Adam Prior - Equity Group Benson Tsang - CFO Kevin Ma - CEO.

Good day ladies and gentleman and welcome to the ATA Financial Results Fiscal Year 2015 Second Quarter and six months Conference Call. My name is [indiscernible] and I will be your operator for today. At this time all participants are on a listen only mode. We will conduct a question and answer session towards the end of the conference.

(Operator Instructions). I’d also like to remind all participants this conference is being recorded. Now I’d like to turn the call over to Mr. Adam Prior of the Equity Group. Please go ahead sir..

Thank you, and good morning, everyone. Thank you for joining us. Copies of the press release announcing ATA’s fiscal 2015 second quarter results are available at the IR section of the Company’s website at www.ata.net.cn. As part of this conference call, the Company has an accompanying slide presentation available on its website.

You are also welcome to contact our office at 212-836-9600 and we would be happy to send you a copy. In addition, a replay of this broadcast will be made available at ATA’s website for the next 90 days.

Before we get started, I'd like to remind everyone that this conference call and any accompanying information discussed herein contains certain forward looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995.

Although the Company believes that the expectations reflected in its forward looking statements are reasonable as of today, those statements are subject to risks and uncertainties that could cause the actual results to differ dramatically from those projected. There can be no assurance that those expectations will prove to be correct.

Information about the risks associated with investing in ATA is included in its filings with the Securities and Exchange Commission, which we encourage you to review before making an investment decision.

The Company does not assume any obligation to update any forward looking statements as a result of new information, future events, changes in market conditions or otherwise, except as required by law. Regarding the disclaimer language, I would also like to refer you to Slide 2 of the conference call presentation for further information.

All dollar amounts in this conference call relating to financial results for the Company’s most recent quarter ended September, 30, 2014 are converted from RMB using an exchange rate of RMB6.1 to RMB6.1380 to $1. All historical conversions are accurate as of the time reported unless otherwise noted. The Company reports its financial results under U.S.

GAAP in RMB and all percentages calculated in the presentation are based on RMB, unless otherwise noted. For those of you following along with the accompanying PowerPoint presentation, there is an overview of the Company on Slide 3. The Company’s CFO Mr.

Benson Tsang will provide an overview of operational and financial highlights for second quarter 2015 beginning with Slide 4. The Company’s Chairman and CEO, Mr. Kevin Ma, will then discuss ATA’s outlook and growth strategy for the remainder of fiscal year 2015, before opening the floor for questions. With that I’ll turn the call over to ATA’s CFO Mr.

Benson Tsang. Please go ahead Benson..

testing services and test preparation and training solutions. At about 94%, our core terminal testing services was a significant percentage of our total revenue in the 2015 second quarter. On the next slide, we have provided a breakdown of the Company's financial results for the quarter.

Gross profit increased about 111% to RMB46.5 million compared to RMB22 million in the prior-year period due to the change in timing of the CPA exam. Gross margin for second quarter 2015 was 35.4% compared to 48.7% in the prior-year period for the reasons I stated earlier.

Net income was RMB6.8 million compared to net loss of RMB4.3 million in the prior year period. Diluted earnings per ADS were RMB0.38 in second quarter 2015, compared to diluted losses of ADS RMB0.19 in the prior year period. On the next slide, we have provided a breakdown of the Company’s financial results for the first half of the fiscal year.

Gross profit increased about 34% to RMB94 million, compared to RMB70 million in the prior year period. Gross margin for second quarter 2015 was 50.3%, compared to 51.1% in the prior year period.

Net income increased about 164% to RMB13.4 million for the period, or diluted earnings per ADS of RMB0.56, compared to RMB5.1 million in the prior year period, as a result of change in timing of the CPA exam.

Please turn to Slide 10, where we provide a supplemental chart of quarterly numbers, adjusted for share-based compensation expense and foreign currency exchange gains and losses.

I would like to highlight that excluding these items, adjusted net income for second quarter 2015 was RMB11 million, compared to our adjusted net loss of RMB2.7 million in the prior-year period.

Diluted earnings per ADS during second quarter 2015, on a non-GAAP basis, was RMB0.48, compared to diluted losses per ADS on a non-GAAP basis, of RMB0.12, in the prior-year period.

Adjusted net income for first half 2015 increased about 137% to RMB19.8 million from RMB8.3 million in the prior year period, and diluted earnings per ADS on a non-GAAP basis of RMB0.84. We continue to be supported by free cash flow and a solid balance sheet, which we have highlighted on Slide 11.

As of September 30, 2014, we had about $41 million in cash. We have no long-term debt or short-term borrowings and continue to follow the strict cost structure that has served us well over the past several years.

On August 5, 2014, the Company continued a steady traditional [indiscernible] impact to its shareholders through the repurchases and special dividends and authorizing the repurchase of up to $5 million of its issued and outstanding ADSs from time to time in the open-market and privately negotiated transactions.

By the end of second quarter 2015, the Company had repurchased about 123,000 ADSs at an average stock price of $4.63. This share repurchase plan is in effect until January 31, 2015. Please turn to Slide 12 for our third quarter guidance. We expect third quarter net revenues will be in the range of RMB110 million to RMB120 million.

Please keep in mind that this guidance is based on our internal projections and we will continue to evaluate our projections on ongoing basis. With that, I would like to turn it over to our Chairman and CEO, Mr. Kevin Ma, to provide some more detail on the outlook for 2015 fiscal year..

Thank you, Benson. It’s an exciting time in ATA’s history. Since I cofounded the Company in 1999, we have seen technology began increasing [indiscernible] as a tool to reach to very beginning and as said the further [indiscernible] level. ATA has worked hard adapting to a changing market.

We began pricing in relationship with government bodies that needed effective and experienced third-parties to capital and [indiscernible] larger skill assessment and certification exams. Today we have worked with a number of government associations for over 10 years and continue to view that trend and extending those relationships.

A period ago we extended our core competence of testing service to corporate clients, presenting [indiscernible] make the most suitable choice for new hire and be able to approach and to incentivize and also productive employees of their firms.

Today, we are proud to be working with many globally recognized customers in a range of industries such as HSBC Beijing, [indiscernible] Insurers and [indiscernible] high tech. In fiscal year 2015, we continue to serve our government and corporate clients.

But as Benson just mentioned, we have experienced longer than expected contract negotiations as a result of our current difficult environment, which may impact our outlook for the fiscal year.

Our fiscal year 2015 marks yet another step [indiscernible] and we are hoping our new initiatives use on the consumer which you can see on Slide 14 of the presentation. ATA’s mobile application Exam Event Inventory Navigator is while reduce initiatives and we are very pleased with the initial restructuring.

We hope to continue making this tool increasingly useful to our user.

As we previously shared we firmly believe being a structure that believes in strong partnership with different industrial leaders, ATA’s expertise in testing technologies and start to finish procedures as we tabled to a number of different sectors and we continue to explore opportunities for collaboration.

In this regard we continue working closely with New Oriental on the joint event that we allow in July.

Secondary name has been decided and the current leadership team is working on their business trends while [indiscernible] on new online carrier education and a training platform for working professionals in China, which we’ll expected to launched to the healthcare, accounting and the financial industry we already too South in the city.

Earlier in the call Benson also mentioned our resistant allowance to partnership for which a strategic investment in marked demand education which marks ATA’s expansion in the K-12 education space in China.

Given our years of experience including working professionals, [indiscernible] the K-12 education space for the natural expansion where ATA curtain fulfilled a lead.

We are excited to work with a team at Master Mind on antiquating ATA’s and NTS technology into their digitization for K-12 office school to tutorial and look forward close collaboration in penetrating our integrated testing capability into Master Mind's network of after school tutoring institutions as its goes.

I would like to slide through all of since the initiatives that we have adjusted inventory, [indiscernible]. We work with foreign language teaching and resource points which right of the last in language and unit test book publishers in China.

ATA have to digitalize exercise collective test and exam lashing [ph] for select English syllabus and text books of right answer. This will provide continuous test and a timely assessment of each student to cover us and eventually it has a learning capabilities.

The initiative will provide ATA a channel to entering the K-12 and to the English training and testing market. In mid-October we successfully organized and filled efforts to come to the test for new concepts of test of English in to China series using ATA NTS technology. Second we are exploring business corporation with a LinkedIn China.

We are providing a self-assessment at all Marcellus which helps its members to pay asset there carrier choice. This in turn will help members plan their carrier. Marcellus [ph] is going to be offered to all LinkedIn China members through its website.

Marcellus is a professional office mentor, he worked and owned the prior ordered renewed far more conservative. ATA has worked with Marcellus for several years and has exclusive right to distribution and the use of this hope in China. We are excited that its potential opportunity extend ATA’s contribution and the process in the human resources market.

As we focus on exploring consumer with our new initiatives, ATA is mindful of the power of information. As you saw on Slide 18 we believe that collecting and navigating and acting on the information just to show where we're at valuable tool not only for ATA but for our partners and consumers themselves.

For example a teacher come base trapped and understand a severance for growth if he as we watch a time and of student have completed, how will the student answer the content that they're on assessment and so on.

Based on this, information additional tutoring may be recommended in subject areas that students appear to struggle with that some logic can be applied to our raising the courage of graduates looking for jobs and currently looking to advance in their career.

We continue to be in earlier stage of executing on our new group structure and are pleased with our progress thus far. We look forward to shining more details on this issue with the investment community over the next few months. With that operator let's open it up for questions..

Thank you, sir. (Operator Instructions) So we have no questions in the queue. (Operator Instructions) Thank you. We have no questions in the queue. And now I would like to turn the call over to Mr. Kevin Margin for closing remarks. Please go ahead, sir..

Thanks again to all of you for joining us. If anyone has question for us, please feel free to reach up to Benson or myself, as well as our Investor Relations firm The Equity Group. We look forward to speaking with you again during our third quarter 2015 financial results call. And as always we welcome any investors to our office in Beijing. Thank you..

Thank you. Ladies and gentlemen that concludes the conference call for today. You may disconnect. Thank you for joining. Have a very good day..