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The original profit mainly depends on the investment in Xueda Education. The planned investment does not exceed 800 million yuan.


Author: Jin Shang Hua

Source: GPLP Rhino Finance (ID: gplpcn)

On June 19, Xueda Education (000526.SZ) announced that it would invest no more than 800 million yuan in entrusted financial management in the next 12 months. Entrusted wealth management will invest in short-term, low-risk bank wealth management products, structured deposits and monetary funds with high security and good liquidity.

Xueda education relies heavily on investment income. The annual report shows that in 2020, its investment income will reach 73.397 million yuan, accounting for 94.19% of the total profit. Among them, the income from long-term equity investment was RMB 8,899,300, the investment income during the holding period of transactional financial assets was RMB 1,189,600, the investment income from disposal of trading financial assets was RMB 47.593,000, and the income from bank wealth management products was RMB 15.716 million.

In addition, on June 19, Xueda Education issued another announcement stating that as of June 17, 2021, the company’s fund-raising account balance was about 559 million yuan, and about 247 million yuan of raised funds had been used. Among them, the adjusted investment projects and use plans of raised funds include: teaching online store construction project, teaching network optimization project, OMO online trading platform construction project, repayment of shareholder Ziguang Zhuoyuan’s loan, etc.

The financial report shows that in the first quarter of 2021, Xueda’s education revenue was 692 million yuan, a year-on-year increase of 15.31%; net profit was 5,366,900 yuan, a year-on-year increase of 133.47%, turning losses into profits.

It is worth noting that on May 18, the Beijing Municipal Education Commission issued the “Notice on Examining Problems Found in Off-campus Training Institutions”, which was on the Educational List of Xueda University. The reason for the notification was that it carried out improper advertisements such as low-price marketing and sales anxiety.

(This article is for reference only, does not constitute investment advice, and operates at your own risk accordingly)