was affected by novel coronavirus pneumonia, and its performance declined in 2020. In general, 2020 is not only a “difficult” year for maple leaf education, but also a “counter trend expansion” year. < / P > < p > according to the latest annual performance report as of August 31, 2020, the operating revenue of maple leaf education in fiscal year 2020 decreased by 2.65% year on year, the net profit decreased by 22.18% year on year, and the adjusted net profit decreased by 24.0% year on year. < p > < p > although the performance of maple leaf education was frustrated under the epidemic situation, it still chose to expand against the trend. Including the acquisition of Huangqi International School in Malaysia in March and the acquisition of Canadian International Education School in Singapore in August, maple leaf education added 14 schools this fiscal year. < / P > < p > the substantial expansion has significantly changed the asset liability structure of maple leaf education. Compared with the same period last year, the amount of short-term loans increased from 123 million yuan to 2.303 billion yuan, the amount of long-term loans increased from 208 million yuan to 1.328 billion yuan, the book value of goodwill increased from 253 million yuan to 2.449 billion yuan, and the asset liability ratio increased from 7.8% to 78.5%. In terms of cash flow, the net outflow of investment cash flow was 3.68 billion yuan, and the net decrease of cash and cash equivalents was 1.441 billion yuan. < / P > < p > maple leaf education is an education group listed in Hong Kong stock market in November 2014, mainly engaged in operating international schools and providing K-12 bilingual education. The company operates all its schools under the maple leaf brand, including high school, junior high school, primary school, kindergarten and school for children of foreigners. < / P > < p > maple leaf education is mainly aimed at Chinese students from the increasingly affluent middle-income groups in China who pursue overseas higher education, so its tuition fees are usually higher. Except for Shanghai and Shenzhen, most of the schools are located in the second and third tier cities. According to the annual financial report, maple leaf education achieved an operating revenue of 1.529 billion yuan, down 2.65% year-on-year, and a net profit of 509 million yuan, down 22.18% year-on-year, and 654 million yuan year-on-year. After adjustment, its net profit decreased 165 million yuan, down 24.0%. < / P > < p > in terms of profitability, gross profit margin remained stable, but net profit and return on net assets declined. From fiscal year 2018 to fiscal year 2020, the gross profit margin of the company is 46.53%, 46.80% and 46.66% respectively; the net profit margin is 40.14%, 41.66% and 33.30% respectively; the ROE (diluted) of the company is 14.87%, 15.81% and 11.16% respectively. < / P > < p > maple leaf Education said that the company’s operation was greatly affected by the new crown epidemic. According to the requirements of relevant government departments, the company refunded about 38 million yuan of tuition and accommodation. At the same time, there was almost no kindergarten business in the second half of the semester, resulting in a decrease of nearly 30 million yuan in revenue. The most affected is the non tuition income. In order to ensure the safety of students, the company cancelled the winter and summer camp throughout the year, resulting in a decrease of more than 50 million yuan in revenue. In addition, service revenue from other sources decreased by 15 million yuan. < / P > < p > according to market news, Citigroup and Goldman Sachs have recently lowered the target price and profit forecast of maple leaf education. Citigroup lowered its earnings forecast for fiscal years 2021 and 2022 by 15% and 13%, and its target price by 28.6% to HK $2; Goldman Sachs lowered its revenue forecast for fiscal years 2021 to 2023 by 7% to 8%, and its target price by HK $2.7 to HK $2.4. Relevant studies suggest that the epidemic control in China will make maple leaf education’s domestic business return to normal in the fiscal year 2021, but the global epidemic will still suspend the company’s summer camp and winter camp business, and affect students’ willingness to study abroad. In terms of operational data, maple leaf education’s global school network increased from 95 in the same period last year to 109 this year, of which 96 are located in 22 cities in China, and the other 13 are located in Canada, Singapore, Malaysia and Australia. < / P > < p > it is worth noting that the increase in the number of students enrolled in the 2019 / 2020 academic year mainly comes from the newly acquired Huangqi international school and Canadian International School of education. The total number of students enrolled in overseas campuses in the 2019 / 2020 academic year is 4255, compared with 137 in the 2018 / 2019 academic year. < / P > < p > in terms of average tuition fee, the average tuition fee per student decreased from 35300 yuan in 2019 to 31700 yuan, with a decrease rate of about 10.2%. < / P > < p > maple leaf Education said that the decline in average tuition fees was mainly due to the return of tuition fees and accommodation fees due to the epidemic; kindergartens were closed due to the epidemic; the number of junior middle schools, primary schools and kindergartens increased and the tuition fees charged were relatively lower than the average tuition fees charged by the group; the income from the newly acquired CIS tuition fees has not been recorded. < / P > < p > on the other hand, maple leaf education covers preschool education, primary and junior high school education and other fields, which are facing more and more strict policy supervision. On September 7, the draft Preschool Education Law (Exposure Draft) released by the Ministry of education continued the guidance of strengthening supervision and supporting inclusive in the “opinions on deepening reform and standardizing development of preschool education” issued by the State Council on November 15, 2018. The draft clearly states that kindergartens should not be listed directly or indirectly as enterprise assets. Listed companies and their controlling shareholders shall not invest in profit-making kindergartens through capital market financing, and shall not purchase profit-making kindergarten assets by issuing shares or paying cash. < / P > < p > in addition, for private K-12 education group, due to its coverage of nine-year compulsory education stage, relevant schools are not allowed to choose as profit-making schools, only non-profit schools. This means that in the future, related party transactions will become the main way to obtain profits. Although the Ministry of education disclosed on November 10 that it is open to legal and compliant related party transactions, investors are still alert to policy risks. < / P > < p > in 2020, maple leaf education’s overseas colleges and universities are mainly acquired by Malaysia’s private education group Huangqi International Education Group Co., Ltd. and Singapore’s Canadian International School PTE. Ltd. According to the financial report, the acquisition in fy2020 has a significant impact on the asset liability structure of maple leaf education. Short term loans increased to 2.303 billion yuan from 123 million yuan last year, and long-term loans increased to 1.328 billion yuan from 208 million yuan last year. The book value of goodwill increased by 868.70% to 2.449 billion yuan from 253 million yuan last year. Among the 2.449 billion yuan of goodwill, 2.196 billion yuan was generated from the acquisition of subsidiaries. < p > < p > the purpose of this article is to convey more information, and it does not represent the views and positions of our website. The content of this article is for reference only, and does not constitute an investment proposal. Investors operate on this basis at their own risk.