Earnings call transcript Q2 2023

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Operator

Greetings. Welcome to ATA Creativity Global's Second Quarter 2020 Financial Results Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded.

the to turn The Zhang now Group. Equity will conference Alice over of I you. Thank

begin. may You

Alice Zhang

Thank hello, Global's at operator, months the press for you, IR and second ended release us. for the the is announcing The June joining section XX, ATA available and of www.atai.net.cn. Creativity quarter or XXXX results everyone. ACG's six Thank at you website company's

broadcast conference slide A days. this of the call, also this presentation replay on part has for accompanying the available As an made website. available its of website at will be company ACG's XX next

Before provision would accompanying that information get the Reform Litigation of of statements XXXX. to any this contains herein remind meaning certain forward-looking Private Securities we everyone started, of I discussed within Act and Harbor conference Safe call the like the

market These restrictions, will identified forward-looking as outlook, ACG's operations, for results of could, estimate, terms to similar ACG's forecast, other plans growth growth demand services. anticipate, and statements generally, and by plan, among and terms as anticipated initiatives pandemic-related believe, growth eased strategy, and subsequent education and such acceptance ACG ACG's and forward of portfolio statements and acquisitions future, training COVID include, activities, things, intend, be expect, should, future mergers with adjustments business can regarding and ACG's taken for competitiveness other prospects China including market programs and

prove those correct. results can uncertainties these differ reflected be no cause statements projected. from are could of expectations Although reasonable the expectations that to those those be in forward-looking subject that the believes There to will assurance and company that to actual dramatically statements today, are risks as

review information, events, included filings forward-looking obligation investing not conditions making of update and new Information as before a assume does statements in the changes with to otherwise, any an future we which ACG associated market Securities about encourage law. decision. investment or as company by except in you result the The its is Exchange Commission, to with in risks any required

converted -- June RMB like X an I noon you dollar language, to information. as six RMB second XX, using conference disclaimer unless July conference Slide All June ended refer for to call would to as this rate XXXX, results XX, the X.XXXX accurate are and XXXX. conversions rate historical as from financial in the $X, of All the relating exchange Regarding of of call amounts also months buying the quarter are time the presentation for U.S. the noted. further of reported, to

under The in and unless based GAAP company financial otherwise RMB are RMB, reports results U.S. in all the calculated noted. on percentages presentation

of of with along you accompanying company is on there X. Powerpoint the For following an presentation, those the overview Slide

session during Q&A or we investor happy e-mailed are to the take than addition, questions today's company. In be to more

you to the If please ask to and send specify questions during session. whether you read e-mail questions, azhang@equityny.com have would your your wish name can address to you like Q&A the

of XXXX. its and brief financial floor of quarter the and long-term Mr. questions. growth and update an for On Sima, Chairman today's company's President, CFO, on Mr. provide strategy Ruobai opening company's call, overview the will Mr. Ma operating follow Jun the will CEO, before outlook Kevin and highlights Zhang, a with second the for

Ruobai With Please Sima. ahead, call to CFO, that, turn the Mr. I'll ACG's over go Sima. Mr.

Ruobai Sima

domestic we quarter. in pleased were and restrictions saw the good the XXXX were second fourth time. travel and year evening appreciate everyone, Americas, to We at trend those international into welcome, and Alice, and quarter continuing everyone's We positive the from enrollment China. left see pent-up of for demand the some in of you, start Thank with

prior was XXX year the XXXX. period. student second in the Total of of enrollment quarter quarter to over for normalized the course levels second XXXX enrollment X,XXX However, the compared

year-over-year. students However, the enrollment excluding third language increased enrolled who XXXX, quarter off X.X% disposed that student the actually in in were business XXX training we foreign

in We delivered and to study also the for in year growth achieved service increase stable XX,XXX year portfolio period, compared was increased We which overseas QX, net XX% a delivered hours counseling. training from revenue the to training prior for a period. portfolio primarily program due the prior

a also and year-over-year lower of result we As line improved increased expenses, gross results. operating profit reported bottom

program the fourth about excited We strong COVID-XX pandemic. is particularly feedback of time we programs the have this the students those the were major thrilled from and type of been We in year. thus which received have summer prospect the many remain offerings, delivered summer, been far. business remainder for We about this saw all positive overseas lines demand of at in we as since offering the resumed point of have of our the with this excited

from of increased the XXXX With quarter X.X% compared Despite of portfolio the training a quarter second during disposal that, quickly XX.X% business, portfolio I Total increased the services will of language services XXXX. to revenue primarily training by the was study from of and services. review lack the represented in total the revenue It period. RMBXX.X overseas revenue for training driven revenue second financials. consulting net foreign million RMBXX net to million

XXXX the was quarter compared prior loss while increase period. net quarter million improved to million the decreased RMBXX.X primarily revenue second due remained The of revenues of XXXX XX.X% and in relatively cost ACG which attributable from increased to period, expenses margin net year year gross revenues Net the a result narrowed Gross year to during primarily to was RMBXX.X during prior period. in operating during stable the XX.X% compared period. the margin prior increased to second in

of in first year to Net to the compared operating period. XX.X% narrowed increased million due the RMBXX margin million Turning attributable from RMBXX.X compared million, revenue RMBXX.X primarily million RMB net in loss prior to decreased half the XXXX, period. to year to improved prior Gross to XX.X ACG expenses. to XX.X%

sheet. balance the to Moving

million adjusted and total at $XX.X of a in working position was and and equivalents. equity financial with $XX.X $XX solid was $X.X XXXX. Working cash million be shareholders' in million XXXX, at to continue equity to compared December respectively, of $XX.X million capital million, XX, shareholders June XX, We capital deficit cash

like I'd upon who it outlook growth over our that, will and to to expand With trend. turn Kevin,

Kevin Ma

you, third Thank XXXX XXXX. at service consulting portfolio the on beginning experienced the of in we than momentum which studies the Sima. a of see more lack restrictions, for from demand of positive revenue overseas to language the growing lifting quarter with offerings, off in we service, foreign Riding continue particularly contributions disposed pandemic-related training training offset and we our

our students number levels institutional service in resources anticipate is the our normalized support second as enrollments improved partnership the saw students a during new at wave to academic We environment. XXXX. will We of gain quarter are and which comprehensive adviser increasing enroll rate a with quarter to to momentum art stable Overseas and as program looking students apply grow consulting to continues first trusted the continue teaching study market in for of process. working XXXX, consulting to and application international overseas active We leverage institutions. students throughout schools service, a

study students as potential of a about environment. seek optimistic in finish and more more generally business the remain to their post-pandemic our We

ACG. positive comprehensive be education the to our proud resources are outcomes high-quality teaching journey with in offerings staff, take We student all first-class of educational resulting part and and and from pride the extremely extensive their above

students of which related serving a continue while students of sector leader our as to topics explore kinds expand will stages ways of of in for We service targets look increasing the population different education portfolio start. industry an to China. their to the creative And all art in in of forward

over the by update will English be Zhang, President, Jun Mandarin, ahead. translation. hand on current to provide to I'd which now make ACG's to Jun, growth please followed like floor in Jun remarks our initiatives. will his go an

Jun Zhang

to Kevin. years. has been campus you, we in year the more Thank come fully welcome ACG, rewarding students with challenging recent to has of returning students a face-to-face truly our in communication first by interaction person, for as to been It and half but the back

define arts academic success students professional achieve has Our always as been full their an from the goal help potential and and to what pursuits of they explore perspective.

are been impressed have by several pandemic the by achievements. demonstrated proud their students and particularly the We during perseverance of

we ACG able has the taking curating educational confident to We're tours of to that our provide research-based be learning, hands-on or an changing other world parts incredibly in beginning schooling. world. which and been beyond there students is nurture or will maximize our valuable art to projects demand believe that to programs that for the in experience with programs strength explore opportunity of the fields, projects related growing adapt the country many student sensibilities XXXX, Since their the of and

heritage three Guizhou continue Gansu This camps intangible sites and summer, Yunnan summer bootcamps in cultural heritage China to school on we province top domestic theme covering regular of programs, across and product. host province, internships,

allow in various programs to students mineral experts participating in a fields, and model painted photography really themselves film, acting sculptures. and from oil including local These culture, [ph] and group, painting immerse learn unique environment

Tokyo, In innovation the addition SMO launched co-hosted programs, in these to Japan, Association. also experience Education domestic a camp by ACG Japanese design Exchange

provide an will and cells art and local and campuses six explore into at covering artistic to gain of art with but students to Japan. project modules, of the Waseda content different neighborhoods Art [ph], students also This Tokyo schools disciplinary local studios. University, the galleries University the will experience of not opportunity immersive and have at only Participating study access

students. of who students may be a how in more to looking to multiple other culture. art point both traditional presentation studying the good from We wait help our to learn our design our and will programs display perspectives, the and interested aims serve program for understand from and from hear culture This resuming along with abroad and summer since a foreign in Japanese programs overseas historical we to cannot feedback believe all this pandemic, this program, as starting

started those apply want portfolio. on Starting intensively to students this for schools work have summer, who overseas the to

the the combination as the ideas projects staff students key the gratifying with on they of to students' undergo portfolio. work it become application And that hard Our closely working will been see pieces the always of presentation and is process. have

leading art ACG has maintained creative role a in field.

track stems proven with positive and experiences network our art and record of of major world, a a strong students. relevant staff growing art interest the institutes outcomes, to areas relationship delivering all of renowned from around launch Our ability amazing products teaching in student to competency the

managed groups. a And population. for to services options offerings art By of continue brand our the serve set experiences, students. of is better different large introducing comprehensive to increase among we students student diverse working superior awareness aim educational and to more serve we ACG's age

With Kevin. over turn back to that, it I'll

Kevin Ma

Alice. Jun and Thanks,

We are opportunities first half and demand with ACG's pleased are the excited in XXXX about for year. the of of achievements the the

their meet experience improve always growth to our we student thinking to demands. well strategy are and our our ways by We expanding execute to believe equipped are service

for With up operator, let's that, open it questions.

Operator

[Operator would Instructions] it at like There to for to I time. no closing hand back remarks. questions this are Kevin

Kevin Ma

Thanks directly all has Equity free please feel again us, reach Group. anyone us or from of questions you our to us. to Investor The joining for Relations to for out If

investors during our all We are always to speaking next quarterly you. to available forward you to and speak Thank with look call.

Operator

will Thank conclude you. today's conference. This

You your time. disconnect this at lines may

ATA Creativity Global (AACG) 10 Aug 232023 Q2 Earnings call transcript