Hailiang Education Reports Strong Growth for 2019

Hailiang Education, hit last year by short-seller allegations, reported strong results for the fiscal year 2019 and said it is now looking to expand in metropolitan areas.

Author: Belinda Zhou   

Hailiang Education Group Inc. (Nasdaq: HLG) announced on Monday its financial results for the fiscal year 2019, sending its stock to waver throughout the day but close unchanged, at $64.05 per American depositary share.

The Hangzhou-based education provider said in a statement today that its revenue in the year through June reached $218.4 million, up 28% year-over-year. Its net income soared 37% from a year ago to $46 million, or 10 cents per American depositary share, according to the report.

"Revenue increased across both our basic education program and international program as well as our educational training services, study trip services, and education and management services," Ming Wang, the chairman and chief executive officer of Hailiang, said in a call with analysts today.

Revenue from educational training services skyrocketed 296% year-over-year to $21 million, fueled by increased student enrollment. Its study trip services unit saw a fivefold rise in revenue to $11.9 million, while its education and management services increased to $6 million from a year ago, the company said.

Hailiang said it has added 13 schools to network in the fiscal 2019, now operating 36 study centers with 23,000 students in total. The company said it has formed an extensive cooperation network with more than 200 educational institutions and universities globally.

Now, it is looking to expand in urban markets. 

"We look forward to implementing our hybrid development to attract teachers on combination of – on asset-light model and strategical accreditation to expand our affiliated and managed schools network among major metropolitan areas," Wang said.

Last year, Hailiang was shorted by a well-known short-seller, Citron Research. The research company said it has "never seen anything as bad as Hailiang," and warned investors in a Twitter post, stating: "If you are fortunate to get a borrow on Hailiang Education than [sic] you can be short your part of the China Hustle."