This item is part of Stockwatch's value added news feed and is only available to Stockwatch subscribers.Here is a sample of this item:51job, Inc. Reports Third Quarter 2009 Financial Results 2009-11-23 04:05 ET - News Release SHANGHAI, Nov. 23 /PRNewswire-Asia-FirstCall/ -- 51job, Inc. , a leading provider of integrated human resource services in China, announced today unaudited financial results for the third quarter of 2009 ended September 30, 2009.
Third Quarter 2009 Financial Highlights:
-- Total revenues increased 5.1% over Q3 2008 to RMB219.6 million (US$32.2
million), exceeding the Company's guidance range of RMB198 million to
RMB208 million
-- Gross margin expanded to 62.4% compared with 52.7% in Q3 2008 primarily
due to cost control and efficiency measures
-- Operating income increased 81.6% over Q3 2008 to RMB40.1 million
(US$5.9 million)
-- Fully diluted earnings per common share were RMB0.65 (US$0.19 per ADS)
-- Excluding share-based compensation expense and the impact of foreign
currency translation loss, non-GAAP adjusted fully diluted earnings per
common share were RMB0.77 (US$0.22 per ADS), exceeding the Company's
guidance range of RMB0.48 to RMB0.58
-- Cash and short-term investments increased to RMB1,173.9 million
(US$172.0 million) as of September 30, 2009
Commenting on the results, Rick Yan, President and Chief Executive Officer of 51job, Inc., said, "We saw an improvement in market conditions in the third quarter as recruitment activity and job openings increased compared to the early part of 2009. The uptick in market demand, coupled with our successful efforts this year to realign our cost structure and drive operating efficiency, resulted in significant margin expansion and allowed us to achieve our most profitable quarter ever. With our strong brand, focus on innovation and proven execution capability, we are confident in our leadership position as the premier HR services provider in China." Third Quarter 2009 Unaudited Financial Results Total revenues for the third quarter ended September 30, 2009 were RMB219.6 million (US$32.2 million), an increase of 5.1% from RMB209.0 million for the same quarter in 2008. Print advertising revenues for the third quarter of 2009 decreased 7.2% to RMB77.1 million (US$11.3 million) compared with RMB83.2 million for the same quarter in 2008. The decrease was primarily due to a lower volume of print advertising pages in 51job Weekly resulting from a decline in market demand, which was largely offset by higher average revenue per page. The estimated number of print advertising pages generated in the third quarter of 2009 decreased 23.6% to 3,213 compared with 4,204 pages in the same quarter in 2008. Although print advertising prices charged in each city have remained relatively stable, overall average revenue per page increased 21.4% over the third quarter of 2008 due to an increase in page volume contribution from cities where print advertising prices are generally higher as compared to the same quarter of the prior year. Online recruitment services revenues for the third quarter of 2009 were RMB90.1 million (US$13.2 million), representing a 16.0% increase from RMB77.7 million for the same quarter of the prior year. The increase primarily resulted from a greater number of unique employers using the Company's online recruitment services, which was partially offset by lower average revenue per unique employer. Unique employers increased 47.0% to 91,167 in the third quarter of 2009 compared with 62,023 in the same quarter of the prior year driven by greater customer acceptance and usage of online recruitment services. Average revenue per unique employer decreased 21.1% in the third quarter of 2009 due to employers purchasing lower priced products and/or reducing their overall spending on online recruitment services as compared to the same quarter in 2008. Other human resource related revenues for the third quarter of 2009 increased 8.6% to RMB52.4 million (US$7.7 million) from RMB48.2 million in the same quarter of 2008 principally due to greater customer demand for human resource outsourcing services, which was partially offset by lower revenues from executive search and training services. Gross profit for the third quarter of 2009 increased 24.3% to RMB129.7 million (US$19.0 million) from RMB104.3 million for the same quarter of the prior year. Gross margin, which is equal to gross profit divided by net revenues, expanded to 62.4% in the third quarter of 2009 compared with 52.7% in the same quarter in 2008 primarily due to lower printing related and other direct expenses resulting from the implementation of cost control and efficiency measures earlier this year. Operating expenses for the third quarter of 2009 were RMB89.6 million (US$13.1 million) compared with RMB82.3 million for the same quarter of 2008. Operating expenses as a percentage of net revenues was 43.1% for the third quarter of 2009 compared with 41.6% for the third quarter of 2008. Excluding share-based compensation expense, operating expenses as a percentage of net revenues were 40.5% in the third quarter of 2009 compared with 38.9% in the third quarter of 2008. Sales and marketing expenses for the third quarter of 2009 increased 7.5% to RMB53.2 million (US$7.8 million) from RMB49.4 million for the same quarter of the prior year primarily due to increased commissions resulting from higher sales and greater advertising expenses, which were partially offset by lower travel and entertainment expenses compared to the same quarter in 2008. General and administrative expenses for the third quarter of 2009 increased 11.1% to RMB36.5 million (US$5.3 million) from RMB32.8 million in the third quarter of 2008, which was largely attributable to higher employee compensation, rental and depreciation expenses incurred in the third quarter of 2009. Income from operations for the third quarter of 2009 increased 81.6% to RMB40.1 million (US$5.9 million) from RMB22.1 million for the same quarter of the prior year. Other income in the third quarter of 2009 included tax subsidies of RMB7.4 million (US$1.1 million) compared with RMB2.9 million in the same quarter of the prior year. The Company's effective tax rate was 30.1% in the third quarter of 2009 compared with 7.4% in the third quarter of 2008, which was lower due to an adjustment for the cumulative impact of certain tax changes in 2008. Net income for the third quarter of 2009 increased 27.0% to RMB35.9 million (US$5.3 million) from RMB28.3 million for the same quarter in 2008. Fully diluted earnings per common share for the third quarter of 2009 were RMB0.65 (US$0.10) compared with RMB0.50 for the same quarter in 2008. Fully diluted earnings per ADS for the third quarter of 2009 were RMB1.29 (US$0.19) compared with RMB1.00 in the third quarter of 2008. In the third quarter of 2009, the Company recognized total share-based compensation expense of RMB6.5 million (US$0.9 million), unchanged from the third quarter of 2008. The Company also recognized a foreign currency translation loss of RMB86,000 (US$13,000) in the third quarter of 2009 compared with a translation loss of RMB1.5 million in the third quarter of 2008. Excluding share-based compensation expense and the impact of foreign currency translation loss, non-GAAP adjusted income for the third quarter of 2009 increased 17.0% to RMB42.5 million (US$6.2 million) compared with RMB36.3 million for the third quarter of 2008. Non-GAAP adjusted fully diluted earnings per common share were RMB0.77 (US$0.11) in the third quarter of 2009 compared with RMB0.64 in the third quarter of 2008. Non-GAAP adjusted fully diluted earnings per ADS in the third quarter of 2009 were RMB1.53 (US$0.22) compared with RMB1.28 in the third quarter of 2008. Nine Months 2009 Unaudited Financial Results Total revenues for the nine months ended September 30, 2009 were RMB591.2 million (US$86.6 million), a decrease of 11.0% from RMB664.2 million in the comparable period in 2008. Income from operations for the nine months ended September 30, 2009 decreased to RMB78.6 million (US$11.5 million) from RMB90.9 million for the same period last year. Net income for the first nine months of 2009 decreased to RMB66.1 million (US$9.7 million) from RMB69.8 million for the same period in 2008. Fully diluted earnings per common share for the first nine months of 2009 decreased to RMB1.18 (US$0.17) from RMB1.23 in the comparable period in 2008. Fully diluted earnings per ADS for the first nine months of 2009 were RMB2.37 (US$0.35) compared with RMB2.46 in the same period in 2008. Excluding share-based compensation and foreign currency translation loss, non-GAAP adjusted net income for the nine months ended September 30, 2009 decreased to RMB87.1 million (US$12.8 million) from RMB108.2 million for the nine months ended September 30, 2008. Non-GAAP adjusted fully diluted earnings per common share were RMB1.56 (US$0.23) in first nine months of 2009 compared with RMB1.91 in the same period in 2008. Non-GAAP adjusted fully diluted earnings per ADS in the first nine months of 2009 were RMB3.12 (US$0.46) compared with RMB3.81 in the same period in 2008. In September 2008, the Company announced that its shareholders had approved a share repurchase program authorizing the repurchase of up to US$25 million worth of outstanding ADSs. In the third quarter of 2009, the Company repurchased 273,563 ADSs, representing 547,126 common shares, in the open market for an aggregate consideration of US$3.3 million, including transaction fees. Since the inception of this share repurchase program, the Company has repurchased a total of 794,605 ADSs, representing 1,589,210 common shares, for an aggregate consideration of US$7.0 million. As of September 30, 2009, the Company had cash and short-term investments totaling RMB1,173.9 million (US$172.0 million) compared with RMB1,074.4 million at December 31, 2008. Short-term investments consist of certificates of deposit held by the Company in banking institutions in China. Business Outlook Based on current market and operating conditions, and taking into consideration that the fourth quarter is historically a seasonally weak period for recruitment, the Company's revenue target for the fourth quarter of 2009 is in the estimated range of RMB215 million to RMB225 million (US$31.5 million to US$33.0 million). Excluding share-based compensation expense and any foreign currency translation loss or gain, the Company's non-GAAP fully diluted earnings target for the fourth quarter of 2009 is in the estimated range of RMB0.58 to RMB0.68 per common share (US$0.17 to US$0.20 per ADS). The Company expects aggregate share-based compensation expense in the fourth quarter of 2009 to be in the estimated range of RMB6 million to RMB7 million (US$0.9 million to US$1.0 million). Currency Convenience Translation For the convenience of readers, certain Renminbi amounts have been translated into U.S. dollars at the rate of RMB6.8262 to US$1.00, the noon buying rate on September 30, 2009 in New York for cable transfers of Renminbi per U.S. dollar as set forth in the H.10 weekly statistical release of the Federal Reserve Board. Conference Call Information Management will hold a conference call at 8:00 a.m. Eastern Time (9:00 p.m. Shanghai / Hong Kong time zone) on November 23, 2009 to discuss its third quarter 2009 financial results, operating performance and business outlook. To dial in to the call, please use conference ID 4183748 and the following telephone numbers:
US: +1-877-941-2332
Hong Kong: +852-3009-5027
International: +1-480-629-9722
The call will also be available live and on replay through 51job's investor relations website, http://ir.51job.com . Please go to the website at least fifteen minutes early to register or install any necessary audio software. Use of Non-GAAP Financial Measures To supplement the consolidated financial statements presented in accordance with United States Generally Accepted Accounting Principles (GAAP), 51job uses non-GAAP measures of adjusted net income, adjusted earnings per common share and adjusted earnings per ADS, which are adjusted from results based on GAAP to exclude the impact of share-based compensation expense and foreign currency translation gain or loss. The Company believes excluding share-based compensation expense from its non-GAAP financial measures is useful for its management and investors to assess and analyze the Company's core operating results as such expense is not directly attributable to the underlying performance of the Company's business operations and do not impact its cash earnings. The Company believes excluding foreign currency translation gain or loss from its non-GAAP financial measures is useful for its management and investors as such translation gain or loss is unrelated to the Company's core business operations and will not result in cash settlement nor impact the Company's cash earnings. 51job also believes these non-GAAP measures excluding share-based compensation expense and foreign currency translation gain or loss are important in helping investors to understand the Company's current financial performance and future prospects and to compare business trends among different reporting periods on a consistent basis. The presentation of these additional measures should not be considered a substitute for or superior to GAAP results or as being comparable to results reported or forecasted by other companies. The non-GAAP measures have been reconciled to GAAP measures in the attached financial statements. About 51job 51job, Inc. is a leading provider of integrated human resource services in China with a strong focus on recruitment related services. Through print advertisements in 51job Weekly and online recruitment services at http://www.51job.com , 51job enables enterprises to attract, identify and recruit employees and connects millions of job seekers with employment opportunities. 51job also provides a number of other value-added human resource services, including business process outsourcing, training, executive search services and salary surveys. 51job's nationwide office network spans 26 cities in China. Safe Harbor Statement Statements in this release regarding targets for the fourth quarter of 2009, future business and operating results constitute "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon management's current expectations, and actual results could differ materially. Among the factors that could cause actual results to differ are the number of recruitment advertisements placed, sales orders received and customer contracts executed during the remaining weeks of the fourth quarter of 2009; any accounting adjustments that may occur during the quarterly close; fluctuations in the value of the Renminbi against the U.S. dollar and other currencies; behavioral and operational changes of customers in meeting their human resource needs as they respond to evolving social, economic and political changes in China as well as stock market volatilities; introduction by its competitors of new or enhanced products or services; price competition in the market for the various human resource services that the Company provides in China; acceptance of new products and services developed or introduced by the Company outside of the human resources industry and fluctuations in general economic conditions. For additional information on these and other factors that may affect the Company's financial results, please refer to the Company's filings with the Securities and Exchange Commission. 51job undertakes no obligation to update these targets prior to announcing final results for the fourth quarter of 2009 or as a result of new information, future events or otherwise.
- Financial tables to follow -
51job, Inc.
Consolidated Statements of Operations
For the Three Months Ended
September September September
30, 2008 30, 2009 30, 2009
(In thousands, except number of (unaudited) (unaudited) (unaudited)
shares and per share data) RMB RMB USD (Note 1)
Revenues:
Print advertising 83,163 77,140 11,301
Online recruitment services 77,663 90,102 13,199
Other human resource related
revenues 48,197 52,355 7,670
Total revenues 209,023 219,597 32,170
Less: Business and related tax (11,257) (11,586) (1,697)
Net revenues 197,766 208,011 30,473
Cost of services (Note 2) (93,445) (78,309) (11,472)
Gross profit 104,321 129,702 19,001
Operating expenses:
Sales and marketing (Note 3) (49,437) (53,168) (7,789)
General and administrative (Note 4) (32,817) (36,469) (5,343)
Total operating expenses (82,254) (89,637) (13,132)
Income from operations 22,067 40,065 5,869
Loss from foreign currency translation (1,533) (86) (13)
Interest and investment income 7,151 3,974 582
Other income 2,863 7,436 1,090
Income before provision for income tax 30,548 51,389 7,528
Income tax expense (2,262) (15,475) (2,267)
Net income 28,286 35,914 5,261
Earnings per share:
Basic 0.50 0.65 0.10
Diluted 0.50 0.65 0.10
Earnings per ADS (Note 5):
Basic 1.00 1.30 0.19
Diluted 1.00 1.29 0.19
Weighted average number of common
shares outstanding:
Basic 56,643,124 55,262,260 55,262,260
Diluted 56,728,877 55,482,240 55,482,240
Notes:
1. The conversion of RMB amounts into USD amounts is based on the noon
buying rate of USD1.00=RMB6.8262 on September 30, 2009 in New York for
cable transfers of RMB as set forth in the H.10 weekly statistical
release of the Federal Reserve Board.
2. Includes share-based compensation expense of RMB1,192 and RMB1,036
(US$152) for the three months ended September 30, 2008 and 2009,
respectively.
3. Includes share-based compensation expense of RMB1,023 and RMB891
(US$131) for the three months ended September 30, 2008 and 2009,
respectively.
4. Includes share-based compensation expense of RMB4,252 and RMB4,542
(US$665) for the three months ended September 30, 2008 and 2009,
respectively.
5. Each ADS represents two common shares.
51job, Inc.
Consolidated Statements of Operations
For the Nine Months Ended
September September September
30, 2008 30, 2009 30, 2009
(In thousands, except number of (unaudited) (unaudited) (unaudited)
shares and per share data) RMB RMB USD (Note 1)
Revenues:
Print advertising 299,535 214,873 31,478
Online recruitment services 239,380 235,735 34,534
Other human resource related
revenues 125,291 140,556 20,590
Total revenues 664,206 591,164 86,602
Less: Business and related tax (34,073) (31,154) (4,564)
Net revenues 630,133 560,010 82,038
Cost of services (Note 2) (286,608) (226,045) (33,114)
Gross profit 343,525 333,965 48,924
Operating expenses:
Sales and marketing (Note 3) (157,036) (151,297) (22,164)
General and administrative (Note 4) (95,583) (104,098) (15,250)
Total operating expenses (252,619) (255,395) (37,414)
Income from operations 90,906 78,570 11,510
Loss from foreign currency translation (18,369) (197) (29)
Interest and investment income 20,207 11,188 1,639
Other income 2,814 8,309 1,217
Income before provision for income tax 95,558 97,870 14,337
Income tax expense (25,713) (31,739) (4,650)
Net income 69,845 66,131 9,687
Earnings per share:
Basic 1.23 1.19 0.17
Diluted 1.23 1.18 0.17
Earnings per ADS (Note 5):
Basic 2.47 2.37 0.35
Diluted 2.46 2.37 0.35
Weighted average number of common
shares outstanding:
Basic 56,580,854 55,729,039 55,729,039
Diluted 56,726,136 55,847,597 55,847,597
Notes:
1. The conversion of RMB amounts into USD amounts is based on the noon
buying rate of USD1.00=RMB6.8262 on September 30, 2009 in New York for
cable transfers of RMB as set forth in the H.10 weekly statistical
release of the Federal Reserve Board.
2. Includes share-based compensation expense of RMB3,354 and RMB3,333
(US$488) for the nine months ended September 30, 2008 and 2009,
respectively.
3. Includes share-based compensation expense of RMB2,883 and RMB2,866
(US$420) for the nine months ended September 30, 2008 and 2009,
respectively.
4. Includes share-based compensation expense of RMB13,727 and RMB14,607
(US$2,140) for the nine months ended September 30, 2008 and 2009,
respectively.
5. Each ADS represents two common shares.
51job, Inc.
Reconciliation of GAAP and Non-GAAP Results
For the Three Months Ended
September September September
30, 2008 30, 2009 30, 2009
(In thousands, except number of (unaudited) (unaudited) (unaudited)
shares and per share data) RMB RMB USD (Note 1)
GAAP income before provision
for income tax 30,548 51,389 7,528
Add back: Share-based compensation
expense 6,467 6,469 948
Add back: Loss from foreign currency
translation 1,533 86 13
Non-GAAP income before provision for
income tax 38,548 57,944 8,489
Non-GAAP income tax expense (2,262) (15,473) (2,267)
Non-GAAP adjusted net income 36,286 42,471 6,222
Non-GAAP adjusted earnings per share:
Basic 0.64 0.77 0.11
Diluted 0.64 0.77 0.11
Non-GAAP adjusted earnings per ADS
(Note 2):
Basic 1.28 1.54 0.23
Diluted 1.28 1.53 0.22
Weighted average number of common
shares outstanding:
Basic 56,643,124 55,262,260 55,262,260
Diluted 56,728,877 55,482,240 55,482,240
For the Nine Months Ended
September September September
30, 2008 30, 2009 30, 2009
(In thousands, except number of (unaudited) (unaudited) (unaudited)
shares and per share data) RMB RMB USD (Note 1)
GAAP income before provision
for income tax 95,558 97,870 14,337
Add back: Share-based compensation
expense 19,964 20,806 3,048
Add back: Loss from foreign currency
translation 18,369 197 29
Non-GAAP income before provision for
income tax 133,891 118,873 17,414
Non-GAAP income tax expense (25,726) (31,740) (4,650)
Non-GAAP adjusted net income 108,165 87,133 12,764
Non-GAAP adjusted earnings per share:
Basic 1.91 1.56 0.23
Diluted 1.91 1.56 0.23
Non-GAAP adjusted earnings per ADS
(Note 2):
Basic 3.82 3.13 0.46
Diluted 3.81 3.12 0.46
Weighted average number of common
shares outstanding:
Basic 56,580,854 55,729,039 55,729,039
Diluted 56,726,136 55,847,597 55,847,597
Notes:
1. The conversion of RMB amounts into USD amounts is based on the noon
buying rate of USD1.00=RMB6.8262 on September 30, 2009 in New York for
cable transfers of RMB as set forth in the H.10 weekly statistical
release of the Federal Reserve Board.
2. Each ADS represents two common shares.
51job, Inc.
Consolidated Balance Sheets
As of
December September September
31, 2008 30, 2009 30, 2009
(In thousands, except number of (audited) (unaudited) (unaudited)
shares and per share data) RMB RMB USD (Note 1)
ASSETS
Current assets:
Cash 1,058,310 976,653 143,074
Short-term investments 16,100 197,232 28,893
Accounts receivable (net of
allowance of RMB2,783 and
RMB3,754 as of December 31,
2008 and September 30,
2009, respectively) 19,524 18,694 2,739
Prepayments and other current
assets 44,996 36,257 5,312
Deferred tax assets, current 2,322 5,005 733
Total current assets 1,141,252 1,233,841 180,751
Long-term investments 15,927 15,914 2,331
Property and equipment 205,805 187,717 27,500
Intangible assets 4,669 5,844 856
Other long-term assets 6,311 20,807 3,048
Deferred tax assets, non-current 405 286 42
Total assets 1,374,369 1,464,409 214,528
LIABILITIES
Current liabilities:
Accounts payable 10,511 9,947 1,457
Salary and employee related accrual 22,370 22,512 3,298
Taxes payable 13,337 30,493 4,467
Advance from customers 87,639 115,825 16,968
Other payables and accruals 12,939 12,392 1,815
Total current liabilities 146,796 191,169 28,005
Deferred tax liabilities, non-current 730 1,106 162
Total liabilities 147,526 192,275 28,167
Shareholders' equity:
Common shares (US$0.0001 par value;
500,000,000 shares authorized,
56,378,139 and 55,108,969 shares
issued and outstanding as of
December 31, 2008 and September
30, 2009, respectively) 47 46 7
Additional paid-in capital 917,352 896,506 131,333
Statutory reserves 6,947 6,947 1,018
Other comprehensive income 1,054 1,061 155
Retained earnings 301,443 367,574 53,848
Total shareholders' equity 1,226,843 1,272,134 186,361
Total liabilities and shareholders'
equity 1,374,369 1,464,409 214,528
Note 1: The conversion of RMB amounts into USD amounts is based on the
noon buying rate of USD1.00=RMB6.8262 on September 30, 2009 in New York
for cable transfers of RMB as set forth in the H.10 weekly statistical
release of the Federal Reserve Board.
For more information, please contact:
Linda Chien
Investor Relations
51job, Inc.
Tel: +86-21-6879-6250
Email: investor.relations@51job.com
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