Edvantage Group (0382.HK) announced successful college conversion, Renamed as Guangzhou Huashang College

Jan 11, 2021 16:50 JST

Source: Edvantage Group Holdings Limited

"Huashang" brand deepened, Enrolment scale expanded, Cost structure optimised

HONG KONG, Jan 11, 2021 - (ACN Newswire) - Edvantage Group Holdings Limited ("Edvantage Group" or the "Group", stock code: 0382.HK), the largest private higher education group in the Guangdong-Hong Kong-Macao Greater Bay Area ("GBA"), is pleased to announce that the conversion of Huashang College Guangdong University of Finance and Economics ("Huashang College") into a private higher education institution has been approved and the college was renamed as Guangzhou Huashang College. The completion of Huashang College's conversion will provide beneficial impacts to school running perspective and operational perspective of the Group. After the conversion, the college will have more autonomy in school running and establishment of school running model, more flexibility in establishment of professional courses, more resources to improve educational level. It will create beneficial conditions for the future school running level development of the Group. After completion of the conversion, it will also proactively raise the Group's profitability and add value to its efficiency.

(Picture: The conversion of Huashang College Guangdong University of Finance and Economics ("Huashang College") into a private higher education institution has been approved and the college was renamed as Guangzhou Huashang College.)

School Running perspective
Inheriting the "Huashang" brand, Portraying novel prestigious education
Founded in 2006, Huashang College has been adhering to the motto of "Establishing school of the century, Nurturing talents of the nation", with the mission to develop professional talents in the GBA. The school running positioning of the Huashang College is to be an application-oriented higher education institution. Throughout the years, Huashang College has been focusing on business-related programmes to continuously output labours for the GBA. The successful conversion of Huashang College represents another landmark along the Group's development. Huashang College, in its new name of Guangzhou Huashang College, will inherit and promote the distinguished brand of "Huashang" in another dimension, maintaining a steady and healthy development of its reputation.

Successful conversion reflecting recognition for quality education
In accordance with relevant laws and regulations including the Non-state Education Promotion Law of the PRC, Provisional Regulations relating to General Bachelor Degree College Establishment and proactively responding to the call of the PRC government, Huashang College has proactively carried out procedures to improve school conditions and quality After rigorous consideration conducted by experts from the High School Establishment Consideration Committee of Guangdong Province, eventually Huashang College was selected as one of the 4 approved colleges in Guangdong Province for conversion. This demonstrates the Ministry of Education's recognition for the school quality and level of Huashang College as well as its confidence in Huashang College's developed internal governance, continuously growing teaching team and eager cooperation in optimising the conversion project.

Operational Perspective
Breakthrough in enrolment scale and boosting endogenous growth
Since the announcement of acquiring two schools in Chengdu, Sichuan, the Group has stepped into a high-speed development to robustly promote the full-time academic and vocational education businesses with both endogenous growth as well as outreach mergers and acquisitions (M&A). The post-conversion Huashang College is expected to provide more high-quality bachelor degree capacity and proactively expand the scale of student enrolment, by utilising the massive source of students in Guangdong Province as well as the multi-layered favourable policy which enabled full-time academic programmes to recruit additional students, thus creating advantageous conditions for the Group's revenue growth. Meanwhile, the school conditions of Huashang College will also be immensely enhanced, as Sihui Campus, the new site for its bachelor's degrees, commences operation.

Student management fees declining yearly, Cost structure highly improved
For the school year 2020/21, Huashang College paid approximately RMB86 million of student management fees to Guangdong University of Finance and Economics; however, after the conversion, starting from the school year 2021/22, no management fees will be incurred for student recruitment in the name of Guangzhou Huashang College. Guangzhou Huashang College will merely be responsible for management fees in regard to bachelor's students at Huashang College Guangdong University of Finance and Economics. Such fees will diminish year by year and eventually reduced to zero in the school year 2024/25, as the Group estimated, benefitting three figures, namely cost, gross profit and net profit. The reduction in cost will allow the Group to deploy more resources in programme development, campus construction and acquisitions, thus continuously enhancing its school conditions.

As one of the first independent colleges approved for conversion, the Group has taken an active role to align with the nation in promoting conversion work and closely follow relevant policies to boost equity in education as well as the healthy development of higher education in China. Moreover, this successful conversion will favour the Group in multi directions, extensively reinforcing its revenue and brand influence. Despite the conversion, Huashang College will still maintain a decent and continuous cooperation with Guangdong University of Finance and Economics. Such cooperation will include co-construction of research institutes and external social services. Looking forward, the Group will be dedicated to ensuring orderly daily education throughout the conversion and, sticking to the conversion scheme, proactively cooperate with each party, hence continuously embrace the motto of "Establishing school of the century, Nurturing talents of the nation" and reciprocate students, parents and investors.

About Edvantage Group Holdings Limited
Edvantage Group Holdings Limited (("Edvantage Group" or the "Group", stock code: 0382.HK) is the largest private higher education group in the Guangdong-Hong Kong-Macao Greater Bay Area and an early mover in education sector in pursuing international expansion. Up to now, the Group has more than 62,000 students in school, and it owns 7 domestic and foreign schools in China and overseas.

In China, the Group currently operates two Chinese private higher education institutions in Guangdong Province, namely, the undergraduate college, Guangdong University of Finance and Economics Huashang College (now renamed as "Guangzhou Huashang College") and a junior college, the Guangzhou Huashang Vocational College with the strategic focus of major business, major health and IT as the main curriculum. As of now, the number of students is 38,351. On December 4, 2020, the Group's existing Chinese school network in the Greater Bay Area expanded to the Chengdu-Chongqing integrated regional economic belt with great development potential, and acquired two colleges, Sichuan City Vocational College and Sichuan City Technician College in Sichuan Province with the number of full-time students in the two schools is about 24,000.

Overseas, the Group operates a private vocational education institution named Global Business College of Australia ("GBCA") authorised by Australian Skills Quality Authority ("ASQA") in Australia, offering vocational education courses and non-formal short-term courses. GBCA is the first Chinese international education institution approved by the Australian government. In December 2019, the Group also acquired a private vocational education institution in Singapore with an EduTrust certification from the Ministry of Education, that is, Edvantage Institute (Singapore) ("EIS") (formerly known as NYU Language School), which provides short-term and long-term language training courses, various kinds of diploma and higher diploma programmes. Moreover, in the first half of year 2020, the Group's Edvantage Institute Australia ("EIA") was authorised and approved by the Tertiary Education Quality and Standards Agency ("TEQSA"), being the Group's first higher education institution qualified to offer and award both undergraduate and master's degrees.

Source: Edvantage Group Holdings Limited
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