HQ GLOBAL EDUCATION REPORTS RECORD THIRD QUARTER RESULTS
THIRD QUARTER NET INCOME GREW 127.82% COMPARED WITH THE SAME QUARTER LAST YEAR
ON AN 80.73% INCREASE IN REVENUES; NINE MONTH REVENUES ADVANCED 19.02% AND NET
INCOME GREW 20.57% COMPARED WITH THE CORRESPONDING PERIOD LAST YEAR
HQ Global Education Inc. (OTCBB: HQGE), which currently operates 10 vocational
schools in China under the widely known "HQ" brand and is one of China's leading
providers of customized or "order-oriented" vocational education, today
announced record results for its third quarter and nine months ended May 31,
2010.
Revenues in the Company's third fiscal quarter reached $17,235,916, an 80.73%
gain over revenues of $9,536,983 in the prior year third quarter. Net income
climbed to $5,548,960, from $2,435,720 in last year's third quarter. EPS, based
on 33,000,000 shares outstanding in the third quarter of fiscal year 2010 was
$0.17, compared with $0.15 per share on 20,500,000 shares outstanding in the
same period last year.
Through the first nine months of this fiscal year, revenues grew 19.02% to
$37,110,090 compared with $31,179,916 in the first nine months of the prior
fiscal year. Net income in the first nine months this year was $11,721,045, a
20.57% gain compared with $9,721,010 in the first nine months of the prior
fiscal year. EPS for the nine month ended May 31, 2010 was $0.46 on 25,673,993
shares outstanding, compared with $0.47 in the same period last year on the
basis of 20,500,000 shares outstanding.
The Company explained that the 2010 second semester began this year on March
1st, as opposed to February 12th in 2009, due to the timing of the Chinese New
Year and a winter vacation period lasting the entire month of February 2010.
This timing difference accounted for much of the revenue gain in this year's
third quarter which included a portion of second semester tuition revenues. Due
to the later start of the 2010 second semester, the Company also reported there
were no revenues in this year's third quarter recorded for student fees for
summer internships, while receipt of such fees was reflected in third quarter
results last year.
Continuing Growth in Schools and Students
Mr. Guangwen He, Chairman and CEO of the Company, stated, "We are extremely
pleased with the continuing strong results through the first nine months this
year where the gains more accurately reflect year over year progress in building
our student population and in the number of schools we manage. Of note, student
enrollment in the second semester of 2009 was 29,883, and reached 34,477 in the
2010 second semester. The third quarter also was marked by the addition of new
classrooms and new higher margin programs, as well as the announcement late in
the quarter of a 20-year agreement to assume operational and management control
of our ninth school, Shanxi Tianzhen No.2 Secondary School in Shanxi Province.
Starting with 410 students, it is anticipated this school will grow to about
3000 students in year one."
"Just after the end of the third quarter," Mr. He continued, "we started
expansion of our Maritime related training program through an agreement with
Shangdong Shengli Maritime School, under which we will receive 80% of the
school's revenues and profits and we expect to more than double the school's
population to approximately 5000 students within the next five years."
Mr. He concluded, "We anticipate contributions to our bottom line from both new
school additions in the current fiscal year, which we see shaping up to be
another year of strong top and bottom line growth, in a period of continuing
strong demand for our well-trained graduates."
SEE TABLE BELOW
HQ Global Education Inc. ("HQ")
HQ provides "customized training" services to varied student populations through
running its own private schools or cooperating with selected vocational schools
in China. By rendering full-scale educational and job placement services, the
Company realizes recurring revenues, such as tuition fees, school logistics
service fees, uniform fees, off-campus internship management fees, and job
placement fees. As of May 31, 2010, there were more than 34,000 HQ students from
22 provinces throughout China. They are taught a wide range of vocational skills
in approximately 60 programs in 17 technical career categories at 10 vocational
schools in the Sichuan, Shanxi, Shandong and Hunan Provinces. In cooperation
with nearly 120 participating employers, HQ has become increasingly synonymous
throughout China with superior training to meet employer needs and for producing
outstanding technical specialists with immediate jobs and fulfilling career
opportunities. Graduating students of HQ schools have consistently achieved 100%
employment upon graduation.
Information Regarding Forward-Looking Statements
Except for historical information contained herein, the statements in this press
release are forward-looking statements that are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve known and unknown risks and uncertainties,
which may cause our actual results in future periods to differ materially from
forecasted results. These risks and uncertainties include, among other things,
product demand, market competition, and risks inherent in our operations. These
and other risks are described in our filings with the U.S. Securities and
Exchange Commission.
HQ GLOBAL EDUCATION INC.
(FORMERLY GREEN STAR MINING CORP.)
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
For the three months ended For the nine months ended
May 31, May 31,
------------------------------ ------------------------------
2010 2009 2010 2009
------------ ------------ ------------ ------------
Revenues $ 17,235,916 $ 9,536,983 $ 37,110,090 $ 31,179,916
Cost of revenue (10,802,813) (6,447,337) (22,317,831) 19,515,016)
------------ ------------ ------------ ------------
Gross profit 6,433,103 3,089,646 14,792,259 11,664,900
Selling expenses (268,893) (156,857) (512,651) (503,089)
General and administrative expenses (567,662) (470,846) (1,495,898) (1,360,377)
------------ ------------ ------------ ------------
Income from operations 5,596,548 2,461,943 12,783,710 9,801,434
Other expenses
Interest expenses (38,711) (25,367) (83,838) (64,795)
Other expenses (8,877) (856) (978,827) (15,629)
------------ ------------ ------------ ------------
Total other expenses (47,588) (26,223) (1,062,665) (80,424)
------------ ------------ ------------ ------------
Income before income taxes 5,548,960 2,435,720 11,721,045 9,721,010
Provision for income taxes -- -- -- --
------------ ------------ ------------ ------------
Net income 5,548,960 2,435,720 11,721,045 9,721,010
------------ ------------ ------------ ------------
Other comprehensive item
oreign currency translation gain (loss) (10,268) 43,478 9,359 41,549
------------ ------------ ------------ ------------
Comprehensive Income $ 5,538,692 $ 2,479,198 $ 11,730,404 $ 9,762,559
============ ============ ============ ============
Basic and diluted income per common share $ 0.17 $ 0.12 $ 0.46 $ 0.47
============ ============ ============ ============
Basic and diluted weighted average
common shares outstanding 33,000,000 20,500,000 25,673,993 20,500,000
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