Attached files
Exhibit 99.1
HQ GLOBAL EDUCATION ANNOUNCES FISCAL 2010 FINANCIAL RESULTS
* FY10 REVENUES UP 30.3% YOY TO $47.1M
* FY10 NET INCOME UP 27.2% YOY TO $13.6M
* FY10 GROSS MARGIN OF 38.1%, UP FROM 36.8% IN FY09
CHANGSHA CITY, CHINA -- (Globe Newswire) - November 30, 2010 -- HQ Global
Education Inc. ("HQ" or the "Company") (OTCBB: HQGE), which controls and
operates 10 vocational schools in China under the widely known "HQ" brand and is
one of China's leading providers of customized or "order-oriented" vocational
education, today announced its financial results for the fiscal year ended
August 31, 2010. Summary financial data is provided below:
FISCAL YEAR 2010 FINANCIAL AND OPERATING HIGHLIGHTS
* Revenues generated in fiscal year 2010 increased by 30.3% to $47.1 million,
up from $36.1 million in fiscal 2009
* Tuition and other fees generated $34.8 million or 73.9% of revenues
* Services generated $12.3 million or 26.1% of revenues
* Gross margin for the year was 38.1% based on gross profit of $17.9 million,
compared with a 36.8% margin in fiscal 2009
* Net income for fiscal 2010 increased 27.2% to $13.6 million, compared with
$10.7 million in fiscal 2009
* Earnings per diluted share were $0.49 for the year, compared with diluted
EPS of $0.52 achieved in the previous year
Mr. Guangwen He, Chairman and CEO of the Company, stated, "Our fiscal 2010
performance was highlighted by solid revenue and net income growth, as well as
improved margins. These strong results demonstrate our ability to successfully
manage costs as we expand our operations. We grew our operating network to 10
schools during fiscal 2010, and accumulated enrollment at HQ-operated schools
exceeded 100,000 students. There is an urgent need for skilled workers in
China's rapidly developing economy, and we anticipate that enrollment in
vocational training programs such as ours will continue to increase."
Mr. He continued, "In fiscal 2011, we plan to seek strategic partnerships with
other schools, expand our existing facilities and program offerings, and promote
the HQ brand name to increase our market presence and attract new students to
our schools. By leveraging our strong reputation and successful operating
history, we expect the positive growth pattern of recent years to continue into
2011."
FISCAL YEAR 2010 RESULTS OF OPERATIONS
REVENUES
Revenues for the fiscal year ended August 31, 2010 were $47.1 million as
compared to $36.1 million for the fiscal year ended August 31, 2009. The
increase of $11.0 million, or 30.3%, was primarily due to an increase in student
enrollment at Company-operated schools as well as the expansion of the Company's
operations. Tuition and other fees generated $34.8 million or 73.9% of revenues,
and services generated $12.3 million or 26.1% of revenues.
GROSS PROFIT
Gross profit for the fiscal year ended August 31, 2010 was $17.9 million as
compared to $13.3 million for the period ended August 31, 2009. The increase of
$4.6 million, or 35.1%, was primarily due to an increase in student enrollment
as well as an increase in fee standards for vocational education programs and
order-oriented services, while the related fixed costs remained unchanged. Cost
of revenue for fiscal 2010 was $29.1 million as compared to $22.8 million for
fiscal 2009. The Company's gross margin was 38.1% and 36.8%, for the fiscal year
ended August 31, 2010 and 2009, respectively.
NET INCOME
Net income for the year ended August 31, 2010 was $13.6 million as compared to
$10.7 million for the year ended August 31, 2009. Earnings per diluted share
were $0.49 for fiscal 2010, compared with diluted EPS of $0.52 for the same
period in 2009. The decrease was primarily due to an increase in the number of
weighted average shares outstanding, from 20.5 million shares in fiscal 2009 to
27.5 million shares in fiscal 2010.
CHANGE IN LIQUIDITY AND CAPITAL RESOURCES
As of August 31, 2010, the Company's current assets were $15.5 million and
current liabilities were $5.0 million. Cash and cash equivalents totaled $5.2
million as of August 31, 2010. The Company's shareholders' equity at August 31,
2010 was $40.6 million. The Company generated $15.7 million in cash from
operating activities for the fiscal year ended August 31, 2010, compared to $7.6
million for the same period in 2009. The Company used $17.4 million in net cash
for investing activities for the fiscal year ended August 31, 2010, compared to
$6.2 million for the same period in 2009. The Company generated $3.0 million
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from financing activities for the fiscal year ended August 31, 2010, compared to
$0.9 million used in financing activities for the same period in 2009.
CONFERENCE CALL AND WEBCAST
Management will host a conference call to discuss these financial results today
at 8:30 a.m. Eastern time (5:30 a.m. Pacific).
To participate in the call please dial (877) 941-2069, or (480) 629-9713 for
international calls, approximately 10 minutes prior to the scheduled start time.
Interested parties can also listen via a live Internet webcast, which can be
found at http://ViaVid.net.
A replay of the call will be available for two weeks from 11:30 a.m. EST on
November 30, 2010, until 11:59 p.m. EST on December 14, 2010. The number for the
replay is (877) 870-5176, or (858) 384-5517 for international calls; the pass
code for the replay is 4390105. In addition, a recording of the call will be
available via the company's website at http://hq-education.com/english/index.asp
for one year.
ABOUT HQ GLOBAL EDUCATION INC. ("HQ")
HQ provides "customized training" services to varied student populations by
operating its own private schools or cooperating with selected vocational
schools in China. By rendering full-scale educational and job placement
services, the Company realizes recurring revenues, such as tuition fees, school
logistics services fees, off-campus internship management fees, and job
placement fees. As of August 31, 2010, there were more than 34,000 students from
25 provinces throughout China enrolled in HQ-operated schools. In line with its
"customized education" approach, HQ has established cooperation relationships
with 128 enterprise clients and provides training to students who frequently
become employees of these enterprises. As part of the program, HQ also endeavors
to place students in off-campus internships with the enterprises. HQ has become
increasingly synonymous throughout China with superior training to meet employer
needs and for producing outstanding technical specialists with immediate jobs
and fulfilling career opportunities. For the year ended August 31, 2010, the
employment rate remained 100% for the students who graduated from our vocational
programs.
For more information please visit: http://hq-education.com/english/index.asp.
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
Except for historical information contained herein, the statements in this press
release are forward-looking statements that are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve known and unknown risks and uncertainties,
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which may cause our actual results in future periods to differ materially from
forecasted results. These risks and uncertainties include, among other things,
product demand, market competition, and risks inherent in our operations. These
and other risks are described in our filings with the U.S. Securities and
Exchange Commission.
CONTACTS:
At the Company:
Mr. Guangwen He
Chairman and Chief Executive Officer
HQ Global Education Inc.
http://www.hq-education.com
Tel: (86 731) 88873727
Fax: (86 731) 88873727
Investor Relations:
Dave Gentry, U.S.
RedChip Companies, Inc.
Tel: +1-800-733-2447, Ext. 104
Email: info@redchip.com
Jing Zhang, China
RedChip Beijing Representative Office
Tel: +86 10-8591-0635
Web: http://www.RedChip.com
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HQ GLOBAL EDUCATION INC.
(FORMERLY GREEN STAR MINING CORP.)
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
FOR THE YEAR ENDED AUGUST 31,
2010 2009
------------- -------------
Revenues
Fee based $ 34,755,064 $ 24,838,086
Service based 12,300,242 11,273,272
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47,055,306 36,111,358
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Cost of revenue
Fee based (19,488,030) (14,260,958)
Service based (9,635,489) (8,575,464)
------------- -------------
(29,123,519) (22,836,422)
------------- -------------
Gross profit 17,931,787 13,274,936
Selling expenses (915,265) (640,576)
General and administrative expenses (2,327,716) (1,818,177)
------------- -------------
Income from operations 14,688,806 10,816,183
Other expenses
Interest expenses (107,869) (95,759)
Other expenses (1,011,934) (53,249)
------------- -------------
Total other expenses (1,119,803) (149,008)
------------- -------------
Income before income taxes 13,569,003 10,667,175
Provision for income taxes -- --
------------- -------------
Net income 13,569,003 10,667,175
------------- -------------
Other comprehensive income
Foreign currency translation income 113,404 31,288
------------- -------------
Comprehensive Income $ 13,682,407 $ 10,698,463
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Basic and diluted income per common
share $ 0.49 $ 0.52
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Basic and diluted weighted average
common shares outstanding 27,520,548 20,500,000
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