SHANGHAI, China, Aug. 4 /Xinhua-PRNewswire/ -- 51job, Inc. (Nasdaq: JOBS),
a leading provider of integrated human resource services in China, announced
today unaudited financial results for the second quarter ended June 30, 2005.
Second Quarter 2005 Financial Highlights:
-- Total revenues and earnings per share exceeded expectations
-- Total revenues increased 26.2% over Q2 2004 to RMB147.4 million
(US$17.8 million), higher than its guidance of RMB135 to RMB145 million
-- Fully diluted earnings per common share were RMB0.28 (US$0.07 per ADS),
higher than its guidance of RMB0.18 to RMB0.25
Commenting on the results, Rick Yan, President and Chief Executive
Officer of 51job, Inc., said, ''We are pleased that second quarter revenues
and profitability were above our forecasted ranges as we experienced good
uptake in online products during the quarter. Reflecting historical trends,
print advertising revenues were slightly lower compared to the seasonally
strong first quarter, but this was offset by higher revenue growth for online
recruitment services. Our integrated offline and online service platform
continues to uniquely position us ahead of the competition to best serve HR
customers of all types, sizes and needs.''
''We closely monitor industry developments and continue to observe that
market demand for human resource services has moderated thus far in 2005
compared to the same period last year. Despite this relative demand
moderation, we were able to exceed our financial targets through cost
management and execution of our business plan. Although we have had to incur
additional operating expenses subsequent to becoming a public company, our
gross margin has been consistent. For the rest of the year, we remain focused
on initiatives to drive revenues, to improve margins, to further strengthen
our market position and to invest in our long-term growth,'' said Mr. Yan.
Second Quarter 2005 Unaudited Financial Results
Total revenues for the second quarter ended June 30, 2005 were RMB147.4
million (US$17.8 million), an increase of 26.2% from RMB116.8 million for the
same quarter in 2004. Excluding the revenue contribution of the stationery
business which the Company ceased to actively operate since the fourth quarter
of 2004, total revenues grew 29.2% in the second quarter of 2005 to RMB147.2
million (US$17.8 million) compared with RMB114.0 million in the same quarter
last year. Net revenues, which reflect total revenues less business taxes and
related surcharges, increased to RMB139.2 million (US$16.8 million) in the
second quarter of 2005 from RMB111.0 million in the same period last year.
Print advertising revenues for the second quarter of 2005 increased 22.4%
to RMB90.5 million (US$10.9 million) compared with RMB73.9 million for the
same quarter in 2004. The revenue increase was primarily due to a greater
number of recruitment advertisements placed in 51job Weekly (formerly
translated as Career Post Weekly in English), which was offset by lower
average revenue per page. The estimated number of print advertising pages
generated in the second quarter of 2005 increased to 3,191 compared with 2,234
estimated print advertising pages in the same quarter in 2004. Average
revenue per page in the second quarter declined compared with the second
quarter of 2004 as a result of increasing revenue contribution from the
Company's lower priced cities.
Online recruitment services revenues for the second quarter of 2005 were
RMB38.9 million (US$4.7 million), representing a 52.5% growth from RMB25.5
million for the same quarter last year. The increase was principally
attributable to a higher number of customers using the Company's online
recruitment services. Unique employers using online recruitment services
increased to 31,098 in the second quarter of 2005, compared with 21,743 in the
same period last year.
Executive search revenues for the second quarter of 2005 decreased 3.5% to
RMB7.1 million (US$0.9 million) from RMB7.3 million for the same quarter last
year. For the second quarter of 2005, other human resource related revenues
were RMB11.0 million (US$1.3 million), representing a 9.4% growth from RMB10.1
million for the second quarter last year. Excluding the stationery business,
revenues from other human resource related services increased 48.8% to RMB10.8
million (US$1.3 million) in the second quarter of 2005 from RMB7.2 million for
the same quarter last year.
Gross profit for the second quarter of 2005 was RMB69.9 million (US$8.4
million), representing an increase of 23.0% from RMB56.9 million for the same
quarter last year. Gross margin, which is equal to gross profit divided by
net revenues, was 50.2% in the second quarter of 2005 compared with 51.2% in
the same quarter in 2004.
Operating expenses for the second quarter of 2005 were RMB51.5 million
(US$6.2 million) compared with RMB31.4 million for the same period last year.
Operating expenses as a percentage of net revenues was 37.0% for the second
quarter of 2005 compared with 28.3% in the June 2004 quarter.
Sales and marketing expenses for the second quarter of 2005 grew to
RMB27.0 million (US$3.3 million) from RMB15.9 million for the same quarter in
2004 mainly due to the hiring of additional personnel and increased spending
on advertising and promotional activities.
General and administrative expenses for the second quarter of 2005 was
RMB21.2 million (US$2.6 million) compared with RMB12.2 million for the second
quarter last year. The increase was primarily attributable to higher costs
associated with professional services fees and other public company expenses,
operating additional sales offices over the comparable 2004 period and
increased personnel.
Income from operations for the second quarter of 2005 was RMB18.4 million
(US$2.2 million) compared with RMB25.5 million for the same period last year.
Interest and investment income increased to RMB4.8 million (US$0.6 million) in
the second quarter of 2005 from RMB0.2 million in the second quarter of 2004
due to increased interest income from higher bank deposits, which include
RMB635.5 million (US$76.8 million) in net proceeds from the Company's initial
public offering completed in October 2004.
Net income for the second quarter of 2005 was RMB15.9 million (US$1.9
million) compared with RMB16.4 million for the same period in 2004. Fully
diluted earnings per common share for the second quarter of 2005 were RMB0.28
(US$0.03) compared with RMB0.36 for the same quarter in 2004. Applying the
2:1 ratio of common shares to the Company's publicly traded ADSs on the Nasdaq
National Market, fully diluted earnings per ADS in the second quarter of 2005
were RMB0.55 (US$0.07) compared with RMB0.71 in the second quarter of 2004.
The Company's basic weighted average number of common shares outstanding
increased as a result of its initial public offering and the conversion of
Series A Preference Shares into common shares in October 2004.
Six Months 2005 Unaudited Financial Results
Total revenues for the six months ended June 30, 2005 were RMB290.1
million (US$35.1 million), an increase of 28.0% from RMB226.7 million in the
comparable period in 2004. Excluding the revenue contribution of the
stationery business, total revenues grew 29.6% in the first six months of 2005
to RMB287.9 million (US$34.8 million) compared with RMB222.1 million in the
same period last year.
Income from operations for the six months ended June 30, 2005 was RMB26.5
million (US$3.2 million) compared with RMB39.2 million for the same period
last year. Net income for the first half of 2005 was RMB25.1 million (US$3.0
million) compared with RMB25.2 million for the same period in 2004.
As of June 30, 2005, cash and cash equivalents were RMB865.2 million
(US$104.5 million) compared with RMB848.3 million as of December 31, 2004.
Business Outlook
On July 21, 2005, the Chinese government changed its policy of pegging the
value of the Renminbi to the U.S. dollar. Under the new policy, the Renminbi
will be permitted to fluctuate within a band against a basket of certain
foreign currencies. This change in policy resulted initially in an
approximately 2.0% appreciation in the value of the Renminbi against the U.S.
dollar and could result in further and more significant appreciations.
Although the Company generates substantially all of its revenues in Renminbi
which has become more valuable in U.S. dollar terms, the Company's U.S. dollar
cash deposits are subject to foreign currency translations which will impact
net income.
For the third quarter of 2005, based on current market and operating
conditions, the Company's revenue target is in the range of RMB145 to RMB155
million (US$18 to US$19 million). Excluding the impact of recent and any
future foreign currency translations that arise from revaluations of the
Renminbi, the Company's fully diluted earnings target for the third quarter is
in the range of RMB0.22 to RMB0.30 per common share (US$0.05 to US$0.07 per
ADS). Assuming an exchange rate of RMB8.11 to US$1.00, the Company currently
forecasts a foreign currency translation loss to result in a decrease in the
aforementioned earnings range by RMB0.13 to RMB0.15 per common share (US$0.03
and US$0.04 per ADS) in the third quarter.
Other Company News
In May 2005, the Company announced that its shareholders have approved a
stock repurchase program. Under the program, the Company is authorized to
repurchase up to US$25 million worth of outstanding ADSs from time to time
over a period of 12 months. The Company did not repurchase any ADSs in the
second quarter of 2005.
In June 2005, the Company announced the launch of new sales offices in
Suzhou and Fuzhou. Publication and distribution of local editions of 51job
Weekly commenced in early June in Suzhou and in early July in Fuzhou.
Conference Call Information
Management of 51job will host a conference call at 8:30 a.m. Eastern Time
on August 4, 2005 (8:30 p.m. Shanghai / Hong Kong time zone) to discuss second
quarter 2005 results. The call will be available live and on replay in the
"Investor Relations" section of 51job's website at http://www.51job.com or directly
at ir.51job.com for U.S.-based participants. Please go to the website at
least fifteen minutes early to register and download and install any necessary
audio software. Participants may also dial into the teleconference at +1-888-
208-1812 (+1-719-457-2654 for international callers) and provide the passcode
7634577. An audio replay will be available through August 11, 2005, by
calling +1-888-203-1112 (+1-719-457-0820 for international callers) and
entering the passcode 7634577.
About 51job
51job, Inc. (Nasdaq: JOBS) is a leading provider of integrated human
resource services in China with a strong focus on recruitment related
services. Offering a broad array of products and services, 51job connects
millions of job seekers with employment opportunities and streamlines the
recruitment process and human resource administration for tens of thousands of
companies in China. Through print advertisements in 51job Weekly (formerly
translated as Career Post Weekly in English) and online recruitment services
at http://www.51job.com, both domestic Chinese employers and multinational
companies alike are able to attract, identify and recruit new employees.
51job also provides executive search services and a number of other value-
added human resource services, including training, proprietary software
applications, business process outsourcing and salary surveys. 51job's
nationwide office network in China spans 22 cities with local editions of
51job Weekly and Hong Kong.
Safe Harbor Statement
Statements in this release regarding targets for the third quarter of
2005, future business and operating results constitute ''forward-looking''
statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and 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 third quarter of 2005; 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; 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; 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 third quarter or as a result of new
information, future events or otherwise.
51job, Inc.
Consolidated Statements of Operations
For the Three Months Ended
June 30, 2004 June 30, 2005 June 30, 2005
(unaudited) (unaudited) (unaudited)
RMB RMB USD (Note1)
Revenues:
Print advertising 73,917,149 90,502,452 10,934,870
Online recruitment services 25,486,487 38,864,411 4,695,754
Executive search 7,313,420 7,054,774 852,386
Other human resource
related revenues 10,052,557 10,998,127 1,328,838
Total revenues 116,769,613 147,419,761 17,811,848
Less: Business and related tax (5,755,061) (8,255,549) (997,469)
Net revenues 111,014,552 139,164,212 16,814,379
Cost of services (54,153,549) (69,249,300) (8,366,979)
Gross profit 56,861,003 69,914,912 8,447,400
Operating expenses:
Sales and marketing (15,886,445) (26,978,660) (3,259,670)
General and administrative (12,209,298) (21,207,581) (2,562,385)
Share-based compensation -
share option (Note 2) (3,289,293) (3,349,954) (404,755)
Total operating expenses (31,385,036) (51,536,195) (6,226,810)
Income from operations 25,475,967 18,378,717 2,220,590
Interest and investment income 218,856 4,763,127 575,500
Other income 420,133 31,814 3,844
Income before provision for
income tax 26,114,956 23,173,658 2,799,934
Income tax expense (9,713,258) (7,281,976) (879,837)
Net income 16,401,698 15,891,682 1,920,097
Amount allocated to participating
holders of Series A Preference
Shares (5,355,880) -- --
Income attributable to common
shareholders 11,045,818 15,891,682 1,920,097
Earnings per share:
Basic 0.38 0.29 0.03
Diluted 0.36 0.28 0.03
Earnings per ADS (Note 3):
Basic 0.76 0.57 0.07
Diluted 0.71 0.55 0.07
Weighted average number of common
shares outstanding:
Basic 28,993,791 55,756,056 55,756,056
Diluted 30,998,616 57,402,431 57,402,431
Note 1: The conversion of RMB amounts into USD amounts is based on the
noon buying rate of USD1.00=RMB8.2765 on June 30, 2005 in The
City of New York for cable transfers of RMB as certified for
customs purposes by the Federal Reserve Bank of New York.
Note 2: Aggregate share-based compensation expense attributable to cost
of services and operating expenses was RMB3,751,695 for the three
months ended June 30, 2004 and RMB3,759,343 (US$454,219) for the
three months ended June 30, 2005.
Note 3: Each ADS represents two common shares.
51job, Inc.
Consolidated Statements of Operations
For the Six Months Ended
June 30, June 30, June 30,
2004 2005 2005
(unaudited) (unaudited) (unaudited)
RMB RMB USD (Note 1)
Revenues:
Print advertising 149,259,709 184,192,854 22,254,921
Online recruitment services 49,546,906 70,669,633 8,538,589
Executive search 10,833,165 13,992,996 1,690,690
Other human resource related
revenues 17,077,298 21,254,145 2,568,011
Total revenues 226,717,078 290,109,628 35,052,211
Less: Business and related tax (10,846,788) (16,507,612) (1,994,516)
Net revenues 215,870,290 273,602,016 33,057,695
Cost of services (107,765, 129) (138,254,440) (16,704,457)
Gross profit 108,105,161 135,347,576 16,353,238
Operating expenses:
Sales and marketing (29,490,147) (58,682,451) (7,090,250)
General and administrative (27,380,253) (43,565,986) (5,263,818)
Share-based compensation -
share options (Note 2) (12,044,768) (6,640,757) (802,362)
Total operating expenses (68,915,168 (108,889,194) (13,156,430)
Income from operations 39,189,993 26,458,382 3,196,808
Interest and investment income 461,763 9,636,930 1,164,373
Other income 492,566 453,473 54,790
Income before provision for
income tax 40,144,322 36,548,785 4,415,971
Income tax expense (14,930,141) (11,481,811) (1,387,279)
Net income 25,214,181 25,066,974 3,028,692
Amount allocated to participating
holders of Series A
Preference Shares (8,206,217) -- --
Income attributable to common
shareholders 17,007,964 25,066,974 3,028,692
Earnings per share:
Basic 0.59 0.45 0.05
Diluted 0.55 0.44 0.05
Earnings per ADS (Note 3):
Basic 1.18 0.90 0.11
Diluted 1.11 0.87 0.11
Weighted average number of
common shares outstanding:
Basic 28,876,086 55,708,098 55,708,098
Diluted 30,741,727 57,510,596 57,510,596
Note 1: The conversion of RMB amounts into USD is amounts based on the
noon buying rate of USD1.00=RMB8.2765 on June 30, 2005 in The
City of New York for cable transfers of RMB as certified for
customs purposes by the Federal Reserve Bank of New York.
Note 2: Aggregate share-based compensation expense attributable to cost
of services and operating expenses was RMB13,010,393 for the six
months ended June 30, 2004 and RMB7,430,939 (US$897,836) for the
six months ended June 30, 2005.
Note 3: Each ADS represents two common shares.
51job, Inc.
Consolidated Balance Sheets
December 31, June 30, June 30,
2004 2005 2005
(audited) (unaudited) (unaudited)
RMB RMB USD (Note1)
ASSETS
Current assets:
Cash 848,292,672 865,185,629 104,535,206
Short-term investments -- 10,480,312 1,266,273
Accounts receivable (net of
allowance of RMB3,689,222
and RMB3,098,393 as of
December 31, 2004 and June
30, 2005, respectively) 23,252,468 44,752,384 5,407,163
Prepayments and other
current assets 14,675,948 12,153,946 1,468,488
Deferred tax assets,
current 7,426,098 4,527,733 547,059
Total current assets 893,647,186 937,100,004 113,224,189
Investments 10,495,490 -- --
Property and equipment 22,534,875 33,390,918 4,034,425
Intangible assets 6,126,749 8,215,721 992,656
Other long-term assets 4,201,919 4,347,054 525,230
Deferred tax assets, non-current 376,122 388,798 46,976
Total assets 937,382,341 983,442,495 118,823,476
LIABILITIES
Current liabilities:
Accounts payable 9,820,033 11,885,047 1,435,998
Due to related parties 1,577,873 1,800,660 217,563
Salary and employee related
accrual 11,698,665 15,545,033 1,878,214
Taxes payable 30,586,768 9,618,796 1,162,182
Advance from customers 17,777,757 36,715,727 4,436,142
Other payables and accruals 13,933,686 22,875,225 2,763,877
Deferred tax liabilities,
current 169,237 -- --
Total current liabilities 85,564,019 98,440,488 11,893,976
Total liabilities 85,564,019 98,440,488 11,893,976
Commitments and contingencies -- -- --
Shareholders' equity:
Common shares (US$0.0001
par value; 500,000,000 shares
authorized, 55,616,679 and
55,810,193 shares issued and
outstanding as of December 31,
2004 and June 30, 2005,
respectively) 46,044 46,200 5,582
Additional paid-in capital 869,125,807 868,599,016 104,947,625
Deferred share-based
compensation (40,154,027) (31,535,592) (3,810,257)
Statutory reserves 16,756,461 16,756,461 2,024,583
Other comprehensive loss (501,659) (476,749) (57,603)
Retained earnings 6,545,696 31,612,67 3,819,5701
Total shareholders' equity 851,818,322 885,002,007 106,929,500
Total liabilities and 937,382,341 983,442,495 118,823,476
shareholders' equity
Note 1: The conversion of RMB amounts into USD amounts is based on the
noon buying rate of USD1.00=RMB8.2765 on June 30, 2005 in The
City of New York for cable transfers of RMB as certified for
customs purposes by the Federal Reserve Bank of New York.
For more information, please contact:
Linda Chien, Investor Relations,
51job, Inc.
Tel: +86-21-5292-0720
Email: investor.relations@51job.com
SOURCE 51job, Inc.
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Related links:
http://www.51job.com
CONTACT:
Linda Chien, Investor Relations of 51job,
Inc., +86-21-5292-0720, or investor.relations@51job.com
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