Earnings Spotlight: Puxin Limited (NYSE:NEW)

Puxin Limited (NYSE:NEW) traded up 6.88% during trading on Friday, reaching $10.88. The stock had a trading volume of 245.44K shares. The firm has a 50-day moving average of $8.95 and a 200-day moving average of $7.43. The stock has a market cap of $ 885.31 million. NEW has surged 69.21% during the last 3-month period. Year-to-Date the stock performance stands at 84.09%.

Puxin Limited (NYSE:NEW) today declared its unaudited financial results for the third quarter ended September 30, 2019. The company reported net revenues increased by 48.7% to RMB996.0 million (US$139.4 million) from RMB669.7 million in the third quarter of 2018. This increase was primarily driven by an increase in student enrollments. Student enrollments increased by 60.2% to 871,896 from 544,253 in the same period of 2018.

Cost of incomes expanded by 32.0% to RMB494.6 million (US$69.2 million) from RMB374.6 million in a similar time of 2018, fundamentally because of an expansion in showing staff’s remuneration. Cost of revenues, excluding share-based compensation expenses, increased by 32.5% to RMB493.6 million (US$69.1 million) from RMB372.5 million in the third quarter of 2018.

Net income attributable to Puxin Limited was RMB33.7 million (US$4.7 million), compared to the net loss attributable to Puxin Limited of RMB(50.2) million during the third quarter of 2018. Basic and diluted net income per ADS attributable to Puxin Limited were RMB0.38 (US$0.06), compared to basic and diluted net loss of RMB(0.62) during the same period of 2018.

Adjusted net income attributable to Puxin Limited was RMB43.5 million (US$6.1 million), compared to adjusted net loss attributable to Puxin Limited of RMB(51.0) million during the same period of 2018. Balanced essential total compensation per ADS inferable from Puxin Limited[4] was RMB0.50 (US$0.07), contrasted with balanced fundamental overal deficit of RMB(0.62) during a similar time of 2018. Adjusted diluted net income per ADS attributable to Puxin Limited was RMB0.49 (US$0.07), compared to adjusted diluted net loss of RMB(0.62) during the same period of 2018.

Operating income in the third quarter of 2019 was RMB41.5 million (US$5.8 million) compared to the operating loss of RMB(61.1) million in the third quarter of 2018. Operating margin was 4.2% in the second from last quarter of 2019, contrasted with (9.1)% in a similar period in 2018.

Adjusted operating income was RMB52.2 million (US$7.3 million), compared to the adjusted operating loss of RMB(41.8) million in the third quarter of 2018. Adjusted operating margin was 5.2%, compared to (6.2)% in the same period of the prior year.

As of September 30, 2019, the Company had total cash and cash equivalents of RMB322.0 million (US$45.0 million), compared to RMB778.0 million as of December 31, 2018. The decreases were primarily due to acquisitions of k-12 schools.

Puxin Limited is a fruitful consolidator of the after-school education industry in China. Puxin has a solid procurement and combination skill to viably improve training quality and operational execution of obtained schools. Puxin offers a full range of K-12 and study-abroad mentoring programs intended to assist understudies with accomplishing scholastic greatness, just as get ready for affirmation tests and applications for top schools, colleges and graduate projects in China and different nations.

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