China First Capital Group Limited (“CFCG” or the “Group”; stock code: 1269), has announced its unaudited interim results for the six months ended 30 June 2017. During the period under review, the Group’s revenue amounted to RMB991 million. As at 30 June 2017, the Group’s total assets reached RMB8.72 billion and equity attributable to shareholders was RMB 3.57 billion.
During the period under review, the Group continued to diversify its business by increasing investment in financial service business, stepping up development of education operations as well as working hard to optimize the layout of its education industrial chain. The Group pushed forward with implementing all cooperation agreements and framework agreements and enhanced post-investment management of investment projects as well as coordination and integration of the different projects.
Regarding education operation and investment business in the international market, the Group established and subscribed for First Capital Australia Education Master Fund, which subscribed approximately 24.65 million shares in G8 Education Limited, the largest for-profit child care operator in Australia (listed on Australian Securities Exchange under stock code: GEM), representing 5.56% of total issued shares in G8 education as at 30 June 2017. The Group also acquired 40% equity interest of Singapore Raffles Music College, the only private integrated higher music education institution in Singapore dedicated to nurturing musical talent. Moreover, after becoming the limited partner of GSV Fund of the United States, the Group was invited to the 2017 ASU-GSV Education Technology Summit and spoke at the keynote discussion. While in Mainland China, the Group, serving as a bridge, helped Xishan Schools and Beijing Experimental Foreign Language School to join hands with Kingswood School, with which the Group signed a cooperative agreement earlier, to offer the Kingswood Elite Education Programme. Students on finishing the programme will receive a graduate certificate and are qualified to sit for the UK national diploma examination, providing mainland students a channel of direct access to eminent education institutions in 160 countries around the world. At the same time, the Group signed a letter of intent with Deyang Municipal People’s Government in Jingyang District and Kingswood School to introduce Kingswood School into the China (Deyang) Splendid Horizons International Education New Town, an investment project the Group. In addition, the Group’s subsidiary signed an agreement with Yunnan Arts University regarding co-establishing Wenhua College of Yunnan Arts University to nurture professionals in artistic fields. The Group further acquired additional shares of Virscend Education Company Limited (“Virscend Education”; stock code: 1565) and the largest provider of K-12 private education services in Southwest China. As at 30 June 2017, the Group held approximately 10.00% of the total issued shares of Virscend Education.
During the period under review, the Group’s financial service business achieved steady growth. The Group applied its diverse advantages to actively develop different businesses. Among those businesses, during the period, First Capital Securities did underwriting and placing of shares of listed companies, including China YuHua Education Corporation Limited (stock code: 6169), Luzhou Xinglu Water (Group) Co., Ltd. (stock code: 2281), China New Higher Education Group Limited (stock code: 1569). First Capital Securities was also a joint bookrunner and joint lead manager of the IPO of Zhongyuan Bank Co., Ltd. (stock code: 1216), which commenced on 30 June 2017, the second largest IPO of a PRC enterprise in Hong Kong to date in 2017. On 30 June 2017, Bloomberg announced a ranking list of underwriters of IPO in the first half of 2017. First Capital Securities placed 14th on the list with an approximately 2.39% share of the market. During the period under review, First Capital Asset Management launched the First Capital Education Selected Fund and developed discretionary wealth management business that targets high-end clients, as well as actively explored institutional investor network and sales channels, in and outside the country. As at 30 June 2017, the company had total assets under management in funds and discretionary accounts exceeding HK$500 million. First Capital Fund also signed an agreement with Chongqing Cultural Industry Investment Group Co., Ltd. and Chongqing Industry Guiding Equity Investment Fund Co., Ltd. with the intention to jointly set up the Chongqing First Capital Cultural Investment Equity Investment Fund of value up to RMB2 billion, which will focus on investing in cultural tourism, emerging cultural industries and cultural education projects.
Furthermore, the Group plans to expand its financial services platform to Southeast Asia. On 4 July 2017, the Group completed the acquisition of 100% equity interest in Stirling Coleman, a licensed company to conduct regulated financial activities in relation to securities trading and provision of corporate financing advice in Singapore. It offers small and medium enterprises different financial services including IPO services and subsequent issue of shares by them on the Singapore Exchange, provides independent financial advice to listed companies in Singapore and advice on merger and acquisition (“M&A”) to listed and private companies in Singapore and overseas. The acquisition is the first step of the Group in embarking on financial service business in Singapore, allowing it to more effectively capture new opportunities the “One Belt One Road” strategy presents. The Group also signed an agreement on 28 July 2017 with SJW International, the first company providing online English video courses for adults in Korea. The Group intends to acquire 54% of SJW International’s issued shares and gain footing in the online education industry. SJW International owns Korea’s famous online education brand “Siwon School”, which offers including mainly fundamental English courses for adults, online English courses for children, and Chinese, Japanese and Spanish language teaching video courses.
With the global private education sector growing strong in the past decade and demand increasing consistently, the management believes, the private education market, which is fragmented but promises steady and predictable revenue, has bright development prospects. Looking ahead, the Group will continue to grasp market opportunities to establish presence in the global education market, focus on mainstream education development trends and also segments of relevance to China and in which the Group boasts distinct competitive advantages, so as to support a diverse and complete industrial chain.
Dr. Wilson Sea, Chairman and Executive Director of CFCG, said: “As the capital market continues to warm up to the education industry and China’s private education industry keeps flourishing, the Group can capitalize on its complete industrial chain and the abundant education resources, brand reputation and market influence of its financial service business to realize collaborated growth of its financial service business and education operation business. We may explore in depth the demand for financial services of corporate customers in the education sector, offer them such services as listing and issue of shares, securities trading, asset management, M&As and financial advisory. By providing such specialized and diverse financial services, the Group hopes to establish an education operation, investment and financing platform driven by ‘Education Operation plus Financial Services’.”