by Elbert Chu

New Oriental Education & Technology Group Inc. says 4Q enrollment, mostly in personalized services and overseas test prep courses, grew their student ranks 11.9 percent to 489,100. It is interesting to note, the giant in Chinese education now employs 11,700 teachers, and 2.09 million students.

Seems EDU was driving growth with massive expansion in 2009, but found that they needed a more moderate pace of expansion. Profit doubled mostly on cost saving measures like operational efficiencies, and lower marketing costs. On the earnings call, President and CFO Louis Hsieh said:

…in the past three years, we have grown schools and learning centers from 207 as of May 31, 2008 to 487 at the end of May 2011. However as I noted on last quarter’s call, in the second half of fiscal 2011 we have shifted our focus towards raising operational efficiencies across the networks in controlling costs.”

Hsieh further reports tremendous growth in the K-12 courses (my emphasis):

The success of our U-Can and POP Kids programs in the last quarter means that our K-12 all-subjects after school tutoring business reached a major milestone of one million enrollments for fiscal 2011 on the back of enrollment growth of 32%. At the same time gross revenues grew by over 60% to approximately $193 million.

Hsieh also highlighted 119% revenue growth in their Vision Consulting program which provides personal consulting for the growing segment of Chinese families financially able to send students abroad for study.

There is a huge and growing demand for more personalized services from learners in China because people are increasingly willing to spend more to get a more tailored personalized learning experience.

According to the AP, the Beijing based provider of private education reported 4Q net income of $14.3 million / 37 cents per American depositary share (vs $5.8 million / 15 cents 4Q 2010).

Excluding the impact of a $1.5 million loss related to the disposal of two subsidiaries during the quarter, New Oriental would have earned 49 cents per American depositary share, the company said.

Analysts were anticipating earnings of 26 cents per American depositary share, according to FactSet.

Quarterly revenue surged 59 percent to $137.4 million, up from $86.6 million in the prior-year quarter. Analysts were anticipating revenue of $119.7 million.

Full AP report, and EDU company earnings call transcript at Seeking Alpha.