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BUSINESS OVERVIEW We were the largest provider of private education from kindergarten to university in China by student enrolments in the 2015/2016 school year, according to the Frost & Sullivan Report. We had 48,220 students enrolled at our schools for the 2015/2016 school year, giving us a market share of approximately 0.11% in the fragmented PRC private education industry according to the Frost & Sullivan Report. Our University, Zhengzhou Technology and Business University, had 25,063 students enrolled in the 2015/2016 school year, while our 24 “YuHua” branded private schools for K-12 on 16 campuses had an aggregate of 23,157 students enrolled in the same school year. With our significant scale and extensive experience in the private education industry, we believe we are well- placed to benefit from growth and consolidation within the fragmented private education industry. All of our schools are located in Henan Province, a province that has the largest registered population and generated the fifth largest GDP of RMB3.7 trillion among all provinces in China in 2015, according to the Frost & Sullivan Report. The favourable demographics of Henan Province have facilitated the growth of our school network from our inception in 2001 with a single high school to one University and 24 K-12 schools across nine cities with 48,220 students in the 2015/2016 school year. We intend to continue to strengthen our leading position in Henan Province as well as to selectively expand to the surrounding regions of Henan Province. We believe our advanced and established management system has supported our previous business expansion and, together with the growing recognition of our “YuHua” brand, will continue to help us successfully replicate our operating model in new markets. Our University education and K-12 education are designed to serve different target groups and achieve distinct learning outcomes. Our University offers comprehensive tertiary level education aimed at equipping our students with the practical knowledge and skills to prosper in their careers. Our University has established a strong reputation and achieved the fastest growth among the five largest private higher education institutions in terms of student enrolment in the PRC over its seven years of development. According to the Frost & Sullivan Report, our University had the third highest student enrolments in the 2015/2016 school year among private higher education institutions in China. In February 2016, our University ranked second in terms of overall strength in the Independent College category of the PRC university rankings published by the China University Alumni Association. Our University’s Initial Employment Rate was 91.3%, 91.0% and 83.3% in 2013, 2014 and 2015, respectively. In contrast, the Initial Employment Rate of colleges and universities in China as a whole was 77.4%, 77.5% and 77.7% in 2013, 2014 and 2015, respectively, according to the Frost & Sullivan Report. We attribute our high employment rate to our strong focus on career services, the high quality of our curriculum that adapts to changes in industry demands and our close collaboration with prospective employers. Our K-12 schools provide education from kindergarten to high school, allowing us to attract students at an early age and create a stable and sustainable student pipeline. We emphasise the well-rounded development of our students and have structured our curriculum to ensure the high quality of our education and inspire and encourage our students to explore their individual interests. Our K-12 schools are also committed to maximising our students’ opportunities to enter top-tier universities in China and reputable colleges and universities abroad. For example, for the Gaokao administered in 2014, 2015 and 2016, approximately 17.7%, 11.4% and 14.2% of our participating high school students were admitted into Tier One Universities in China, respectively, including Peking University, Tsinghua University and Fudan University, among others. This compares to approximately 8.1%, 8.2% and 9.1%, respectively, of the graduating high school students of Henan Province admitted to first tier universities (which include all Tier One Universities) in China for the same period, according to the Frost & Sullivan Report. Since our inception in 2001, our high schools have had a total of 12 students who achieved the highest score at the provincial or municipal level in the Gaokao, more than any other private school operator in Henan Province. Those students were recognised as Zhuangyuan ( ), which is known as the highest academic achievement in the Gaokao. We believe our students’ accomplishments are viewed as a strong endorsement of our teaching quality and have greatly enhanced our reputation. Our high school graduates have also previously been admitted to well-recognised colleges and universities overseas, including the University of California, Berkeley, the University of Nottingham and the University of Sydney. 99 BUSINESS We have experienced significant growth in our student enrolments, revenue, gross profit and Adjusted Net Profit over the Track Record Period. Our overall student enrolment grew from 35,431 for the 2013/2014 school year to 48,220 for the 2015/2016 school year. Our revenue increased from RMB599.3 million for the year ended 31 August 2014 to RMB697.7 million for the year ended 31 August 2015, and further to RMB781.3 million for the year ended 31 August 2016. Our gross profit increased from RMB266.8 million for the year ended 31 August 2014 to RMB318.3 million for the year ended 31 August 2015, and further to RMB406.2 million for the year ended 31 August 2016. Our profit for the year decreased from RMB207.8 million for the year ended 31 August 2014 to RMB91.2 million for the year ended 31 August 2015, and then increased to RMB311.7 million for the year ended 31 August 2016. Our Adjusted Net Profit increased from RMB207.8 million for the year ended 31 August 2014 to RMB245.1 million for the year ended 31 August 2015, and further to RMB322.1 million for the year ended 31 August 2016. For discussions of Adjusted Net Profit, see the section headed “Financial Information — Non-IFRS Measure” in this prospectus. OUR COMPETITIVE STRENGTHS We believe the following competitive strengths contribute to our success and differentiate us from our competitors: We are the largest provider of private education from kindergarten to university in China We were the largest private school operator of kindergarten to university education in China in terms of student enrolments in the 2015/2016 school year, according to the Frost & Sullivan Report. We launched our first school in Zhengzhou, Henan Province in 2001. Since then, we have rapidly developed a large student base through the expansion of our school network in Henan Province, which has the highest student enrolments among all provinces in China. We operate one university and 24 K-12 schools in 16 campuses across nine cities that enrolled a total of 48,220 students in the 2015/2016 school year. We believe our significant scale and extensive experience in operating private schools to a high standard, together with the trust that we have gained from students, parents and teachers, position us well to further enhance our brand awareness, increase our market share in existing markets and enter new markets with strong demand for high-quality education. Our University ranked third among private higher education institutions in China in terms of student enrolments in the 2015/2016 school year, according to the Frost & Sullivan Report. Over the past seven years of development, our University has achieved the fastest growth among the five largest private higher education institutions in terms of student enrolments in the PRC. Since commencing operations in the 2009/2010 school year, our University has grown its student enrolments to 25,063 in the 2015/2016 school year, representing an average annual growth of approximately 3,580 students which is higher than the average annual growth in student enrolments of 300 students per private university/college in China from the 2008/2009 school year to the 2015/2016 school year, according to the Frost & Sullivan Report. Our K-12 schools cover the full range of private fundamental education from kindergarten to high school, allowing us to attract students at an early age and maintain a stable student pipeline. We estimate that the percentage of students graduating from our kindergartens who continued to attend our primary schools, from our primary schools to attend our middle schools, and from our middle schools to attend our high schools ranged approximately from 85% to 95% (as calculated based on only schools located on the same or adjacent campuses) during the Track Record Period. We were the largest private K-12 school operator in Central China in terms of student enrolments in the 2015/2016 school year according to the Frost & Sullivan Report. Our K-12 schools experienced significant growth in student enrolments during the Track Record Period, growing from 15,863 in the 2013/2014 school year to 23,157 in the 2015/2016 school year. 100 BUSINESS As an education group providing kindergarten through university education, we are able to accommodate the educational needs of students of different grade levels. We believe the comprehensiveness of our school system enhances our reputation and the attractiveness of our schools and is essential for the maintenance of our market position and overall competitiveness. In addition, the economies of scale garnered through our large and still growing school network, together with our centralised management system, have lowered the average administrative costs of our schools. Our enhanced reputation in and beyond the region as well as the reduced marginal administrative costs of new schools would, in turn, expedite our school network expansion.