Puxin Limited (NYSE:NEW) Q2 2019 Earnings Conference Call Transcript
Aug 13, 2019 • 08:00 am ET
Good day, and welcome to the Puxin Limited's Second Quarter 2019 Earnings Conference Call. [Operator Instructions]
I will now like to turn the conference over to Claire [Phonetic]. Please go ahead.
Thank you operator. Hello, everyone, and thank you for joining Puxin's second quarter 2019 earnings conference call. The Company's results were release earlier today and are available on the Company's IR website at ir.pxjy.com.
On the call today are Mr. Yunlong Sha, the Company's Founder, Chairman and Chief Executive Officer; and Mr. Peng Wang, the Chief Financial Officer. Yunlong will give a brief overview of the Company's business operations and highlights, followed by Peng who will go through the financials and guidance. They will both be available to answer your questions during the Q&A session that follows.
I will remind you that this call may contain forward-looking statements made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the Company's control, which may cause the Company's actual results, performance or achievements to differ materially from those in the forward-looking statements.
Further information regarding these and other risks, uncertainties and factors is included in the Company's filings with the US Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as required under the law.
With that, I will now turn the call over to Mr. Sha. Mr. Sha will read through his prepared remarks in Chinese and I will translate that in English. Mr. Sha, please go ahead.
Thank you. Mr. Sha. And hello, everyone. Sorry, now it's time for interpretation.
Okay. Hello, everyone, and welcome to our second quarter earnings conference call. I'm pleased to report that we made solid progress during the second quarter. Net revenues grew 19.1% year-over-year to RMB632 million. This was near the upper limit of our previous outlook. The solid performance was mainly driven by organic growth, especially in student enrollments, which increased by 39.5% to a total of 725,118 students during the quarter.
In terms of business lines, our K-12 education grew rapidly with a 30.4% year-over-year increase in revenues. We achieved this organic growth despite our modest approach to opening new learning centers during the quarter. In the meantime, what's particularly worth noting here is that our K-12 education's operating profit excluding amortization reached RMB18 million during the first half of 2019.
We believe one of the key metrics for after-school tutoring institutions is the retention rate. During the quarter, our retention rate reached 71.4%, an increase of 9.2 percentage point year-over-year. The growth benefited significantly from our approach to raise the customer value propositions. Specifically, we've dedicated our efforts to provide systematic learning plans at an