Koolearn's revenue of Q2 FY2023 was $293.5M, repositioning as a livestreaming e-commerce platform

New Oriental's subsidiary, Koolearn Technology Holdings Limited ("Koolearn"), a leading online extracurricular education service provider and a well known private label products and livestreaming e-commerce platform in China listed on the Hong Kong Stock Exchange, announced its financial results under International Financial Reporting Standards ("IFRS") for the first six months of fiscal year 2023 ended November 30, 2022.

In H1 2023FY, Koolearn recorded revenues of RMB 2,080.1 million (US$293.5 million), a 590.2% increase from revenues from continuing operations of RMB301.4 million in the same period of the prior fiscal year, and recorded a net profit of RMB585.3 million (US$82.6 million), a 638.5% increase from net loss from continuing operations of RMB108.7 million in the same period of the prior fiscal year. Koolearn's gross profit was RMB982.5 million (US$138.6 million) and gross profit margin was 47.2% for the six months ended November 30, 2022.

As we reported previously, Koolearn announced On Oct.25, 2021that it will stop offering subject-based after-school tutoring services to students of K-9 or compulsory education period in mainland China, in light of the new regulations on after-school tutoring services. The cessation will take effect by the end of November 2021.  After the adjustment, the company started a new business that focuses on selecting premium products for customers.

In light of the company has become an outstanding product and technology company that continuously provides agricultural products under the private label, “Dong Fang Zhen Xuan”, Koolearn proposed a change of company name on January 5, 2023 from "Koolearn Technology Holding Limited" ("新東方在綫科技控股有限公司") to "East Buy Holding Limited" (東方甄選控股有限公司") as part of reassessment by Koolearn's board of directors to fully encompass the direction of Koolearn's current business and future outlook.

Future outlook of the new business after the cessation of K-9 afer-school tutoring

As the company’s educational offerings remains primarily focusing on courses for postgraduate entrance exams, they will also continue to focus on the development of tailor-made courses targeting occupational students (which accounted for about 50% of the candidates taking postgraduate entrance exams) and the development of tailor-made courses targeting students who are retaking the exam. Moreover, the company will expand their product offering to include high-end English learning products, given that the overall performance of English learning products during the Reporting Period has increased mainly due to the popularity of new concepts and oral courses.

With the optimization of internal and external environment and the strengthening of our product and marketing capabilities, the overseas test-preparation business has accelerated its growth during the Reporting Period. In terms of external collaborations, the company’s overseas test-preparation business will continue to maintain close collaborations with upstream and downstream institutions, closely interact with test organisers such as IELTS and TOEFL

During the Reporting Period, the company continued to deepen the cooperation with different schools and institution. In terms of vocational education, we have conducted research and communication with a number of universities and colleges on the “Craftsmen in the New Era Institution” (新時代 工匠學院) project and the new energy and smart building project, and planned to implement indepth research and planning with some of the vocational schools and undergraduate colleges on the construction of industrial research institutes and new talent training programmes.