Tarena International, Inc. (NASDAQ:TEDU) Q1 2023 Earnings Call Transcript

Ping Wei: That’s right. [Foreign Language] So basically, the half of our college related business is a non-cash transaction. The – it’s actually because the particular part of the adult business is actually losing money for the past few years. And considering that our core strength is in the 2C market both for adults and for children, and to focus the company’s strategic attention, as well as financial resources, we decided to introducing financial and slash strategic investor, that’s why we carved it out. Our non-cash consideration returns a minority interest, having the hold a controlling investor to be the continuous financial sponsor for this particular business. You know, so, hopefully, the minority interest in the carved out business will actually accrete sort of increase in value over time with sort of deep pockets and strategic investor supporting the sort of the funding needs, as well as the strategic direction.

For the company part, we will lose – we will sort of base basically increase bottom line, but not increasing cash in the – with the transaction. So additionally, the question on the use of the proceeds from the beauty, which is a net additional 15 million of cash, basically, we will let it sit on balance sheet, basically, sort of to enhance our cash position. And we don’t intend to use it for other purposes. So we’ll be for operational purpose – working capital purpose.

Unidentified Analyst: Thank you very much. That was helpful.

Ping Wei: Thank you.

Operator: Thank you. We don’t have any other questions at the moment. Presenters, please continue.

Sylvia Yang: Thank you, operator. If there are no further questions at present, we would like to conclude by thanking everyone for joining our conference call. We welcome you to reach out to us directly by emailing at ir.tedu.cn. Should you have any questions or requests for additional information, we encourage you to visit our Investor Relations site at ir.tedu.cn. Thank you.

Operator: Ladies and gentlemen, that does conclude our call for today. Thank you for participating. You may now disconnect.