Puxin Posts Loss In Q2

Puxin Limited (NEW), a Chinese provider of after school education services, on Wednesday posted a loss for the second quarter, amidst a rise in operating, general expenses and impairment losses. Revenues, however, improved from last year.

The educational services provider posted a net loss of RMB1.378 billion or RMB7.88 per share, compared with a net income of RMB36.59 million or RMB0.21 per share, reported for the same period a year ago. Net loss per ADS was reported at RMB15.76, compared with a net income of RMB0.42, reported for the same period of 2020.

For the second quarter ended on June 30, the Chinese firm recorded an adjusted loss of RMB1.400 billion, compared with an adjusted income of RMB45.2 million, year-on-year basis. Also, adjusted loss per ADS was RMB16.01 as against a net income of RMB0.51, posted for the same quarter, last year.

Amidst, persisting Covid-19 pandemic related headwinds, the education services provider reported an operating loss of RMB1.362 billion for the three-month period ended in June, versus an operating income of RMB29.9 million, reported for the same period of last fiscal.

The company’s loss before interest, taxes, depreciation, and amortization was posted at RMB 1.346 billion, compared with RMB71.8 million in the second quarter of 2020.

The total operating expenses of Puxin moved up to RMB1.660 billion from RMB299.60 million, recorded in the second quarter of previous year.

General and administrative expenses increased by 134.3 percent to RMB200 million, for the quarter, primarily due to allowance provided in the second quarter for doubtful accounts of receivables from disposal of subsidiaries.

For the June quarter, impairment loss on intangible assets and goodwill was reported at RMB1.069 billion, higher than RMB4.1 million, year-over-year basis. The impairment loss on other long-lived assets was RMB173.1 million as against a breakeven reported for the same period of 2020.

Owing to a higher demand for the company’s products and services, the Group’s net revenue increased to RMB674.14 million for the three-month to June, from RMB601.05 million, reported for the second quarter of previous year.

Looking ahead, Peng Wang, Chief Financial Officer said, “We expect our topline will experience headwinds during the business transition period due to the new governmental policy on K-12 business.”

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