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ChinaEdu Reports Fourth Quarter 2009 Results
Mar 11, 2010 (04:03 PM EST)


Fourth Quarter Net Revenue Exceeding Guidance with 10.4% Increase Year-Over-Year; Net income per diluted ADS is $0.075

Live Conference Call to be held on Friday, March 12, 2010 at 8 a.m. (Eastern) / 5 a.m. (Pacific) / 9 p.m. (Beijing/Hong Kong)

BEIJING, March 11 /PRNewswire-Asia-FirstCall/ -- ChinaEdu Corporation (Nasdaq: CEDU) ("ChinaEdu" or the "Company"), an educational services provider in China, today announced its unaudited financial results for the fourth quarter ended December 31, 2009.(1)


    (in thousands,
     unaudited)           Three Months Ended         Twelve Months Ended
                      December  December  Period   December  December   Year
    Period Ended      31, 2008  31, 2009   over    31, 2008  31, 2009   over
    Currency             USD       USD    Period %    USD       USD     Year %
    Financial Data:
      Net revenue       12,678    13,993    10.4%    46,546    51,965   11.6%
      Gross profit       6,965     8,481    21.8%    29,298    31,695    8.2%
      Income from
       operations       (7,216)    2,913      N/A    (1,912)   11,635     N/A
      Net income
       attributable
       to ChinaEdu      (5,711)    1,326      N/A    (6,302)    5,096     N/A
      Adjusted
       EBITDA (2)
       (non-GAAP)        1,539     4,004   160.2%    12,492    16,011   28.2%
      Adjusted net
       income attri-
       butable to
       ChinaEdu (3)
       (non-GAAP)        2,491     1,722   -30.9%     6,198     6,904   11.4%

      Net income
       (loss)
       attributable
       to ChinaEdu
       per ADS (4)      (0.308)    0.082      N/A    (0.330)    0.313     N/A
      Adjusted net
       income per
       ADS (5)
       (non-GAAP)        0.133     0.107   -19.5%     0.322     0.424   31.7%
      Net income
       per diluted
       ADS              (0.308)    0.075      N/A    (0.330)    0.291     N/A
      Adjusted net
       income per
       diluted ADS
       (6) (non-
       GAAP)             0.130     0.098   -24.6%     0.308     0.394   27.9%

    Operating Data:
      Revenue
       students (7)
       for online
       degree
       program         118,000   140,000    18.6%   243,000   287,000   18.1%


    (1) The reporting currency of the Company is RMB, but for the convenience
        of the reader, the amounts for the three and twelve months ended
        December 31, 2009 and the years ended December 31, 2008 and 2009 are
        presented in U.S. dollars. Unless otherwise stated, all translations
        from RMB to U.S. dollars were made at the rate of RMB6.8259 to $1.00,
        the noon buying rate in effect on December 31, 2009 in the H.10
        statistical release of the Federal Reserve Board. The Company makes
        no representation that the RMB or U.S. dollar amounts referred could
        be converted into U.S. dollars or RMB, as the case may be, at any
        particular rate or at all. For analytical presentation, all
        percentages are calculated using the numbers presented in the
        financial statements contained in this earnings release. An
        explanation of the Company's non-GAAP financial measures is included
        in the section entitled "Non-GAAP Financial Measures" below, and the
        related reconciliations to GAAP financial measures are presented in
        the accompanying financial statements.
    (2) "Adjusted EBITDA" is a non-GAAP measure defined as net income before
        interest income, taxes, exchange loss, depreciation, amortization of
        intangible assets and land use rights, share-based compensation and
        goodwill and intangible assets impairment charges, if applicable.
    (3) "Adjusted net income attributable to ChinaEdu" is a non-GAAP measure
        defined as net income attributable to ChinaEdu excluding share-based
        compensation, exchange loss, noncontrolling interest for share-based
        compensation, amortization of intangible assets and land use rights
        and goodwill and intangible assets impairment charges, if applicable.
    (4) "ADS" is American Depositary Share. Each ADS represents three ordinary
        shares.
    (5) "Adjusted net income per ADS" is a non-GAAP measure which is computed
        using adjusted net income attributable to ChinaEdu over number of ADSs
        used in net income (loss) attributable to ChinaEdu per ADS calculation.
    (6) "Adjusted net income per diluted ADS" is a non-GAAP measure which is
        computed using adjusted net income attributable to ChinaEdu over
        number of ADSs used in net income per diluted ADS calculation.
    (7) "Revenue students" refer to students of university online degree
        programs who have paid tuitions in the applicable period.


    Fourth Quarter 2009 Highlights

    -- Total net revenue for the fourth quarter of 2009 increased by 10.4% to
       $14.0 million from $12.7 million for the corresponding period in 2008,
       exceeding our previously disclosed guidance for the fourth quarter of
       2009 of $12.9 million to $13.5 million.
    -- Net revenue from online degree programs, the Company's major business
       segment, increased by 9.3% to $11.2 million for the fourth quarter of
       2009 from $10.3 million for the corresponding period in 2008.
    -- The number of revenue students in online degree programs during the
       fourth quarter of 2009 increased by approximately 18.6% to over 140,000
       from approximately 118,000 for the corresponding period in 2008.
    -- Adjusted EBITDA increased by 160.2% to $4.0 million in the fourth
       quarter of 2009 from $1.5 million for the corresponding period in 2008.
    -- Net income attributable to ChinaEdu increased to $1.3 million in the
       fourth quarter of 2009 from a loss $5.7 million for the corresponding
       period in 2008.
    -- Adjusted net income attributable to ChinaEdu decreased by 30.9% to $1.7
       million in the fourth quarter of 2009 from $2.5 million for the
       corresponding period in 2008.
    -- Net income per diluted ADS was $0.075 for the fourth quarter of 2009 as
       compared to a loss of $0.308 for the corresponding period in 2008.
    -- Adjusted net income per diluted ADS was $0.098 for the fourth quarter
       of 2009 as compared to $0.130 for the corresponding period in 2008.

    Fiscal Year 2009 Highlights

    -- Total net revenue for the fiscal year 2009 increased by 11.6% to $52.0
       million from $46.5 million for the fiscal year 2008.
    -- Net revenue from online degree programs for the fiscal year 2009
       increased by 11.7% to $41.8 million from $37.4 million for the fiscal
       year 2008.
    -- The number of revenue students in online degree programs for the fiscal
       year 2009 increased by approximately 18.1% to over 287,000 from
       approximately 243,000 for the fiscal year 2008.
    -- Adjusted EBITDA for the fiscal year 2009 increased by 28.2% to $16.0
       million from $12.5 million for the fiscal year 2008.
    -- Net income attributable to ChinaEdu increased to $5.1 million in the
       fiscal year 2009 from a loss $6.3 million for the fiscal year 2008.
    -- Adjusted net income attributable to ChinaEdu increased by 11.4% to $6.9
       million in the fiscal year 2009 from $6.2 million for the fiscal year
       2008.
    -- Net income per diluted ADS was $0.291 for the fiscal year 2009 as
       compared to a loss of $0.330 for the fiscal year 2008.
    -- Adjusted net income per diluted ADS was $0.394 for the fiscal year 2009
       as compared to $0.308 for the fiscal year 2008.

"We are pleased to report solid results for the fourth quarter of 2009, completing the fiscal year 2009 with 11.6% total net revenue growth over 2008. Adjusted net income per diluted ADS for the fiscal year 2009 increased 27.9% over 2008. In 2009, all of our major business lines have recorded strong growth and we are very confident of our future prospects," said Ms. Julia Huang, ChinaEdu's Chairman and Chief Executive Officer. "In 2009, we announced several strategic partnerships for our online degree programs, which we believe will contribute significantly to our company's future growth. Our learning centers network continued to expand, reaching 60 learning centers at the end of 2009, contributing to over 5% of our total net revenue in the fourth quarter of 2009. We are also very pleased with our 101 online tutoring segment's performance, which recorded nearly 27% of net revenue growth in 2009. Looking ahead, we are committed to continuing research and development efforts of the technology platform and the internet & mobile applications for the online degree and non-degree programs, while continue to maintain a tight control over our expenses. Overall, we believe our company is positioned strongly to capture the immense potential that online education can offer in the future."

Financial Results for the Fourth Quarter Ended December 31, 2009

Net Revenue

Total net revenue for the fourth quarter of 2009 was $14.0 million, representing a 10.4% increase from the corresponding period in 2008. Net revenue from online degree programs for the fourth quarter of 2009 was $11.2 million, representing a 9.3% increase from $10.3 million for the corresponding period in 2008. The growth in net revenue was due to strong enrollment growth for the 2009 fall semester, which registered over 140,000 revenue students representing an increase of 18.6% as compared to 118,000 revenue students for the 2008 fall semester.

Net revenue from the Company's non-online degree programs (online tutoring programs, international curriculum programs and private primary and secondary schools) for the fourth quarter of 2009 was $2.8 million, representing a 14.9% increase from $2.4 million for the corresponding period in 2008. This increase was attributable to a 23.2% increase in net revenue for the 101 online tutoring programs from increased sales and a 43.9% increase in net revenue at Anqing School due to increase in student enrollment from the academic year beginning in September 2008 as a result of the completion of construction of the new campus, but offset by a 29.6% decrease in net revenue for the international curriculum programs due to the termination of our New Zealand contract.

A refund of valued-added tax ("VAT") of $0.6 million in the fourth quarter of 2009 and $0.9 million in the corresponding period in 2008 was recognized as net revenue primarily in online degree programs.

Cost of Revenue

Total cost of revenue for the fourth quarter of 2009 was $5.5 million, representing a decrease of 3.5% as compared to $5.7 million for the corresponding period of 2008. Cost of revenue for online degree programs for the fourth quarter of 2009 was $3.9 million, representing a decrease of 5.8% as compared to $4.1 million for the fourth quarter of 2008. The decrease in online degree programs' cost of revenue was primarily due to a decrease in special courseware development in the fourth quarter of 2009 as compared to the fourth quarter of 2008, as well as a decrease in employee and recruiting commission related costs.

By the end of the fourth quarter of 2009, we had 60 operational learning centers of which 22 were proprietary and 38 were contracted locations, as compared to 37 operational learning centers as of the end of the fourth quarter of 2008, of which 16 were proprietary and 21 were contracted locations.

Cost of revenue for non-online degree programs for the fourth quarter of 2009 was $1.6 million, representing a 2.3% increase for the corresponding period in 2008. This increase was attributable primarily to an increase in cost of revenue related to Anqing School's new campus, which was partially offset by a decrease in cost of revenue for the international curriculum programs and our 101 online tutoring programs.

Gross Profit and Gross Margin

Gross profit for the fourth quarter of 2009 was $8.5 million, representing a 21.8% increase from $7.0 million for the corresponding period of 2008. Total gross margin for the fourth quarter of 2009 was 60.6% as compared to 54.9% for the corresponding period of 2008. Gross margin for the online degree programs increased to 65.2% for the fourth quarter of 2009 as compared to 59.7% for the corresponding period of 2008. Gross margin for Anqing School improved significantly, due to increased enrollment at the new campus, as compared to the corresponding period in 2008 despite additional depreciation expenses resulting from the construction of the new campus. Gross margin for 101 online tutoring programs also improved due to tight cost controls.

Operating Expenses

Total operating expenses were $5.6 million for the fourth quarter of 2009, representing a 60.7% decrease from $14.2 million for the corresponding period in 2008. This decrease was attributable primarily to the factors discussed below:

    -- General and administrative expenses for the fourth quarter of 2009 were
       $3.4 million, which represented a 16.0% decrease from $4.0 million for
       the corresponding period of 2008. This decrease was primarily
       attributable to a decrease in headquarter employee related expenses of
       approximately $0.3 million in the fourth quarter of 2009 as compared to
       the corresponding period of 2008. General and administrative expenses
       for the fourth quarter of 2008 were also higher due to an account
       receivables write-off of approximately $0.2 million.
    -- Selling and marketing expenses were $1.0 million for the fourth quarter
       of 2009, which represented a 19.8% decrease from $1.2 million for the
       corresponding period in 2008. This decrease was attributable primarily
       to a decrease in the amount spent on conferences and other sales
       activities at our 101 online tutoring programs in the fourth quarter of
       2009.
    -- Research and development expenses, mainly contributing to technology
       platform upgrade and the internet & mobile applications development,
       for the fourth quarter of 2009 were $1.2 million, representing a 6.0%
       decrease from $1.3 million for the corresponding period in 2008. The
       decrease was attributable primarily to a reduction in employee related
       expenses in the fourth quarter of 2009 as compared to the fourth
       quarter of 2008. However, research and development expenses for fiscal
       year 2009 increased by 16.0% compared with fiscal year 2008.
    -- There was no impairment charge of goodwill and intangible assets in the
       fourth quarter of 2009, while such charge was $7.7 million in the
       corresponding period of 2008.
    -- Share-based compensation for the fourth quarter of 2009, which was
       allocated to the related cost and operating expense line items,
       remained flat at $0.2 million as compared to $0.2 million for the
       corresponding period in 2008.

Income from Operations

As a result of the factors discussed above, income from operations for the fourth quarter of 2009 was $2.9 million, as compared to a loss of $7.2 million for the corresponding period of 2008. Operating margin was 20.8% for the fourth quarter of 2009 as compared to a loss of 56.9% in the corresponding period of 2008. The increase in income from operations and operating margin was primarily because there was not an impairment charge of goodwill and intangible assets in the fourth quarter of 2009, while such charge was $7.7 million in the corresponding period of 2008.

Adjusted income from operations, which is a non-GAAP measure defined as income from operations excluding share-based compensation, exchange loss, amortization of intangible assets and land use rights and goodwill and intangible assets impairment charges, if applicable, was $3.3 million for the fourth quarter of 2009, which increased by 228.3% as compared to $1.0 million in the corresponding period of 2008. Adjusted operating margin, which is a non-GAAP measure defined as a ratio of adjusted operating income from operations (non-GAAP) over net revenue, for the fourth quarter of 2009, was 23.9% as compared to 8.0% for the corresponding period of 2008.

Interest Income

Interest income was $0.2 million in the fourth quarter of 2009, as compared to $0.4 million in the corresponding quarter of 2008. This decrease was attributable primarily to (i) reduced interest-bearing cash and bank deposit balance of $47.7 million as of December 31, 2009, as compared to $61.2 million as of December 31, 2008, and (ii) a lower interest rate for the fourth quarter of 2009 as compared to the corresponding period of 2008.

Income Tax Expense

Income tax expense for the fourth quarter of 2009 was $0.8 million, as compared to income tax benefit of $2.9 million for the corresponding period in 2008. In December 2008, seven of our subsidiaries and affiliate companies obtained the "high and new technology enterprises" or "HNTE" status under the new PRC Enterprise Income Tax Law, which came into effect on January 1, 2008. The HNTE entities enjoy a 15% tax rate, which is lower than the statutory tax rate of 25%. A catch-up adjustment was recorded in the fourth quarter of 2008 to adjust our 2008 income tax expenses based on a decrease in tax rate from 25% to 15%. As a result, we had an income tax benefit in the fourth quarter of 2008.

Noncontrolling Interest

Noncontrolling interest was $1.1 million in the fourth quarter of 2009, representing a decrease from $1.8 million in the corresponding period in 2008, which was attributable primarily to the noncontrolling interest impact related to the reduction in our deferred tax liabilities for the fiscal year 2008 resulted from a change of tax rate from 25% to 15%.

Net Income (Loss) attributable to ChinaEdu

Net income (loss) attributable to ChinaEdu, which is net income excluding net income attributable to noncontrolling interest, was $1.3 million for the fourth quarter of 2009, as comparable to a net loss of $5.7 million for the corresponding period in 2008. The increase was primarily because there was not an impairment charge of goodwill and intangible assets in the fourth quarter of 2009, while such a charge was $7.7 million in the corresponding period of 2008.

Net income per basic and diluted ADS were $0.082 and $0.075, respectively, for the fourth quarter of 2009, which have improved significantly as compared to losses of $0.308 and $0.308, respectively, for the corresponding period in 2008.

Adjusted net income attributable to ChinaEdu (non-GAAP) decreased by 30.9% to $1.7 million for the fourth quarter of 2009, as compared to $2.5 million in the corresponding period of 2008. Adjusted net margin, which is a non-GAAP measure defined as a ratio of adjusted net income attributable to ChinaEdu (non-GAAP) over net revenue, was 12.3% in the fourth quarter of 2009 as compared to 19.6% in the corresponding period of 2008. The decrease in adjusted net income attributable to ChinaEdu (non-GAAP) was primarily due to a one-time reduction in income tax expenses in the fourth quarter of 2008.

Adjusted net income per basic and diluted ADS were $0.107 and $0.098, respectively, for the fourth quarter of 2009.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA (non-GAAP) was $4.0 million for the fourth quarter of 2009, which increased by 160.2% as compared to $1.5 million for the corresponding period in 2008. This increase was attributable primarily to improved operating results from our learning centers network, 101 online tutoring programs and Anqing School.

Deferred Revenue

Deferred revenue at the end of the fourth quarter of 2009 was $15.5 million, with current deferred revenue of $14.3 million and non-current deferred revenue of $1.2 million. Deferred revenue at the end of the fourth quarter of 2009 increased significantly as compared to deferred revenue of $6.1 million at the end of the third quarter 2009 due to seasonality of enrollments, which results from tuition received generally during the second quarter (spring semester) and the fourth quarter (fall semester) of each year.

Cash and Cash Equivalents

As of December 31, 2009, ChinaEdu reported cash and cash equivalents of $29.8 million, which primarily consisted of cash-on-hand, demand deposits and term deposits with maturity periods of three months or less.

Term Deposits and Amount Due from Related Parties

Term deposits and amount due from related parties (which represents cash owed to us by our collaborative alliance partners) were $17.9 million and $25.9 million, respectively, on December 31, 2009.

Financial Results for the Fiscal Year Ended December 31, 2009

Net Revenue

Total net revenue for the fiscal year ended December 31, 2009 was $52.0 million, representing an 11.6% increase from $46.5 million for the fiscal year 2008. Net revenue from online degree programs for the fiscal year 2009 was $41.8 million, representing an 11.7% increase from $37.4 million for the fiscal year 2008. This increase was attributable primarily to enrollment growth at our university partners' online degree programs in fiscal year 2009 as compared to fiscal year 2008. In the aggregate, our university partners had approximately 287,000 revenue students during fiscal year 2009, representing an 18.1% increase from approximately 243,000 revenue students in fiscal year 2008.

Net revenue from the Company's non-online degree programs for the fiscal year 2009 was $10.2 million, representing an 11.5% increase compared to $9.1 million for the fiscal year 2008. This result was attributable primarily to the increase in student enrollment at the Anqing School and increase in net revenue from the 101 online tutoring programs in fiscal year 2009, which was offset by a decrease in net revenue from international curriculum programs.

Cost of Revenue

Total cost of revenue for the fiscal year 2009 was $20.3 million, representing an increase of 17.5% as compared to $17.2 million for the fiscal year 2008. Cost of revenue from our online degree programs for fiscal year 2009 was $14.0 million, representing a 25.2% increase from $11.2 million in fiscal year 2008. The increase was primarily due to the cost increase related to the expansion of our learning centers network and increase in employee related costs throughout fiscal year 2009.

Cost of revenue for non-online degree programs for the fiscal year 2009 was $6.3 million, representing a 3.5% increase from $6.1 million for the fiscal year 2008. This increase was attributable primarily to the increase in cost of revenue at Anqing School and 101 online tutoring programs, but was offset by a decrease in cost of revenue for the international curriculum programs.

Gross Profit

Gross profit for the fiscal year 2009 was $31.7 million as compared with $29.3 million for the fiscal year 2008, representing an increase of 8.2%.

Gross margin for the fiscal year 2009 was 61.0%, as compared with gross margin of 62.9% for the fiscal year 2008. Gross margin for the online degree programs was 66.5% in 2009 as compared with gross margin for the online degree programs of 70.2% for 2008. The decrease in gross margin was primarily due to investment in our learning centers network.

Operating Expenses

Total operating expenses for the fiscal year 2009 were $20.1 million, representing a 35.7% decrease from $31.2 million for fiscal year 2008. This decrease was attributable primarily to the factors discussed below:

    -- General and administrative expenses for the fiscal year 2009 were $12.1
       million, representing a 4.7% decrease from $12.7 million for fiscal
       year 2008. The decrease was primarily because there was almost no
       account receivables write off and exchange loss in 2009 as well as a
       reduction in rent in fiscal year 2009 as compared to fiscal year 2008.
    -- Selling and marketing expenses for the fiscal year 2009 were $3.5
       million, representing a 20.6% decrease from $4.4 million for the fiscal
       year 2008. The decrease was attributable primarily to a shift from
       conducting general sales and marketing activities to focusing on direct
       recruiting related activities at our learning centers network.
    -- Research and development expenses for the fiscal year 2009 were $4.5
       million, representing a 16.0% increase from $3.8 million for the fiscal
       year 2008. This increase was attributable primarily to technology
       platform upgrade and the internet & mobile applications development for
       the online degree and non-degree programs.
    -- There was not an impairment charge of goodwill and intangible assets in
       the fiscal year 2009, while such charge was $10.3 million in the fiscal
       year 2008.
    -- Share-based compensation for the fiscal year 2009, which was allocated
       to the related cost of revenue and operating expense line items, was
       $1.1 million, representing an increase of $0.3 million from $0.8
       million for the fiscal year 2008. This increase was attributable
       primarily to the re-pricing for under-water options and an increase in
       the number and fair value of options granted in fiscal year 2009 as
       compared to fiscal year 2008.

Income (Loss) from Operations

Income from operations was $11.6 million for the fiscal year 2009, as compared to a loss of $1.9 million for the fiscal year 2008. Operating margin was 22.4% for the fiscal year 2009 as compared to a negative 4.1% for the fiscal year 2008. The increase was primarily because there was not an impairment charge of goodwill and intangible assets in the fiscal year 2009, while such charge was $10.3 million in the fiscal year 2008.

Adjusted income from operations was $13.6 million for fiscal year 2009, representing a 26.9% increase from $10.7 million for the fiscal year 2008. Correspondingly, adjusted operating margin for the fiscal year 2009 was 26.1% for the fiscal year 2009 as compared to 23.0% for the fiscal year 2008. The increase was primarily due to improved operating results from our learning centers network, 101 online tutoring programs and Anqing School.

Interest Income

Interest income decreased by 53.2% to $0.7 million in the fiscal year 2009, as compared to $1.6 million in the fiscal year 2008. This decrease was attributable primarily to (i) the reduced interest bearing cash and bank deposit balance of $47.7 million as of December 31, 2009, as compared to $61.2 million as of December 31, 2008, and (ii) a lower interest rate for the fiscal year 2009 as compared to the fiscal year 2008.

Income Tax Expense

Income tax expense for the fiscal year 2009 was $2.8 million, representing a significant increase from $0.5 million for the fiscal year 2008. In December 2008, seven of our subsidiaries and affiliate companies obtained the HNTE status under the new PRC Enterprise Income Tax Law, which came into effect on January 1, 2008. The HNTE entities enjoy a 15% tax rate, which is lower than the statutory tax rate of 25%. An adjustment was recorded in the fourth quarter of 2008 to adjust our deferred income tax expenses based on the decrease in tax rate from 25% to 15%, which resulted in a low deferred income tax expense in 2008.

In addition, 2008 income tax was lower because there was a significant decrease in deferred tax liabilities related to impairment of acquired intangible assets in our international curriculum programs, while there was no such charge in 2009.

Noncontrolling Interest

Noncontrolling interest was $4.7 million in the fiscal year 2009, representing an 11.9% decrease, as compared to $5.3 million in the fiscal year 2008, which was attributable primarily to the noncontrolling interest impact related to the reduction in our deferred tax liabilities for the fiscal year 2008 resulted from change of tax rate from 25% to 15%.

Net Income (Loss) attributable to ChinaEdu

Net income attributable to ChinaEdu was $5.1 million for the fiscal year 2009, compared with a loss of $6.3 million for the fiscal year 2008, primarily because there was not an impairment charge of goodwill and intangible assets in the fiscal year 2009, while such charge was $10.3 million in the fiscal year 2008.

Net income per basic and diluted ADS were $0.313 and $0.291, respectively for the fiscal year of 2009, which improved significantly as compared to losses of $0.330 and $0.330, respectively, for the fiscal year 2008.

Adjusted net income attributable to ChinaEdu (non-GAAP) increased by 11.4% to $6.9 million for the fiscal year 2009, as compared to $6.2 million in the fiscal year 2008. Adjusted net margin remained flat at 13.3% for the fiscal year 2009.

Adjusted net income per basic and diluted ADS were $0.424 and $0.394, respectively for the fiscal year 2009, which increased by 31.7% and 27.9% from $0.322 and $0.308, respectively, for the fiscal year 2008.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA (non-GAAP) was $16.0 million for the fiscal year 2009, which increased by 28.2% as compared to $12.5 million for the fiscal year 2008. This increase was attributable primarily to the increased net revenue and decreased general and administrative expenses and selling and marketing expenses as discussed above. Adjusted EBITDA margin was 30.8% for the fiscal year 2009 as compared to 26.8% for the fiscal year 2008.

First Quarter 2010 Total Net Revenue Guidance

For the first quarter of 2010, ChinaEdu expects its total net revenue to be in the range of RMB87 million to RMB90 million or $12.7 million to $13.2 million. This forecast reflects ChinaEdu's current and preliminary view, which is subject to change.

Conference Call

ChinaEdu senior management will host a conference call on Friday, March 12, 2010 at 8:00 a.m. U.S. Eastern time / 5:00 a.m. U.S. Pacific time / 9:00 p.m. Beijing/Hong Kong time.

The conference call may be accessed by calling (US) 866 396 2384/ (International) +1 617 847 8711/ (HK) +852 3002 1672/ (China) +86 10 800 152 1490, and entering the passcode: 76490238. A telephone replay of the conference call will be available shortly after the call until March 19, 2010 at (US) 888 286 8010/ (International) +1 617 801 6888 and entering passcode: 86606775. A live and archived webcast may be accessed via ChinaEdu's investor relations website at http://ir.chinaedu.net .

Non-GAAP Financial Measures

To supplement the unaudited condensed consolidated financial information presented in accordance with Accounting Principles Generally Accepted in the United States of America ("GAAP"), the Company uses non-GAAP measures of income from operations and net income attributable to ChinaEdu, which are adjusted from results based on GAAP to exclude certain non-cash items of share-based compensation, exchange loss, amortization of intangible assets and land use rights and goodwill and intangible assets impairment charges, if applicable. The Company also uses adjusted EBITDA, which is also a non-GAAP measure and is adjusted from GAAP results of net income to exclude interest income, taxes, exchange loss, depreciation, amortization of intangible assets and land use rights, share-based compensation and goodwill and intangible assets impairment charges, if applicable. These non-GAAP financial measures are provided to enhance the investors' overall understanding of the Company's current and past financial performance in on-going core operations as well as prospects for the future. These measures should be considered in addition to results prepared and presented in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. Management considers the non-GAAP information as important measures internally and therefore deems it important to provide all of this information to investors.

About ChinaEdu

ChinaEdu Corporation is an educational services provider in China, incorporated as an exempted limited liability company in the Cayman Islands. Established in 1999, the Company's primary business is to provide comprehensive services to the online degree programs of leading Chinese universities. These services include academic program development, technology services, enrollment marketing, student support services and finance operations. The Company's other lines of businesses include the operation of private primary and secondary schools, online interactive tutoring services and providing marketing and support for international curriculum programs.

The Company believes it is the largest service provider to online degree programs in China in terms of the number of higher education institutions that are served and the number of student enrollments supported. The Company currently has 15 long-term, exclusive contracts that generally vary from 10 to 50 years in length. ChinaEdu also performs recruiting services for 15 universities through its nationwide learning centers network.

Forward-Looking Statement

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including certain plans, expectations, goals, and projections, which are subject to numerous assumptions, risks, and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and contingencies, many of which are beyond our control which may cause actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. The Company's actual results could differ materially from those contained in the forward-looking statements due to a number of factors, including those described under the heading "Risk Factors" in the Company's Annual Report on Form 20-F for the year ended December 31, 2008, and in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission. Unless required by law, the Company undertakes no obligation to (and expressly disclaim any such obligation to) update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

    For more information, please contact:

    Lily Liu, CFO
    ChinaEdu Corporation
    Phone: +86-10-8418-6655 x1002
    Email: ir@chinaedu.net

    S. Jimmy Xia, IR Manager
    ChinaEdu Corporation
    Phone: +86-10-8418-6655 x1150
    Email: ir@chinaedu.net



    ChinaEdu Corporation
    Unaudited Condensed Consolidated Balance Sheets

                                            December
                                            31, 2008    December   December
    (in thousands, unaudited)            As Adjusted(1) 31, 2009   31, 2009
                                               RMB         RMB         US$
    Current assets:
      Cash and cash equivalents              353,933     203,143     29,761
      Term deposits                           63,500     122,304     17,918
      Restricted cash                             --         365         53
      Accounts receivable, net                14,854      28,334      4,151
      Inventory                                   --       1,852        271
      Prepaid expenses and other
       current assets                         20,251      25,315      3,709
      Amounts due from related parties       150,472     176,802     25,902
      Deferred tax assets                      3,986       3,309        485
      Investments                                 --      17,706      2,594
    Total current assets                     606,996     579,130     84,844
      Cost method investment                   1,210       1,210        177
      Investment                                  --       3,000        440
      Land use rights, net                    28,344      27,874      4,084
      Property and equipment, net            161,925     203,995     29,885
      Deposits paid for acquisition
       of property and equipment               8,619      13,898      2,036
      Intangible assets, net                  70,377      66,621      9,760
      Deferred tax assets                      2,096       1,541        226
      Rental deposits                            958         868        127
      Goodwill                                38,155      38,155      5,590
    Total assets                             918,680     936,292    137,169

    Liabilities and equity
    Current liabilities:
      Accounts payable                         8,530       6,467        947
      Deferred revenues                       96,068      97,853     14,336
      Accrued expenses and other
       current liabilities                    51,629      68,917     10,096
      Amounts due to related parties          25,769      25,668      3,760
      Income taxes payable                    27,917      33,389      4,892
      Other taxes payable                     12,008      15,900      2,329
    Total current liabilities                221,921     248,194     36,360
      Deferred revenues                        6,073       8,075      1,183
      Deferred tax liabilities                11,069      10,143      1,486
      Unrecognized tax benefit                 5,473       7,727      1,132
    Total liabilities                        244,536     274,139     40,161

      ChinaEdu shareholders' equity          589,829     559,973     82,039
      Noncontrolling interest                 84,315     102,180     14,969
    Total equity                             674,144     662,153     97,008
    Total liabilities and equity             918,680     936,292    137,169

    (1) Amount in relation to noncontrolling interest, formerly named minority
        interest, as of December 31, 2008 is reclassified in accordance with
        ASC 810 (formerly FASB Statement No. 160, Noncontrolling Interest),
        which was adopted by the Company on January 1, 2009.



    ChinaEdu Corporation
    Unaudited Condensed Consolidated Statements of Operations

                                               Three Months Ended
    (in thousands, except       December 31,
    for percentage, share,        2008 As    September   December    December
    and per share               Adjusted (1)  30, 2009   31, 2009    31, 2009
    information)                     RMB         RMB         RMB         US$

    Gross Revenue (2)              89,441      94,303      95,871      14,045

    Business Tax and Surcharge      2,901       4,559         354          52

    Net Revenue:
    Online degree programs         69,945      71,510      76,457      11,201
    Online tutoring programs        4,472       5,778       5,510         807
    Private primary and
     secondary schools              6,823       7,669       9,816       1,438
    International curriculum
     programs                       5,300       4,787       3,734         547
    Total net revenue              86,540      89,744      95,517      13,993

    Cost of revenue:
    Online degree programs         28,195      23,633      26,575       3,893
    Online tutoring programs        1,443       1,426       1,222         179
    Private primary and
     secondary schools              5,828       7,070       7,298       1,069
    International curriculum
     programs                       3,532       2,840       2,531         371
    Total cost of revenue          38,998      34,969      37,626       5,512

    Gross profit:
    Online degree programs         41,750      47,877      49,882       7,308
    Online tutoring programs        3,029       4,352       4,288         628
    Private primary and
     secondary schools                995         599       2,518         369
    International curriculum
     programs                       1,768       1,947       1,203         176
    Total gross profit             47,542      54,775      57,891       8,481

    Online degree programs          59.7%       67.0%       65.2%       65.2%
    Online tutoring programs        67.7%       75.3%       77.8%       77.8%
    Private primary and
     secondary schools              14.6%        7.8%       25.7%       25.7%
    International curriculum
     programs                       33.4%       40.7%       32.2%       32.2%
    Gross margin                    54.9%       61.0%       60.6%       60.6%

    Operating expenses:
    General and administrative     27,410      20,519      23,014       3,372
    Selling and marketing           8,202       6,766       6,578         964
    Research and development        8,947       7,522       8,410       1,232
    Goodwill and intangible
     assets impairment             52,236          --          --          --
    Total operating expenses       96,795      34,807      38,002       5,568
    Income (loss) from
     operations                   (49,253)     19,968      19,889       2,913
    Operating margin               -56.9%       22.2%       20.8%       20.8%

    Other income (expense)            145        (264)        761         111
    Interest income                 2,973       1,041       1,085         159
    Interest expense                   (1)         (1)         (1)         --
    Income (loss) before
     income tax provisions        (46,136)     20,744      21,734       3,183

    Income tax expense             19,621      (4,835)     (5,487)       (804)
    Net income (loss)             (26,515)     15,909      16,247       2,379
    Net income attributable to
     the noncontrolling
     interest                     (12,469)     (8,610)     (7,191)     (1,053)
    Net income (loss)
     attributable to ChinaEdu     (38,984)      7,299       9,056       1,326
    Net margin                     -45.0%        8.1%        9.5%        9.5%

    Net income (loss)
     attributable to ChinaEdu
     per ADS:
      Basic                         (2.10)       0.45        0.56       0.082
      Diluted                       (2.10)       0.41        0.51       0.075

    Weighted average aggregate
     number of ADSs
     outstanding:
      Basic                    18,650,558  16,227,267  16,148,719  16,148,719
      Diluted                  18,650,558  17,604,567  17,589,699  17,589,699


    (2) Gross revenue are
        detailed as follows
    Online degree programs         72,411      75,564      76,441      11,199
    Online tutoring programs        4,643       6,002       5,658         829
    Private primary and
     secondary schools              6,853       7,671       9,821       1,439
    International curriculum
     programs                       5,534       5,066       3,951         579


                                                  Twelve Months Ended
                                            December
    (in thousands, except                   31, 2008     December    December
    for percentage, share,              As Adjusted (1)  31, 2009    31, 2009
    and per share information)                  RMB         RMB         US$

    Gross Revenue (2)                         327,903     368,447      53,978

    Business Tax and Surcharge                 10,183      13,741       2,013

    Net Revenue:
    Online degree programs                    255,388     285,178      41,779
    Online tutoring programs                   15,436      19,584       2,869
    Private primary and secondary schools      19,289      30,627       4,487
    International curriculum programs          27,607      19,317       2,830
    Total net revenue                         317,720     354,706      51,965

    Cost of revenue:
    Online degree programs                     76,224      95,428      13,980
    Online tutoring programs                    4,017       5,713         837
    Private primary and secondary schools      17,572      26,109       3,825
    International curriculum programs          19,920      11,112       1,628
    Total cost of revenue                     117,733     138,362      20,270

    Gross profit:
    Online degree programs                    179,164     189,750      27,799
    Online tutoring programs                   11,419      13,871       2,032
    Private primary and secondary schools       1,717       4,518         662
    International curriculum programs           7,687       8,205       1,202
    Total gross profit                        199,987     216,344      31,695

    Online degree programs                      70.2%       66.5%       66.5%
    Online tutoring programs                    74.0%       70.8%       70.8%
    Private primary and secondary schools        8.9%       14.8%       14.8%
    International curriculum programs           27.8%       42.5%       42.5%
    Gross margin                                62.9%       61.0%       61.0%

    Operating expenses:
    General and administrative                 86,908      82,858      12,139
    Selling and marketing                      29,851      23,688       3,470
    Research and development                   26,185      30,385       4,451
    Goodwill and intangible assets
     impairment                                70,093          --          --
    Total operating expenses                  213,037     136,931      20,060
    Income (loss) from operations             -13,050      79,413      11,635
    Operating margin                            -4.1%       22.4%       22.4%

    Other income (expense)                        562       1,748         256
    Interest income                            10,652       4,980         730
    Interest expense                           (1,298)         (2)         --
    Income (loss) before income tax
     provisions                                (3,134)     86,139      12,621

    Income tax expense                         (3,473)    (19,287)     (2,826)
    Net income (loss)                          (6,607)     66,852       9,795
    Net income attributable to the
     noncontrolling interest                  (36,412)    (32,073)     (4,699)
    Net income (loss) attributable to
     ChinaEdu                                 (43,019)     34,779       5,096
    Net margin                                 -13.5%        9.8%        9.8%

    Net income (loss) attributable to
     ChinaEdu per ADS:
          Basic                                 (2.25)       2.14       0.313
          Diluted                               (2.25)       1.99       0.291

    Weighted average aggregate number of
     ADSs outstanding:
          Basic                            19,226,501  16,281,535  16,281,535
          Diluted                          19,226,501  17,506,561  17,506,561


    (2) Gross revenue are detailed as
        follows
    Online degree programs                    263,727     297,192      43,539
    Online tutoring programs                   16,058      20,130       2,949
    Private primary and secondary schools      19,319      30,684       4,495
    International curriculum programs          28,799      20,441       2,995



    ChinaEdu Corporation
    Unaudited Condensed Consolidated Statements of Cash Flow

                                                   Three Months Ended
                                        December   September December December
    (in thousands)                    31, 2008 (1)  30, 2009 31, 2009 31, 2009
                                            RMB        RMB      RMB     US$

    Operating activities:
      Net income (loss)                  (26,515)    15,909   16,247   2,379
        Share-based compensation           1,683      1,488    1,611     236
        Depreciation                       3,570      4,119    4,560     668
        Amortization of land use
         rights                              182        152      152      22
        Amortization of intangible
         assets                            2,087      1,114    1,129     165
        Goodwill and intangible
         assets impairment                52,236         --       --      --
        Accounts receivable write-
         off                               1,215         16      (61)     (9)
        Loss from disposal of
         property and equipment            1,663        110      310      45
        Deferred income taxes            (16,310)      (613)     (51)     (7)
        Accounts receivable              (10,341)    11,797  (15,121) (2,215)
        Inventory                             --       (722)     (53)     (8)
        Prepaid expenses and other
         current assets                   (7,287)    (6,582)  (2,800)   (410)
        Amounts due from related
         parties                         (22,991)    26,821   11,511   1,686
        Rental deposits                      107        (67)      62       9
        Land use right                      (160)        --       --      --
        Accounts payable                  (1,084)    (1,368)  (1,373)   (201)
        Deferred revenues                 68,925    (60,114)  64,517   9,452
        Accrued expenses and other
         current liabilities              16,213      8,437   10,043   1,472
        Amounts due to related
         parties                         (29,096)    11,946  (37,523) (5,497)
        Unrecognized tax benefit             872         89      184      27
        Other taxes payable                5,287      2,122    2,054     301
        Income tax payable                (4,556)     4,800    5,131     752

    Net cash provided by operating
     activities                           35,700     19,454   60,529   8,867

    Investing activities:
        Purchase of  business                 --         --       --      --
        Purchase of property and
         equipment                        (4,745)   (10,270)  (6,277)   (920)
        Deposits paid for
         acquisition of property and
         equipment                        (2,616)     2,616  (13,987) (2,049)
        Redeem (purchase) of term
         deposits                         41,000     (8,988) (33,825) (4,955)
        Purchase of investments               --    (14,083)  (6,495)   (952)
        Purchase of contractual
         right                                --         --     (735)   (108)
        Change in restricted cash             --         --     (365)    (53)
        Proceeds from disposal of
         property and equipment               --         --       --      --
    Net cash provided by (used in)
     investing activities                 33,639    (30,725) (61,684) (9,037)

    Financing activities:
        Repurchase of ordinary
         shares                          (13,714)        --  (14,740) (2,159)
        Cancellation fee of
         repurchased ordinary shares          --       (249)      --      --
        Short term loan                       --      2,117   (2,117)   (310)
        Repayment of long-term loan
         interest and principal               --         --       --      --
        Cash dividends paid to
         noncontrolling shareholders      (7,269)        --   (4,098)   (600)
        Capital contributions by
         noncontrolling shareholders          --         --      735     108
        Proceeds from exercise of
         options                           1,383      2,463      274      40
    Net cash provided by (used in)
     financing activities                (19,600)     4,331  (19,946) (2,921)

    Effect of foreign exchange
     rate changes                            865         48        4       1

    CASH AND CASH EQUIVALENTS,
     beginning of period                 303,329    231,132  224,240  32,851

    CASH AND CASH EQUIVALENTS,
     end of period                       353,933    224,240  203,143  29,761

    Net increase (decrease) in cash       50,604     (6,892) (21,097) (3,090)


                                                  Twelve Months Ended
                                            December    December    December
    (in thousands)                        31, 2008 (1)  31, 2009    31, 2009
                                               RMB         RMB         US$

    Operating activities:
      Net income (loss)                       (6,607)     66,852      9,795
        Share-based compensation               5,231       7,416      1,086
        Depreciation                          12,212      16,603      2,432
        Amortization of land use
         rights                                  606         619         91
        Amortization of intangible
         assets                                8,746       5,237        767
        Goodwill and intangible
         assets impairment                    70,093          --         --
        Accounts receivable write-
         off                                   1,215         364         53
        Loss from disposal of
         property and equipment                1,663         513         75
        Deferred income taxes                 (8,387)        306         45
        Accounts receivable                  (14,658)    (13,844)    (2,028)
        Inventory                                 --      (1,852)      (271)
        Prepaid expenses and other
         current assets                       (2,970)     (5,075)      (743)
        Amounts due from related
         parties                             (44,950)    (26,330)    (3,857)
        Rental deposits                          665          90         13
        Land use right                          (160)     (1,989)      (291)
        Accounts payable                        (950)        115         17
        Deferred revenues                     15,210       3,792        556
        Accrued expenses and other
         current liabilities                  10,011      19,082      2,796
        Amounts due to related
         parties                              (4,368)        268         39
        Unrecognized tax benefit               1,141       2,254        330
        Other taxes payable                    5,342       3,892        570
        Income tax payable                     5,462       5,472        802

    Net cash provided by operating
     activities                               54,547      83,785     12,277

    Investing activities:
        Purchase of  business                 (6,700)         --         --
        Purchase of property and
         equipment                           (36,323)    (57,071)    (8,361)
        Deposits paid for
         acquisition of property
         and equipment                        (8,650)    (11,371)    (1,666)
        Redeem (purchase) of term
         deposits                            (57,458)    (58,813)    (8,616)
        Purchase of investments                   --     (20,578)    (3,015)
        Purchase of contractual
         right                                (1,225)     (1,235)      (181)
        Change in restricted cash                 --        (365)       (53)
        Proceeds from disposal of
         property and equipment                   31          --         --
    Net cash provided by (used in)
     investing activities                   (110,325)   (149,433)   (21,892)

    Financing activities:
        Repurchase of ordinary
         shares                              (34,190)    (76,387)   (11,191)
        Cancellation fee of
         repurchased ordinary
         shares                                   --        (249)       (36)
        Short term loan                           --          --         --
        Repayment of long-term
         loan interest and
         principal                           (25,724)         --         --
        Cash dividends paid to
         noncontrolling
         shareholders                        (11,319)    (14,698)    (2,153)
        Capital contributions by
         noncontrolling
         shareholders                          1,225       1,715        251
        Proceeds from exercise of
         options                               1,787       4,161        610
    Net cash provided by (used in)
     financing activities                    (68,221)    (85,458)   (12,519)

    Effect of foreign exchange rate
     changes                                 (19,182)        316         44

    CASH AND CASH EQUIVALENTS, beginning
     of period                               497,114     353,933     51,851

    CASH AND CASH EQUIVALENTS, end of
     period                                  353,933     203,143     29,761

    Net increase (decrease) in cash         (143,181)   (150,790)   (22,090)



    ChinaEdu Corporation
    Reconciliations from income (loss) from operations to adjusted income from
    operations (non-GAAP) and adjusted operating margin (non-GAAP)

                                              Three Months Ended
                                  December   September   December     December
    (in thousands, unaudited)     31, 2008    30, 2009   31, 2009     31, 2009
                                     RMB         RMB         RMB         US$
    Income (loss) from
     operations
    GAAP Result                   (49,253)     19,968      19,889       2,913
    Share-based compensation        1,683       1,488       1,611         236
    Exchange loss                      --          --          --          --
    Amortization                    2,269       1,266       1,281         187
    Goodwill and intangible
     assets impairment             52,236          --          --          --
    Adjusted income from
     operations (non-GAAP)          6,935      22,722      22,781       3,336
    Adjusted operating margin
     (non-GAAP)                      8.0%       25.3%       23.9%       23.9%


                                                    Twelve Months Ended
                                              December    December    December
    (in thousands, unaudited)                 31, 2008    31, 2009    31, 2009
                                                 RMB         RMB         US$
    Income (loss) from operations
    GAAP Result                               (13,050)     79,413      11,635
    Share-based compensation                    5,231       7,416       1,086
    Exchange loss                               1,433          --          --
    Amortization                                9,352       5,856         858
    Goodwill and intangible assets
     impairment                                70,093          --          --
    Adjusted income from operations
     (non-GAAP)                                73,059      92,685      13,579
    Adjusted operating margin (non-GAAP)        23.0%       26.1%       26.1%



    ChinaEdu Corporation
    Reconciliation from net income (loss) to adjusted EBITDA (non-GAAP)
    and adjusted EBITDA margin (non-GAAP)

                                                 Three Months Ended
                                          December September December December
    (in thousands, unaudited)             31, 2008 30, 2009  31, 2009 31, 2009
                                             RMB       RMB      RMB      US$

    Net income (loss)                      (26,515)  15,909   16,247    2,379
      Income tax expense                   (19,621)   4,835    5,487      804
      Share-based compensation               1,683    1,488    1,611      236
      Exchange loss                             --       --       --       --
      Amortization                           2,269    1,266    1,281      187
      Depreciation                           3,570    4,119    4,560      668
      Interest income and other, net        (3,117)    (776)  (1,845)    (270)
      Goodwill and intangible assets
       impairment                           52,236       --       --       --

    Adjusted EBITDA (non-GAAP)              10,505   26,841   27,341    4,004
    Adjusted EBITDA margin (non-GAAP)        12.1%    29.9%    28.6%    28.6%


                                                 Twelve Months Ended
                                            December     December     December
    (in thousands, unaudited)               31, 2008     31, 2009     31, 2009
                                               RMB          RMB          US$

    Net income (loss)                         (6,607)      66,852       9,795
      Income tax expense                       3,473       19,287       2,826
      Share-based compensation                 5,231        7,416       1,086
      Exchange loss                            1,433           --          --
      Amortization                             9,352        5,856         858
      Depreciation                            12,212       16,603       2,432
      Interest income and other, net          (9,916)      (6,726)       (986)
      Goodwill and intangible assets
       impairment                             70,093           --          --

    Adjusted EBITDA (non-GAAP)                85,271      109,288      16,011
    Adjusted EBITDA margin (non-GAAP)          26.8%        30.8%       30.8%



    ChinaEdu Corporation
    Reconciliations from net income (loss) attributable to ChinaEdu to
    adjusted net income attributable to ChinaEdu (non-GAAP), adjusted net
    margin (non-GAAP) and adjusted net income per ADS (non-GAAP)

                                               Three Months Ended
    (in thousands, unaudited)    December    September    December    December
                                 31, 2008     30, 2009    31, 2009    31, 2009
                                     RMB         RMB         RMB         US$
    Net income (loss) attri-
     butable to ChinaEdu
    GAAP Result                   (38,984)      7,299       9,056       1,326
    Share-based compensation        1,683       1,488       1,611         236
    Exchange loss                      --          --          --          --
    Share-based compensation
     attributable to the
     noncontrolling interest         (203)       (168)       (183)        (27)
    Amortization                    2,269       1,266       1,281         187
    Goodwill and intangible
     assets impairment             52,236          --          --          --
    Adjusted net income
     attributable to ChinaEdu
     (non-GAAP)                    17,001       9,885      11,765       1,722
    Adjusted net margin (non-
     GAAP)                          19.6%       11.0%       12.3%       12.3%

    Adjusted net income per
     ADS (non-GAAP)
      Basic                          0.91        0.61        0.73       0.107
      Diluted                        0.89        0.56        0.67       0.098

    Weighted average aggregate
     number of ordinary shares
     outstanding:
      Basic                    18,650,558  16,227,267  16,148,719  16,148,719
      Diluted                  19,187,923  17,604,567  17,589,699  17,589,699


                                                  Twelve Months Ended
    (in thousands, unaudited)                December    December    December
                                             31, 2008    31, 2009    31, 2009
                                                RMB         RMB         US$
    Net income (loss) attributable to
     ChinaEdu
    GAAP Result                               (43,019)     34,779       5,096
    Share-based compensation                    5,231       7,416       1,086
    Exchange loss                               1,433          --          --
    Share-based compensation attributable
     to the noncontrolling interest              (786)       (925)       (136)
    Amortization                                9,352       5,856         858
    Goodwill and intangible assets
     impairment                                70,093          --          --
    Adjusted net income attributable to
     ChinaEdu (non-GAAP)                       42,304      47,126       6,904
    Adjusted net margin (non-GAAP)              13.3%       13.3%       13.3%

    Adjusted net income per ADS (non-GAAP)
      Basic                                      2.20        2.89       0.424
      Diluted                                    2.10        2.69       0.394

    Weighted average aggregate number of
     ordinary shares outstanding:
      Basic                                19,226,501  16,281,535  16,281,535
      Diluted                              20,162,529  17,506,561  17,506,561

    Adjusted income from operations, which is a non-GAAP measure defined as
    income from operations excluding share-based compensation, exchange loss,
    amortization of intangible assets and land use rights, and goodwill and
    intangible assets impairment charges, if applicable.

    Adjusted net income attributable to ChinaEdu, which is a non-GAAP measure
    defined as net income attributable to the ChinaEdu excluding share-based
    compensation, exchange loss, noncontrolling interest for share-based
    compensation, amortization of intangible assets and land use rights, and
    goodwill and intangible assets impairment charges,  if applicable.

SOURCE ChinaEdu Corporation