMB401,000 and RMB3,526,603 were matured, respectively. The term deposits are held for investment purpose and can be withdrawn prior to their maturity without incurring significant penalties. Such amounts have been presented as investing activities in the statements of cash flows.As of June 30, 2018 and 2019, the Group has term deposits with maturities ranging from three months to one year amounting to RMB204,000 and RMB1,387,094 that are placed at Hailiang Finance, respectively.The interest income from the deposits during the years ended June 30, 2017, 2018 and 2019 amounted to RMB5,847, RMB11,464 and RMB24,313, respectively. Interest receivable as of June 30, 2018 and 2019 amounted to RMB1,038 and RMB4,916 respectively. | |||||||
[3] | The Group leases the school buildings and the related facilities in three campuses from Hailiang Investment, a related party controlled by Mr. Feng. In addition, Haibo Education and Haibo Logistics lease the office space and warehouse from Nanchang Hongtou Property Management Co., Ltd. (“Nanchang Hongtou”), a related party owned by Mr. Honggen Min, who is the controlling shareholder of Nanchang Baishu. The Group also leases some office spaces from Hangzhou Hailiang Real Estate Co., Ltd. (“Hailiang Real Estate”), a related party controlled by Mr. Feng. | |||||||
[4] | During the years ended June 30, 2017, 2018 and 2019, the Group paid expenses, which mainly include staff related expenses, start-up costs and other miscellaneous expenses, of nil, RMB 9,401 and RMB10,312 respectively on behalf of the related parties. Such amount is receivable on demand, and the related parties repaid nil, RMB8,794 and RMB10,007 to the Group during the years ended June 30, 2017, 2018 and 2019, respectively.During the years ended June 30, 2017, 2018 and 2019, the related parties paid expenses, which mainly include staff related expenses and other miscellaneous expenses, of RMB3,836, RMB4,612 and RMB2,731 respectively on behalf of the Group. Such amount is due and payable on demand, and the Group repaid RMB4,536, RMB4,124 and RMB 4,663 to the related parties during the years ended June 30, 2017, 2018 and 2019, respectively.During the years ended June 30, 2017, 2018 and 2019, the Group collected amounts of RMB39,760, RMB47,070, and RMB46,453 on behalf of Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., a related party controlled by Mr. Feng. Such amount is due and payable on demand, and the Group repaid RMB37,541, RMB48,428 and RMB47,429 to Zhejiang Ming Kang Hui Food Co., Ltd. during the years ended June 30, 2017, 2018 and 2019, respectively.The above unsettled balances were included in “Amount due to related parties” and “Amount due from related parties” as of June 30, 2018 and 2019, respectively. | |||||||
[5] | The Group entered into a series of leasehold improvement contracts with Heng Zhong Da Construction Limited Company (“Heng Zhong Da"), a company over which Mr. Feng has significant influence, for the leasehold improvement of classroom buildings, dining halls, student dormitories.During the years ended June 30, 2017, 2018 and 2019, the Group purchased leasehold improvement service from Heng Zhong Da of RMB37,231, RMB29,098 and RMB29,669, respectively.As of June 30, 2018 and 2019, the above unsettled balances of RMB19,508 and RMB11,260 were recognized in “Amount due to related parties”. | |||||||
[6] | The Group purchased food products from Zhejiang Ming Kang Hui E-Commerce Co., Ltd. and Ming Kang Hui Ecological Agriculture Group Co., Ltd. (collectively referred as “Ming Kang Hui”), two companies controlled by Mr. Feng, amounting to RMB48,298, RMB38,323 and RMB68,963 during the years ended June 30, 2017, 2018 and 2019, respectively.As of June 30, 2018 and 2019, the above unsettled balances of RMB5,386 and RMB18,516 were recognized in “Amount due to related parties”. | |||||||
[7] | Pursuant to the strategic cooperation agreement signed with Hailiang Group and Hailiang investment, the Group provided education and management services to Hailiang Kindgarten, Zhuji Hailiang Jinshan Kindgarten and Tianma Kindgarten, which were controlled by Hailiang Group, and other 19 schools controlled by Hailiang Investment, including Xiantao No.1 Middle School, Xinchang Nanrui Experimental School, Feicheng Hailiang Foreign Language school, Jinhua Hailiang Foreign Language School and etc.. Education and management service fees of nil, RMB12,275 and RMB28,344 were charged to the abovementioned schools during the years ended June 30, 2017, 2018 and 2019, respectively.The Group provided service to Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., controlled by Mr. Feng, in the Group’s campuses, amounting to RMB3,766, RMB4,556 and RMB4,878 during the years ended June 30, 2017, 2018 and 2019, respectively. | |||||||
[8] | Other service and product provided to related parties mainly include daily consumables sold to related parties, hotel services and etc. | |||||||
[9] | The Group received IT services, physical examination services, travel services and other services from related parties controlled by Hailiang Group, amounting to nil, RMB6,884 and RMB23,263 during the years ended June 30, 2017, 2018 and 2019.As of June 30, 2018 and 2019, the above unsettled balances of RMB3,416 and RMB420 were recognized in “Amount due to related parties”. | |||||||
[10] | (x) The gains were recognized from disposal of Hailiang Kindergarten, Tianma Kindergarten and Chuzhou School (see Note 8 (iii) for additional details), amounting to RMB3,285, RMB1,683 and RMB381 during the year ended June 30, 2018, respectively. | |||||||
[11] | In August 2017, Haibo Education and Haibo Logistics were incorporated by Xinyu Baishu Technology Service Co., Ltd. (“Xinyu Baishu”), an entity ultimately controlled by Mr. Feng. The contributed capitals from Xinyu Baishu in Haibo Education and Haibo Logistics were RMB6,000 and RMB5,000, respectively. In January 2018, Xinyu Baishu transferred 56% equity interests in each of Haibo Education and Haibo Logistics to Ningbo Haoliang with considerations of RMB3,360 and RMB2,800, respectively. The considerations were equivalent to the cost of 56% of the contributed capital.In January 2018, Xinyu Baishu also transferred the remaining 44% equity interest in Haibo Education and Haibo Logistics to Nanchang Baishu, a related party of the Company. The 44% equity interests owned by Nanchang Baishu were recorded as non-controlling interests (see note 16).In November 2018, Haibo Education and Haibo Logistics declared and fully paid dividends amounting to RMB6,075 and RMB 1,407 to Nanchang Baishu, respectively (see note 16). | |||||||
[12] | Mr. Feng, paid awards of RMB 15,000 to the Group's outstanding teachers to recognize their outstanding performance and contributions during the year ended June 30, 2019. The transaction is accounted for as a deemed contribution from a controlling shareholder. |
Related parties transactions -
Related parties transactions - Leasing terms and rental (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Disclosure of related party [Line Items] | ||||
Rental expense | [1] | ¥ 33,814 | ¥ 32,486 | ¥ 30,030 |
Hailiang Investment [Member] | ||||
Disclosure of related party [Line Items] | ||||
Rental expense | ¥ 31,504 | 30,965 | 30,030 | |
Leasing period | October 11, 2017 ~ June 30, 2037 | |||
Nanchang Hongtou [Member] | ||||
Disclosure of related party [Line Items] | ||||
Rental expense | ¥ 1,580 | 1,521 | 0 | |
Leasing period | July 1, 2017 ~ June 30, 2022 | |||
Hailiang Real estate [Member] | ||||
Disclosure of related party [Line Items] | ||||
Rental expense | ¥ 730 | ¥ 0 | ¥ 0 | |
Leasing period | June 11, 2018 ~ June 10, 2023 | |||
[1] | The Group leases the school buildings and the related facilities in three campuses from Hailiang Investment, a related party controlled by Mr. Feng. In addition, Haibo Education and Haibo Logistics lease the office space and warehouse from Nanchang Hongtou Property Management Co., Ltd. (“Nanchang Hongtou”), a related party owned by Mr. Honggen Min, who is the controlling shareholder of Nanchang Baishu. The Group also leases some office spaces from Hangzhou Hailiang Real Estate Co., Ltd. (“Hailiang Real Estate”), a related party controlled by Mr. Feng. |
Related parties transactions _2
Related parties transactions - Education and management service provided to related parties (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Disclosure of related party [Line Items] | ||||
Total | [1] | ¥ 33,222 | ¥ 16,831 | ¥ 3,766 |
Education And Management Service Provided To Managed Schools [Member] | ||||
Disclosure of related party [Line Items] | ||||
Revenue from rendering of services, related party transactions | 28,344 | 12,275 | 0 | |
Ming Kang Hui Supermarket Service Fee [Member] | ||||
Disclosure of related party [Line Items] | ||||
Revenue from rendering of services, related party transactions | ¥ 4,878 | ¥ 4,556 | ¥ 3,766 | |
[1] | Pursuant to the strategic cooperation agreement signed with Hailiang Group and Hailiang investment, the Group provided education and management services to Hailiang Kindgarten, Zhuji Hailiang Jinshan Kindgarten and Tianma Kindgarten, which were controlled by Hailiang Group, and other 19 schools controlled by Hailiang Investment, including Xiantao No.1 Middle School, Xinchang Nanrui Experimental School, Feicheng Hailiang Foreign Language school, Jinhua Hailiang Foreign Language School and etc.. Education and management service fees of nil, RMB12,275 and RMB28,344 were charged to the abovementioned schools during the years ended June 30, 2017, 2018 and 2019, respectively.The Group provided service to Ming Kang Hui supermarkets, which are operated by Zhejiang Ming Kang Hui Food Co., Ltd., controlled by Mr. Feng, in the Group’s campuses, amounting to RMB3,766, RMB4,556 and RMB4,878 during the years ended June 30, 2017, 2018 and 2019, respectively. |
Related parties transactions _3
Related parties transactions - Transactions with key management personnel (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Related parties transactions | |||
Short-term benefits | ¥ 5,713 | ¥ 8,162 | ¥ 7,614 |
Related parties transactions _4
Related parties transactions - Additional Information (Details) ¥ in Thousands, $ in Thousands | Dec. 05, 2017USD ($) | Dec. 05, 2017CNY (¥) | Nov. 30, 2018CNY (¥) | Jan. 31, 2018CNY (¥) | Aug. 31, 2017CNY (¥) | Oct. 31, 2016USD ($) | Oct. 31, 2016CNY (¥) | Jun. 30, 2019USD ($)item | Jun. 30, 2019CNY (¥)item | Jun. 30, 2018CNY (¥) | Jun. 30, 2017CNY (¥) | Jun. 30, 2019CNY (¥) | Jun. 30, 2019CNY (¥) | Jun. 30, 2018USD ($) | Jun. 30, 2018CNY (¥) | ||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Cash payments for loan made to related party | [1] | ¥ 0 | ¥ 0 | ¥ 98,229 | |||||||||||||||
Cash loans from related parties | 0 | [1] | 7,609 | [1] | 99,603 | [1] | ¥ 7,609 | ||||||||||||
Cash receipts from repayment of advances and loans made to related parties | 12,412 | 0 | 0 | ||||||||||||||||
Net deposits/(withdrawals) of cash at a related party finance entity | [2] | (517,185) | 679,018 | (109,998) | |||||||||||||||
Cash held at a related party finance entity | [2] | ¥ 223,548 | ¥ 740,733 | ||||||||||||||||
Cash payments for term deposits placed with related party finance entity | [2] | 4,709,697 | 204,000 | 1,953,600 | |||||||||||||||
Cash receipts of maturity of term deposits placed with related party finance entity | [2] | 3,526,603 | 401,000 | 1,552,600 | |||||||||||||||
Term deposits held by related party | [2] | 1,387,094 | 204,000 | ||||||||||||||||
Interest income on deposits | [2] | 24,313 | 11,464 | 5,847 | |||||||||||||||
Interest income receivable from term deposit | 4,916 | 1,038 | |||||||||||||||||
Purchase of leasehold improvement from a related party | [3] | 29,669 | 29,098 | 37,231 | |||||||||||||||
Service provided by related parties | [4] | 23,263 | 6,884 | 0 | |||||||||||||||
Staff, Start-up Cost and Other Miscellaneous Expense Paid on Behalf of Related Party | 10,312 | 9,401 | 0 | ||||||||||||||||
Repayment of expenses paid by the Group on behalf of a related party | 0 | 10,007 | 8,794 | ||||||||||||||||
Repayment of expenses paid by a related party on behalf of the Group | 4,536 | 4,663 | 4,124 | ||||||||||||||||
Staff, Start-up Cost and Other Miscellaneous Expense Paid By Related Party Transactions On Behalf Of Affiliates | 2,731 | 4,612 | 3,836 | ||||||||||||||||
Consideration percentage on contributed capital | 56.00% | ||||||||||||||||||
Capital Contribution, Related Party Transactions | [5] | 0 | 15,000 | 0 | |||||||||||||||
Haibo Logistics [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Contributed Capital From Former Shareholder | ¥ 5,000 | ||||||||||||||||||
Haibo Logistics [Member] | Nanchang Baishu [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Proportion of ownership interests held by non-controlling interests | 44.00% | ||||||||||||||||||
Dividends Paid to Related Party Transactions | ¥ 1,407 | ||||||||||||||||||
Haibo Logistics [Member] | Ningbo Haoliang [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Consideration paid (received) | ¥ 2,800 | ||||||||||||||||||
Ming Kang Hui [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Amount Received By Affiliates on Behalf Of Related Party Transactions | ¥ 46,453 | 47,070 | 39,760 | ||||||||||||||||
Amounts payable, related party transactions | 37,541 | 47,429 | 48,428 | ||||||||||||||||
Hailiang Education Investment Group Co Ltd [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Cash loan Due to related party outstanding | 99,603 | 99,603 | |||||||||||||||||
Rental fees waive of liability to a related party | 10,000 | ||||||||||||||||||
Number of schools | item | 19 | 19 | |||||||||||||||||
Education And Management Service Provided To Managed Schools [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Revenue from rendering of services, related party transactions | ¥ 28,344 | 12,275 | 0 | ||||||||||||||||
Tianma Experimental School [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Gains From Disposal Of Affiliated Entities To A Related Party | 1,683 | ||||||||||||||||||
Hailiang Kindergarten [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Gains From Disposal Of Affiliated Entities To A Related Party | 3,285 | ||||||||||||||||||
Chuzhou School [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Gains From Disposal Of Affiliated Entities To A Related Party | 381 | ||||||||||||||||||
Heng Zhong Da Leasehold Improvement Service [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Amounts payable, related party transactions | 11,260 | 19,508 | |||||||||||||||||
Services received, related party transactions | 29,669 | 29,098 | 37,231 | ||||||||||||||||
Mr.Feng [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Cash Payments For Purchase Of Healthy Food From Related Parties | 68,963 | 38,323 | 48,298 | ||||||||||||||||
Amounts payable, related party transactions | 18,516 | 5,386 | |||||||||||||||||
Capital Contribution, Related Party Transactions | 15,000 | ||||||||||||||||||
IT Services, Students Physical Examination Services, Travel Services and Other Service [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Amounts payable, related party transactions | 420 | 3,416 | |||||||||||||||||
Services received, related party transactions | 23,263 | 6,884 | 0 | ||||||||||||||||
Hong Kong Leonit Limited [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Cash payments for loan made to related party | $ 14,500 | ¥ 98,229 | |||||||||||||||||
Cash loans from related parties | $ 1,150 | ¥ 7,609 | ¥ 99,603 | ||||||||||||||||
Loan offset against the USD loan due | $ | $ 1,150 | ||||||||||||||||||
Cash receipts from repayment of advances and loans made to related parties | $ 1,820 | 12,412 | |||||||||||||||||
Cash loan Due from related party outstanding | $ 11,530 | 79,265 | $ 13,350 | 88,332 | |||||||||||||||
Hailiang Finance [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Net deposits/(withdrawals) of cash at a related party finance entity | 517,185 | 679,018 | 109,998 | ||||||||||||||||
Cash held at a related party finance entity | 223,548 | 740,733 | |||||||||||||||||
Cash payments for term deposits placed with related party finance entity | 4,709,697 | 204,000 | 1,953,600 | ||||||||||||||||
Cash receipts of maturity of term deposits placed with related party finance entity | ¥ 3,526,603 | ¥ 401,000 | ¥ 1,552,600 | ||||||||||||||||
Term deposits held by related party | ¥ 1,387,094 | ¥ 204,000 | |||||||||||||||||
Hailiang Finance [Member] | Minimum [member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Term deposit maturity period | 3 months | 3 months | 3 months | ||||||||||||||||
Hailiang Finance [Member] | Maximum [member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Term deposit maturity period | 1 year | 1 year | 1 year | ||||||||||||||||
Haibo Education [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Contributed Capital From Former Shareholder | ¥ 6,000 | ||||||||||||||||||
Haibo Education [Member] | Nanchang Baishu [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Dividends Paid to Related Party Transactions | ¥ 6,075 | ||||||||||||||||||
Haibo Education [Member] | Ningbo Haoliang [Member] | |||||||||||||||||||
Disclosure of related party [Line Items] | |||||||||||||||||||
Percentage of voting equity interests acquired | 56.00% | ||||||||||||||||||
Consideration paid (received) | ¥ 3,360 | ||||||||||||||||||
[1] | On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid.On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit.During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company.As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. | ||||||||||||||||||
[2] | As of June 30, 2018 and 2019, the Group has cash held at a related party finance entity of RMB740,733 and RMB223,548, respectively. During the year ended June 30, 2018, net amount of RMB679,018 were placed with Hailiang Finance. During the years ended June 30, 2017 and 2019, net amount of RMB109,998 and RMB517,185 were withdrawn from Hailiang Finance, respectively. The cash held at a related party finance entity is held for the purpose of meeting short-term cash commitments, such as to pay for the Group’s operating expenses at any time.During the years ended June 30, 2017, 2018 and 2019, term deposits of RMB1,953,600, RMB204,000 and RMB4,709,697 were placed with Hailiang Finance, and RMB1,552,600, RMB401,000 and RMB3,526,603 were matured, respectively. The term deposits are held for investment purpose and can be withdrawn prior to their maturity without incurring significant penalties. Such amounts have been presented as investing activities in the statements of cash flows.As of June 30, 2018 and 2019, the Group has term deposits with maturities ranging from three months to one year amounting to RMB204,000 and RMB1,387,094 that are placed at Hailiang Finance, respectively.The interest income from the deposits during the years ended June 30, 2017, 2018 and 2019 amounted to RMB5,847, RMB11,464 and RMB24,313, respectively. Interest receivable as of June 30, 2018 and 2019 amounted to RMB1,038 and RMB4,916 respectively. | ||||||||||||||||||
[3] | The Group entered into a series of leasehold improvement contracts with Heng Zhong Da Construction Limited Company (“Heng Zhong Da"), a company over which Mr. Feng has significant influence, for the leasehold improvement of classroom buildings, dining halls, student dormitories.During the years ended June 30, 2017, 2018 and 2019, the Group purchased leasehold improvement service from Heng Zhong Da of RMB37,231, RMB29,098 and RMB29,669, respectively.As of June 30, 2018 and 2019, the above unsettled balances of RMB19,508 and RMB11,260 were recognized in “Amount due to related parties”. | ||||||||||||||||||
[4] | The Group received IT services, physical examination services, travel services and other services from related parties controlled by Hailiang Group, amounting to nil, RMB6,884 and RMB23,263 during the years ended June 30, 2017, 2018 and 2019.As of June 30, 2018 and 2019, the above unsettled balances of RMB3,416 and RMB420 were recognized in “Amount due to related parties”. | ||||||||||||||||||
[5] | Mr. Feng, paid awards of RMB 15,000 to the Group's outstanding teachers to recognize their outstanding performance and contributions during the year ended June 30, 2019. The transaction is accounted for as a deemed contribution from a controlling shareholder. |
Commitments and contingencies -
Commitments and contingencies - Capital commitments (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 |
Contracted, but not provided for: | ||
Leasehold improvement | ¥ 12,525 | ¥ 14,988 |
Commitments and contingencies_2
Commitments and contingencies - Operating lease commitments (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 |
Commitments and Contingencies [Line Items] | ||
Minimum lease payments payable under non-cancellable operating lease | ¥ 688,424 | ¥ 676,248 |
within one year [member] | ||
Commitments and Contingencies [Line Items] | ||
Minimum lease payments payable under non-cancellable operating lease | 36,376 | 33,764 |
one year to five years [member] | ||
Commitments and Contingencies [Line Items] | ||
Minimum lease payments payable under non-cancellable operating lease | 155,254 | 145,016 |
Five years thereafter [member] | ||
Commitments and Contingencies [Line Items] | ||
Minimum lease payments payable under non-cancellable operating lease | ¥ 496,794 | ¥ 497,468 |
Subsequent events (Details)
Subsequent events (Details) - CNY (¥) ¥ in Thousands | Sep. 12, 2019 | Sep. 06, 2019 | Jul. 01, 2019 | Sep. 12, 2019 | Jul. 17, 2019 | Jul. 08, 2019 | May 21, 2019 |
Subsequent Events [Line Items] | |||||||
Prepayment of rental fee | ¥ 540,453 | ||||||
Payment of Rental Fees | ¥ 540,453 | ||||||
Subsequent event [member] | |||||||
Subsequent Events [Line Items] | |||||||
Prepayment of rental fee | ¥ 540,453 | ||||||
Payment of Rental Fees | ¥ 540,453 | ||||||
Subsequent event [member] | Seven Consolidated Entities or Schools, and Three of the Company Related Parties [Member] | |||||||
Subsequent Events [Line Items] | |||||||
Damages requested by the opposing party of the suit | ¥ 10,000 | ||||||
Subsequent event [member] | Ronghuai [Member] | Hailiang Group and Hailiang Senior Middle School [Member] | |||||||
Subsequent Events [Line Items] | |||||||
Damages claimed by the company | ¥ 3,000 | ||||||
Increase in damages claimed by the company | ¥ 7,500 | ||||||
Damages requested by the opposing party of the suit | ¥ 3,010 | ||||||
Increase in damages payable by the company | ¥ 7,510 |
Parent company financial stat_3
Parent company financial statement - Comprehensive Loss (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disclosure of transactions between related parties [line items] | ||||
Cost of revenue | ¥ (1,026,903) | ¥ (804,674) | ¥ (648,482) | |
Gross loss | 472,122 | 364,674 | 204,813 | |
Other income, net | 25,100 | 3,689 | 6,325 | |
Selling expenses | 25,003 | 24,539 | 21,902 | |
Operating loss | 399,558 | 280,450 | 160,851 | |
Loss before tax | 424,493 | 297,190 | 167,743 | |
Income tax expenses for the year | 108,713 | 66,288 | 0 | |
Loss | 315,780 | ¥ 315,780 | 230,902 | 167,743 |
Total comprehensive loss | 319,090 | ¥ 319,090 | 228,360 | 169,945 |
Parent [Member] | ||||
Disclosure of transactions between related parties [line items] | ||||
Cost of revenue | 0 | (2,299) | 0 | |
Gross loss | 0 | (2,299) | 0 | |
Administrative expenses | (8,176) | (9,124) | (4,148) | |
Operating loss | (8,176) | (11,423) | (4,148) | |
Net finance expenses | 0 | (17) | (8) | |
Loss before tax | (8,176) | (11,440) | (4,156) | |
Loss | (8,176) | (11,440) | (4,156) | |
Other comprehensive income /(loss)-foreign currency translation differences | 4,086 | (3,016) | 2,643 | |
Total comprehensive loss | ¥ (4,090) | ¥ (14,456) | ¥ (1,513) |
Parent company financial stat_4
Parent company financial statement - Financial Position (Details) - CNY (¥) ¥ in Thousands | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2016 |
Assets | ||||
Non-current assets | ¥ 730,141 | ¥ 757,920 | ||
Cash | 260,684 | 812,620 | ¥ 77,801 | ¥ 291,011 |
Current assets | 1,772,771 | 1,126,930 | ||
Total assets | 2,502,912 | 1,884,850 | ||
Shareholders' equity | ||||
Share capital | 268 | 268 | ||
Share premium | 134,583 | 134,583 | ||
Accumulated losses | 905,009 | 638,246 | ||
Total shareholders' equity | 1,689,247 | 1,334,813 | 1,101,613 | 921,668 |
Liabilities | ||||
Other payables due to related parties | 35,142 | 38,612 | ||
Current liabilities | 806,395 | 550,037 | ||
Total liabilities | 813,665 | 550,037 | ||
Total shareholders' equity and liabilities | 2,502,912 | 1,884,850 | ||
Parent [Member] | ||||
Assets | ||||
Other receivables due from subsidiaries | 24,994 | 20,330 | ||
Non-current assets | 24,994 | 20,330 | ||
Other receivables due from related parties | 79,265 | 86,997 | ||
Cash | 390 | 526 | ¥ 2,508 | ¥ 105,100 |
Current assets | 79,655 | 87,523 | ||
Total assets | 104,649 | 107,853 | ||
Shareholders' equity | ||||
Share capital | 268 | 268 | ||
Share premium | 134,583 | 134,583 | ||
Translation reserve | 13,195 | 9,110 | ||
Accumulated losses | (45,679) | (37,503) | ||
Total shareholders' equity | 102,367 | 106,458 | ||
Liabilities | ||||
Other payables due to third parties | 2,280 | 1,393 | ||
Other payables due to related parties | 2 | 2 | ||
Current liabilities | 2,282 | 1,395 | ||
Total liabilities | 2,282 | 1,395 | ||
Total shareholders' equity and liabilities | ¥ 104,649 | ¥ 107,853 |
Parent company financial stat_5
Parent company financial statement - Cash Flow (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | ||
Cash flows from operating activities | |||||
Loss for the year | ¥ 315,780 | ¥ 315,780 | ¥ 230,902 | ¥ 167,743 | |
Adjustments for: | |||||
Net cash used in operating activities | 690,317 | 587,931 | 286,953 | ||
Cash flows from investing activities | |||||
A Loan made to a related party | [1] | 0 | 0 | (98,229) | |
Net cash used in investing activities | (1,234,206) | 131,145 | (602,251) | ||
Cash flows from financing activities | |||||
Net cash from financing activities | (7,343) | 18,609 | 99,603 | ||
Net foreign exchange loss/(gain) | (704) | (2,866) | 2,485 | ||
Cash and cash equivalents at beginning of the year | 812,620 | 77,801 | 291,011 | ||
Cash and cash equivalents at the end of the year | 260,684 | 260,684 | 812,620 | 77,801 | |
Parent [Member] | |||||
Cash flows from operating activities | |||||
Loss for the year | (8,176) | (11,440) | (4,156) | ||
Adjustments for: | |||||
Change in other payables due to third parties | 887 | 1,393 | (1,851) | ||
Change in other payables due to a related party | 0 | 1 | (651) | ||
Change in other receivable due from subsidiaries | (4,664) | (152) | (347) | ||
Change in other receivable due from related parties | (201) | 3,623 | 0 | ||
Net cash used in operating activities | (12,154) | (6,575) | (7,005) | ||
Cash flows from investing activities | |||||
A Loan made to a related party | 0 | 0 | (98,229) | ||
Repayment of a loan from a related party | 12,412 | 0 | 0 | ||
Net cash used in investing activities | 12,412 | 0 | (98,229) | ||
Cash flows from financing activities | |||||
A Loan made from a related party | 0 | 7,609 | 0 | ||
Net cash from financing activities | 0 | 7,609 | 0 | ||
Net foreign exchange loss/(gain) | (394) | (3,016) | 2,642 | ||
Net decrease in cash | (136) | (1,982) | (102,592) | ||
Cash and cash equivalents at beginning of the year | 526 | 2,508 | 105,100 | ||
Cash and cash equivalents at the end of the year | ¥ 390 | 390 | 526 | 2,508 | |
Non cash transaction : | |||||
Net settlement of a loan made to a related party with a loan borrowed from a related party | ¥ 0 | ¥ (7,609) | ¥ 0 | ||
[1] | On October 31, 2016, the Company provided a one-year-period interest-free loan to Leonit, which is controlled by Hailiang Group, amounting to USD14,500 (equivalent to RMB98,229) (“USD Loan”). On the same date, Hailiang Consulting borrowed a one-year-period interest-free loan from Hailiang Group amounting to RMB99,603 (“RMB Loan”). On October 9, 2017, the Company agreed to extend the loan with Leonit, pursuant to which the USD Loan’s due date was extended to due on October 30, 2018 with renewal option if both parties agree. Similarly, Hailiang Group and Hailiang Consulting agreed to a loan extension pursuant to which the RMB Loan was due on October 30, 2018 with renewal option if both parties agree. Per the agreement among the four parties mentioned above, when the USD Loan is repaid, the RMB Loan will similarly be repaid.On December 5, 2017, the Company borrowed a one-year-period interest-free loan from Leonit amounting to USD1,150 (equivalent to RMB7,609). The loan of USD1,150 was offset against the USD loan per the agreement between the Company and Leonit.During the year ended June 30, 2019, Leonit cash settled part of the USD loan, amounting to USD 1,820 (equivalent to RMB12,412) to the Company.As of June 30, 2018 and 2019, the USD loan made to Leonit of USD 13,350 (equivalent to RMB 88,332) and USD11,530 (equivalent to RMB79,265) was included in “Amount due from related parties”, respectively, and the RMB loan borrowed from Hailiang Group of RMB99,603 and RMB99,603 was included in “Amount due to related parties”, respectively. |