Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2018shares | |
Document And Entity Information [Abstract] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2018 |
Document Fiscal Year Focus | 2018 |
Document Fiscal Period Focus | FY |
Trading Symbol | REDU |
Entity Registrant Name | RISE Education Cayman Ltd |
Entity Central Index Key | 0001712178 |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | No |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Filer Category | Accelerated Filer |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | true |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 113,779,244 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Current assets: | |||
Cash and cash equivalents | ¥ 1,288,080 | $ 187,343 | ¥ 1,055,982 |
Restricted cash | 28,705 | 4,175 | 28,913 |
Accounts receivable, net | 2,438 | 355 | 2,470 |
Amounts due from a related party | 190 | 28 | 6,604 |
Inventories | 11,320 | 1,646 | 7,905 |
Prepayments and other current assets | 71,537 | 10,405 | 40,571 |
Total current assets | 1,402,270 | 203,952 | 1,142,445 |
Non-current assets: | |||
Property and equipment, net | 128,412 | 18,677 | 100,177 |
Intangible assets, net | 198,057 | 28,806 | 200,615 |
Goodwill | 491,969 | 71,554 | 475,732 |
Deferred tax assets | 6,713 | 976 | 2,404 |
Other non-current assets | 53,353 | 7,760 | 34,965 |
Total non-current assets | 878,504 | 127,773 | 813,893 |
Total assets | 2,280,774 | 331,725 | 1,956,338 |
Current liabilities | |||
Current portion of long-term loan | 82,506 | 12,000 | |
Accounts payable | 8,426 | 1,225 | 6,041 |
Accrued expenses and other current liabilities | 159,882 | 23,254 | 171,099 |
Deferred revenue and customer advances | 1,002,796 | 145,851 | 812,821 |
Due to a related party | 20,000 | ||
Income taxes payable | 25,262 | 3,674 | 20,739 |
Total current liabilities | 1,278,872 | 186,004 | 1,030,700 |
Non-current liabilities | |||
Long-term loan | 502,356 | 73,065 | 623,439 |
Non-current deferred revenue and customer advances | 36,037 | 5,241 | |
Deferred tax liabilities | 14,541 | 2,115 | 3,785 |
Other non-current liabilities | 8,134 | 1,183 | 2,682 |
Total non-current liabilities | 561,068 | 81,604 | 629,906 |
Total liabilities | 1,839,940 | 267,608 | 1,660,606 |
Commitments and contingencies | |||
Shareholders' equity: | |||
Ordinary shares (US$0.01 par value; 200,000,000 and 200,000,000 shares authorized, 110,000,00 and 113,779,244 shares issued and outstanding as of December 31, 2017 and 2018, respectively) | 7,074 | 1,029 | 6,782 |
Additional paid-in capital | 600,011 | 87,268 | 532,474 |
Treasury shares, at cost | (23,460) | (3,412) | |
Statutory reserves | 78,345 | 11,395 | 46,366 |
Accumulated deficit | (248,674) | (36,168) | (315,531) |
Accumulated other comprehensive income | 42,459 | 6,175 | 40,040 |
Total RISE Education Cayman Ltd shareholders' equity | 455,755 | 66,287 | 310,131 |
Non-controlling interests | (14,921) | (2,170) | (14,399) |
Total equity | 440,834 | 64,117 | 295,732 |
Total liabilities and shareholders' equity | ¥ 2,280,774 | $ 331,725 | ¥ 1,956,338 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017CNY (¥)shares |
Statement of Financial Position [Abstract] | |||
Variable Interest Entity, Consolidated, Liabilities, Current, No Recourse | ¥ 1,124,250 | $ 163,515 | ¥ 897,630 |
Variable Interest Entity, Consolidated, Liabilities, Noncurrent, No Recourse | ¥ 39,275 | $ 5,712 | ¥ 2,682 |
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.01 | ||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 | 200,000,000 |
Common Stock, Shares, Issued | 113,779,244 | 113,779,244 | 110,000,000 |
Common Stock, Shares, Outstanding | 113,779,244 | 113,779,244 | 110,000,000 |
CONSOLIDATED STATEMENTS OF (LOS
CONSOLIDATED STATEMENTS OF (LOSS)/INCOME ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥)¥ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017CNY (¥)¥ / sharesshares | Dec. 31, 2016CNY (¥)¥ / sharesshares | |
Income Statement [Abstract] | ||||
Revenues | ¥ 1,271,888 | $ 184,989 | ¥ 969,275 | ¥ 710,993 |
Cost of revenues | (576,530) | (83,853) | (452,220) | (363,579) |
Gross profit | 695,358 | 101,136 | 517,055 | 347,414 |
Operating expenses: | ||||
Selling and marketing | (245,662) | (35,730) | (177,993) | (128,475) |
General and administrative | (242,084) | (35,210) | (339,690) | (148,093) |
Total operating expenses | (487,746) | (70,940) | (517,683) | (276,568) |
Operating income/(loss) | 207,612 | 30,196 | (628) | 70,846 |
Interest income | 26,376 | 3,836 | 19,559 | 16,622 |
Interest expense | (33,803) | (4,916) | (26,589) | (6,073) |
Foreign currency exchange (loss)/gain | (1,383) | (201) | 388 | (2,741) |
Other income, net | 15,397 | 2,239 | 6,594 | 4,391 |
Income/(loss) before income tax expense | 214,199 | 31,154 | (676) | 83,045 |
Income tax expense | (71,763) | (10,438) | (52,924) | (32,202) |
Net income/(loss) | 142,436 | 20,716 | (53,600) | 50,843 |
Add: Net loss attributable to non-controlling interests | 522 | 76 | 5,626 | 3,080 |
Net income/(loss) attributable to RISE Education Cayman Ltd | ¥ 142,958 | $ 20,792 | ¥ (47,974) | ¥ 53,923 |
Net income/(loss) per share: | ||||
Basic | (per share) | ¥ 1.26 | $ 0.18 | ¥ (0.47) | ¥ 0.54 |
Diluted | (per share) | 1.23 | 0.18 | (0.47) | 0.54 |
Net income/(loss) per ADS (1 ADS equals 2 ordinary shares): | ||||
Basic | (per share) | 2.51 | 0.37 | (0.94) | 1.08 |
Diluted | (per share) | ¥ 2.47 | $ 0.36 | ¥ (0.94) | ¥ 1.08 |
Shares used in net income/(loss) per share computation | ||||
Basic | 113,812,182 | 113,812,182 | 101,890,411 | 100,000,000 |
Diluted | 115,881,867 | 115,881,867 | 101,890,411 | 100,000,000 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Statement of Comprehensive Income [Abstract] | ||||
Net income/(loss) | ¥ 142,436 | $ 20,716 | ¥ (53,600) | ¥ 50,843 |
Other comprehensive income/(loss), net of tax of nil: | ||||
Foreign currency translation adjustments | 2,419 | 352 | (10,424) | 22,275 |
Other comprehensive income/(loss) | 2,419 | 352 | (10,424) | 22,275 |
Comprehensive income/(loss) | 144,855 | 21,068 | (64,024) | 73,118 |
Add: comprehensive loss attributable to non-controlling interests | 522 | 76 | 5,626 | 3,080 |
Comprehensive income/(loss) attributable to RISE Education Cayman Ltd | ¥ 145,377 | $ 21,144 | ¥ (58,398) | ¥ 76,198 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY ¥ in Thousands, $ in Thousands | CNY (¥)shares | USD ($)shares | Common Stock [Member]CNY (¥)shares | Common Stock [Member]USD ($)shares | Additional Paid-in Capital [Member]CNY (¥) | Additional Paid-in Capital [Member]USD ($) | Treasury Stock [Member]CNY (¥) | Treasury Stock [Member]USD ($) | Statutory Reserves [Member]CNY (¥) | Statutory Reserves [Member]USD ($) | Retained Earnings [Member]CNY (¥) | Retained Earnings [Member]USD ($) | AOCI Attributable to Parent [Member]CNY (¥) | AOCI Attributable to Parent [Member]USD ($) | Parent [Member]CNY (¥) | Parent [Member]USD ($) | Noncontrolling Interest [Member]CNY (¥) | Noncontrolling Interest [Member]USD ($) | |
Balance at Dec. 31, 2015 | ¥ 751,325 | ¥ 6,120 | ¥ 878,385 | ¥ 25,870 | ¥ (181,546) | ¥ 28,189 | ¥ 757,018 | ¥ (5,693) | |||||||||||
Balance (Shares) at Dec. 31, 2015 | shares | 100,000,000 | 100,000,000 | |||||||||||||||||
Appropriation of statutory reserves | 6,641 | (6,641) | |||||||||||||||||
Distribution to a shareholder | [1] | (426,016) | (426,016) | (426,016) | |||||||||||||||
Net income/(loss) | 50,843 | 53,923 | 53,923 | (3,080) | |||||||||||||||
Other comprehensive income | 22,275 | 22,275 | 22,275 | ||||||||||||||||
Balance at Dec. 31, 2016 | 398,427 | ¥ 6,120 | 452,369 | 32,511 | (134,264) | 50,464 | 407,200 | (8,773) | |||||||||||
Balance (Shares) at Dec. 31, 2016 | shares | 100,000,000 | 100,000,000 | |||||||||||||||||
Issuance of ordinary shares upon initial public offering ("IPO"), net of offering costs | 437,829 | ¥ 662 | 437,167 | 437,829 | |||||||||||||||
Issuance of ordinary shares upon initial public offering ("IPO"), net of offering costs (in shares) | shares | 10,000,000 | 10,000,000 | |||||||||||||||||
Share-based compensation (Note 15) | 95,307 | 95,307 | 95,307 | ||||||||||||||||
Appropriation of statutory reserves | 13,855 | (13,855) | |||||||||||||||||
Distribution to a shareholder | [1] | (571,807) | (452,369) | (119,438) | (571,807) | ||||||||||||||
Net income/(loss) | (53,600) | (47,974) | (47,974) | (5,626) | |||||||||||||||
Other comprehensive income | (10,424) | (10,424) | (10,424) | ||||||||||||||||
Balance at Dec. 31, 2017 | 295,732 | ¥ 6,782 | 532,474 | 46,366 | (315,531) | 40,040 | 310,131 | (14,399) | |||||||||||
Balance (Shares) at Dec. 31, 2017 | shares | 110,000,000 | 110,000,000 | |||||||||||||||||
Issuance of ordinary shares for business acquisition ,Value | [1] | 9,212 | ¥ 14 | 9,198 | 9,212 | ||||||||||||||
Issuance of ordinary shares for business acquisition, Shares | shares | 216,021 | 216,021 | |||||||||||||||||
Issuances in relation to share option exercise | ¥ 39,986 | ¥ 278 | 39,708 | 39,986 | |||||||||||||||
Issuances in relation to share option exercise (Shares) | shares | 4,388,397 | 4,388,397 | 4,388,397 | 4,388,397 | |||||||||||||||
Cash-settled share-based compensation (Note 15) | ¥ (1,721) | (1,721) | (1,721) | ||||||||||||||||
Share-based compensation (Note 15) | 20,352 | 20,352 | 20,352 | ||||||||||||||||
Appropriation of statutory reserves | 31,979 | (31,979) | |||||||||||||||||
Repurchase of ordinary shares, Value | [2] | (23,460) | ¥ (23,460) | (23,460) | |||||||||||||||
Repurchase of ordinary shares, Shares | shares | (825,174) | (825,174) | |||||||||||||||||
Net income/(loss) | 142,436 | $ 20,716 | 142,958 | 142,958 | (522) | ||||||||||||||
Other comprehensive income | 2,419 | 352 | 2,419 | 2,419 | |||||||||||||||
Balance at Dec. 31, 2018 | 440,834 | $ 64,117 | ¥ 7,074 | $ 1,029 | ¥ 600,011 | $ 87,268 | ¥ (23,460) | $ (3,412) | ¥ 78,345 | $ 11,395 | (248,674) | $ (36,168) | ¥ 42,459 | $ 6,175 | 455,755 | $ 66,287 | ¥ (14,921) | $ (2,170) | |
Balance (Shares) at Dec. 31, 2018 | shares | 113,779,244 | 113,779,244 | |||||||||||||||||
Effect of adoption of ASU 2014-09 (Note 4) | ¥ (44,122) | ¥ (44,122) | ¥ (44,122) | ||||||||||||||||
[1] | On November 1, 2017, the Group acquired 100% equity interest of Edge Franchising, a leading Hong Kong-based admissions consulting company specializing in overseas boarding school and college placement, and certain fixed assets, intellectual properties, material contracts and key employees of the educational consulting business ("Edge Business") from a seller in which a managing director of Bain Capital Education IV Cayman Limited ("Bain Capital Education IV") is a director and minority shareholder (Note 12). In accordance with the sale and purchase agreement, the Company shall issue to the selling shareholder 216,021 ordinary shares, which was issued on January 2, 2018. | ||||||||||||||||||
[2] | In November 2018, the Board of Directors approved share repurchase program to purchase up to US$30,000 of the Company's ordinary shares. As of December 31, 2018, pursuant to the share repurchase program, the Company repurchased 412,587 outstanding ADS representing 825,174 outstanding ordinary shares for an aggregated purchase price of RMB23,460, of which RMB2,093 was not settled. (Note 2) |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) ¥ in Thousands, $ in Thousands | Nov. 01, 2017shares | Dec. 31, 2018CNY (¥)shares | Nov. 30, 2018USD ($) |
Share repurchase program, authorized amount | $ | $ 30,000 | ||
Repurchase of ordinary share | ¥ 21,367 | ||
Share Repurchase Plan [Member] | |||
Repurchase of ordinary shares | 825,174,000 | ||
American Depository Shares [Member] | |||
Repurchase of ordinary shares, not settled | ¥ | ¥ 2,093 | ||
American Depository Shares [Member] | Share Repurchase Plan [Member] | |||
Repurchase of ordinary shares | 412,587,000 | ||
Repurchase of ordinary share | ¥ | ¥ 23,460 | ||
Edge Franchising Co Limited Edge Franchising [Member] | |||
Issuance of ordinary shares for business acquisition, Shares | 216,021 | ||
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | 100.00% |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net income/(loss) | ¥ 142,436 | $ 20,716 | ¥ (53,600) | ¥ 50,843 |
Adjustments to reconcile net income/(loss) to net cash generated from operating activities: | ||||
Depreciation and amortization expenses | 58,225 | 8,469 | 49,711 | 69,822 |
Share-based compensation | 18,631 | 2,710 | 95,307 | |
Loss/(gain) on disposal of equipment | (94) | (13) | 33 | 16 |
Amortization of debt issuance cost | 8,225 | 1,196 | 5,129 | |
Deferred income tax (benefit)/expense | 6,740 | 980 | 1,151 | (4,763) |
Changes in operating assets and liabilities: | ||||
Prepayments and other current assets | (29,839) | (4,340) | 2,617 | (16,756) |
Accounts receivable, net | 112 | 16 | (1,695) | |
Amounts due from a related party | 6,277 | 913 | (6,733) | |
Inventories | (3,415) | (497) | (2,372) | 430 |
Accounts payable | 2,385 | 347 | 1,973 | 1,130 |
Accrued expenses and other current liabilities | 8,308 | 1,208 | 47,427 | 20,520 |
Income taxes payable | 4,242 | 617 | (2,543) | 17,959 |
Deferred revenue and customer advances | 181,828 | 26,446 | 201,004 | 111,406 |
Due to a related party | (20,000) | (2,909) | 20,000 | |
Other non-current assets | (9,479) | (1,378) | (7,659) | (3,093) |
Other non-current liabilities | 5,452 | 793 | 350 | (6,534) |
Net cash generated from operating activities | 380,034 | 55,274 | 350,100 | 240,980 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Proceeds from disposal of equipment | 100 | 14 | 12 | 190 |
Purchase of property and equipment | (65,210) | (9,484) | (50,336) | (35,450) |
Purchase of intangible assets | (8,780) | (1,277) | (2,743) | (8,317) |
Purchase of short-term investments | (405,000) | (58,905) | (390,000) | (615,100) |
Proceeds from maturity of short-term investments | 405,000 | 58,905 | 390,000 | 616,133 |
Acquisition of subsidiaries, net of cash acquired | (18,076) | (2,629) | ||
Business acquisition advance payment | (8,909) | (1,296) | ||
Loans to a related party | (150,000) | (21,817) | (150,000) | (280,000) |
Repayment of loans to a related party | 150,000 | 21,817 | 150,000 | 280,000 |
Net cash used in investing activities | (100,875) | (14,672) | (53,067) | (42,544) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||||
Proceeds from loans, net of issuance costs | 573,019 | 356,887 | ||
Principal repayments on loans | (75,924) | (11,043) | (301,639) | |
Repurchase of ordinary shares | (21,367) | (3,108) | ||
Proceeds from IPO, net of capitalized expenses | 437,829 | |||
Proceeds from exercise of share options | 39,985 | 5,816 | ||
Distribution to a shareholder | (571,807) | (426,016) | ||
Net cash (used in)/generated from financing activities | (57,306) | (8,335) | 137,402 | (69,129) |
Effects of exchange rate changes | 10,037 | 1,460 | (6,228) | 5,234 |
Net increase in cash, cash equivalents and restricted cash | 231,890 | 33,727 | 428,207 | 134,541 |
Cash, cash equivalents and restricted cash at beginning of year | 1,084,895 | 157,791 | 656,688 | 522,147 |
Cash, cash equivalents and restricted cash at end of year | 1,316,785 | 191,518 | 1,084,895 | 656,688 |
Supplemental disclosures of cash flow information: | ||||
Cash and cash equivalent | 1,288,080 | 1,055,982 | 639,999 | |
Restricted cash | 28,705 | 4,175 | 28,913 | 16,689 |
Income taxes paid | (55,326) | (8,047) | (53,418) | (25,845) |
Interest expense paid | (26,707) | (3,884) | (20,472) | (4,170) |
Non-cash investing activities: | ||||
Purchase of property and equipment included in accrued expenses and other current liabilities | (8,298) | (1,207) | (9,241) | ¥ (7,292) |
Consideration for business acquisitions included in accrued expenses and other current liabilities | ¥ 2,000 | $ 291 | ¥ 25,980 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BASIS OF PRESENTATION | 1. ORGANIZATION AND BASIS OF PRESENTATION RISE Education Cayman Ltd (the “Company”) is a limited company incorporated in the Cayman Islands under the laws of Cayman Islands on July 16, 2013. On September 30, 2013 (the “Acquisition date”), the Company acquired from certain third-party sellers a junior English Language Training (“ELT”) business (the “Acquisition”). In October 2017, the Group completed an initial public offering (“IPO”) and issued 5,000,000 American depositary shares representing 10,000,000 of the Company’s ordinary shares. The Company does not conduct any substantive operations on its own but instead conducts its primary business operations through its wholly-owned subsidiaries, the variable interest entity (the “VIE”), and the VIE’s subsidiaries and schools, which are located in the People’s Republic of China (the “PRC”) and Hong Kong Special Administration Region (“Hong Kong”). The VIE, the VIE’s subsidiaries and schools, hereinafter are collectively referred to as the “VIEs”. The accompanying consolidated financial statements include the financial statements of the Company, its wholly-owned subsidiaries and the VIEs (hereinafter collectively referred to as the “Group”). The Group is principally engaged in the business of providing junior ELT services in China primarily under the “RISE” brand. The Group offers a wide range of educational programs, services and products, consisting primarily of educational courses, sale of course materials, franchise services, and study tours. As of December 31, 2018, details of the Company’s subsidiaries, the VIE and the VIE’s subsidiaries and schools are as follows: Name Date of establishment Place of Percentage Principal activity Subsidiaries of the Company: RISE Education Cayman III Ltd (“Cayman III”) July 29, 2013 Cayman Islands 100% Investment holding RISE Education Cayman I Ltd (“Cayman”) June 19, 2013 Cayman Islands 100% Investment holding Rise IP (Cayman) Limited (“Rise IP”) July 24, 2013 Cayman Islands 100% Educational consulting Edge Franchising Co., Limited (“Edge Franchising”) March 16, 2016 Hong Kong 100% Educational consulting Bain Capital Rise Education (HK) Limited (“Rise HK”) June 24, 2013 Hong Kong 100% Educational consulting Edge Online Co. Limited April 1, 2018 Hong Kong 100% Educational consulting Rise (Tianjin) Education Information Consulting Co., Ltd. (“Rise Tianjin” or “WFOE”) August 12, 2013 PRC 100% Educational consulting, Sale of course materials, study tour service VIE: Beijing Step Ahead Education Technology Development Co., Ltd. January 2, 2008 PRC — Educational consulting VIE’s subsidiaries and school: Beijing Haidian District Step Ahead Training School September 18, 2008 PRC — Language education Beijing Shijingshan District Step Ahead Training School July 14, 2009 PRC — Language education Beijing Changping District Step Ahead Training School July 3, 2009 PRC — Language education Beijing Chaoyang District Step Ahead Training School July 20, 2009 PRC — Language education Beijing Xicheng District RISE Immersion Subject English Training School February 5, 2010 PRC — Language education Beijing Dongcheng District RISE Immersion Subject English Training School July 30, 2010 PRC — Language education Beijing Tongzhou District RISE Immersion Subject English Training School April 19, 2011 PRC — Language education Beijing Daxing District RISE Immersion Subject English Training School March 31, 2013 PRC — Language education Beijing Fengtai District Step Ahead Training School February 28, 2012 PRC — Language education Beijing RISE Immersion Subject English Training School Co., Ltd. October 26, 2018 PRC — Language education Shanghai Boyu Investment Management Co., Ltd. January 29, 2012 PRC — Language education Shanghai Riverdeep Education Information Consulting Co., Ltd. March 8, 2010 PRC — Educational consulting services Shanghai Huangpu District RISE Immersion Subject English Training School June 17, 2011 PRC — Language education Guangzhou Ruisi Education Technology Development Co., Ltd. August 17, 2012 PRC — Training services Guangzhou Yuexiu District RISE Immersion Subject English Training School April 29, 2014 PRC — Language education Guangzhou Haizhu District RISE Immersion Subject English Training School-Chigang December 8, 2014 PRC — Language education Guangzhou Tianhe District RISE Immersion Subject English Training School July 11, 2017 PRC — Language education Hebei Camphor Tree Information Technology Co., Ltd. November 5, 2015 PRC — Investment holding Shijiazhuang Forest Rock Education Technology Co., Ltd. August 28, 2018 PRC — Investment holding Shenzhen Mei Ruisi Education Management Co., Ltd. February 28, 2014 PRC — Training services Shenzhen Futian District Rise Training Center January 8, 2015 PRC — Language education Shenzhen Nanshan District Rise Training Center May 26, 2015 PRC — Language education Shenzhen Luohu District Rise Training Center August 3, 2017 PRC — Language education Wuxi Rise Foreign Language Training Co., Ltd. June 5, 2013 PRC — Training services Ruisixing (Tianjin) Travel Services Co., Ltd July 3, 2018 PRC — Traveling services The VIE arrangements PRC laws and regulations currently require any foreign entity that invests in the education business in China to be an educational institution with relevant experience in providing educational services outside China. The Group’s offshore holding companies are not educational institutions and do not provide educational services outside China. Accordingly, the Group’s offshore holding companies are not allowed to directly engage in the education business in China. To comply with PRC laws and regulations, the Group conducts all of its junior ELT business in China through the VIEs. The VIEs hold the requisite licenses and permits necessary to conduct the Group’s junior ELT business. In addition, the VIEs hold leases and other assets necessary to operate the Group’s schools, employ teachers and generate substantially all of the Group’s revenues. Despite the lack of technical majority ownership, the Company has effective control of the VIE through a series of contractual arrangements (the “Contractual Agreements”) and a parent-subsidiary relationship exists between the Company and the VIE. The equity interests of the VIE are legally held by PRC individuals (the “Nominee Shareholders”). Through the Contractual Agreements, the nominee shareholders of the VIE effectively assign all their voting rights underlying their equity interests in the VIE to the Company, and therefore, the Company has the power to direct the activities of the VIE that most significantly impact its economic performance. The Company also has the right to receive economic benefits from the VIE that potentially could be significant to the VIE. Based on the above, the Company consolidates the VIE in accordance with SEC Regulation SX-3A-02 810-10, Consolidation: Overall. The following is a summary of the Contractual Agreements: Proxy Agreement. Loan Agreements. Call Option Agreement. Business Cooperation Agreement. Equity Pledge Agreement. Consulting Services Agreements. Service Agreement. Comprehensive Services Agreements. License Agreements. Spousal Consent Letters. In November 2016, certain Contractual Agreements were supplemented to reflect a change in one of the Nominee Shareholders designated by Rise HK, and it was resolved that Rise HK through the WFOE held the irrevocable proxy to exercise all the voting rights of the shareholders of the VIE since the Proxy Agreement was in existence. As a result, Rise HK has the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and is the primary beneficiary of the VIE. In June 2017, certain Contractual Arrangements were supplemented to reflect a change in one of the Nominee Shareholders designated by Rise HK. Based on the opinion of the Company’s PRC legal counsel, (i) the ownership structure of the Group, including its subsidiaries in the PRC and VIEs are in compliance with all existing PRC laws and regulations; and (ii) each of the Contractual Agreements among Rise HK, the WFOE, the VIEs and the Nominee Shareholders governed by PRC laws, are legal, valid and binding, enforceable against such parties, and will not result in any violation of PRC laws or regulations currently in effect. However, uncertainties in the PRC legal system could cause the relevant regulatory authorities to find the current Contractual Agreements and businesses to be in violation of any existing or future PRC laws or regulations. If the Company, Rise HK, the WFOE or any of its current or future VIEs are found in violation of any existing or future laws or regulations, or fail to obtain or maintain any of the required permits or approvals, the relevant PRC regulatory authorities would have broad discretion in dealing with such violations, which may include, but not limited to, revocation of business and operating licenses, being required to discontinue or restrict its business operations, restriction of the Group’s right to collect revenues, being required to restructure its operations, imposition of additional conditions or requirements with which the Group may not be able to comply, or other regulatory or enforcement actions against the Group that could be harmful to its business. The imposition of any of these or other penalties may result in a material and adverse effect on the Group’s ability to conduct its business. In addition, if the imposition of any of these penalties causes the Company to lose the rights to direct the activities of the VIEs or the right to receive their economic benefits, the Company would no longer be able to consolidate the VIEs. The following financial statement balances and amounts of the VIEs were included in the accompanying consolidated financial statements: As at December 31, 2017 2018 2018 RMB RMB US$ Cash and cash equivalents 654,777 947,626 137,826 Restricted cash 10,441 13,442 1,955 Accounts receivable, net 1,364 38 6 Inventories 1,952 1,978 288 Prepayments and other current assets 32,621 59,141 8,602 Amounts due from the Group’s subsidiaries 106,748 18,422 2,679 Total current assets 807,903 1,040,647 151,356 Property and equipment, net 92,803 118,482 17,232 Intangible assets, net 1,060 2,579 375 Goodwill 145,781 146,666 21,332 Deferred tax assets 2,404 6,157 895 Other non-current 31,681 51,660 7,514 Total non-current 273,729 325,544 47,348 Total assets 1,081,632 1,366,191 198,704 Accounts payable 3,168 7,558 1,099 Accrued expenses and other liabilities 100,156 126,455 18,392 Deferred revenue and customer advances 776,052 970,022 141,084 Income taxes payable 18,254 20,215 2,940 Amounts due to the Group’s subsidiaries 67,990 44,208 6,430 Total current liabilities 965,620 1,168,458 169,945 Non-current — 36,037 5,241 Other non-current 2,682 3,238 471 Total non-current 2,682 39,275 5,712 Total liabilities 968,302 1,207,733 175,657 For the Years ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Revenues 673,264 912,166 1,175,618 170,987 Net (loss)/income (24,532 ) 24,771 85,753 12,472 Net cash provided by operating activities 49,586 263,813 368,546 53,603 Net cash used in investing activities (26,792 ) (46,630 ) (72,695 ) (10,573 ) The revenue-producing assets that are held by the VIEs comprise of property and equipment, student base and franchise agreements. The VIEs contributed an aggregate of 95%, 94% and 92% of the consolidated revenues for the years ended December 31, 2016, 2017 and 2018, respectively, after elimination of inter-company transactions. As of December 31, 2018, there was no pledge or collateralization of the VIEs’ assets that can only be used to settle obligations of the VIEs. Other than the amounts due to subsidiaries of the Group (which are eliminated upon consolidation), all remaining liabilities of the VIEs are without recourse to the Company. The Company did not provide nor intend to provide financial or other support not previously contractually required to the VIEs during the years presented. Relevant PRC laws and regulations restrict the VIEs from transferring a portion of its net assets, equivalent to the balance of its paid-in |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | 2. SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The consolidated financial statements of the Group have been prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”). Principles of consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries, and the VIEs. All significant inter-company transactions and balances between the Company, its subsidiaries and the VIEs have been eliminated upon consolidation. Results of subsidiaries, businesses acquired from third parties and the VIEs are consolidated from the date on which control is obtained by the Company. Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and revenue and expenses in the consolidated financial statements and accompanying notes. Significant accounting estimates reflected in the Group’s consolidated financial statements include valuation allowance for deferred tax assets, uncertain tax positions, the initial valuation of the assets acquired and liabilities assumed in a business combination, economic lives and impairment of long-lived assets, impairment of goodwill, standalone selling prices of performance obligations of revenue contracts, accounts receivable and contract assets allowances, and share-based compensation. Actual results could differ from those estimates. Convenience translation Amounts in the United States Dollars (“US$”) are presented for the convenience of the reader and are translated at the noon buying rate of RMB6.8755 per US$1.00 on December 31, 2018 in the City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York. No representation is made that the RMB amounts could have been, or could be, converted into US$ at such rate. Foreign currency The functional currency of the Company, its Cayman subsidiaries and Rise HK are the US$, the functional currency of Edge franchising and Edge Online Co. Limited are the Hong Kong Dollars (“HK$”). The Company’s PRC subsidiaries and the VIEs determined their functional currency to be Renminbi (the “RMB”). The Group uses the RMB as its reporting currency. Each entity in the Group maintains its financial records in its own functional currency. Transactions denominated in foreign currencies are measured at the exchange rates prevailing on the transaction dates. Monetary assets and liabilities denominated in foreign currencies are remeasured at the exchange rates prevailing at the balance sheet date. Non-monetary The Company uses the average exchange rate for the year and the exchange rate at the balance sheet date to translate the operating results and financial position, respectively. Translation differences are recorded in accumulated other comprehensive income, a component of shareholders’ equity. Cash and cash equivalents Cash and cash equivalents consist of cash on hand and highly liquid investments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less when purchased. Restricted cash Restricted cash primarily represents deposits held in a designated bank account as security for the interest payments on the Group’s long-term loan; and deposits restricted as to withdrawal or use under government regulations. In November 2016, the FASB issued Accounting Standards Update No. 2016-18, beginning-of-period end-of-period Short-term investments The Group’s short-term investments comprise primarily of cash deposits at floating rates based on daily bank deposit rates with original maturities ranging from over three months to six months. Inventories Inventories are finished goods and mainly comprised of textbooks and other educational study tools (“course materials”). Course materials are stated at the lower of cost or market. Cost is determined using the weighted average cost method. As of December 31, 2017 and 2018, the Group did not have any provision for inventories. Property and equipment Property and equipment is stated at cost less accumulated depreciation and impairment. Depreciation is calculated on a straight line basis over the following estimated useful lives: Electronic equipment 3 years Furniture 3 - 5 years Vehicles 4 years Leasehold improvements Shorter of the lease term or estimated useful life Repair and maintenance costs are charged to expense as incurred, whereas the cost of renewals and betterments that extend the useful lives of property and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the cost and accumulated depreciation from the asset and accumulated depreciation accounts with any resulting gain or loss reflected in the consolidated statements of income/(loss). Direct costs that are related to the construction of property and equipment, and incurred in connection with bringing the assets to their intended use are capitalized as construction in progress. Construction in progress is transferred to specific property and equipment, and the depreciation of these assets commences when the assets are ready for their intended use. Segment reporting In accordance with ASC 280, Segment Reporting Non-controlling For certain subsidiaries of the VIE, a non-controlling non-controlling non-controlling non-controlling Goodwill The Group assesses goodwill for impairment in accordance with ASC 350-20, Intangibles—Goodwill and Other: Goodwill 350-20”), 350-20. There was only one reporting unit (that also represented the operating segment) as of December 31, 2017 and 2018, respectively. Goodwill was allocated to the one reporting unit as of December 31, 2017 and 2018, respectively (Note 9). The Group has the option to assess qualitative factors first to determine whether it is necessary to perform the two-step 350-20. more-likely-than-not two-step In performing the two-step Intangible assets Intangible assets with finite lives are carried at cost less accumulated amortization. Amortization of finite-lived intangible assets except for student base is computed using the straight-line method over the estimated useful lives. Student base is amortized using an accelerated pattern based on the estimated student attrition rate of the acquired schools. The estimated useful lives of intangible assets from the date of purchase are as follows: Category Estimated Useful Life Courseware license 15 years Franchise agreements 2.5-3 years Student base 3-5 Trademarks 10-15 years Purchased software 3-5 Teaching course materials 10 years Impairment of long-lived assets other than goodwill The Group evaluates its long-lived assets, including fixed assets and intangible assets with finite lives, for impairment whenever events or changes in circumstances, such as a significant adverse change to market conditions that will impact the future use of the assets, indicate that the carrying amount of an asset may not be fully recoverable. When these events occur, the Group evaluates the recoverability of long-lived assets by comparing the carrying amount of the assets to the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Group recognizes an impairment loss based on the excess of the carrying amount of the assets over their fair value. Fair value is generally determined by discounting the cash flows expected to be generated by the assets, when the market prices are not readily available. For all periods presented, there was no impairment of any of the Group’s long-lived assets. Business Combination We account for business combinations using the purchase method of accounting in accordance with ASC topic 805, Business Combinations non-controlling non-controlling In a business combination achieved in stages, we re-measured re-measurement The determination and allocation of fair values to the identifiable assets acquired, liabilities assumed and non-controlling Fair value of financial instruments Financial instruments include cash and cash equivalents, short-term investments, restricted cash, certain other current assets, accounts payable, long-term loan, customer advances, and certain other current liabilities. The carrying amounts of these financial instruments, except for the long-term loan, approximate their fair values because of their short-term maturities. The carrying amount of the long-term loan approximates its fair value due to the fact that the related interest rate approximates the interest rates currently offered by financial institutions for similar debt instruments of comparable maturities. Adoption of New Revenue Recognition Accounting Standard In August 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-14, 2015-14”). 2015-14 No. 2014-09, 2014-09”), 2015-14, 2014-09 No. 2016-08, 2016-08”), No. 2016-10, 2016-10”), No. 2014-09. No. 2016-12, 2016-12”), non-cash 2016-08, 2016-10 2016-12 No. 2014-09. ASC 606 replaced most current U.S. GAAP guidance on this topic and eliminated most industry-specific guidance. The new revenue recognition standard provides a unified model to determine when and how revenue is recognized. The core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. The new standard superseded substantially all existing revenue recognition guidance. It impacts the revenue recognition for certain of our contracts, in addition to our business processes and our information technology systems. We performed cross-functional coordination to implement the new revenue recognition standard. We are in process of implementing changes to our systems, processes and internal controls to meet the standard’s reporting and disclosure requirements. On January 1, 2018, the Group adopted the new revenue standard utilizing the modified retrospective method. As a result, the Group changed its accounting policy for revenue recognition as detailed below. The Group recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of accumulated deficit. Using the modified retrospective approach, the Group applied the standard only to contracts that are not completed at the date of initial application. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods as the Group believes it is still comparable. Based on the contracts outstanding as of January 1, 2018, adoption of ASC 606 did not have a significant impact except for recognition of initial franchise fees. The Group’s accounting policy before January 1, 2018 was to recognize initial franchise fees when franchisees commence operations under the RISE brand or upon the renewal of the franchise agreements. In accordance with ASC 606, the initial franchise services are not distinct from the continuing rights or services offered during the term of the franchise agreement, and will therefore, be treated as a single performance obligation. Therefore, initial franchise fees should be recognized over the franchise term, which is generally five years under ASC 606. The cumulative effect of the changes made to the Group’s consolidated balance sheets at January 1, 2018 were as follows: December 31, Adjustment due January 1, January 1, RMB RMB RMB US$ Liabilities Deferred revenue and customer advances (current and non-current) 812,821 44,122 856,943 124,637 Shareholders’ equity - Accumulated deficit 315,531 44,122 359,653 52,309 Revenue recognition The Group’s revenue recognition policies effective on the adoption date of ASC 606 are as follows: Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Group expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Group determines are within the scope of the new revenue recognition accounting standard, the Group performs the following five steps: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Group satisfies a performance obligation. The Group only applies the five-step model to contracts when it is probable that the Group will collect the consideration it is entitled to in exchange for the goods or services transferred to the customer. At contract inception, the Group assesses the goods or services promised within each contract to determine those that represent performance obligations, and assess whether each promised good or service is distinct. The Group then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Revenue is recognized net of business tax, value added taxes and tax surcharges. Contract liabilities relate to contracts where the Group received payments but has not yet satisfied the related performance obligations. The advance consideration received from customers for the services is a contract liability until services are provided to the customer and are presented in “deferred revenue and customer advances” in the consolidated balance sheets. Contract assets include costs to obtain contracts with customers. Costs to obtain contracts with customers are incremental costs to obtain franchise contracts, which are recorded as prepayment and other current assets, and other non-current The primary sources of the Group’s revenues are as follows: (a) Educational programs Educational programs’ contracts generally consist of two performance obligations, English courses and course materials, which are both capable of being distinct and distinct in the context of the contract. The transaction price is stated in the contract and known at the time of contract inception, therefore no variable consideration exists. The Group may issue promotional coupons to attract enrollment for its courses. The promotional coupons are not issued in conjunction with a concurrent revenue transaction and are for a fixed RMB amount that can only be redeemed to reduce the amount of the tuition fees for future courses. The promotional coupons are accounted for as a reduction of the transaction price and are allocated across all performance obligations unless observable evidence exists that the discount relates to a specific performance obligation or obligations in the contract. Revenue is allocated to each performance obligation based on its standalone selling price. The Group generally determines standalone selling prices based on the prices charged to students. If the standalone selling price is not observable through past transactions, the Group estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. Course fees are collected in full in advance of the commencement of each course and each course comprises of a fixed amount of classes. The Group uses the student’s daily attendance records, an output measure, to recognize revenue over time as it best depicts the simultaneous consumption and delivery of educational program services. Students are allowed to return course materials if they are unused. However, once the student attends the first class of the respective course, course materials cannot be returned. Therefore, revenue associated with distinct course materials is recognized at the point in time when control transfers to the student, generally when the student attends the first class of the respective course. According to local education bureau regulations, depending on a school’s location and the amount of classes remaining for a course, the Group may be required to refund course fees for any remaining undelivered classes to students who withdraw from a course. The refund is recorded as a reduction of the related course fees received in advance and has no impact on recognized revenue. Refunds on recognized revenue were insignificant for all periods presented. (b) Franchise revenues Franchise revenues includes non-refundable (c) Other revenues Other revenues comprise mainly of the provision of overseas and domestic study tour services and the admission consulting, academic tutoring and test preparation business of the Edge. The Group determined the overseas study tours contract contains a single performance obligation and the Group is the principal in providing overseas study tours services as it controls such services before the services are transferred to the customer. Therefore, the Group recognizes study tours revenue on a gross basis. The Group recognize revenue over the service period of the study tour, which is, generally around two to three weeks, as it best depicts the simultaneous consumption and delivery of overseas study tours services. Edge offers admission consulting, academic tutoring and test preparation services for students who intend to study abroad and each service represents an individual performance obligation. For admission consulting services, the Group uses the input method by reference to the consulting hours incurred up to the end of reporting period as a percentage of total estimated hours to recognize revenue over the contract period which best depict the Group’s efforts toward satisfying the performance obligation relative to the total expected efforts. For academic tutoring and test preparation services, the Group use students’ attendance records, an output measure, to recognize revenue over time as it best depicts the simultaneous consumption and delivery of such services. Advertising expenditures Advertising costs are expensed when incurred and are included in selling expenses in the consolidated statements of income/(loss). For the years ended December 31, 2016, 2017 and 2018, advertising expenses were approximately RMB63,734, RMB80,475 and RMB136,323 (US$19,827), respectively. Leases Leases are classified at the inception date as either a capital lease or an operating lease. A lease is a capital lease if any of the following conditions exists: a) ownership is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the property’s estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. A capital lease is accounted for as if there was an acquisition of an asset and an incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases wherein rental payments are expensed on a straight-line basis over their respective lease term. The Group leases certain office facilities under non-cancelable Income/(loss) per share In accordance with ASC 260, Earnings Per Share Share-based compensation The Group applies ASC 718, Compensation — Stock Compensation In accordance with ASC 718, the Group recognizes share-based compensation cost for equity awards to employees with a performance condition based on the probable outcome of that performance condition — compensation cost is recognized if it is probable that the performance condition will be achieved and shall not be recognized if it is not probable that the performance condition will be achieved. In accordance with ASC 718, the effect of a market condition is reflected in the grant-date fair value of the granted equity awards. The Group recognizes share-based compensation cost for equity awards with a market condition provided that the requisite service is rendered, regardless of when, if ever, the market condition is satisfied. A change in any of the terms or conditions of the awards is accounted for as a modification of the award. When the vesting conditions (or other terms) of the equity awards granted to employees are modified, the Group first determines on the modification date whether the original vesting conditions were expected to be satisfied, regardless of the entity’s policy election for accounting for forfeitures. If the original vesting conditions are not expected to be satisfied, the grant-date fair value of the original equity awards are ignored and the fair value of the equity award measured at the modification date is recognized if the modified award ultimately vests. When a vesting condition that is probable of achievement is modified and the new vesting condition also is probable of achievement, the compensation cost to be recognized if either the original vesting condition or the new vesting condition is achieved cannot be less than the grant-date fair value of the original award. That compensation cost is recognized if either the original or modified vesting condition is achieved. Cancellation of the awards accompanied by the concurrent grant of a replacement award is also accounted for as a modification of the terms of the cancelled awards. Therefore, incremental compensation cost shall be measured as the excess of the fair value of the replacement award or other valuable consideration over the fair value of the cancelled award at the cancellation date. Incremental compensation cost is measured as the excess, if any, of the fair value of the modified award over the fair value of the original award immediately before its terms are modified, measured based on the fair value of the awards and other pertinent factors at the modification date. For vested awards, the Group recognizes incremental compensation cost in the period the modification occurs. For unvested awards, the Group recognizes over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date. If the fair value of the modified award is lower than the fair value of the original award immediately before modification, the minimum compensation cost the Group recognizes is the cost of the original award. The Group uses the accelerated method for all awards granted with graded vesting service conditions, and the straight-line method for awards granted with non-graded Income taxes The Group follows the liability method of accounting for income taxes in accordance with ASC 740, Income Taxes more-likely-than-not The Group accounted for uncertainties in income taxes in accordance with ASC 740. Interest and penalties arising from underpayment of income taxes shall be computed in accordance with the related PRC tax law. The amount of interest expense is computed by applying the applicable statutory rate of interest to the difference between the tax position recognized and the amount previously taken or expected to be taken in a tax return. Interest and penalties recognized in accordance with ASC 740 are classified in the consolidated statements of income/(loss) as income tax expense. In accordance with the provisions of ASC 740, the Group recognizes in its consolidated financial statements the impact of a tax position if a tax return position or future tax position is “more likely than not” to prevail based on the facts and technical merits of the position. Tax positions that meet the “more likely than not” recognition threshold are measured at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. The Group’s estimated liability for unrecognized tax benefits which is included in “other non-current Government subsidies Government subsidies primarily consist of financial subsidies received from local governments for operating a business in their jurisdictions and compliance with specific policies promoted by the local governments. There are no defined rules and regulations to govern the criteria necessary for companies to receive such benefits, and the amount of financial subsidy is determined at the discretion of the relevant government authorities. Government subsidies of non-operating non-operating Other income, net The Group’s depositary bank of its American depositary receipt (“ADR”) program may make contributions to the Group provided certain conditions are met. For the years ended December 31, 2016, 2017 and 2018, the Group received nil, nil and RMB10,960(US$1,594) from the depository bank, and recognized as nil, nil and RMB10,960(US$1,594) as other income, net of the consolidated statements of income/(loss). Comprehensive income/(loss) Comprehensive income/(loss) is defined as the changes in equity of the Group during a period from transactions and other events and circumstances excluding transactions resulting from investments by owners and distributions to owners. Among other disclosures, ASC 220, Comprehensive Income Employee benefit expenses All eligible employees of the Group are entitled to staff welfare benefits including medical care, welfare subsidies, unemployment insurance and pension benefits through a PRC government-mandated multi-employer defined contribution plan. The Group is required to accrue for these benefits based on certain percentages of the qualified employees’ salaries. The Group is required to make contributions to the plans out of the amounts accrued. The PRC government is responsible for the medical benefits and the pension liability to be paid to these employees and the Group’s obligations are limited to the amounts contributed. The Group has no further payment obligations once the contributions have been paid. The Group recorded employee benefit expenses of RMB52,734, RMB62,934 and RMB87,544 (US$12,733) for the years ended December 31, 2016, 2017 and 2018, respectively. Treasury shares, at cost In November 2018, the Board of Directors approved a share repurchase plan (“2018 repurchase plan”). The Company accounts for treasury shares using the cost method. Under this method, the cost incurred to purchase the shares is initially recorded in the T reasury S hares Recent accounting pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases 2016-02”) 2017-13, 2018-01, 2018-10, 2018-11, 2018-20 2019-01, off-balance The Group will adopt ASU 2016-02 on non-lease In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment 2017-04”) , In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In August 2018, FASB issued ASU 2018-13, Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement 2018-13 |
CONCENTRATION OF RISKS
CONCENTRATION OF RISKS | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION OF RISKS | 3. CONCENTRATION OF RISKS Business, customer, political, social and economic risks The Group participates in a dynamic industry and believes that changes in any of the following areas could have a material adverse effect on the Group’s future financial position, results of operations or cash flows: changes in the overall demand for services; competitive pressures due to new entrants; advances and new trends in new technologies and industry standards; changes in certain strategic relationships or customer relationships; regulatory considerations; and risks associated with the Group’s ability to attract and retain employees necessary to support its growth. The Group’s operations could be also adversely affected by significant political, economic and social uncertainties in the PRC. No single customer or supplier accounted for more than 10% of revenue or costs of revenues for the each of three years in the period ended December 31, 2018. Concentration of credit risk Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and cash equivalents, short-term investments, and restricted cash. As of December 31, 2018, substantially all of the Group’s cash and cash equivalents, and restricted cash were deposited with financial institutions with high-credit ratings and quality. PRC state-owned banks, such as Bank of China, are subject to a series of risk control regulatory standards, and PRC bank regulatory authorities are empowered to take over the operation and management when any of those banks faces a material credit crisis. The Company does not foresee substantial credit risk with respect to cash and cash equivalents, restricted cash and short-term investments held at the PRC state-owned banks. Meanwhile, China does not have an official deposit insurance program, nor does it have an agency similar to what was the Federal Deposit Insurance Corporation (FDIC) in the U.S. In the event of bankruptcy of one of the financial institutions in which the Company has deposits or investments, it may be unlikely to claim its deposits or investments back in full. The Company selected reputable international financial institutions with high rating rates to place its foreign currencies. The Company regularly monitors the rating of the international financial institutions to avoid any potential defaults. There has been no recent history of default in relation to these financial institutions. Interest rate risk The Group is exposed to interest rate risk related to its outstanding long-term loan (Note 10). The interest rate of the long-term loan was mainly based on the three month London Interbank Offered Rate and a pre-determined Foreign currency exchange rate risk From July 21, 2005, the RMB is permitted to fluctuate within a narrow and managed band against a basket of certain foreign currencies. For RMB against US$, there was depreciation of approximately 6.4%, 6.7% and appreciation of 5.7% during the years ended December 31, 2016, 2017 and 2018. It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between the RMB and the US$ in the future. To the extent that the Company needs to convert US$ into RMB for capital expenditures and working capital and other business purposes, appreciation of RMB against US$ would have an adverse effect on the RMB amount the Company would receive from the conversion. Conversely, if the Company decides to convert RMB into US$ for the purpose of making payments for dividends on ordinary shares, strategic acquisitions or investments or other business purposes, appreciation of US$ against RMB would have a negative effect on the US$ amount available to the Company. In addition, a significant depreciation of the RMB against the US$ may significantly reduce the US$ equivalent of the Company’s earnings or losses. Currency convertibility risk The Group transacts all of its business in RMB, which is not freely convertible into foreign currencies. On January 1, 1994, the PRC government abolished the dual rate system and introduced a single rate of exchange as quoted daily by the People’s Bank of China (the “PBOC”). However, the unification of the exchange rates does not imply that the RMB may be readily convertible into US$ or other foreign currencies. All foreign exchange transactions continue to take place either through the PBOC or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the PBOC. Approval of foreign currency payments by the PBOC or other institutions requires submitting a payment application form together with suppliers’ invoices, shipping documents and signed contracts. The Group’s cash and cash equivalents, and restricted cash denominated in RMB amounted to RMB1,138,651 (US$165,610) as of December 31, 2018. |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2018 | |
Text Block [Abstract] | |
REVENUES | 4. REVENUES For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Educational programs 618,326 831,106 1,071,605 155,859 Franchise revenues (a) 63,532 100,013 125,214 18,212 Others 29,135 38,156 75,069 10,918 710,993 969,275 1,271,888 184,989 (a) Initial franchise fees amounted to RMB15,566, RMB23,302 and RMB19,904 (US$2,895), and recurring franchise fees amounted to RMB47,966, RMB76,711 and RMB105,310 (US$15,317) for the years ended December 31, 2016, 2017 and 2018, respectively. The following table provides information about contract assets and liabilities from contracts with customers: As of December 31, 2017 2018 2018 RMB RMB US$ Cost to obtain contract with customers-current — 551 80 Cost to obtain contract with customers-non — 1,274 185 Contract liabilities-current 812,821 959,363 139,534 Contract liabilities-non — 36,037 5,241 During the year of 2018, the contract liabilities balance included decreases for revenues recognized during the period and increases related to new enrollments. For the year ended December 31, 2018, revenue recognized from amounts included in contract liabilities at the beginning of the period was RMB808,554(US$117,599). As of December 31, 2018, the remaining performance obligations related to educational program services that are partially or wholly unsatisfied are expected to be satisfied within one year, and other remaining performance obligations related to franchise services that are partially or wholly unsatisfied which will be satisfied from one to five years. |
PREPAYMENTS AND OTHER CURRENT A
PREPAYMENTS AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
Text Block [Abstract] | |
PREPAYMENTS AND OTHER CURRENT ASSETS | 5. PREPAYMENTS AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consisted of the following: As at December 31, 2017 2018 2018 RMB RMB US$ Prepayments to suppliers 12,820 27,786 4,041 Prepaid rental expense 11,924 14,701 2,138 Staff advances 1,762 2,306 335 Deposits 10,411 12,679 1,844 Prepaid taxes and surcharges 1,528 3,930 572 Current portion of costs to obtain contracts with customers — 551 80 Other receivables 2,126 9,584 1,395 40,571 71,537 10,405 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | 6. PROPERTY AND EQUIPMENT, NET As at December 31, 2017 2018 2018 RMB RMB US$ Electronic equipment 40,740 50,278 7,313 Furniture 8,643 10,649 1,549 Vehicles 1,168 1,168 170 Leasehold improvements 185,922 237,256 34,507 236,473 299,351 43,539 Less: accumulated depreciation 136,296 170,939 24,862 Property and equipment, net 100,177 128,412 18,677 Depreciation expense for the years ended December 31, 2016, 2017 and 2018 was RMB29,634, RMB29,246 and RMB36,026 (US$5,240), respectively. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | 7. INTANGIBLE ASSETS, NET The Group’s intangible assets were all acquired and consisted of the following: As at December 31, 2017 2018 2018 RMB RMB US$ Costs: Courseware license 200,079 211,433 30,752 Franchise agreements 61,133 61,151 8,894 Student base 94,875 97,239 14,143 Trademarks 47,040 49,705 7,229 Purchased software 16,783 21,309 3,455 Teaching course materials 10,747 14,022 1,709 430,657 454,859 66,182 Accumulated amortization: Courseware license (56,862 ) (74,002 ) (10,763 ) Franchise agreements (60,818 ) (60,937 ) (8,863 ) Student base (91,875 ) (94,480 ) (13,751 ) Trademarks (12,893 ) (16,984 ) (2,472 ) Purchased software (4,420 ) (6,008 ) (894 ) Teaching course materials (3,174 ) (4,391 ) (633 ) (230,042 ) (256,802 ) (37,376 ) Net carrying amount 200,615 198,057 28,806 The Group recorded amortization expense of RMB40,188, RMB20,465 and RMB22,199(US$3,229) for the years ended December 31, 2016, 2017 and 2018, respectively. As of December 31, 2018, estimated amortization expense of the existing intangible assets for each of the next five years is RMB21,791, RMB21,331, RMB20,713, RMB20,284, and RMB20,181, respectively. |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | 8. GOODWILL Balance as of January 1, 2017 461,686 Goodwill acquired in business combination 30,751 Impairment losses — Foreign exchange effect (16,705 ) Balance as of December 31, 2017 475,732 Goodwill acquired in business combination 884 Impairment losses — Foreign exchange effect 15,353 Balance as of December 31, 2018 491,969 Balance as of December 31, 2018 (US$) 71,554 The Group’s goodwill is mainly attributable to the Acquisition in 2013 and 2017. Goodwill is not tax deductible. For the years ended December 31, 2017 and 2018, respectively, the Group performed a qualitative assessment based on the requirements of ASC 350-20. more-likely-than-not |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 9. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other liabilities consisted of the following: As at December 31, 2017 2018 2018 RMB RMB US$ Payroll and welfare payable 78,263 80,490 11,707 Taxes payable 8,995 6,778 986 Interest payable 1,608 1,605 233 Accrued other operating expenses 41,553 54,223 7,886 Accrual for purchase of property and equipment 9,241 8,298 1,207 Payable for acquisition consideration 25,626 — — Others 5,813 8,488 1,235 171,099 159,882 23,254 |
LONG-TERM LOAN
LONG-TERM LOAN | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
LONG-TERM LOAN | 10. LONG-TERM LOAN In July 2016, the Company entered into a loan facility agreement (“Original Facility Agreement”), pursuant to which the Company is entitled to draw down up to US$55,000. The maturity date of the loan facility is five years from the drawdown date. In September 2017, an amendment facility agreement (“Amendment Facility Agreement”) was entered, pursuant to which the maturity date was revised to five years from the amendment date and the aggregate of the facility commitments was amended to US$110,000. No other terms or conditions were changed. According to ASC 470-50, As of December 31, 2018, the Group has repaid principal of US$22,000. The amount repayable within twelve months was reclassified to current liabilities. The interest rate of the facility is a flexible interest rate from 2.00% to 3.50% per annum, depending on the leverage ratio of Cayman, plus London Interbank Offered Rate. The interest rate for the outstanding loan as of December 31, 2018, was approximately 4.78%. Arrangement fee of US$4,708 was incurred to establish the loan facility, and has been capitalized on the consolidated balance sheet to offset against loan liability and accounted for under the effective interest rate method. Management assessed no breach of its loan covenants for the year ended December 31, 2018. The loan facility is guaranteed by Rise IP, Rise HK, the WFOE and VIE. Further, the ordinary shares of certain subsidiaries of the Group were pledged as collateral for the loan facility. In addition, the Group maintained deposits held in a designated bank account as security for interest payments amounting to US$2,220 (equivalent to RMB15,262) as of December 31, 2018. As of December 31, 2018, the loan principal will be due according to the following schedule: US$ September 12, 2019 12,000 September 12, 2020 19,250 September 12, 2021 24,750 September 12, 2022 32,000 88,000 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 11. INCOME TAXES Cayman Islands Under the current laws of the Cayman Islands, the Company and its Cayman subsidiaries are not subject to tax on income or capital gain. Additionally, upon payments of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed. Hong Kong Rise HK and Edge Franchising are incorporated in Hong Kong and are subject to Hong Kong Profits Tax, which is currently imposed at the rate of 16.5%, with half-rate of 8.25% may apply for the first HK$2,000 of assessable profits for years of assessment beginning on or after April 1, 2018. PRC The Company’s subsidiaries and VIEs in the PRC are subject to the statutory income tax rate of 25%, in accordance with the Enterprise Income Tax law (the “EIT Law”), which was effective since January 1, 2008. Dividends, interests, rent or royalties payable by the Group’s PRC subsidiaries, to non-PRC non-resident non-PRC Income/(loss) before income taxes consists of: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ PRC 43,995 14,121 189,760 27,600 Non-PRC 39,050 (14,797 ) 24,439 3,554 83,045 (676 ) 214,199 31,154 The current and deferred portions of income tax benefit/(expense) included in the consolidated statements of income/(loss) are as follows: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Current income tax expense (36,965 ) (51,773 ) (65,023 ) (9,458 ) Deferred income tax benefit/(expense) 4,763 (1,151 ) (6,740 ) (980 ) Income tax expense (32,202 ) (52,924 ) (71,763 ) (10,438 ) The reconciliation of the income tax expense for the years ended December 31, 2016, 2017 and 2018 is as follows: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Income/(loss) before income tax 83,045 (676 ) 214,199 31,154 Income tax (expense)/benefit computed at the PRC statutory tax rate of 25% (20,761 ) 169 (53,550 ) (7,788 ) Effect of different tax rates in different jurisdictions 5,688 (8,175 ) 2,291 333 Non-deductible (9,051 ) (26,482 ) (15,069 ) (2,193 ) Outside basis difference on investment in WFOE (3,174 ) (4,446 ) (6,233 ) (907 ) PRC royalty withholding tax (4,607 ) (6,950 ) (6,080 ) (883 ) Changes in valuation allowance (297 ) (7,040 ) 6,878 1,000 Income tax expense (32,202 ) (52,924 ) (71,763 ) (10,438 ) The significant components of the Group’s deferred tax assets and liabilities as of December 31, 2017 and 2018 are as follows: For the year ended December 31, 2017 2018 2018 RMB RMB US$ Deferred tax assets: Tax loss carry forward 34,111 24,214 3,522 Accrued expenses 6,638 6,680 972 Revenue recognition — 12,749 1,854 Others 1,971 992 144 Less: Valuation allowance (32,002 ) (37,311 ) (5,427 ) 10,718 7,324 1,065 Deferred tax liabilities: Long-lived assets arising from acquisitions 1,094 844 123 Outside basis difference on investment in WFOE 7,620 13,853 2,015 Others 3,385 455 66 12,099 15,152 2,204 Presentation in the consolidated balance sheets: Deferred tax assets 2,404 6,713 976 Deferred tax liabilities (3,785 ) (14,541 ) (2,115 ) Net deferred tax liabilities (1,381 ) (7,828 ) (1,139 ) The Group operates through several subsidiaries and the VIEs and valuation allowances are considered for each of the subsidiaries and the VIEs on an individual basis. The Group recorded a valuation allowance against deferred tax assets of those subsidiaries and the VIEs that are individually in a cumulative loss as of December 31, 2017 and 2018. In making such determination, the Group evaluates a variety of factors including the Group’s operating history, accumulated deficit, existence of taxable temporary differences and reversal periods. As of December 31, 2018, the aggregate undistributed earnings from the Company’s WFOE and VIEs that are available for distribution are RMB309,910 (US$45,075). The Company has considered its operational funding needs, future development initiatives and its dividend distribution plan, and is permanently reinvesting all but RMB138,531 (US$20,148). Determination of the amount of unrecognized deferred tax liability related to the earnings that are indefinitely reinvested is not practical because of the various associated income taxes including withholding income tax that would be payable upon the distribution of those amounts. As of December 31, 2017 and 2018, the Group had taxable losses of RMB136,445 and RMB97,192 (US$14,136), respectively, derived from entities in the PRC and Hong Kong, which can be carried forward per tax regulation to offset future net profit for income tax purposes. The PRC taxable losses as of December 31, 2018 will expire from 2019 to 2023 if not utilized. The Hong Kong taxable losses as of December 31, 2018 can be utilized indefinitely. As of December 31, 2017 and 2018, the Group had unrecognized tax benefits of RMB8,799 and RMB7,613 (US$1,105), respectively, of which RMB1,389 and RMB1,389 (US$202), respectively were offset against the deferred tax assets on tax losses carry forward, and the remaining amount of RMB7,410 and RMB6,224 (US$905), respectively which if ultimately recognized, would impact the effective tax rate. The Group planned to settle unrecognized tax benefits of RMB670 (US$97) in cash in the next 12 months, and such amount was classified as income taxes payable. It is possible that the amount of unrecognized benefits will further change in the next 12 months; however, an estimate of the range of the possible change cannot be made at this moment. A reconciliation of the beginning and ending amount of unrecognized tax benefit is as follows: 2017 2018 2018 RMB RMB US$ Balance at January 1, 9,124 8,799 1,279 Additions based on tax positions related to current year 738 2,636 382 Reversal based on tax positions related to prior years — (171 ) (25 ) Settlement (1,063 ) (3,463 ) (504 ) Foreign currency translation adjustments — (188 ) (27 ) Balance at December 31, 8,799 7,613 1,105 The Group recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expenses. For the years ended December 31, 2016, 2017 and 2018, the Group recognized approximately RMB573, RMB734 and RMB259 (US$38) in interest, respectively, and RMB nil, nil, and RMB1,161 (US$169) in penalties, respectively. The Group had approximately RMB1,160 and RMB2,580 (US$375) in accrued interest and penalties recorded in other non-current As of December 31, 2018, tax years ended December 31, 2013 through 2018 for the WFOE and the VIEs remain open to examination by the PRC tax authorities. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 12. RELATED PARTY TRANSACTIONS a) Related parties The direct controlling shareholder Bain Capital Education IV Entities controlled by the ultimate holding company Lionbridge Limited (“Lionbridge”) Bain Capital Advisors (China) Ltd. (“Bain Advisors”) An Entity controlled by a shareholder Beijing Mai Rui Technology Co., Ltd. (“Mai Rui”) b) During the years ended December 31, 2016, 2017 and 2018, the Group had the following related party transactions: For the year ended December 31, Notes 2016 2017 2018 2018 RMB RMB RMB US$ Loan to a related party: Lionbridge (i ) 280,000 150,000 150,000 21,817 Services received from related parties: Mai Rui (ii ) 278 — — — Bain Advisors (iii ) 6,200 38,537 — — (i) The Group entered into certain entrustment loan agreements with Lionbridge, pursuant to which the Group granted total loans of RMB280,000, RMB150,000 and RMB150,000 (US$21,817) to Lionbridge during the years ended December 31, 2016, 2017 and 2018, respectively, with details set forth below: Year ended December 31, 2016 Loan granted Principal Interest Rate Period Loan 1 200,000 9 % March 30, 2016 to November 30, 2016 Loan 2 30,000 5 % July 8, 2016 to December 8, 2016 Loan 3 50,000 6 % July 8, 2016 to December 8, 2016 Year ended December 31, 2017 Loan granted Principal Interest Rate Period Loan 1 100,000 7 % February 24, 2017 to November 30, 2017 Loan 2 50,000 7 % March 20, 2017 to November 30, 2017 Year ended December 31, 2018 Loan granted Principal Interest Rate Period Loan 1 150,000 7 % March 1, 2018 to November 30, 2018 As of December 31, 2017 and 2018, respectively, the above loans were fully repaid. Interest income of RMB12,712, RMB7,457 and RMB7,539 (US$1,097) from the above loans were recorded as interest income during the years ended December 31, 2016, 2017 and 2018, respectively. (ii) During the years ended December 31, 2016, 2017 and 2018, the Group paid course development fees of RMB278, RMB nil and RMB nil, respectively, to Mai Rui. (iii) During the years ended December 31, 2016, 2017 and 2018, the Group accrued consulting fees of RMB6,200, RMB38,537 and nil, respectively, to Bain Advisors, an affiliate of the Group’s majority shareholder, which included a lump sum consulting termination fee of RMB33,887 to Bain Advisors as a result of the IPO for the year ended December 31, 2017. (note 12 c) (2). (iv) On November 1, 2017, the Group acquired Edge Business from a seller in which a managing director of Bain Capital is a director and minority shareholder. c) The balances between the Group and its related parties as of December 31, 2017 and 2018 are listed below: (1) Amounts due from a related party As at December 31, 2017 2018 2018 RMB RMB US$ Bain Capital Education IV 6,604 190 28 The balance consists of amount due from the Company’s direct controlling shareholder in the ordinary course of business. (2) Amounts due to a related party As at December 31, 2017 2018 2018 RMB RMB US$ Bain Advisors 20,000 — — |
RESTRICTED NET ASSETS
RESTRICTED NET ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
RESTRICTED NET ASSETS | 13. RESTRICTED NET ASSETS Prior to payment of dividends, pursuant to the laws applicable to the PRC’s foreign investment enterprises, the VIE and the VIE’s subsidiaries must make appropriations from after-tax non-distributable Subject to certain cumulative limits, the general reserve requires annual appropriations of 10% of after-tax year-end PRC laws and regulations require private schools that require reasonable returns to make annual appropriations of no less than 25% of after-tax These reserves are included as statutory reserves in the consolidated statements of changes in shareholders’ equity. The statutory reserves cannot be transferred to the Company in the form of loans or advances and are not distributable as cash dividends except in the event of liquidation. Relevant PRC laws and regulations restrict the WFOE and the VIEs from transferring certain of their net assets to the Company in the form of loans, advances or cash dividends. Amounts restricted include the paid in capital and statutory reserves of the WFOE and the VIEs, totaling approximately RMB213,913(US$31,112) as of December 31, 2018. |
INCOME_(LOSS) PER SHARE
INCOME/(LOSS) PER SHARE | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
INCOME/(LOSS) PER SHARE | 14. INCOME/(LOSS) PER SHARE Basic and diluted income/(loss) per share and per ADS for each of the years presented are calculated as follows: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Numerator: Net income/(loss) attributable to RISE Education Cayman Ltd—basic and diluted 53,923 (47,974 ) 142,958 20,792 Denominator: Weighted average number of ordinary shares outstanding-basic 100,000,000 101,890,411 113,812,182 113,812,182 Weighted average number of ordinary shares outstanding- diluted 100,000,000 101,890,411 115,881,867 115,881,867 Basic income/(loss) per share 0.54 (0.47 ) 1.26 0.18 Diluted income/(loss) per share 0.54 (0.47 ) 1.23 0.18 Basic income/(loss) per ADS 1.08 (0.94 ) 2.51 0.37 Diluted income/(loss) per ADS 1.08 (0.94 ) 2.47 0.36 As at December 31, 2016, the outstanding share options are considered contingently issuable shares. As the exercisability event has not occurred (Note 2, Note 15) at December 31, 2016, the contingently issuable shares, were excluded from the computation of diluted income per share for the year ended December 31, 2016. No adjustment has been made to the basic loss per share amount presented for the year ended December 31, 2017 as the impact of the outstanding share options were anti-dilutive. Nil share options were excluded from the computation of diluted income per share for the year ended December 31, 2018 because their effect would be anti-dilutive. |
SHARE-BASED PAYMENTS
SHARE-BASED PAYMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED PAYMENTS | 15. SHARE-BASED PAYMENTS 2016 Equity Incentive Plan In 2016, the Board of Directors approved the Equity Option Plan (the “2016 Equity Incentive Plan”), which has a term of 10 years and is administrated by the Board of Directors. Under 2016 Equity Incentive Plan, the Company reserved options to its eligible employees, directors and officers of the Group for the purchase of 7,000,000 of the Company’s ordinary shares in aggregate (excluding shares which have lapsed or have been forfeited). In April 2016, the Board of Directors approved option grants to employees for the purchase of 5,985,000 of the Company’s ordinary shares. 50% of the options granted will generally vest in four or five equal installments over a service period (the “2016 Service Options”) while the remaining 50% of the options will vest in two equal installments of 25% each if a fixed targeted return on the Company’s ordinary shares is achieved (the “2016 Market Options”). Both the Service Options and Market Options (collectively, the “2016 Options”) are exercisable only upon the occurrence of an IPO or change of control (each or collectively, the “exercisability event”). The exercisability event constitutes a performance condition that is not considered probable until the completion of the IPO or change of control. The Company will not recognize any compensation expense until the exercisability event occurs. Upon the occurrence of the exercisability event, the effect of the change in this estimate will be accounted for in the period of change by cumulative compensation cost recognition as if the new estimate had been applied since the service inception date, with the remaining unrecognized compensation cost amortized over the remaining requisite service period. Upon the occurrence of the exercisability event (the IPO completion date), the Company immediately recognized expenses associated with options that were vested as of the IPO completion date amounting to RMB90,335. In addition, the Company also will recognize the remaining compensation expenses over the remaining service requisite period using the accelerated method. Modification of options In September 2016, the Board of Directors approved the modification of substantially all the 2016 Options to require recipients to remain in service with the Company until October 1, 2017, October 1, 2018, October 1, 2019, or October 1, 2020; otherwise the 2016 Options (both vested and unvested portions) will be forfeited. As of the modification date, the original performance condition of the 2016 Options was not expected to be satisfied, therefore, the modification-date fair value of the 2016 Options instead of the original grant-date fair value will be used to measure the modified 2016 Options once they ultimately vest. In November 2017 (“2017 Modification Date”), the Board of Directors modified share options granted to six directors and officers to be fully vested on the 2017 Modification Date. On the 2017 Modification Date, the Company recognized compensation expenses amounting to RMB2,329 (US$358) associated with the fully vested share options. The fair value of the share options immediately after the modification was the same as that immediately before the modification and therefore, the Company did not recognize any incremental compensation costs related to such modification. In 2018, the vesting of 432,500 options granted to seven employees was accelerated, and 50,000 options of one employee was cancelled and replaced with cash rewards (which was an isolated non-recurring event). As of the respective modification dates in December 2018, the original performance condition of the 2016 Options was not expected to be satisfied, therefore, the modification-date fair value of the grantees’ respective 2016 Options instead of the original grant-date fair value was used to measure the modified 2016 Options. A summary of the equity award activity under 2016 Equity Incentive Plan is stated below: Number of Weighted - Weighted - Average grant date fair value Weighted - Aggregate US$ Years US$ Outstanding, December 31, 2017 6,885,000 1.44 N/A 6.84 41,035 Granted — N/A N/A Exercised (4,388,397 ) 1.44 N/A Forfeited/Cancelled (197,500 ) 1.44 1.96 Outstanding, December 31, 2018 2,299,103 1.44 N/A 6.13 5,840 Vested and expected to vest at December 31, 2018 2,299,103 1.44 N/A 6.13 5,840 Exercisable at December 31, 2018 2,066,103 1.44 N/A 5.99 5,248 The aggregate intrinsic value in the table above represents the difference between the fair value of the Company’s ordinary share as of December 31, 2018 and the option’s respective exercise price. Total intrinsic value of options exercised for the years ended December 31, 2017 and 2018 was nil and RMB168,917. 2,227,500 awards were vested and share-based compensation expense of RMB20,352 (US$2,960) was recorded for the year ended December 31, 2018, and the weighted-average grant-date fair value for vested options is US$2.21. As of December 31, 2018, there was US$704 of total unrecognized share-based compensation expenses. Total unrecognized compensation cost may be adjusted for actual forfeitures and modifications occurring in the future. The fair value of Service Options and Market Options were determined using the binomial option valuation model and Monte Carlo simulation model, respectively, with the assistance from an independent third-party appraiser. The option valuation models required the input of highly subjective assumptions, including the expected share price volatility and the suboptimal early exercise factor. For expected volatilities, the Company has made reference to historical volatilities of several comparable companies. The suboptimal early exercise factor was estimated based on the Company’s expectation of exercise behavior of the grantees. The risk-free rate for the period within the contractual life of the Options is based on the market yield of U.S. Treasury Bonds in effect at the time of grant. The estimated fair value of the ordinary shares, was determined with the assistance of an independent third-party appraiser. Subsequent to the IPO, fair value of the ordinary shares is the price of the Company’s publicly traded shares. The Company’s management is ultimately responsible for the determination of the estimated fair value of its ordinary shares. The assumptions used to estimate the fair value of 2016 Equity Incentive Plan granted or modified are as follows: For the years ended December 31, 2016 2017 2018 Risk-free interest rate 1.92%-2.23 % 2.39%-2.93 % 3.51%-3.82 % Expected volatility range 48.1%-50.7 % 47.5%-49.3 % 49.9%-53.6 % Suboptimal exercise factor 2.8 2.8 2.8 Fair value per ordinary share as at valuation date US$ 3.10-$3.26 US$ 7.07 US$ 5.28-$7.06 2017 Share Incentive Plan In 2017, the Board of Directors approved the Share Incentive Plan (the “2017 Share Incentive Plan”), which has a term of 10 years and is administrated by the Board of Directors. Under 2017 Share Incentive Plan, the Company reserved options to its eligible employees, directors and officers of the Group for the purchase of 5,000,000 of the Company’s ordinary shares in aggregate (excluding shares which have lapsed or have been forfeited). As at December 31, 2018, no options were granted under 2017 Share Incentive Plan. Total cost of share-based payments are summarized as follows: For the year ended 2018 RMB US$ Cost of revenues 1,315 191 Selling and marketing expenses 4,229 615 General and administrative expenses 14,808 2,154 Total 20,352 2,960 On April 1, 2019 the Company’s Board of Directors approved the grant of 308,000 shares and 4,800,000 shares of stock awards to management and employees, pursuant to the 2016 Equity Incentive Plan and the 2017 Share Incentive Plan, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 16. COMMITMENTS AND CONTINGENCIES Operating lease commitments The Group leases offices and classroom facilities under operating leases. Future minimum lease payments under non-cancelable RMB US$ 2019 186,028 27,057 2020 172,712 25,120 2021 141,172 20,533 2022 121,860 17,724 2023 and thereafter 179,503 26,108 801,275 116,542 Payments under operating leases are expensed on a straight-line basis over the periods of their respective leases. The Group’s lease arrangements have no renewal options, rent escalation clauses, restrictions or contingent rents and are all executed with third parties. For the years ended December 31, 2016, 2017 and 2018, total rental expenses for all operating leases amounted to approximately RMB121,530, RMB136,662 and RMB192,296 (US$27,968), respectively. Capital expenditure commitments As of December 31, 2018, future minimum capital commitments under non-cancelable contracts were as follows: RMB US$ Construction of leasehold improvements 17,260 2,510 Software development 4,561 663 21,821 3,173 All capital expenditure commitments are expected to be paid within one year. Other commitments On November 11, 2018, the Group entered into an agreement with a third party seller (the “Seller”) in Shijiazhuang, China to purchase 51% equity interests of the seven learning centers operated by the Seller for a consideration of approximately RMB44,319 (US$6,446). As of December 31, 2018, RMB35,455 (US$5,157) of consideration was not paid as the acquisition was not consummated. Contingencies As of December 31, 2018, the Group is in the process of applying for private school operating permits or private non-enterprise From time to time, the Group is also subject to legal proceedings, investigations, and claims incidental to the conduct of its business. The Group is currently not involved in any legal or administrative proceedings that may have a material adverse impact on the Group’s business, financial position or results of operations. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME | 17. ACCUMULATED OTHER COMPREHENSIVE INCOME Foreign currency RMB Balance as of January 1, 2016 28,189 Foreign currency translation adjustments, net of tax of nil 22,275 Balance as of December 31, 2016 50,464 Foreign currency translation adjustments, net of tax of nil (10,424 ) Balance as of December 31, 2017 40,040 Foreign currency translation adjustments, net of tax of nil 2,419 Balance as of December 31, 2018 42,459 US$ Balance as of December 31, 2018 6,175 There have been no reclassifications out of accumulated other comprehensive income to net income for the periods presented. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATION | 18. BUSINESS COMBINATION On November 1, 2017, the Group acquired 100% equity interest of Edge Franchising, a leading Hong Kong-based admissions consulting company specializing in overseas boarding school and college placement, and certain fixed assets, intellectual properties, material contracts and key employees of the educational consulting business (collectively referred to as “Acquiree”, or “Edge Business”) from a seller in which a managing director of Bain Capital Education IV Cayman Limited (“Bain Capital Education IV”) is a director and minority shareholder. The acquisition is expected to complement the Group’s existing business and achieve significant synergies. Details of the purchase consideration are as follows: (i) Cash consideration of RMB16,769 (“Cash Consideration”) (ii) In accordance with the sale and purchase agreement, the Company shall issue to the selling shareholder 216,021 ordinary shares. As of the acquisition date, the Group recorded RMB9,211 (“Share Consideration”) in the “Accrued expenses and other current liabilities” The Cash Consideration and Share Consideration were settled on January 2, 2018 The Company has completed the valuations necessary to assess the fair values of the tangible and intangible assets acquired and liabilities assumed, resulting from which the amount of goodwill was determined and recognized as of the acquisition date. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of November 1, 2017, the date of acquisition: RMB Purchase consideration 25,980 Net assets acquired, excluding intangible assets and the related deferred tax liabilities 2,133 Intangible assets 4,994 Trademark 1,693 Student base 2,962 Franchise agreements 339 Deferred tax liabilities (1,235 ) Deferred revenue and customer advances (10,663 ) Goodwill 30,751 Included in the goodwill of RMB30,261 recognized on the acquisition date is the expected synergies from combining operations of the Acquiree and the Group which does not qualify for separate recognition. None of the goodwill recognized is expected to be deductible for income tax purposes. The Company recognized RMB889 of acquisition related costs which were included in general and administrative expenses in the year ended December 31, 2017. The actual results of operation after the acquisition date and pro-forma results of operations for this acquisition have not been presented because the effects of this acquisition were insignificant. |
CONDENSED FINANCIAL INFORMATION
CONDENSED FINANCIAL INFORMATION OF THE COMPANY | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
CONDENSED FINANCIAL INFORMATION OF THE COMPANY | 19. CONDENSED FINANCIAL INFORMATION OF THE COMPANY Condensed Balance Sheets As at December 31, 2017 2018 2018 RMB RMB US$ ASSETS Current assets: Cash and cash equivalents — 13,774 2,003 Due from subsidiaries of the Group 145,416 47,096 6,850 Prepayments and other current assets 143 8,682 1,263 Total current assets 145,559 69,552 10,116 Non-current Investment in subsidiaries 184,707 436,925 63,549 Total non-current 184,707 436,925 63,549 Total assets 330,266 506,477 73,665 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Accrued expenses and other liabilities 5,329 3,367 490 Amount due to a subsidiary of the Group 14,806 47,355 6,888 Total current liabilities 20,135 50,722 7,378 Total liabilities 20,135 50,722 7,378 Shareholders’ equity: Ordinary shares (US$0.01 par value; 200,000,000 and 200,000,000 shares authorized, 110,000,000 and 113,779,244 shares issued and outstanding as of December 31, 2017 and 2018, respectively) 6,782 7,074 1,029 Additional paid-in 532,474 600,011 87,268 Treasury shares, at cost — (23,460 ) (3,412 ) Accumulated deficit (269,165 ) (170,329 ) (24,773 ) Accumulated other comprehensive income 40,040 42,459 6,175 Total shareholders’ equity 310,131 455,755 66,287 Total liabilities and shareholders’ equity 330,266 506,477 73,665 Condensed Statements of Comprehensive Income/(Loss) For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ General and administrative expenses — — (8,400 ) (1,222 ) Operating loss — — (8,400 ) (1,222 ) Equity in profit/(loss) of subsidiaries and the VIEs 35,409 (54,676 ) 138,698 20,173 Interest income 18,514 6,702 22 3 Others, net — — 12,638 1,838 Income/(loss) before income tax expense 53,923 (47,974 ) 142,958 20,792 Income tax expense — — — — Net income/(loss) 53,923 (47,974 ) 142,958 20,792 Other comprehensive income/(loss), net of tax of nil Foreign currency translation adjustments 22,275 (10,424 ) 2,419 352 Other comprehensive income/(loss) 22,275 (10,424 ) 2,419 352 Comprehensive income/(loss) 76,198 (58,398 ) 145,377 21,144 Statements of Cash Flows For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Net cash generated from investing activities 426,016 571,808 13,774 2,003 Net cash used in financing activities (426,016 ) (571,808 ) — — Net increase in cash, cash equivalents and restricted cash — — — — Cash and cash equivalents and restricted cash at beginning of year — — — — Cash and cash equivalents and restricted cash at end of year — — 13,774 2,003 (a) Basis of presentation For the Company only condensed financial information, the Company records its investment in its subsidiaries and VIEs under the equity method of accounting. Such investment is presented on the condensed balance sheets as “Investment in subsidiaries” and share of their income/(loss) as “Equity in profit/(loss)of subsidiaries and the VIEs” on the condensed statements of comprehensive income/(loss). The subsidiaries and VIEs did not pay any dividends to the Company for the periods presented. (b) Commitments The Company does not have any significant commitments or long-term obligations as of any of the periods presented. The Company only condensed financial information should be read in conjunction with the Group’s consolidated financial statements. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of presentation The consolidated financial statements of the Group have been prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Principles of Consolidation | Principles of consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries, and the VIEs. All significant inter-company transactions and balances between the Company, its subsidiaries and the VIEs have been eliminated upon consolidation. Results of subsidiaries, businesses acquired from third parties and the VIEs are consolidated from the date on which control is obtained by the Company. |
Use of Estimates | Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and revenue and expenses in the consolidated financial statements and accompanying notes. Significant accounting estimates reflected in the Group’s consolidated financial statements include valuation allowance for deferred tax assets, uncertain tax positions, the initial valuation of the assets acquired and liabilities assumed in a business combination, economic lives and impairment of long-lived assets, impairment of goodwill, standalone selling prices of performance obligations of revenue contracts, accounts receivable and contract assets allowances, and share-based compensation. Actual results could differ from those estimates. |
Convenience Translation | Convenience translation Amounts in the United States Dollars (“US$”) are presented for the convenience of the reader and are translated at the noon buying rate of RMB6.8755 per US$1.00 on December 31, 2018 in the City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York. No representation is made that the RMB amounts could have been, or could be, converted into US$ at such rate. |
Foreign Currency | Foreign currency The functional currency of the Company, its Cayman subsidiaries and Rise HK are the US$, the functional currency of Edge franchising and Edge Online Co. Limited are the Hong Kong Dollars (“HK$”). The Company’s PRC subsidiaries and the VIEs determined their functional currency to be Renminbi (the “RMB”). The Group uses the RMB as its reporting currency. Each entity in the Group maintains its financial records in its own functional currency. Transactions denominated in foreign currencies are measured at the exchange rates prevailing on the transaction dates. Monetary assets and liabilities denominated in foreign currencies are remeasured at the exchange rates prevailing at the balance sheet date. Non-monetary The Company uses the average exchange rate for the year and the exchange rate at the balance sheet date to translate the operating results and financial position, respectively. Translation differences are recorded in accumulated other comprehensive income, a component of shareholders’ equity. |
Cash and Cash Equivalents | Cash and cash equivalents Cash and cash equivalents consist of cash on hand and highly liquid investments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less when purchased. |
Restricted Cash | Restricted cash Restricted cash primarily represents deposits held in a designated bank account as security for the interest payments on the Group’s long-term loan; and deposits restricted as to withdrawal or use under government regulations. In November 2016, the FASB issued Accounting Standards Update No. 2016-18, beginning-of-period end-of-period |
Short-Term Investments | Short-term investments The Group’s short-term investments comprise primarily of cash deposits at floating rates based on daily bank deposit rates with original maturities ranging from over three months to six months. |
Inventories | Inventories Inventories are finished goods and mainly comprised of textbooks and other educational study tools (“course materials”). Course materials are stated at the lower of cost or market. Cost is determined using the weighted average cost method. As of December 31, 2017 and 2018, the Group did not have any provision for inventories. |
Property and Equipment | Property and equipment Property and equipment is stated at cost less accumulated depreciation and impairment. Depreciation is calculated on a straight line basis over the following estimated useful lives: Electronic equipment 3 years Furniture 3 - 5 years Vehicles 4 years Leasehold improvements Shorter of the lease term or estimated useful life Repair and maintenance costs are charged to expense as incurred, whereas the cost of renewals and betterments that extend the useful lives of property and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the cost and accumulated depreciation from the asset and accumulated depreciation accounts with any resulting gain or loss reflected in the consolidated statements of income/(loss). Direct costs that are related to the construction of property and equipment, and incurred in connection with bringing the assets to their intended use are capitalized as construction in progress. Construction in progress is transferred to specific property and equipment, and the depreciation of these assets commences when the assets are ready for their intended use. |
Segment Reporting | Segment reporting In accordance with ASC 280, Segment Reporting |
Non-controlling Interests | Non-controlling For certain subsidiaries of the VIE, a non-controlling non-controlling non-controlling non-controlling |
Goodwill | Goodwill The Group assesses goodwill for impairment in accordance with ASC 350-20, Intangibles—Goodwill and Other: Goodwill 350-20”), 350-20. There was only one reporting unit (that also represented the operating segment) as of December 31, 2017 and 2018, respectively. Goodwill was allocated to the one reporting unit as of December 31, 2017 and 2018, respectively (Note 9). The Group has the option to assess qualitative factors first to determine whether it is necessary to perform the two-step 350-20. more-likely-than-not two-step In performing the two-step |
Intangible Assets | Intangible assets Intangible assets with finite lives are carried at cost less accumulated amortization. Amortization of finite-lived intangible assets except for student base is computed using the straight-line method over the estimated useful lives. Student base is amortized using an accelerated pattern based on the estimated student attrition rate of the acquired schools. The estimated useful lives of intangible assets from the date of purchase are as follows: Category Estimated Useful Life Courseware license 15 years Franchise agreements 2.5-3 years Student base 3-5 Trademarks 10-15 years Purchased software 3-5 Teaching course materials 10 years |
Impairment of Long-Lived Assets Other Than Goodwill | Impairment of long-lived assets other than goodwill The Group evaluates its long-lived assets, including fixed assets and intangible assets with finite lives, for impairment whenever events or changes in circumstances, such as a significant adverse change to market conditions that will impact the future use of the assets, indicate that the carrying amount of an asset may not be fully recoverable. When these events occur, the Group evaluates the recoverability of long-lived assets by comparing the carrying amount of the assets to the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Group recognizes an impairment loss based on the excess of the carrying amount of the assets over their fair value. Fair value is generally determined by discounting the cash flows expected to be generated by the assets, when the market prices are not readily available. For all periods presented, there was no impairment of any of the Group’s long-lived assets. |
Business Combination | Business Combination We account for business combinations using the purchase method of accounting in accordance with ASC topic 805, Business Combinations non-controlling non-controlling In a business combination achieved in stages, we re-measured re-measurement The determination and allocation of fair values to the identifiable assets acquired, liabilities assumed and non-controlling |
Fair Value of Financial Instruments | Fair value of financial instruments Financial instruments include cash and cash equivalents, short-term investments, restricted cash, certain other current assets, accounts payable, long-term loan, customer advances, and certain other current liabilities. The carrying amounts of these financial instruments, except for the long-term loan, approximate their fair values because of their short-term maturities. The carrying amount of the long-term loan approximates its fair value due to the fact that the related interest rate approximates the interest rates currently offered by financial institutions for similar debt instruments of comparable maturities. |
Adoption of New Revenue Recognition Accounting Standard | Adoption of New Revenue Recognition Accounting Standard In August 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-14, 2015-14”). 2015-14 No. 2014-09, 2014-09”), 2015-14, 2014-09 No. 2016-08, 2016-08”), No. 2016-10, 2016-10”), No. 2014-09. No. 2016-12, 2016-12”), non-cash 2016-08, 2016-10 2016-12 No. 2014-09. ASC 606 replaced most current U.S. GAAP guidance on this topic and eliminated most industry-specific guidance. The new revenue recognition standard provides a unified model to determine when and how revenue is recognized. The core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. The new standard superseded substantially all existing revenue recognition guidance. It impacts the revenue recognition for certain of our contracts, in addition to our business processes and our information technology systems. We performed cross-functional coordination to implement the new revenue recognition standard. We are in process of implementing changes to our systems, processes and internal controls to meet the standard’s reporting and disclosure requirements. On January 1, 2018, the Group adopted the new revenue standard utilizing the modified retrospective method. As a result, the Group changed its accounting policy for revenue recognition as detailed below. The Group recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of accumulated deficit. Using the modified retrospective approach, the Group applied the standard only to contracts that are not completed at the date of initial application. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods as the Group believes it is still comparable. Based on the contracts outstanding as of January 1, 2018, adoption of ASC 606 did not have a significant impact except for recognition of initial franchise fees. The Group’s accounting policy before January 1, 2018 was to recognize initial franchise fees when franchisees commence operations under the RISE brand or upon the renewal of the franchise agreements. In accordance with ASC 606, the initial franchise services are not distinct from the continuing rights or services offered during the term of the franchise agreement, and will therefore, be treated as a single performance obligation. Therefore, initial franchise fees should be recognized over the franchise term, which is generally five years under ASC 606. The cumulative effect of the changes made to the Group’s consolidated balance sheets at January 1, 2018 were as follows: December 31, Adjustment due January 1, January 1, RMB RMB RMB US$ Liabilities Deferred revenue and customer advances (current and non-current) 812,821 44,122 856,943 124,637 Shareholders’ equity - Accumulated deficit 315,531 44,122 359,653 52,309 |
Revenue Recognition | Revenue Recognition Our revenue recognition policies effective on the adoption date of ASC 606 are as follows: Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which we expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that we determine are within the scope of the new revenue recognition accounting standard, we perform the following five steps: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy a performance obligation. We only apply the five-step model to contracts when it is probable that we will collect the consideration it is entitled to in exchange for the goods or services transferred to the customer. At contract inception, we assess the goods or services promised within each contract to determine those that represent performance obligations, and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Revenue is recognized net of business tax, value added taxes and tax surcharges. Contract liabilities relate to contracts where we received payments but has not yet satisfied the related performance obligations. The advance consideration received from customers for the services is a contract liability until services are provided to the customer and are presented in “deferred revenue and customer advances” in the consolidated balance sheets. Contract assets include accounts receivable and costs to obtain contracts with customers. Accounts receivable is primarily related to our rights to consideration for services completed at the reporting date. Costs to obtain contracts with customers are incremental costs to obtain franchise contracts, which are recorded as prepayment and other current assets, and other non-current The primary sources of our revenues are as follows: (a) Educational Programs Educational programs’ contracts generally consist of two performance obligations, English courses and course materials, which are both capable of being distinct and distinct in the context of the contract. The transaction price is stated in the contract and known at the time of contract inception, therefore no variable consideration exists. We may issue promotional coupons to attract enrollment for its courses. The promotional coupons are not issued in conjunction with a concurrent revenue transaction and are for a fixed RMB amount that can only be redeemed to reduce the amount of the tuition fees for future courses. The promotional coupons are accounted for as a reduction of the transaction price and are allocated across all performance obligations unless observable evidence exists that the discount relates to a specific performance obligation or obligations in the contract. Revenue is allocated to each performance obligation based on its standalone selling price. We generally determine standalone selling prices based on the prices charged to students. If the standalone selling price is not observable through past transactions, we estimate the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. Course fees are collected in full in advance of the commencement of each course and each course comprises of a fixed amount of classes. We use the student’s daily attendance records, an output measure, to recognize revenue over time as it best depicts the simultaneous consumption and delivery of educational program services. Students are allowed to return course materials if they are unused. However, once the student attends the first class of the respective course, course materials cannot be returned. Therefore, revenue associated with distinct course materials is recognized at the point in time when control transfers to the student, generally when the student attends the first class of the respective course. According to local education bureau regulations, depending on a school’s location and the amount of classes remaining for a course, we may be required to refund course fees for any remaining undelivered classes to students who withdraw from a course. The refund is recorded as a reduction of the related course fees received in advance and has no impact on recognized revenue. Refunds on recognized revenue were insignificant for all periods presented. (b) Franchise Revenues Franchise revenues includes non-refundable (c) Other Revenues Other revenues comprise mainly of the provision of overseas and domestic study tour services and the admission consulting, academic tutoring and test preparation business of the Edge. We determined the overseas study tours contract contains a single performance obligation and we are the principal in providing overseas study tours services as it controls such services before the services are transferred to the customer. Therefore, we recognize study tours revenue on a gross basis. We recognize revenue over the service period of the study tour, which is, generally around two to three weeks, as it best depicts the simultaneous consumption and delivery of overseas study tours services. Edge offers admission consulting, academic tutoring and test preparation services for students who intend to study abroad and each service represents an individual performance obligation. For admission consulting services, we use the input method by reference to the consulting hours incurred up to the end of reporting period as a percentage of total estimated hours to recognize revenue over the contract period which best depict our efforts toward satisfying the performance obligation relative to the total expected efforts. For academic tutoring and test preparation services, we use students’ attendance records, an output measure, to recognize revenue over time as it best depicts the simultaneous consumption and delivery of such services. |
Advertising Expenditures | Advertising expenditures Advertising costs are expensed when incurred and are included in selling expenses in the consolidated statements of income/(loss). For the years ended December 31, 2016, 2017 and 2018, advertising expenses were approximately RMB63,734, RMB80,475 and RMB136,323 (US$19,827), respectively. |
Leases | Leases Leases are classified at the inception date as either a capital lease or an operating lease. A lease is a capital lease if any of the following conditions exists: a) ownership is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the property’s estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. A capital lease is accounted for as if there was an acquisition of an asset and an incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases wherein rental payments are expensed on a straight-line basis over their respective lease term. The Group leases certain office facilities under non-cancelable |
Income/(loss) Per Share | Income/(loss) per share In accordance with ASC 260, Earnings Per Share |
Share-based Compensation | Share-based compensation The Group applies ASC 718, Compensation — Stock Compensation In accordance with ASC 718, the Group recognizes share-based compensation cost for equity awards to employees with a performance condition based on the probable outcome of that performance condition — compensation cost is recognized if it is probable that the performance condition will be achieved and shall not be recognized if it is not probable that the performance condition will be achieved. In accordance with ASC 718, the effect of a market condition is reflected in the grant-date fair value of the granted equity awards. The Group recognizes share-based compensation cost for equity awards with a market condition provided that the requisite service is rendered, regardless of when, if ever, the market condition is satisfied. A change in any of the terms or conditions of the awards is accounted for as a modification of the award. When the vesting conditions (or other terms) of the equity awards granted to employees are modified, the Group first determines on the modification date whether the original vesting conditions were expected to be satisfied, regardless of the entity’s policy election for accounting for forfeitures. If the original vesting conditions are not expected to be satisfied, the grant-date fair value of the original equity awards are ignored and the fair value of the equity award measured at the modification date is recognized if the modified award ultimately vests. When a vesting condition that is probable of achievement is modified and the new vesting condition also is probable of achievement, the compensation cost to be recognized if either the original vesting condition or the new vesting condition is achieved cannot be less than the grant-date fair value of the original award. That compensation cost is recognized if either the original or modified vesting condition is achieved. Cancellation of the awards accompanied by the concurrent grant of a replacement award is also accounted for as a modification of the terms of the cancelled awards. Therefore, incremental compensation cost shall be measured as the excess of the fair value of the replacement award or other valuable consideration over the fair value of the cancelled award at the cancellation date. Incremental compensation cost is measured as the excess, if any, of the fair value of the modified award over the fair value of the original award immediately before its terms are modified, measured based on the fair value of the awards and other pertinent factors at the modification date. For vested awards, the Group recognizes incremental compensation cost in the period the modification occurs. For unvested awards, the Group recognizes over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date. If the fair value of the modified award is lower than the fair value of the original award immediately before modification, the minimum compensation cost the Group recognizes is the cost of the original award. The Group uses the accelerated method for all awards granted with graded vesting service conditions, and the straight-line method for awards granted with non-graded |
Income Taxes | Income taxes The Group follows the liability method of accounting for income taxes in accordance with ASC 740, Income Taxes more-likely-than-not The Group accounted for uncertainties in income taxes in accordance with ASC 740. Interest and penalties arising from underpayment of income taxes shall be computed in accordance with the related PRC tax law. The amount of interest expense is computed by applying the applicable statutory rate of interest to the difference between the tax position recognized and the amount previously taken or expected to be taken in a tax return. Interest and penalties recognized in accordance with ASC 740 are classified in the consolidated statements of income/(loss) as income tax expense. In accordance with the provisions of ASC 740, the Group recognizes in its consolidated financial statements the impact of a tax position if a tax return position or future tax position is “more likely than not” to prevail based on the facts and technical merits of the position. Tax positions that meet the “more likely than not” recognition threshold are measured at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. The Group’s estimated liability for unrecognized tax benefits which is included in “other non-current |
Government Subsidies | Government subsidies Government subsidies primarily consist of financial subsidies received from local governments for operating a business in their jurisdictions and compliance with specific policies promoted by the local governments. There are no defined rules and regulations to govern the criteria necessary for companies to receive such benefits, and the amount of financial subsidy is determined at the discretion of the relevant government authorities. Government subsidies of non-operating non-operating |
Other Income, Net | Other income, net The Group’s depositary bank of its American depositary receipt (“ADR”) program may make contributions to the Group provided certain conditions are met. For the years ended December 31, 2016, 2017 and 2018, the Group received nil, nil and RMB10,960(US$1,594) from the depository bank, and recognized as nil, nil and RMB10,960(US$1,594) as other income, net of the consolidated statements of income/(loss). |
Comprehensive Income/Loss) | Comprehensive income/(loss) Comprehensive income/(loss) is defined as the changes in equity of the Group during a period from transactions and other events and circumstances excluding transactions resulting from investments by owners and distributions to owners. Among other disclosures, ASC 220, Comprehensive Income |
Employee Benefit Expenses | Employee benefit expenses All eligible employees of the Group are entitled to staff welfare benefits including medical care, welfare subsidies, unemployment insurance and pension benefits through a PRC government-mandated multi-employer defined contribution plan. The Group is required to accrue for these benefits based on certain percentages of the qualified employees’ salaries. The Group is required to make contributions to the plans out of the amounts accrued. The PRC government is responsible for the medical benefits and the pension liability to be paid to these employees and the Group’s obligations are limited to the amounts contributed. The Group has no further payment obligations once the contributions have been paid. The Group recorded employee benefit expenses of RMB52,734, RMB62,934 and RMB87,544 (US$12,733) for the years ended December 31, 2016, 2017 and 2018, respectively. |
Treasury Shares, At Cost | Treasury shares, at cost In November 2018, the Board of Directors approved a share repurchase plan (“2018 repurchase plan”). The Company accounts for treasury shares using the cost method. Under this method, the cost incurred to purchase the shares is initially recorded in the T reasury S hares |
Recent Accounting Pronouncements | Recent accounting pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases 2016-02”) 2017-13, 2018-01, 2018-10, 2018-11, 2018-20 2019-01, off-balance The Group will adopt ASU 2016-02 on non-lease In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment 2017-04”) , In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In August 2018, FASB issued ASU 2018-13, Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement 2018-13 |
ORGANIZATION AND BASIS OF PRE_2
ORGANIZATION AND BASIS OF PRESENTATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Company's Subsidiaries, the VIE and the VIE's Subsidiaries and Schools | As of December 31, 2018, details of the Company’s subsidiaries, the VIE and the VIE’s subsidiaries and schools are as follows: Name Date of establishment Place of Percentage Principal activity Subsidiaries of the Company: RISE Education Cayman III Ltd (“Cayman III”) July 29, 2013 Cayman Islands 100% Investment holding RISE Education Cayman I Ltd (“Cayman”) June 19, 2013 Cayman Islands 100% Investment holding Rise IP (Cayman) Limited (“Rise IP”) July 24, 2013 Cayman Islands 100% Educational consulting Edge Franchising Co., Limited (“Edge Franchising”) March 16, 2016 Hong Kong 100% Educational consulting Bain Capital Rise Education (HK) Limited (“Rise HK”) June 24, 2013 Hong Kong 100% Educational consulting Edge Online Co. Limited April 1, 2018 Hong Kong 100% Educational consulting Rise (Tianjin) Education Information Consulting Co., Ltd. (“Rise Tianjin” or “WFOE”) August 12, 2013 PRC 100% Educational consulting, Sale of course materials, study tour service VIE: Beijing Step Ahead Education Technology Development Co., Ltd. January 2, 2008 PRC — Educational consulting VIE’s subsidiaries and school: Beijing Haidian District Step Ahead Training School September 18, 2008 PRC — Language education Beijing Shijingshan District Step Ahead Training School July 14, 2009 PRC — Language education Beijing Changping District Step Ahead Training School July 3, 2009 PRC — Language education Beijing Chaoyang District Step Ahead Training School July 20, 2009 PRC — Language education Beijing Xicheng District RISE Immersion Subject English Training School February 5, 2010 PRC — Language education Beijing Dongcheng District RISE Immersion Subject English Training School July 30, 2010 PRC — Language education Beijing Tongzhou District RISE Immersion Subject English Training School April 19, 2011 PRC — Language education Beijing Daxing District RISE Immersion Subject English Training School March 31, 2013 PRC — Language education Beijing Fengtai District Step Ahead Training School February 28, 2012 PRC — Language education Beijing RISE Immersion Subject English Training School Co., Ltd. October 26, 2018 PRC — Language education Shanghai Boyu Investment Management Co., Ltd. January 29, 2012 PRC — Language education Shanghai Riverdeep Education Information Consulting Co., Ltd. March 8, 2010 PRC — Educational consulting services Shanghai Huangpu District RISE Immersion Subject English Training School June 17, 2011 PRC — Language education Guangzhou Ruisi Education Technology Development Co., Ltd. August 17, 2012 PRC — Training services Guangzhou Yuexiu District RISE Immersion Subject English Training School April 29, 2014 PRC — Language education Guangzhou Haizhu District RISE Immersion Subject English Training School-Chigang December 8, 2014 PRC — Language education Guangzhou Tianhe District RISE Immersion Subject English Training School July 11, 2017 PRC — Language education Hebei Camphor Tree Information Technology Co., Ltd. November 5, 2015 PRC — Investment holding Shijiazhuang Forest Rock Education Technology Co., Ltd. August 28, 2018 PRC — Investment holding Shenzhen Mei Ruisi Education Management Co., Ltd. February 28, 2014 PRC — Training services Shenzhen Futian District Rise Training Center January 8, 2015 PRC — Language education Shenzhen Nanshan District Rise Training Center May 26, 2015 PRC — Language education Shenzhen Luohu District Rise Training Center August 3, 2017 PRC — Language education Wuxi Rise Foreign Language Training Co., Ltd. June 5, 2013 PRC — Training services Ruisixing (Tianjin) Travel Services Co., Ltd July 3, 2018 PRC — Traveling services The following financial statement balances and amounts of the VIEs were included in the accompanying consolidated financial statements: As at December 31, 2017 2018 2018 RMB RMB US$ Cash and cash equivalents 654,777 947,626 137,826 Restricted cash 10,441 13,442 1,955 Accounts receivable, net 1,364 38 6 Inventories 1,952 1,978 288 Prepayments and other current assets 32,621 59,141 8,602 Amounts due from the Group’s subsidiaries 106,748 18,422 2,679 Total current assets 807,903 1,040,647 151,356 Property and equipment, net 92,803 118,482 17,232 Intangible assets, net 1,060 2,579 375 Goodwill 145,781 146,666 21,332 Deferred tax assets 2,404 6,157 895 Other non-current 31,681 51,660 7,514 Total non-current 273,729 325,544 47,348 Total assets 1,081,632 1,366,191 198,704 Accounts payable 3,168 7,558 1,099 Accrued expenses and other liabilities 100,156 126,455 18,392 Deferred revenue and customer advances 776,052 970,022 141,084 Income taxes payable 18,254 20,215 2,940 Amounts due to the Group’s subsidiaries 67,990 44,208 6,430 Total current liabilities 965,620 1,168,458 169,945 Non-current — 36,037 5,241 Other non-current 2,682 3,238 471 Total non-current 2,682 39,275 5,712 Total liabilities 968,302 1,207,733 175,657 For the Years ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Revenues 673,264 912,166 1,175,618 170,987 Net (loss)/income (24,532 ) 24,771 85,753 12,472 Net cash provided by operating activities 49,586 263,813 368,546 53,603 Net cash used in investing activities (26,792 ) (46,630 ) (72,695 ) (10,573 ) |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Property and Equipment | Depreciation is calculated on a straight line basis over the following estimated useful lives: Electronic equipment 3 years Furniture 3 - 5 years Vehicles 4 years Leasehold improvements Shorter of the lease term or estimated useful life |
Schedule of Estimated Useful Lives of Intangible Assets | The estimated useful lives of intangible assets from the date of purchase are as follows: Category Estimated Useful Life Courseware license 15 years Franchise agreements 2.5-3 years Student base 3-5 Trademarks 10-15 years Purchased software 3-5 Teaching course materials 10 years |
Schedule of Cumulative Effect of the Changes made to Consolidated Balance Sheets | The cumulative effect of the changes made to the Group’s consolidated balance sheets at January 1, 2018 were as follows: December 31, Adjustment due January 1, January 1, RMB RMB RMB US$ Liabilities Deferred revenue and customer advances (current and non-current) 812,821 44,122 856,943 124,637 Shareholders’ equity - Accumulated deficit 315,531 44,122 359,653 52,309 |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Text Block [Abstract] | |
Revenue | For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Educational programs 618,326 831,106 1,071,605 155,859 Franchise revenues (a) 63,532 100,013 125,214 18,212 Others 29,135 38,156 75,069 10,918 710,993 969,275 1,271,888 184,989 (a) Initial franchise fees amounted to RMB15,566, RMB23,302 and RMB19,904 (US$2,895), and recurring franchise fees amounted to RMB47,966, RMB76,711 and RMB105,310 (US$15,317) for the years ended December 31, 2016, 2017 and 2018, respectively. |
Schedule of Information about Contract Assets and Liabilities from Contracts with Customers | The following table provides information about contract assets and liabilities from contracts with customers: As of December 31, 2017 2018 2018 RMB RMB US$ Cost to obtain contract with customers-current — 551 80 Cost to obtain contract with customers-non — 1,274 185 Contract liabilities-current 812,821 959,363 139,534 Contract liabilities-non — 36,037 5,241 |
PREPAYMENTS AND OTHER CURRENT_2
PREPAYMENTS AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Text Block [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following: As at December 31, 2017 2018 2018 RMB RMB US$ Prepayments to suppliers 12,820 27,786 4,041 Prepaid rental expense 11,924 14,701 2,138 Staff advances 1,762 2,306 335 Deposits 10,411 12,679 1,844 Prepaid taxes and surcharges 1,528 3,930 572 Current portion of costs to obtain contracts with customers — 551 80 Other receivables 2,126 9,584 1,395 40,571 71,537 10,405 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Net | As at December 31, 2017 2018 2018 RMB RMB US$ Electronic equipment 40,740 50,278 7,313 Furniture 8,643 10,649 1,549 Vehicles 1,168 1,168 170 Leasehold improvements 185,922 237,256 34,507 236,473 299,351 43,539 Less: accumulated depreciation 136,296 170,939 24,862 Property and equipment, net 100,177 128,412 18,677 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets Acquired | The Group’s intangible assets were all acquired and consisted of the following: As at December 31, 2017 2018 2018 RMB RMB US$ Costs: Courseware license 200,079 211,433 30,752 Franchise agreements 61,133 61,151 8,894 Student base 94,875 97,239 14,143 Trademarks 47,040 49,705 7,229 Purchased software 16,783 21,309 3,455 Teaching course materials 10,747 14,022 1,709 430,657 454,859 66,182 Accumulated amortization: Courseware license (56,862 ) (74,002 ) (10,763 ) Franchise agreements (60,818 ) (60,937 ) (8,863 ) Student base (91,875 ) (94,480 ) (13,751 ) Trademarks (12,893 ) (16,984 ) (2,472 ) Purchased software (4,420 ) (6,008 ) (894 ) Teaching course materials (3,174 ) (4,391 ) (633 ) (230,042 ) (256,802 ) (37,376 ) Net carrying amount 200,615 198,057 28,806 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Balance as of January 1, 2017 461,686 Goodwill acquired in business combination 30,751 Impairment losses — Foreign exchange effect (16,705 ) Balance as of December 31, 2017 475,732 Goodwill acquired in business combination 884 Impairment losses — Foreign exchange effect 15,353 Balance as of December 31, 2018 491,969 Balance as of December 31, 2018 (US$) 71,554 |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities consisted of the following: As at December 31, 2017 2018 2018 RMB RMB US$ Payroll and welfare payable 78,263 80,490 11,707 Taxes payable 8,995 6,778 986 Interest payable 1,608 1,605 233 Accrued other operating expenses 41,553 54,223 7,886 Accrual for purchase of property and equipment 9,241 8,298 1,207 Payable for acquisition consideration 25,626 — — Others 5,813 8,488 1,235 171,099 159,882 23,254 |
LONG-TERM LOAN (Tables)
LONG-TERM LOAN (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Due for Loan Principal | As of December 31, 2018, the loan principal will be due according to the following schedule: US$ September 12, 2019 12,000 September 12, 2020 19,250 September 12, 2021 24,750 September 12, 2022 32,000 88,000 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
(Loss)/Income Before Income Taxes | Income/(loss) before income taxes consists of: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ PRC 43,995 14,121 189,760 27,600 Non-PRC 39,050 (14,797 ) 24,439 3,554 83,045 (676 ) 214,199 31,154 |
Current and Deferred Portions of Income Tax Benefit/(Expense) | The current and deferred portions of income tax benefit/(expense) included in the consolidated statements of income/(loss) are as follows: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Current income tax expense (36,965 ) (51,773 ) (65,023 ) (9,458 ) Deferred income tax benefit/(expense) 4,763 (1,151 ) (6,740 ) (980 ) Income tax expense (32,202 ) (52,924 ) (71,763 ) (10,438 ) |
Reconciliation of the Income Tax Expense | The reconciliation of the income tax expense for the years ended December 31, 2016, 2017 and 2018 is as follows: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Income/(loss) before income tax 83,045 (676 ) 214,199 31,154 Income tax (expense)/benefit computed at the PRC statutory tax rate of 25% (20,761 ) 169 (53,550 ) (7,788 ) Effect of different tax rates in different jurisdictions 5,688 (8,175 ) 2,291 333 Non-deductible (9,051 ) (26,482 ) (15,069 ) (2,193 ) Outside basis difference on investment in WFOE (3,174 ) (4,446 ) (6,233 ) (907 ) PRC royalty withholding tax (4,607 ) (6,950 ) (6,080 ) (883 ) Changes in valuation allowance (297 ) (7,040 ) 6,878 1,000 Income tax expense (32,202 ) (52,924 ) (71,763 ) (10,438 ) |
Deferred Tax Assets and Liabilities | The significant components of the Group’s deferred tax assets and liabilities as of December 31, 2017 and 2018 are as follows: For the year ended December 31, 2017 2018 2018 RMB RMB US$ Deferred tax assets: Tax loss carry forward 34,111 24,214 3,522 Accrued expenses 6,638 6,680 972 Revenue recognition — 12,749 1,854 Others 1,971 992 144 Less: Valuation allowance (32,002 ) (37,311 ) (5,427 ) 10,718 7,324 1,065 Deferred tax liabilities: Long-lived assets arising from acquisitions 1,094 844 123 Outside basis difference on investment in WFOE 7,620 13,853 2,015 Others 3,385 455 66 12,099 15,152 2,204 Presentation in the consolidated balance sheets: Deferred tax assets 2,404 6,713 976 Deferred tax liabilities (3,785 ) (14,541 ) (2,115 ) Net deferred tax liabilities (1,381 ) (7,828 ) (1,139 ) |
Unrecognized Tax Benefit | A reconciliation of the beginning and ending amount of unrecognized tax benefit is as follows: 2017 2018 2018 RMB RMB US$ Balance at January 1, 9,124 8,799 1,279 Additions based on tax positions related to current year 738 2,636 382 Reversal based on tax positions related to prior years — (171 ) (25 ) Settlement (1,063 ) (3,463 ) (504 ) Foreign currency translation adjustments — (188 ) (27 ) Balance at December 31, 8,799 7,613 1,105 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | b) During the years ended December 31, 2016, 2017 and 2018, the Group had the following related party transactions: For the year ended December 31, Notes 2016 2017 2018 2018 RMB RMB RMB US$ Loan to a related party: Lionbridge (i ) 280,000 150,000 150,000 21,817 Services received from related parties: Mai Rui (ii ) 278 — — — Bain Advisors (iii ) 6,200 38,537 — — (i) The Group entered into certain entrustment loan agreements with Lionbridge, pursuant to which the Group granted total loans of RMB280,000, RMB150,000 and RMB150,000 (US$21,817) to Lionbridge during the years ended December 31, 2016, 2017 and 2018, respectively, with details set forth below: Year ended December 31, 2016 Loan granted Principal Interest Rate Period Loan 1 200,000 9 % March 30, 2016 to November 30, 2016 Loan 2 30,000 5 % July 8, 2016 to December 8, 2016 Loan 3 50,000 6 % July 8, 2016 to December 8, 2016 Year ended December 31, 2017 Loan granted Principal Interest Rate Period Loan 1 100,000 7 % February 24, 2017 to November 30, 2017 Loan 2 50,000 7 % March 20, 2017 to November 30, 2017 Year ended December 31, 2018 Loan granted Principal Interest Rate Period Loan 1 150,000 7 % March 1, 2018 to November 30, 2018 As of December 31, 2017 and 2018, respectively, the above loans were fully repaid. Interest income of RMB12,712, RMB7,457 and RMB7,539 (US$1,097) from the above loans were recorded as interest income during the years ended December 31, 2016, 2017 and 2018, respectively. (ii) During the years ended December 31, 2016, 2017 and 2018, the Group paid course development fees of RMB278, RMB nil and RMB nil, respectively, to Mai Rui. (iii) During the years ended December 31, 2016, 2017 and 2018, the Group accrued consulting fees of RMB6,200, RMB38,537 and nil, respectively, to Bain Advisors, an affiliate of the Group’s majority shareholder, which included a lump sum consulting termination fee of RMB33,887 to Bain Advisors as a result of the IPO for the year ended December 31, 2017. (note 12 c) (2). (iv) On November 1, 2017, the Group acquired Edge Business from a seller in which a managing director of Bain Capital is a director and minority shareholder. |
Due From Related Parties | c) The balances between the Group and its related parties as of December 31, 2017 and 2018 are listed below: (1) Amounts due from a related party As at December 31, 2017 2018 2018 RMB RMB US$ Bain Capital Education IV 6,604 190 28 |
Due To Related Parties | (2) Amounts due to a related party As at December 31, 2017 2018 2018 RMB RMB US$ Bain Advisors 20,000 — — |
INCOME_(LOSS) PER SHARE (Tables
INCOME/(LOSS) PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Basic and Dilluted Income/(Loss) Per Share | Basic and diluted income/(loss) per share and per ADS for each of the years presented are calculated as follows: For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Numerator: Net income/(loss) attributable to RISE Education Cayman Ltd—basic and diluted 53,923 (47,974 ) 142,958 20,792 Denominator: Weighted average number of ordinary shares outstanding-basic 100,000,000 101,890,411 113,812,182 113,812,182 Weighted average number of ordinary shares outstanding- diluted 100,000,000 101,890,411 115,881,867 115,881,867 Basic income/(loss) per share 0.54 (0.47 ) 1.26 0.18 Diluted income/(loss) per share 0.54 (0.47 ) 1.23 0.18 Basic income/(loss) per ADS 1.08 (0.94 ) 2.51 0.37 Diluted income/(loss) per ADS 1.08 (0.94 ) 2.47 0.36 |
SHARE-BASED PAYMENTS (Tables)
SHARE-BASED PAYMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of the Equity Award Activity Under 2016 Equity Incentive Plan | A summary of the equity award activity under 2016 Equity Incentive Plan is stated below: Number of Weighted - Weighted - Average grant date fair value Weighted - Aggregate US$ Years US$ Outstanding, December 31, 2017 6,885,000 1.44 N/A 6.84 41,035 Granted — N/A N/A Exercised (4,388,397 ) 1.44 N/A Forfeited/Cancelled (197,500 ) 1.44 1.96 Outstanding, December 31, 2018 2,299,103 1.44 N/A 6.13 5,840 Vested and expected to vest at December 31, 2018 2,299,103 1.44 N/A 6.13 5,840 Exercisable at December 31, 2018 2,066,103 1.44 N/A 5.99 5,248 |
Assumptions Used to Estimate the Fair Value of 2016 Equity Incentive Plan | The assumptions used to estimate the fair value of 2016 Equity Incentive Plan granted or modified are as follows: For the years ended December 31, 2016 2017 2018 Risk-free interest rate 1.92%-2.23 % 2.39%-2.93 % 3.51%-3.82 % Expected volatility range 48.1%-50.7 % 47.5%-49.3 % 49.9%-53.6 % Suboptimal exercise factor 2.8 2.8 2.8 Fair value per ordinary share as at valuation date US$ 3.10-$3.26 US$ 7.07 US$ 5.28-$7.06 |
Total Cost of Share-based Payments | Total cost of share-based payments are summarized as follows: For the year ended 2018 RMB US$ Cost of revenues 1,315 191 Selling and marketing expenses 4,229 615 General and administrative expenses 14,808 2,154 Total 20,352 2,960 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments Under Non-cancelable Operating Leases | The Group leases offices and classroom facilities under operating leases. Future minimum lease payments under non-cancelable RMB US$ 2019 186,028 27,057 2020 172,712 25,120 2021 141,172 20,533 2022 121,860 17,724 2023 and thereafter 179,503 26,108 801,275 116,542 |
Schedule of Future Minimum Capital Commitments Under Non-Cancellable Construction Contracts | As of December 31, 2018, future minimum capital commitments under non-cancelable contracts were as follows: RMB US$ Construction of leasehold improvements 17,260 2,510 Software development 4,561 663 21,821 3,173 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income | Foreign currency RMB Balance as of January 1, 2016 28,189 Foreign currency translation adjustments, net of tax of nil 22,275 Balance as of December 31, 2016 50,464 Foreign currency translation adjustments, net of tax of nil (10,424 ) Balance as of December 31, 2017 40,040 Foreign currency translation adjustments, net of tax of nil 2,419 Balance as of December 31, 2018 42,459 US$ Balance as of December 31, 2018 6,175 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of November 1, 2017, the date of acquisition: RMB Purchase consideration 25,980 Net assets acquired, excluding intangible assets and the related deferred tax liabilities 2,133 Intangible assets 4,994 Trademark 1,693 Student base 2,962 Franchise agreements 339 Deferred tax liabilities (1,235 ) Deferred revenue and customer advances (10,663 ) Goodwill 30,751 |
CONDENSED FINANCIAL INFORMATI_2
CONDENSED FINANCIAL INFORMATION OF THE COMPANY (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Condensed Balance Sheet | Condensed Balance Sheets As at December 31, 2017 2018 2018 RMB RMB US$ ASSETS Current assets: Cash and cash equivalents — 13,774 2,003 Due from subsidiaries of the Group 145,416 47,096 6,850 Prepayments and other current assets 143 8,682 1,263 Total current assets 145,559 69,552 10,116 Non-current Investment in subsidiaries 184,707 436,925 63,549 Total non-current 184,707 436,925 63,549 Total assets 330,266 506,477 73,665 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Accrued expenses and other liabilities 5,329 3,367 490 Amount due to a subsidiary of the Group 14,806 47,355 6,888 Total current liabilities 20,135 50,722 7,378 Total liabilities 20,135 50,722 7,378 Shareholders’ equity: Ordinary shares (US$0.01 par value; 200,000,000 and 200,000,000 shares authorized, 110,000,000 and 113,779,244 shares issued and outstanding as of December 31, 2017 and 2018, respectively) 6,782 7,074 1,029 Additional paid-in 532,474 600,011 87,268 Treasury shares, at cost — (23,460 ) (3,412 ) Accumulated deficit (269,165 ) (170,329 ) (24,773 ) Accumulated other comprehensive income 40,040 42,459 6,175 Total shareholders’ equity 310,131 455,755 66,287 Total liabilities and shareholders’ equity 330,266 506,477 73,665 |
Condensed Statement of Comprehensive Income/(Loss) | Condensed Statements of Comprehensive Income/(Loss) For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ General and administrative expenses — — (8,400 ) (1,222 ) Operating loss — — (8,400 ) (1,222 ) Equity in profit/(loss) of subsidiaries and the VIEs 35,409 (54,676 ) 138,698 20,173 Interest income 18,514 6,702 22 3 Others, net — — 12,638 1,838 Income/(loss) before income tax expense 53,923 (47,974 ) 142,958 20,792 Income tax expense — — — — Net income/(loss) 53,923 (47,974 ) 142,958 20,792 Other comprehensive income/(loss), net of tax of nil Foreign currency translation adjustments 22,275 (10,424 ) 2,419 352 Other comprehensive income/(loss) 22,275 (10,424 ) 2,419 352 Comprehensive income/(loss) 76,198 (58,398 ) 145,377 21,144 |
Statements of Cash Flows | Statements of Cash Flows For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ Net cash generated from investing activities 426,016 571,808 13,774 2,003 Net cash used in financing activities (426,016 ) (571,808 ) — — Net increase in cash, cash equivalents and restricted cash — — — — Cash and cash equivalents and restricted cash at beginning of year — — — — Cash and cash equivalents and restricted cash at end of year — — 13,774 2,003 |
ORGANIZATION AND BASIS OF PRE_3
ORGANIZATION AND BASIS OF PRESENTATION (Textual) (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Common Stock [Member] | |||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 10,000,000 | ||
American Depositary Shares [Member] | |||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||
Stock Issued During Period, Shares, New Issues | 5,000,000 | ||
Variable Interest Entity, Primary Beneficiary [Member] | |||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||
Percentage Of Entity Revenue | 92.00% | 94.00% | 95.00% |
ORGANIZATION AND BASIS OF PRE_4
ORGANIZATION AND BASIS OF PRESENTATION (Detail) | 12 Months Ended | |
Dec. 31, 2018 | Nov. 01, 2017 | |
Beijing Step Ahead Education Technology Development Co., Ltd. [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Jan. 2, 2008 | |
Place of establishment Of Subsidiary | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Minority Interest Principal Activity | Educational consulting | |
Beijing Haidian District Step Ahead Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Sep. 18, 2008 | |
Place of establishment Of Subsidiary | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Minority Interest Principal Activity | Language education | |
Beijing Shijingshan District Step Ahead Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jul. 14, 2009 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Changping District Step Ahead Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jul. 3, 2009 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Chaoyang District Step Ahead Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jul. 20, 2009 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Xicheng District RISE Immersion Subject English Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Feb. 5, 2010 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Dongcheng District RISE Immersion Subject English Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jul. 30, 2010 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Tongzhou District RISE Immersion Subject English Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Apr. 19, 2011 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Daxing District RISE Immersion Subject English Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Mar. 31, 2013 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Fengtai District Step Ahead Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Feb. 28, 2012 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Beijing Rise Immersion Subject English Training School Co Ltd [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Oct. 26, 2018 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Shanghai Boyu Investment Management Co., Ltd. [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jan. 29, 2012 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Shanghai Riverdeep Education Information Consulting Co., Ltd. [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Mar. 8, 2010 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Educational consulting services | |
Shanghai Huangpu District RISE Immersion Subject English Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jun. 17, 2011 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Guangzhou Ruisi Education Technology Development Co., Ltd. [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Aug. 17, 2012 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Training services | |
Guangzhou Yuexiu District RISE Immersion Subject English Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Apr. 29, 2014 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Guangzhou Haizhu District RISE Immersion Subject English Training School-Chigang [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Dec. 8, 2014 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Guangzhou Tianhe District RISE Immersion Subject English Training School [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jul. 11, 2017 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Hebei Camphor Tree Information Technology Co Ltd [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Nov. 5, 2015 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Investment holding | |
Shijiazhuang Forest Rock Education Technology Co Ltd [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Aug. 28, 2018 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Investment holding | |
Shenzhen Mei Ruisi Education Management Co., Ltd. [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Feb. 28, 2014 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Training services | |
Shenzhen Futian District Rise Training Center [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jan. 8, 2015 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Shenzhen Nanshan District Rise Training Center [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | May 26, 2015 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Shenzhen Luohu District Rise Training Center [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Aug. 3, 2017 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Language education | |
Wuxi Rise Foreign Language Training Co., Ltd. [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jun. 5, 2013 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Training services | |
Ruisixing Tianjin Travel Services Co Ltd [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Date Involvement Began | Jul. 3, 2018 | |
Variable Interest Entity, Qualitative or Quantitative Information, Place Of Establishment | PRC | |
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 0.00% | |
Variable Interest Entity, Qualitative or Quantitative Information, Activities of VIE | Traveling services | |
RISE Education Cayman III Ltd [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Jul. 29, 2013 | |
Place of establishment Of Subsidiary | Cayman Islands | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | |
Minority Interest Principal Activity | Investment holding | |
RISE Education Cayman I Ltd [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Jun. 19, 2013 | |
Place of establishment Of Subsidiary | Cayman Islands | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | |
Minority Interest Principal Activity | Investment holding | |
Rise IP Cayman Limited [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Jul. 24, 2013 | |
Place of establishment Of Subsidiary | Cayman Islands | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | |
Minority Interest Principal Activity | Educational consulting | |
Edge Franchising Co Limited Edge Franchising [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Mar. 16, 2016 | |
Place of establishment Of Subsidiary | Hong Kong | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | 100.00% |
Minority Interest Principal Activity | Educational consulting | |
Bain Capital Rise Education HK Limited [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Jun. 24, 2013 | |
Place of establishment Of Subsidiary | Hong Kong | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | |
Minority Interest Principal Activity | Educational consulting | |
Edge Online Co Limited [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Apr. 1, 2018 | |
Place of establishment Of Subsidiary | Hong Kong | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | |
Minority Interest Principal Activity | Educational consulting | |
Rise Tianjin Education Information Consulting Co., Ltd. [Member] | ||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||
Date of establishment Of Subsidiary | Aug. 12, 2013 | |
Place of establishment Of Subsidiary | PRC | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | |
Minority Interest Principal Activity | Educational consulting, Sale of course materials, study tour service |
ORGANIZATION AND BASIS OF PRE_5
ORGANIZATION AND BASIS OF PRESENTATION 1 (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018USD ($) | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Current | ¥ 1,040,647 | ¥ 807,903 | $ 151,356 | ||
Variable Interest Entity, Consolidated, Assets, Noncurrent | 325,544 | 273,729 | 47,348 | ||
Total assets | 1,366,191 | 1,081,632 | 198,704 | ||
Variable Interest Entity, Consolidated, Liabilities, Current | 1,168,458 | 965,620 | 169,945 | ||
Variable Interest Entity, Consolidated, Liabilities, Noncurrent | 39,275 | 2,682 | 5,712 | ||
Total liabilities | 1,207,733 | 968,302 | 175,657 | ||
Revenues | 1,175,618 | $ 170,987 | 912,166 | ¥ 673,264 | |
Net (loss)/income | 85,753 | 12,472 | 24,771 | (24,532) | |
Net cash provided by operating activities | 368,546 | 53,603 | 263,813 | 49,586 | |
Net cash used in investing activities | (72,695) | $ (10,573) | (46,630) | ¥ (26,792) | |
Cash and cash equivalents | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Current | 947,626 | 654,777 | 137,826 | ||
Restricted cash | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Current | 13,442 | 10,441 | 1,955 | ||
Inventories | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Current | 1,978 | 1,952 | 288 | ||
Accounts receivable, net | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Current | 38 | 1,364 | 6 | ||
Prepayments and other current assets | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Current | 59,141 | 32,621 | 8,602 | ||
Amounts due from the Group's subsidiaries | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Current | 18,422 | 106,748 | 2,679 | ||
Property and equipment, net | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Noncurrent | 118,482 | 92,803 | 17,232 | ||
Intangible assets, net | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Noncurrent | 2,579 | 1,060 | 375 | ||
Goodwill | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Noncurrent | 146,666 | 145,781 | 21,332 | ||
Deferred tax assets | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Noncurrent | 6,157 | 2,404 | 895 | ||
Other non current assets | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Assets, Noncurrent | 51,660 | 31,681 | 7,514 | ||
Accounts payable | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Liabilities, Current | 7,558 | 3,168 | 1,099 | ||
Accrued expenses and other liabilities | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Liabilities, Current | 126,455 | 100,156 | 18,392 | ||
Deferred revenue and customer advances | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Liabilities, Current | 970,022 | 776,052 | 141,084 | ||
Income taxes payable | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Liabilities, Current | 20,215 | 18,254 | 2,940 | ||
Amounts due to the Group's subsidiaries | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Liabilities, Current | 44,208 | 67,990 | 6,430 | ||
Noncurrent Deferred Revenue And Customer Advances [Member] | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Liabilities, Noncurrent | 36,037 | 5,241 | |||
Other non current liabilities | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Variable Interest Entity, Consolidated, Liabilities, Noncurrent | ¥ 3,238 | ¥ 2,682 | $ 471 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Textual) (Detail) ¥ in Thousands, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Foreign Currency Exchange Rate, Translation | 6.8755 | 6.8755 | ||
Advertising Expense | ¥ 136,323 | $ 19,827 | ¥ 80,475 | ¥ 63,734 |
Description of Lessee Leasing Arrangements, Capital Leases | a) ownership is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the property's estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. | a) ownership is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the property's estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. | ||
Employee Benefits and Share-based Compensation | ¥ 87,544 | $ 12,733 | 62,934 | 52,734 |
Share Repurchase Plan [Member] | ||||
Repurchase of ordinary shares | 825,174 | 825,174 | ||
American Depository Shares [Member] | Share Repurchase Plan [Member] | ||||
Repurchase of ordinary shares | 412,587 | 412,587 | ||
Other Nonoperating Income (Expense) [Member] | ||||
Amount received from depository bank | ¥ 10,960 | $ 1,594 | ¥ 0 | ¥ 0 |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Detail) | 12 Months Ended |
Dec. 31, 2018 | |
Equipment [Member] | |
Property, Plant and Equipment, Useful Life | 3 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment, Useful Life | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment, Useful Life | 5 years |
Vehicles [Member] | |
Property, Plant and Equipment, Useful Life | 4 years |
Leasehold Improvements [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | Shorter of the lease term or estimated useful life |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES 1 (Detail) | 12 Months Ended |
Dec. 31, 2018 | |
Computer Software, Intangible Asset [Member] | |
Finite-Lived Intangible Asset, Useful Life | 15 years |
Teaching Course Materials [Member] | |
Finite-Lived Intangible Asset, Useful Life | 10 years |
Maximum [Member] | Franchise Rights [Member] | |
Finite-Lived Intangible Asset, Useful Life | 3 years |
Maximum [Member] | Trademarks [Member] | |
Finite-Lived Intangible Asset, Useful Life | 15 years |
Maximum [Member] | Student Base [Member] | |
Finite-Lived Intangible Asset, Useful Life | 5 years |
Maximum [Member] | Acquired Software [Member] | |
Finite-Lived Intangible Asset, Useful Life | 5 years |
Minimum [Member] | Franchise Rights [Member] | |
Finite-Lived Intangible Asset, Useful Life | 2 years 6 months |
Minimum [Member] | Trademarks [Member] | |
Finite-Lived Intangible Asset, Useful Life | 10 years |
Minimum [Member] | Student Base [Member] | |
Finite-Lived Intangible Asset, Useful Life | 3 years |
Minimum [Member] | Acquired Software [Member] | |
Finite-Lived Intangible Asset, Useful Life | 3 years |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES 2 (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Jan. 01, 2018CNY (¥) | Jan. 01, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Shareholders' equity - Accumulated deficit | ¥ (248,674) | $ (36,168) | ¥ (315,531) | ||
Accounting Standards Update 2014-09 [Member] | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Deferred revenue and customer advances (current and non-current) | ¥ 44,122 | ||||
Shareholders' equity - Accumulated deficit | 44,122 | ||||
Scenario, Previously Reported [Member] | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Deferred revenue and customer advances (current and non-current) | 812,821 | ||||
Shareholders' equity - Accumulated deficit | ¥ 315,531 | ||||
Restatement Adjustment [Member] | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Deferred revenue and customer advances (current and non-current) | 856,943 | $ 124,637 | |||
Shareholders' equity - Accumulated deficit | ¥ 359,653 | $ 52,309 |
CONCENTRATION OF RISKS (Textual
CONCENTRATION OF RISKS (Textual) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2015CNY (¥) | |
Debt Instrument, Interest Rate, Increase (Decrease) | 1.00% | 1.00% | |||||
Increase (Decrease) in Interest Payable, Net | ¥ 6,050 | $ 880 | |||||
Foreign Currency Exchange Depreciation Rate | 5.70% | 5.70% | 6.70% | 6.40% | |||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | ¥ 1,316,785 | ¥ 1,084,895 | ¥ 656,688 | $ 191,518 | $ 157,791 | ¥ 522,147 | |
China, Yuan Renminbi | |||||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | ¥ 1,138,651 | $ 165,610 |
REVENUES (Detail)
REVENUES (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | ||
Revenue [Abstract] | |||||
Revenues | ¥ 1,271,888 | $ 184,989 | ¥ 969,275 | ¥ 710,993 | |
Educational Programs [Member] | |||||
Revenue [Abstract] | |||||
Revenues | 1,071,605 | 155,859 | 831,106 | 618,326 | |
Franchise revenues [Member] | |||||
Revenue [Abstract] | |||||
Revenues | [1] | 125,214 | 18,212 | 100,013 | 63,532 |
Other [Member] | |||||
Revenue [Abstract] | |||||
Revenues | ¥ 75,069 | $ 10,918 | ¥ 38,156 | ¥ 29,135 | |
[1] | Initial franchise fees amounted to RMB15,566, RMB23,302 and RMB19,904 (US$2,895), and recurring franchise fees amounted to RMB47,966, RMB76,711 and RMB105,310 (US$15,317) for the years ended December 31, 2016, 2017 and 2018, respectively. |
REVENUES (Parenthetical) (Detai
REVENUES (Parenthetical) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Initial Franchise Fees [Member] | ||||
Revenues | ¥ 19,904 | $ 2,895 | ¥ 23,302 | ¥ 15,566 |
Recurring Franchise Fees [Member] | ||||
Revenues | ¥ 105,310 | $ 15,317 | ¥ 76,711 | ¥ 47,966 |
REVENUES 1 (Detail)
REVENUES 1 (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Revenue from Contract with Customer [Abstract] | |||
Cost to obtain contract with customers-current | ¥ 551 | $ 80 | |
Cost to obtain contract with customers-non current | 1,274 | 185 | |
Contract liabilities-current | 959,363 | 139,534 | ¥ 812,821 |
Contract liabilities-noncurrent | ¥ 36,037 | $ 5,241 |
REVENUES (Textual) (Detail)
REVENUES (Textual) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | |
Revenue From Contract With Customer [Line Items] | ||
Contract liabilities recognized revenue | ¥ 808,554 | $ 117,599 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | ||
Revenue From Contract With Customer [Line Items] | ||
Remaining performance obligations recognized period | 1 year | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | ||
Revenue From Contract With Customer [Line Items] | ||
Remaining performance obligations recognized period | 5 years | 5 years |
PREPAYMENTS AND OTHER CURRENT_3
PREPAYMENTS AND OTHER CURRENT ASSETS (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Prepayments to suppliers | ¥ 27,786 | $ 4,041 | ¥ 12,820 |
Prepaid rental expense | 14,701 | 2,138 | 11,924 |
Staff advances | 2,306 | 335 | 1,762 |
Deposits | 12,679 | 1,844 | 10,411 |
Prepaid taxes and surcharges | 3,930 | 572 | 1,528 |
Current portion of costs to obtain contracts with customers | 551 | 80 | |
Other receivables | 9,584 | 1,395 | 2,126 |
Prepaid Expense and Other Assets, Current | ¥ 71,537 | $ 10,405 | ¥ 40,571 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | ¥ 299,351 | $ 43,539 | ¥ 236,473 |
Less: accumulated depreciation | 170,939 | 24,862 | 136,296 |
Property and equipment, net | 128,412 | 18,677 | 100,177 |
Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 50,278 | 7,313 | 40,740 |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 10,649 | 1,549 | 8,643 |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 1,168 | 170 | 1,168 |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | ¥ 237,256 | $ 34,507 | ¥ 185,922 |
PROPERTY AND EQUIPMENT, NET (Te
PROPERTY AND EQUIPMENT, NET (Textual) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | ¥ 36,026 | $ 5,240 | ¥ 29,246 | ¥ 29,634 |
INTANGIBLE ASSETS, NET (Detail)
INTANGIBLE ASSETS, NET (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Indefinite-lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | ¥ 454,859 | $ 66,182 | ¥ 430,657 |
Finite-Lived Intangible Assets, Accumulated Amortization | (256,802) | (37,376) | (230,042) |
Net carrying amount | 198,057 | 28,806 | 200,615 |
Computer Software, Intangible Asset [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 211,433 | 30,752 | 200,079 |
Finite-Lived Intangible Assets, Accumulated Amortization | (74,002) | (10,763) | (56,862) |
Franchise Rights [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 61,151 | 8,894 | 61,133 |
Finite-Lived Intangible Assets, Accumulated Amortization | (60,937) | (8,863) | (60,818) |
Student Base [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 97,239 | 14,143 | 94,875 |
Finite-Lived Intangible Assets, Accumulated Amortization | (94,480) | (13,751) | (91,875) |
Trademarks [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 49,705 | 7,229 | 47,040 |
Finite-Lived Intangible Assets, Accumulated Amortization | (16,984) | (2,472) | (12,893) |
Acquired Software [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 21,309 | 3,455 | 16,783 |
Finite-Lived Intangible Assets, Accumulated Amortization | (6,008) | (894) | (4,420) |
Teaching Course Materials [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 14,022 | 1,709 | 10,747 |
Finite-Lived Intangible Assets, Accumulated Amortization | ¥ (4,391) | $ (633) | ¥ (3,174) |
INTANGIBLE ASSETS, NET (Textual
INTANGIBLE ASSETS, NET (Textual) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of Intangible Assets | ¥ 22,199 | $ 3,229 | ¥ 20,465 | ¥ 40,188 |
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | 21,791 | |||
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 21,331 | |||
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 20,713 | |||
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 20,284 | |||
Finite-Lived Intangible Assets, Amortization Expense, Year Five | ¥ 20,181 |
GOODWILL (Detail)
GOODWILL (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Beginning Balance | ¥ 475,732 | ¥ 461,686 | |
Goodwill acquired in business combination | 884 | 30,751 | |
Impairment losses | 0 | 0 | |
Foreign exchange effect | 15,353 | (16,705) | |
Ending Balance | ¥ 491,969 | $ 71,554 | ¥ 475,732 |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Payables and Accruals [Abstract] | |||
Payroll and welfare payable | ¥ 80,490 | $ 11,707 | ¥ 78,263 |
Taxes payable | 6,778 | 986 | 8,995 |
Interest payable | 1,605 | 233 | 1,608 |
Accrued other operating expenses | 54,223 | 7,886 | 41,553 |
Accrual for purchase of property and equipment | 8,298 | 1,207 | 9,241 |
Payable for acquisition consideration | 25,626 | ||
Others | 8,488 | 1,235 | 5,813 |
Accounts Payable and Accrued Liabilities, Current | ¥ 159,882 | $ 23,254 | ¥ 171,099 |
LONG-TERM LOAN (Textual) (Detai
LONG-TERM LOAN (Textual) (Detail) ¥ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Sep. 30, 2017USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Jul. 31, 2016USD ($) | |
Short-term Debt [Line Items] | ||||||
Repayments of Long-term Debt | $ 22,000 | $ 10,000 | ||||
Debt Instrument, Collateral Amount | ¥ 15,262 | $ 2,220 | ||||
Loan Facility Agreement [Member] | ||||||
Short-term Debt [Line Items] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 55,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 4.78% | 4.78% | ||||
Debt Issuance Costs, Net | $ 4,708 | |||||
Amendment Facility Agreement [Member] | ||||||
Short-term Debt [Line Items] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 110,000 | |||||
Debt Instrument, Term | 5 years | |||||
Amendment Facility Agreement [Member] | Minimum [Member] | ||||||
Short-term Debt [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.00% | 2.00% | ||||
Amendment Facility Agreement [Member] | Maximum [Member] | ||||||
Short-term Debt [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.50% | 3.50% |
LONG-TERM LOAN (Detail)
LONG-TERM LOAN (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Debt Disclosure [Abstract] | |
September 12, 2019 | $ 12,000 |
September 12, 2020 | 19,250 |
September 12, 2021 | 24,750 |
September 12, 2022 | 32,000 |
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year | $ 88,000 |
INCOME TAXES (Textual) (Detail)
INCOME TAXES (Textual) (Detail) ¥ in Thousands, $ in Thousands, $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2018HKD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% | 25.00% | 25.00% | ||||
Disposition Of Assets Tax Percentage | 10.00% | 10.00% | 10.00% | ||||
Undistributed Earnings (Loss) Available to Common Shareholders, Basic | ¥ 309,910 | $ 45,075 | |||||
Remaining Balance Of Undistributed Earnings Available To Commonshareholders | 138,531 | 20,148 | |||||
Deferred Tax Assets, Operating Loss Carryforwards | 97,192 | ¥ 136,445 | $ 14,136 | ||||
Unrecognized tax benefits | 7,613 | 8,799 | ¥ 9,124 | 1,105 | $ 1,279 | ||
Deferred tax assets tax credit carryforwards alternative minimum tax | 1,389 | 1,389 | 202 | ||||
Deferred tax assets tax credit carryforwards other | 6,224 | 7,410 | $ 905 | ||||
Unrecognized tax benefits decrease resulting from settlements with taxing authorities | 3,463 | 504 | 1,063 | ||||
Unrecognized Tax Benefits, Interest on Income Taxes Expense | 259 | 38 | 734 | 573 | |||
Unrecognized Tax Benefits, Income Tax Penalties Expense | 1,161 | 169 | 0 | ¥ 0 | |||
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense | 2,580 | 375 | ¥ 1,160 | ||||
The Group [Member] | |||||||
Unrecognized tax benefits decrease resulting from settlements with taxing authorities | ¥ 670 | $ 97 | |||||
HONG KONG [Member] | |||||||
Profit eligible for half income tax rate | $ 2,000 | ||||||
HONG KONG [Member] | Corporation Business [Member] | |||||||
Effective Income Tax Rate Reconciliation, current imposed rate percent | 16.50% | 16.50% | 16.50% | ||||
Half reduced income tax rate percentage | 8.25% | 8.25% | 8.25% | ||||
Minimum [Member] | PRC [Member] | |||||||
Tax Credit Carryforward, Expiration Date | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | ||||
Maximum [Member] | PRC [Member] | |||||||
Tax Credit Carryforward, Expiration Date | Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2023 |
INCOME TAXES (Detail)
INCOME TAXES (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Income Tax Disclosure [Abstract] | ||||
PRC | ¥ 189,760 | $ 27,600 | ¥ 14,121 | ¥ 43,995 |
Non-PRC | 24,439 | 3,554 | (14,797) | 39,050 |
Income/(loss) before income tax expense | ¥ 214,199 | $ 31,154 | ¥ (676) | ¥ 83,045 |
INCOME TAXES 1 (Detail)
INCOME TAXES 1 (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Income Tax Disclosure [Abstract] | ||||
Current income tax expense | ¥ (65,023) | $ (9,458) | ¥ (51,773) | ¥ (36,965) |
Deferred income tax benefit/(expense) | (6,740) | (980) | (1,151) | 4,763 |
Income tax expense | ¥ (71,763) | $ (10,438) | ¥ (52,924) | ¥ (32,202) |
INCOME TAXES 2 (Detail)
INCOME TAXES 2 (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Income Tax Disclosure [Abstract] | ||||
Income/(loss) before income tax | ¥ 214,199 | $ 31,154 | ¥ (676) | ¥ 83,045 |
Income tax (expense)/benefit computed at the PRC statutory tax rate of 25% | (53,550) | (7,788) | 169 | (20,761) |
Effect of different tax rates in different jurisdictions | 2,291 | 333 | (8,175) | 5,688 |
Non-deductible expenses and others | (15,069) | (2,193) | (26,482) | (9,051) |
Outside basis difference on investment in WFOE | (6,233) | (907) | (4,446) | (3,174) |
PRC royalty withholding tax | (6,080) | (883) | (6,950) | (4,607) |
Changes in valuation allowance | 6,878 | 1,000 | (7,040) | (297) |
Income tax expense | ¥ (71,763) | $ (10,438) | ¥ (52,924) | ¥ (32,202) |
INCOME TAXES 2 (Parenthetical)
INCOME TAXES 2 (Parenthetical) (Detail) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% |
INCOME TAXES 3 (Detail)
INCOME TAXES 3 (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Deferred tax assets: | |||
Tax loss carry forward | ¥ 24,214 | $ 3,522 | ¥ 34,111 |
Accrued expenses | 6,680 | 972 | 6,638 |
Revenue recognition | 12,749 | 1,854 | |
Others | 992 | 144 | 1,971 |
Less: Valuation allowance | (37,311) | (5,427) | (32,002) |
Deferred tax assets | 7,324 | 1,065 | 10,718 |
Deferred tax liabilities: | |||
Long-lived assets arising from acquisitions | 844 | 123 | 1,094 |
Outside basis difference on investment in WFOE | 13,853 | 2,015 | 7,620 |
Others | 455 | 66 | 3,385 |
Deferred income tax liabilities, net | 15,152 | 2,204 | 12,099 |
Deferred tax assets | 6,713 | 976 | 2,404 |
Deferred tax liabilities | (14,541) | (2,115) | (3,785) |
Net deferred tax liabilities | ¥ (7,828) | $ (1,139) | ¥ (1,381) |
Reconciliation of Unrecognized
Reconciliation of Unrecognized Tax Benefit (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | |
Income Tax Disclosure [Abstract] | |||
Balance at January 1, | ¥ 8,799 | $ 1,279 | ¥ 9,124 |
Additions based on tax positions related to current year | 2,636 | 382 | 738 |
Reversal based on tax positions related to prior years | (171) | (25) | |
Settlement | (3,463) | (504) | (1,063) |
Foreign currency translation adjustments | (188) | (27) | |
Balance at December 31, | ¥ 7,613 | $ 1,105 | ¥ 8,799 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | ||
Loan to a related party: | |||||
Payments to Fund Long-term Loans to Related Parties | ¥ 150,000 | $ 21,817 | ¥ 150,000 | ¥ 280,000 | |
Lionbridge Limited [Member] | |||||
Loan to a related party: | |||||
Payments to Fund Long-term Loans to Related Parties | [1] | ¥ 150,000 | $ 21,817 | 150,000 | 280,000 |
Mai Rui [Member] | |||||
Services received from related parties: | |||||
Services received from related parties | [2] | 278 | |||
Bain Advisors [Member] | |||||
Services received from related parties: | |||||
Services received from related parties | [3] | ¥ 38,537 | ¥ 6,200 | ||
[1] | The Group entered into certain entrustment loan agreements with Lionbridge, pursuant to which the Group granted total loans of RMB280,000, RMB150,000 and RMB150,000 (US$21,817) to Lionbridge during the years ended December 31, 2016, 2017 and 2018, respectively, with details set forth below: | ||||
[2] | During the years ended December 31, 2016, 2017 and 2018, the Group paid course development fees of RMB278, RMB nil and RMB nil, respectively, to Mai Rui. | ||||
[3] | During the years ended December 31, 2016, 2017 and 2018, the Group accrued consulting fees of RMB6,200, RMB38,537 and nil, respectively, to Bain Advisors, an affiliate of the Group's majority shareholder, which included a lump sum consulting termination fee of RMB33,887 to Bain Advisors as a result of the IPO for the year ended December 31, 2017. (note 12 c) (2). |
RELATED PARTY TRANSACTIONS (Tex
RELATED PARTY TRANSACTIONS (Textual) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | ||
Payments to Fund Long-term Loans to Related Parties | ¥ 150,000 | $ 21,817 | ¥ 150,000 | ¥ 280,000 | |
Investment Income, Interest | 26,376 | 3,836 | 19,559 | 16,622 | |
Lionbridge Limited [Member] | |||||
Payments to Fund Long-term Loans to Related Parties | [1] | 150,000 | 21,817 | 150,000 | 280,000 |
Investment Income, Interest | ¥ 7,539 | $ 1,097 | 7,457 | 12,712 | |
Bain Advisors | |||||
Payment Of Termination Fee | 33,887 | ||||
Bain Advisors [Member] | |||||
Payments for Other Fees | [2] | ¥ 38,537 | 6,200 | ||
Mai Rui [Member] | |||||
Payments for Other Fees | [3] | ¥ 278 | |||
[1] | The Group entered into certain entrustment loan agreements with Lionbridge, pursuant to which the Group granted total loans of RMB280,000, RMB150,000 and RMB150,000 (US$21,817) to Lionbridge during the years ended December 31, 2016, 2017 and 2018, respectively, with details set forth below: | ||||
[2] | During the years ended December 31, 2016, 2017 and 2018, the Group accrued consulting fees of RMB6,200, RMB38,537 and nil, respectively, to Bain Advisors, an affiliate of the Group's majority shareholder, which included a lump sum consulting termination fee of RMB33,887 to Bain Advisors as a result of the IPO for the year ended December 31, 2017. (note 12 c) (2). | ||||
[3] | During the years ended December 31, 2016, 2017 and 2018, the Group paid course development fees of RMB278, RMB nil and RMB nil, respectively, to Mai Rui. |
RELATED PARTY TRANSACTIONS 1 (D
RELATED PARTY TRANSACTIONS 1 (Detail) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Loan One [Member] | |||
Interest Rate | 7.00% | 7.00% | 9.00% |
Principal | ¥ 150,000 | ¥ 100,000 | ¥ 200,000 |
Period | March 1, 2018 to November 30, 2018 | February 24, 2017 to November 30, 2017 | March 30, 2016 to November 30, 2016 |
Loan Two [Member] | |||
Interest Rate | 7.00% | 5.00% | |
Principal | ¥ 50,000 | ¥ 30,000 | |
Period | March 20, 2017 to November 30, 2017 | July 8, 2016 to December 8, 2016 | |
Loan Three [Member] | |||
Interest Rate | 6.00% | ||
Principal | ¥ 50,000 | ||
Period | July 8, 2016 to December 8, 2016 |
RELATED PARTY TRANSACTIONS 2 (D
RELATED PARTY TRANSACTIONS 2 (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Bain Capital Education IV [Member] | |||
Due from Related Parties | ¥ 190 | $ 28 | ¥ 6,604 |
RELATED PARTY TRANSACTIONS 3 (D
RELATED PARTY TRANSACTIONS 3 (Detail) ¥ in Thousands | Dec. 31, 2017CNY (¥) |
Bain Advisors | |
Due to Related Parties | ¥ 20,000 |
RESTRICTED NET ASSETS (Textual)
RESTRICTED NET ASSETS (Textual) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2018USD ($) | |
Receivables [Abstract] | ||||
Descriptions of Annual Appropriations of General Reserve Subject to Certain Cumulative Limits | Subject to certain cumulative limits, the general reserve requires annual appropriations of 10% of after-tax income as determined under PRC laws and regulations at each year-end until the balance reaches 50% of the PRC entity registered capital; the other reserve appropriations are at the Company's discretion. | Subject to certain cumulative limits, the general reserve requires annual appropriations of 10% of after-tax income as determined under PRC laws and regulations at each year-end until the balance reaches 50% of the PRC entity registered capital; the other reserve appropriations are at the Company's discretion. | ||
Appropriations to General Reserve | ¥ 5,665 | $ 824 | ¥ 0 | |
Descriptions of Annual Appropriations of After Tax Income to Development Fund Prior To Payments of Dividend | PRC laws and regulations require private schools that require reasonable returns to make annual appropriations of no less than 25% of after-tax income prior to payments of dividend to its development fund, which is to be used for the construction or maintenance of the school or procurement or upgrading of educational equipment. For private schools that do not require reasonable returns, this amount should be equivalent to no less than 25% of the annual increase of net assets of the school as determined in accordance with generally accepted accounting principles in the PRC. | PRC laws and regulations require private schools that require reasonable returns to make annual appropriations of no less than 25% of after-tax income prior to payments of dividend to its development fund, which is to be used for the construction or maintenance of the school or procurement or upgrading of educational equipment. For private schools that do not require reasonable returns, this amount should be equivalent to no less than 25% of the annual increase of net assets of the school as determined in accordance with generally accepted accounting principles in the PRC. | ||
Appropriations to Development Fund | ¥ 26,314 | $ 3,827 | ¥ 13,855 | |
Amount of Restricted Net Assets for Consolidated and Unconsolidated Subsidiaries | ¥ 213,913 | $ 31,112 |
INCOME_(LOSS) PER SHARE (Detail
INCOME/(LOSS) PER SHARE (Detail) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥)¥ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017CNY (¥)¥ / sharesshares | Dec. 31, 2016CNY (¥)¥ / sharesshares | |
Numerator: | ||||
Net income/(loss) attributable to RISE Education Cayman Ltd-basic and diluted | ¥ 142,958 | $ 20,792 | ¥ (47,974) | ¥ 53,923 |
Denominator: | ||||
Weighted average number of ordinary shares outstanding - basic | 113,812,182 | 113,812,182 | 101,890,411 | 100,000,000 |
Weighted average number of ordinary shares outstanding - diluted | 115,881,867 | 115,881,867 | 101,890,411 | 100,000,000 |
Basic income/(loss) per share | (per share) | ¥ 1.26 | $ 0.18 | ¥ (0.47) | ¥ 0.54 |
Diluted income/(loss) per share | (per share) | 1.23 | 0.18 | (0.47) | 0.54 |
Basic income/(loss) per ADS | (per share) | 2.51 | 0.37 | (0.94) | 1.08 |
Diluted income/(loss) per ADS | (per share) | ¥ 2.47 | $ 0.36 | ¥ (0.94) | ¥ 1.08 |
INCOME_(LOSS) PER SHARE(Textual
INCOME/(LOSS) PER SHARE(Textual) (Detail) | 12 Months Ended |
Dec. 31, 2018shares | |
Earnings Per Share [Abstract] | |
Number of share options excluded from exercise shares | 0 |
SHARE-BASED PAYMENTS (Textual)
SHARE-BASED PAYMENTS (Textual) (Detail) $ / shares in Units, ¥ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Oct. 24, 2017CNY (¥) | Apr. 30, 2016shares | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017CNY (¥)shares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016shares | Apr. 01, 2019shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights | 50% of the options granted will generally vest in four or five equal installments over a service period (the "2016 Service Options") while the remaining 50% of the options will vest in two equal installments of 25% each if a fixed targeted return on the Company's ordinary shares is achieved (the "2016 Market Options"). | |||||||
Share-based compensation | ¥ 18,631 | $ 2,710,000 | ¥ 95,307 | |||||
Accelerated vesting of stock options granted | 432,500 | 432,500 | ||||||
Accelerated vesting of stock options granted | 50,000 | 50,000 | ||||||
Weighted-average grant-date fair value for vested options | $ / shares | $ 2.21 | |||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ | $ 704 | |||||||
Share Incentive Plan 2016 [Member] | ||||||||
Share-based compensation | ¥ 90,335 | ¥ 20,352 | $ 2,960,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | ¥ | ¥ 168,917 | ¥ 0 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 2,227,500 | 2,227,500 | ||||||
Share Incentive Plan 2017 [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | 10 years | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 5,000,000 | 5,000,000 | ||||||
Equity Option Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 7,000,000 | |||||||
2017 Modification Date [Member] | ||||||||
Share-based compensation | ¥ 2,329 | $ 358,000 | ||||||
Employee [Member] | Equity Option Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 5,985,000 | |||||||
Management And Employees [Member] | Share Incentive Plan 2017 [Member] | ||||||||
Stock award granted | 4,800,000 | |||||||
Management And Employees [Member] | Equity Incentive Plan 2016 [Member] | ||||||||
Stock award granted | 308,000 |
SHARE-BASED PAYMENTS (Detail)
SHARE-BASED PAYMENTS (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Number of options, Outstanding Opening | 6,885,000 | |
Number of options, Granted | 0 | |
Number of options, Exercised | (4,388,397) | |
Number of options, Forfeited/Cancelled | (197,500) | |
Number of options, Outstanding Ending | 2,299,103 | 6,885,000 |
Number of options, Vested and expected to vest | 2,299,103 | |
Number of options, Exercisable | 2,066,103 | |
Weighted- average exercise price, Outstanding Opening | $ 1.44 | |
Weighted- average exercise price, Exercised | 1.44 | |
Weighted- average exercise price, Forfeited/Cancelled | 1.44 | |
Weighted- average exercise price, Outstanding Ending | 1.44 | $ 1.44 |
Weighted- average exercise price, Vested and expected to vest | 1.44 | |
Weighted- average exercise price, Exercisable | 1.44 | |
Weighted-Average grant date fair value, Forfeited/Cancelled | $ 1.96 | |
Weighted - average remaining contractual term, Outstanding | 6 years 1 month 17 days | 6 years 10 months 2 days |
Weighted - average remaining contractual term Vested and expected to vest | 6 years 1 month 17 days | |
Weighted - average remaining contractual term Exercisable | 5 years 11 months 26 days | |
Aggregate intrinsic Value, Outstanding Ending | $ 5,840 | $ 41,035 |
Aggregate intrinsic Value, Vested and expected to vest | 5,840 | |
Aggregate intrinsic Value, Exercisable | $ 5,248 |
SHARE-BASED PAYMENTS 1 (Detail)
SHARE-BASED PAYMENTS 1 (Detail) | 12 Months Ended | ||
Dec. 31, 2018$ / shares | Dec. 31, 2017$ / shares | Dec. 31, 2016$ / shares | |
Suboptimal exercise factor | 2.8 | 2.8 | 2.8 |
Fair value per ordinary share as at valuation date | $ 0.0707 | ||
Minimum [Member] | |||
Risk-free interest rate | 3.51% | 2.39% | 1.92% |
Expected volatility range | 49.90% | 47.50% | 48.10% |
Fair value per ordinary share as at valuation date | $ 0.0528 | $ 0.0310 | |
Maximum [Member] | |||
Risk-free interest rate | 3.82% | 2.93% | 2.23% |
Expected volatility range | 53.60% | 49.30% | 50.70% |
Fair value per ordinary share as at valuation date | $ 0.0706 | $ 0.0326 |
SHARE-BASED PAYMENTS 2 (Detail)
SHARE-BASED PAYMENTS 2 (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Selling and marketing expenses | ¥ 245,662 | $ 35,730 | ¥ 177,993 | ¥ 128,475 |
General and administrative expenses | 242,084 | 35,210 | 339,690 | ¥ 148,093 |
Share-based compensation | 18,631 | 2,710 | ¥ 95,307 | |
Share Incentive Plan 2017 [Member] | ||||
Cost of revenues | 1,315 | 191 | ||
Selling and marketing expenses | 4,229 | 615 | ||
General and administrative expenses | 14,808 | 2,154 | ||
Share-based compensation | ¥ 20,352 | $ 2,960 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Detail) - Dec. 31, 2018 ¥ in Thousands, $ in Thousands | CNY (¥) | USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2019 | ¥ 186,028 | $ 27,057 |
2020 | 172,712 | 25,120 |
2021 | 141,172 | 20,533 |
2022 | 121,860 | 17,724 |
2023 and thereafter | 179,503 | 26,108 |
Operating Leases, Future Minimum Payments Due | ¥ 801,275 | $ 116,542 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Textual) (Detail) ¥ in Thousands, $ in Thousands | Nov. 11, 2018CNY (¥) | Nov. 11, 2018USD ($) | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) |
Operating Leases, Rent Expense | ¥ 192,296 | $ 27,968 | ¥ 136,662 | ¥ 121,530 | ||
Equity interests | 51.00% | 51.00% | ||||
Cash consideration not yet paid for business acquisitions | ¥ 35,455 | $ 5,157 | ||||
Number of acquisition learning center | 7 | 7 | ||||
Third Party Seller [Member] | ||||||
Business combination consideration transferred | ¥ 44,319 | $ 6,446 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Schedule of Future Minimum Capital Commitments Under Non-Cancellable Construction Contracts (Detail) - Dec. 31, 2018 ¥ in Thousands, $ in Thousands | CNY (¥) | USD ($) |
Future Minimum Payments Under Non Cancelable Operating Leases With Initial Or Remaining Lease Terms In Excess Of One Year And Future Minimum Capital Lease Payments [Line Items] | ||
Future minimum capital expenditure commitments | ¥ 21,821 | $ 3,173 |
Construction of leasehold improvements [Member] | ||
Future Minimum Payments Under Non Cancelable Operating Leases With Initial Or Remaining Lease Terms In Excess Of One Year And Future Minimum Capital Lease Payments [Line Items] | ||
Future minimum capital expenditure commitments | 17,260 | 2,510 |
Software Development [Member] | ||
Future Minimum Payments Under Non Cancelable Operating Leases With Initial Or Remaining Lease Terms In Excess Of One Year And Future Minimum Capital Lease Payments [Line Items] | ||
Future minimum capital expenditure commitments | ¥ 4,561 | $ 663 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Equity [Abstract] | ||||
Opening Balance | ¥ 40,040 | ¥ 50,464 | ¥ 28,189 | |
Foreign currency translation adjustments, net of tax of nil | 2,419 | $ 352 | (10,424) | 22,275 |
Closing Balance | ¥ 42,459 | $ 6,175 | ¥ 40,040 | ¥ 50,464 |
BUSINESS COMBINATION (Textual)
BUSINESS COMBINATION (Textual) (Detail) ¥ in Thousands, $ in Thousands | Nov. 01, 2017CNY (¥)shares | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) |
Business Combination, Consideration Transferred, Liabilities Incurred | ¥ 35,455 | $ 5,157 | |
Edge Learning Centers [Member] | |||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||
Business Combination, Consideration Transferred, Liabilities Incurred | ¥ 16,769 | ||
Stock Issued During Period, Shares, Acquisitions | shares | 216,021 | ||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | ¥ 9,211 | ||
Business Combination, Goodwill Recognized, Description | Included in the goodwill of RMB30,261 recognized on the acquisition date is the expected synergies from combining operations of the Acquiree and the Group which does not qualify for separate recognition. None of the goodwill recognized is expected to be deductible for income tax purposes. | Included in the goodwill of RMB30,261 recognized on the acquisition date is the expected synergies from combining operations of the Acquiree and the Group which does not qualify for separate recognition. None of the goodwill recognized is expected to be deductible for income tax purposes. | |
Business Acquisition, Transaction Costs | ¥ 889 |
BUSINESS COMBINATION (Detail)
BUSINESS COMBINATION (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Goodwill | ¥ 491,969 | $ 71,554 | ¥ 475,732 | ¥ 461,686 |
Edge Learning Centers [Member] | ||||
Purchase consideration | 25,980 | |||
Net assets acquired, excluding intangible assets and the related deferred tax liabilities | 2,133 | |||
Intangible assets | 4,994 | |||
Trademark | 1,693 | |||
Student base | 2,962 | |||
Franchise agreements | 339 | |||
Deferred tax liabilities | (1,235) | |||
Deferred revenue and customer advances | (10,663) | |||
Goodwill | ¥ 30,751 |
CONDENSED FINANCIAL INFORMATI_3
CONDENSED FINANCIAL INFORMATION OF THE COMPANY (Detail) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2015CNY (¥) |
Current assets: | |||||
Cash and cash equivalents | ¥ 1,288,080 | $ 187,343 | ¥ 1,055,982 | ¥ 639,999 | |
Due from subsidiaries of the Group | 190 | 28 | 6,604 | ||
Prepayments and other current assets | 71,537 | 10,405 | 40,571 | ||
Total current assets | 1,402,270 | 203,952 | 1,142,445 | ||
Non-current assets: | |||||
Total non-current assets | 878,504 | 127,773 | 813,893 | ||
Total assets | 2,280,774 | 331,725 | 1,956,338 | ||
Current liabilities | |||||
Accrued expenses and other liabilities | 54,223 | 7,886 | 41,553 | ||
Total current liabilities | 1,278,872 | 186,004 | 1,030,700 | ||
Total liabilities | 1,839,940 | 267,608 | 1,660,606 | ||
Shareholders' equity: | |||||
Ordinary shares (US$0.01 par value; 200,000,000 and 200,000,000 shares authorized, 110,000,000 and 113,779,244 shares issued and outstanding as of December 31, 2017 and 2018, respectively) | 7,074 | 1,029 | 6,782 | ||
Additional paid-in capital | 600,011 | 87,268 | 532,474 | ||
Treasury shares, at cost | 23,460 | 3,412 | |||
Accumulated deficit | (248,674) | (36,168) | (315,531) | ||
Accumulated other comprehensive income | 42,459 | 6,175 | 40,040 | ¥ 50,464 | ¥ 28,189 |
Total shareholders' equity | 455,755 | 66,287 | 310,131 | ||
Total liabilities and shareholders' equity | 2,280,774 | 331,725 | 1,956,338 | ||
Parent Company [Member] | |||||
Current assets: | |||||
Cash and cash equivalents | 13,774 | 2,003 | |||
Due from subsidiaries of the Group | 47,096 | 6,850 | 145,416 | ||
Prepayments and other current assets | 8,682 | 1,263 | 143 | ||
Total current assets | 69,552 | 10,116 | 145,559 | ||
Non-current assets: | |||||
Investment in subsidiaries | 436,925 | 63,549 | 184,707 | ||
Total non-current assets | 436,925 | 63,549 | 184,707 | ||
Total assets | 506,477 | 73,665 | 330,266 | ||
Current liabilities | |||||
Accrued expenses and other liabilities | 3,367 | 490 | 5,329 | ||
Amount due to a subsidiary of the Group | 47,355 | 6,888 | 14,806 | ||
Total current liabilities | 50,722 | 7,378 | 20,135 | ||
Total liabilities | 50,722 | 7,378 | 20,135 | ||
Shareholders' equity: | |||||
Ordinary shares (US$0.01 par value; 200,000,000 and 200,000,000 shares authorized, 110,000,000 and 113,779,244 shares issued and outstanding as of December 31, 2017 and 2018, respectively) | 7,074 | 1,029 | 6,782 | ||
Additional paid-in capital | 600,011 | 87,268 | 532,474 | ||
Treasury shares, at cost | (23,460) | (3,412) | |||
Accumulated deficit | (170,329) | (24,773) | (269,165) | ||
Accumulated other comprehensive income | 42,459 | 6,175 | 40,040 | ||
Total shareholders' equity | 455,755 | 66,287 | 310,131 | ||
Total liabilities and shareholders' equity | ¥ 506,477 | $ 73,665 | ¥ 330,266 |
CONDENSED FINANCIAL INFORMATI_4
CONDENSED FINANCIAL INFORMATION OF THE COMPANY (Parenthetical) (Detail) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Consolidated Balance Sheet Statements Captions [Line Items] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock, Shares, Issued | 113,779,244 | 110,000,000 |
Common Stock, Shares, Outstanding | 113,779,244 | 110,000,000 |
Parent Company [Member] | ||
Consolidated Balance Sheet Statements Captions [Line Items] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock, Shares, Issued | 114,604,418 | 110,000,000 |
Common Stock, Shares, Outstanding | 114,604,418 | 110,000,000 |
CONDENSED FINANCIAL INFORMATI_5
CONDENSED FINANCIAL INFORMATION OF THE COMPANY (Detail 1) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Condensed Income Statements, Captions [Line Items] | ||||
General and administrative expenses | ¥ 242,084 | $ 35,210 | ¥ 339,690 | ¥ 148,093 |
Operating loss | 207,612 | 30,196 | (628) | 70,846 |
Interest income | 26,376 | 3,836 | 19,559 | 16,622 |
Others, net | 15,397 | 2,239 | 6,594 | 4,391 |
Income/(loss) before income tax expense | 214,199 | 31,154 | (676) | 83,045 |
Income tax expense | 71,763 | 10,438 | 52,924 | 32,202 |
Net income/(loss) | 142,958 | 20,792 | (47,974) | 53,923 |
Other comprehensive income/(loss), net of tax of nil | ||||
Foreign currency translation adjustments | 2,419 | 352 | (10,424) | 22,275 |
Comprehensive income/(loss) | 145,377 | 21,144 | (58,398) | 76,198 |
Parent Company [Member] | ||||
Condensed Income Statements, Captions [Line Items] | ||||
General and administrative expenses | (8,400) | (1,222) | ||
Operating loss | (8,400) | (1,222) | ||
Equity in profit/(loss) of subsidiaries and the VIEs | 138,698 | 20,173 | (54,676) | 35,409 |
Interest income | 22 | 3 | 6,702 | 18,514 |
Others, net | 12,638 | 1,838 | ||
Income/(loss) before income tax expense | 142,958 | 20,792 | (47,974) | 53,923 |
Income tax expense | 0 | 0 | 0 | 0 |
Net income/(loss) | 142,958 | 20,792 | (47,974) | 53,923 |
Other comprehensive income/(loss), net of tax of nil | ||||
Foreign currency translation adjustments | 2,419 | 352 | (10,424) | 22,275 |
Other comprehensive income/(loss) | 2,419 | 352 | (10,424) | 22,275 |
Comprehensive income/(loss) | ¥ 145,377 | $ 21,144 | ¥ (58,398) | ¥ 76,198 |
CONDENSED FINANCIAL INFORMATI_6
CONDENSED FINANCIAL INFORMATION OF THE COMPANY (Detail 2) (Detail) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Condensed Cash Flow Statements, Captions [Line Items] | ||||
Net cash generated from investing activities | ¥ (100,875) | $ (14,672) | ¥ (53,067) | ¥ (42,544) |
Net cash used in financing activities | (57,306) | (8,335) | 137,402 | (69,129) |
Net increase in cash, cash equivalents and restricted cash | 231,890 | 33,727 | 428,207 | 134,541 |
Cash, cash equivalents and restricted cash at beginning of year | 1,084,895 | 157,791 | 656,688 | 522,147 |
Cash, cash equivalents and restricted cash at end of year | 1,316,785 | 191,518 | 1,084,895 | 656,688 |
Parent Company [Member] | ||||
Condensed Cash Flow Statements, Captions [Line Items] | ||||
Net cash generated from investing activities | 13,774 | 2,003 | 571,808 | 426,016 |
Net cash used in financing activities | 0 | 0 | (571,808) | (426,016) |
Net increase in cash, cash equivalents and restricted cash | 0 | 0 | 0 | 0 |
Cash, cash equivalents and restricted cash at beginning of year | 0 | 0 | 0 | 0 |
Cash, cash equivalents and restricted cash at end of year | ¥ 13,774 | $ 2,003 | ¥ 0 | ¥ 0 |