Raffles Education Corp swings to net loss in Q2 on currency translation loss

SINGAPORE - Raffles Education Corp swung to a loss for the second quarter.

Net loss for the three months to Dec 31 amounted to $5.2 million compared to earnings of $431,000 in the same period last year.

Revenue fell by 2 per cent to $29.5 million.

Loss per share was 0.53 cent, reversing from earnings of 0.04 cents previously.

Net asset value per share fell to 55.58 cents from 57.1 cents as at June 30, 2015.

The group recorded $14.3 million in currency translation loss arising from consolidation of foreign operations.

The currency translation loss arose mainly from the translation of Oriental University City and OUC HK's 2.2 billion yuan net asset value as at Dec 31.

The renminbi depreciated by about 2.4 per cent during the second quarter, resulting in the two entities' translation loss of $12.1 million.

Looking ahead, Raffles Education noted that the current macroeconomic slowdown, especially in China, currency volatility, recent increase in US interest rates and the uncertain global interest rate movements are creating new challenges.

On top of that, it is grappling with increasing competition, higher manpower costs and a more stringent regulatory environment, all of which are expected to have an adverse effect on its operations.

The group will also seek opportunities in new territories.