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China Distance Education Holdings Limited (NYSE: DL)
Q2 2019 Earnings Call
May sixteen, 2019, eight:00 a.M. ET

Contents:

Prepared Remarks
Questions and Answers
Call Participants
Prepared Remarks:
Operator

Good evening. Thank you for joining us for the China Distance Education Holdings Limited second area financial yr 2019 profits convention name. On trendy call are Mr. Zhengdong Zhu, Chairman and CEO, and Mr. Marostica, Co-CFO. During control’s organized comments, all contributors will be in a listen-best mode. Following management’s prepared comments, we will open the call for questions.

Before we start, I remind listeners that this convention call incorporates ahead-looking statements. These statements are made underneath the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995.

The outlook for the third quarter and complete fiscal year 2019, oral statements from control on this name, in addition to the corporation’s strategic and operational plans, mainly the expected blessings of strategic boom tasks, such as the promotion of the business enterprise’s lifelong mastering ecosystem, normal class take a look at prep enrollment increase, cost manipulate, and year over yr improvement of operating margins, amongst different things may also incorporate ahead-looking statements.

Forward searching statements contain inherent dangers and uncertainties. A range of factors could purpose real consequences to vary materially from those contained in any forward-searching announcement. Further information regarding this and other risks is blanketed in the agency’s annual file in Form 20-F and different company documents as filed with the Securities and Exchange Commission. The company does no longer undertake any duty to update any forward-looking statements except as required below relevant law.

As a reminder, this convention call is being recorded. In addition, the presentation we can be regarded at some stage in the path of the call may be downloaded from the agency’s investor family members’ internet site. Further, a webcast of this convention name will also be had at the business enterprise’s IR website at ir.Cdeledu.Com.

I will now turn the decision over to Mr. Zhu. Mr. Zhu, please cross ahead.

Zhengdong Zhu — Co-Founder, Chairman of the Board and Chief Executive Officer

[Through Translator] Thank you, all people, for becoming a member of our second zone monetary yr 2019 profits conference call. Our working effects were allotted in advance through net newswire offerings and are published on our website, wherein a slide presentation is available properly.

In the second economic 2019, our internet revenue accelerated with the aid of 30.3% year over 12 months to $38.8 million, exceeding the excessive quit of our steerage variety, in what’s normally our seasonally weakest region of the economic yr in terms of sales and profitability. The 2d zone’s higher-than-expected revenue performance was a consequence of the sturdy boom of our accounting vertical together with a widespread boom of sales from the sale of studying simulation software programs. Revenue from the felony vertical generated with Beijing Ruida additionally contributed to our 2d region sales boom.

Cash receipts from online path registration grew by 29.8% year over year to $ fifty-seven million. Second area cash receipts were buoyed via a sturdy boom in cash receipts from our market-leading accounting vertical and greater student enrollments in our longer duration top rate and elite lessons.

Total enrollments expanded with the aid of 8.9% year over year in the course of the second region due to strong growth in accounting and engineering and production or E&C persevering with training path enrollments.

This yr, we had been a hit in monetizing our longer duration training, which provides our students extra fee-brought offerings, which includes closers oversight from our tutors, employment steering services, customized studying reviews, and longer take a look at periods, amongst others. Such top-class and elite classes are placed at distinctly higher price points than our everyday training.

While our pivot to better value longer period training has driven sturdy cash receipt boom in receipt quarters, we consider our exceptionally lower charge, shorter duration normal training as well as our loose lessons are critical drivers of accelerated visitors to our course websites and assist us, in addition, sell our higher price lessons. And searching ahead to subsequent 12 months’s take a look at education season that allows you to serve our students better; we have fashioned a crew that is focused on improving our route websites with enriched content material and progressed website navigation.