THE FAR EASTERN UNIVERSITY, INCORPORATED AND SUBSIDIAR

CONSOLIDATED STATEMENT OF PROFIT OR LOSS

FOR THE YEARS ENDED MAY 31,2017 AND MARCH 31,2016

REVENUES Notes
Educational 19
Tuition fees-net
Other school fees
15
Rental 24
Management Fees

COSTS AND OPERATING EXPENSES 20

OTHER OPERATING INCOME
OPERATING INCOME (LOSS)
FINANCE INCOME 21
FINANCE COSTS 21
OTHER INCOME 2,17
OTHER CHARGES 13
PROFIT (LOSS) BEFORE TAX
TAX INCOME (EXPENSES) 23
NET PROFIT (LOSS)

Attributable to:
Owners of the parent company 25
Non-controlling interests

Earnings (Loss) Per Share

Basic and Diluted 26

NET PROFIT (LOSS)

OTHER COMPREHENSIVE INCOME (LOSS)

Item that will be reclassified subsequently to profit or loss
 Fair value gains(losses) on available-for-sale financial assets - net of tax 11
Fair value gains (losses) during the period
Fair value gains reclassified to profit or loss

Item that will not be reclassified subsequently to profit or loss

Gains on remeasurement of post-empoyment benefit plan 22
Tax-effect 23

Other Comprehensive Income (Loss) - Net of Tax

TOTAL COMPREHENSIVE INCOME (LOSS)

Attributable to:
Owners of the parent company
Non-controlling interests
TED AND SUBSIDIARIES
OFIT OR LOSS
ND MARCH 31,2016

March 31,2016 May 31,2017

(One Year) (One Year)

₱ 2,847,941,948.00 ₱ 2,710,248,681
70,643,435 106,582,390
2,918,585,383 2,816,831,071
124,073,069 43,430,248
20,449,880 -

3,063,108,332 2,860,261,319

(1,915,329,117) (2,095,567,965)
3,235,844 2,559,803
1,151,015,059 767,253,157
171,949,548 180,126,492
(11,656,699) (88,837,546)
71,999,234 69,263,938
(70,105) (70,933)
1,383,237,037 927,735,108
(158,338,419) (121,282,797)
₱ 1,224,898,618 ₱ 806,452,311

₱ 1,166,023,155 ₱ 749,519,197
58,875,463 56,933,114

₱ 1,224,898,618 ₱ 806,452,311

₱ 70.89 ₱ 45.61

₱ 1,224,898,618 ₱ 806,452,311.00
 (38,385,706) 10,347,633
(53,689,984) (36,850,401)
(92,075,690) (26,502,768)

- 6,980,564
- (698,056)
6,282,508

(92,075,690) (20,220,260)

₱ 1,132,822,928 ₱ 786,232,051

₱ 1,074,618,961 ₱ 726,604,065
58,203,967 59,627,986

₱ 1,132,822,928 ₱ 786,232,051
 THE FAR EASTERN UNIVERSITY, INCORPORATED AND SUBSIDIA
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
MAY 31 2017 AND MARCH 31 2016

ASSETS Notes

CURRENT ASSETS
Cash and Cash Equivalents 8
Trade and Other Receivables - Net 9
Available-for-sale financial assets 11
Held-to-maturity investments 11
Real estate held-for-sale 12
Other current assets - net 16
Total Current Assets

NON-CURRENT ASSETS
Trade and other receivables - net 9
Available-for-sale financial assets 11
Held-to-maturity investments 11
Investment in an associate 13
Property and Equipment - net 14
Investment property -net 15
Goodwill 1
Deferred tax assets - net 23
Other non-current assets 16
Total Non-current Assets

TOTAL ASSETS

LIABILITIES AND EQUITY

CURRENT LIABILITIES
Trade and other payables 17
Interest-bearing loans 18
Derivative Liability 10
Deferred Revenues 19
Provisions 28
Income tax payable
Total Current Liabilities

NON-CURRENT LIABILITIES
Interest-bearing loans 18
Post-employment benefit obligation 22
 Deferred tax liabilities - net 23
Other non-current liabilities
Total Non-current Liabilities
Total Liabilities

EQUITY
Equity attributable to owners of the parent company
Capital Stock 25
Treasury Stock at cost 25
Revaluation reserves 11, 22
Other reserves 2
Retained Earnings 25
Total Equity attributable to owners of parent company

Non-controlling interests 25
Total Equity

TOTAL LIABILITIES AND EQUITY

 ORPORATED AND SUBSIDIARIES
S OF FINANCIAL POSITION
MARCH 31 2016

March 31, 2016 May 31, 2017

₱ 1,089,584,537.00 ₱ 1,526,201,248
652,219,771 446,699,264
2,151,377,898 2,139,654,834
- 95,148,019
121,613,876 141,547,959
212,615,124 680,352,309
4,227,411,206 5,029,603,633

- 1,701,014
450,192,695 138,991,746
- 241,418,315
6,656,734 6,585,801
4,423,746,294 5,675,099,744
563,137,344 567,045,862
- 186,487,019
8,063,668 20,272,377
11,840,122 88,942,544
5,463,636,857 6,926,544,422

₱ 9,691,048,063 ₱ 11,956,148,055

₱ 602,275,911 ₱ 958,063,062
9,575,440 332,857,143
18,072,300 33,365,459
66,765,560 75,199,534
- 19,694,375
51,164,590 22,006,031
747,853,801 1,441,185,604

704,013,177 1,617,142,857
- 59,800,703
 4,360,135 10,697,213
14,042,052 4,696,331
722,415,364 1,692,337,104
1,470,269,165 3,133,522,708

1,651,435,400 1,651,435,400
(33,855,641.00) (49,362,563)
44,997,346 39,707,565
- (57,785,452)
4,906,624,398 5,128,123,327
6,569,201,503 6,712,118,277

1,651,579,396 2,110,507,070
8,220,780,899 8,822,625,347

₱ 9,691,050,064 ₱ 11,956,148,055
 THE FAR EASTERN UNIVERSITY, INCORPORATED AND S
CONOSOLIDATED STATEMENTS OF CASH FLO
FOR THE YEARS ENDED MAY 31, 2017 AND MARCH
(Amounts in Philippine Pesos)

CASH FROM OPERATING EXPENSES

Profit (loss) before tax
Adjustments for:
Depreciation and Amortization
Interest Income
Interest Expense
Other investment from available-for-sale (AFS) Financial assets
Unrealized foreign exchange gains-net
Share in net losses of an associate
Operating profit (loss) before working capital changes
Decrease (increase) in trade and other receivables
Increase in real estate held-for-sale
Increase in other assets
Increase (decrease) in trade and other payables
Increase in derivative liability
Increase (decrease) in deferred revenues
Increase (decrease) in provisions
Increase in post-employment benefit obligation
Increase (decrease) in other non-current liabilities
Cash generated from (used in) operations
Income taxes paid

Net Cash From (Used in) Operating Activities

CASH FLOWS FROM INVESTING ACTIVITIES

Acquisitions of Property and Equipment
Advance payment for campus construction
Acquisition of new subsidiaries
Interest received
Advances granted to related parties
Matured held-to-maturity (HTM) investments
Net acquisitions (disposal) of AFS financial assets
Addition to investment properties
Acquisition of HTM investments
Collections of advances to related parties

Net Cash Used in Investing Activities

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds of interest-bearing loans
Proceeds from issuance of preferred shares to a related party under common management
Dividends paid
Interest paid
Repayments of interest-bearing loans
Acquisition of treasury shares

Net Cash From (Used in) Financing Activities

Cash and Cash Equivalents of Newly-acquired Susidiary

Effect of Exchange Rate Changes on Cash and Cash Equivalents

NET INCREASE IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

CASH AND CASH EQUIVALENTS AT END OF PERIOD

Y, INCORPORATED AND SUBSIDIARIES
ATEMENTS OF CASH FLOWS
AY 31, 2017 AND MARCH 31, 2016
n Philippine Pesos)
March 31, 2016 May 31, 2017
Notes (One Year) (One Year)

₱ 1,383,237,037 ₱ 927,735,108

20 272,615,272 302,109,262
21 (118,254,585) (105,320,467)
21 400,899 46,753,278
21 (26,133,578) (38,740,963)
21 -27,561,385 (36,065,062)
13 70,105 70,933
1,484,373,765 1,096,542,089
(140,334,630) 29,777,561
- (46,710,342)
(8,542,831) (72,746,889)
(232,422,774) 100,052,024
18,072,300 12,845,459
20,253,191 (41,059,209)
- (28,772,990)
- 1,372,501
249,034 708,739
1,141,648,055 1,052,008,943
(98,140,166) (105,811,268)

1,043,507,889 946,197,675

14 (333,246,291) (571,978,810)
16 - (404,924,056)
1 - (180,144,963)
11 147,713,115 75,493,688
24 (35,570,042) (30,429,613)
11 - 30,297,340
(217,968,211) 29,754,822
15 (57,234,963) (26,564,345)
11 - (15,000,000)
24 74,370,475 2,016,074

(421,935,917) (1,091,479,863)
 18 680,000,000 470,000,000
n management 24 - 416,500,000
25 -391,463,964 (374,228,241)
14 -19,990,694 (32,540,909)
18 -688,958,043 (12,333,334)
25 - (10,706,922)

-420,412,701 456,690,594

- -

978,009 1,442,262

202,137,280 312,850,668

887,447,257 1,213,350,580

1,089,584,537 1,526,201,248
 STI EDUCATION SYSTEMS HOLDINGS,
CONSOLIDATED STATEMENTS OF CO
YEAR ENDED MARC

REVENUES
Sale of services
Tuition and other school fees
Educational services
Royalty fees
Others
Sale of educational materials and supplies

COSTS AND EXPENSES

Cost of educational services (Note 23)
Cost of educational materials and supplies sold (Note 24)
General and administrative expenses (Note 25)

INCOME BEFORE OTHER INCOME (EXPENSES) AND INCOME TAX

OTHER INCOME (EXPENSES)

Equity in net losses of associates and joint ventures (Note 13)
Interest expense (Note 22)
Rental income (Notes 12, 28 and 30)
Interest income (Note 22)
Dividend and other income (Notes 3 and 15)
Gain (loss) on sale of property and equipment
Effect of derecognuition of a subsidiary (Note 20)
Excess of consideration received from collection of receivables (Notes 12, 33)

INCOME BEFORE INCOME TAX

PROVISION FOR (BENEFIT FROM) INCOME TAX (Note 29)

Current
Deferred

NET INCOME (Carried Forward)

NET INCOME (Brought Forward)

OTHER COMPREHENSIVE INCOME (LOSS)
Items to be reclassified to profit or loss in subsequent years:
Share in associates unrealized mark-to-market gain (loss)on available-for-sale financial assets (Note
 Unrealized mark-to-market gain (loss) on available-for-sale financial assets (Note 15)
Share in associates' measurement gain (loss) on life insurance reserves (Note 13)

Items not to be reclassified on profit or loss in subsequent years:

Share in associates' remeasurement gain on pension liability (Note 13)
Remeasurement gain (loss) on pension liability (Note 27)
Income tax effect

OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX

TOTAL COMPREHENSIVE INCOME

Net Income Attributable To

Equity holders of the Parent Company
Non-controlling interests

Total Comprehensive Income Attributable To

Equity holders of the parent company
Non-controlling interests

Basic/Diluted Earnings Per Share on Net Income

Attributable to Equity Holders of the Parent Company (Note 31)
 STI EDUCATION SYSTEMS HOLDINGS, INC. AND SUBSI
CONSOLIDATED STATEMENTS OF COMPREHENSIVE IN
YEAR ENDED MARCH 31

n and other school fees

ational services

educational materials and supplies

AND EXPENSES
educational services (Note 23)
educational materials and supplies sold (Note 24)
and administrative expenses (Note 25)

E BEFORE OTHER INCOME (EXPENSES) AND INCOME TAX

INCOME (EXPENSES)
n net losses of associates and joint ventures (Note 13)
expense (Note 22)
ncome (Notes 12, 28 and 30)
income (Note 22)
d and other income (Notes 3 and 15)
ss) on sale of property and equipment
derecognuition of a subsidiary (Note 20)
of consideration received from collection of receivables (Notes 12, 33)

E BEFORE INCOME TAX

SION FOR (BENEFIT FROM) INCOME TAX (Note 29)

COME (Carried Forward)

COME (Brought Forward)

COMPREHENSIVE INCOME (LOSS)
be reclassified to profit or loss in subsequent years:
e in associates unrealized mark-to-market gain (loss)on available-for-sale financial assets (Note 13)
alized mark-to-market gain (loss) on available-for-sale financial assets (Note 15)
e in associates' measurement gain (loss) on life insurance reserves (Note 13)

ot to be reclassified on profit or loss in subsequent years:

e in associates' remeasurement gain on pension liability (Note 13)
easurement gain (loss) on pension liability (Note 27)
me tax effect

COMPREHENSIVE INCOME (LOSS), NET OF TAX

COMPREHENSIVE INCOME

ome Attributable To
olders of the Parent Company
ntrolling interests

omprehensive Income Attributable To

olders of the parent company
ntrolling interests

Diluted Earnings Per Share on Net Income

butable to Equity Holders of the Parent Company (Note 31)
 NC. AND SUBSIDIARIES
MPREHENSIVE INCOME
H 31

2016 2017 2018

₱ 2,274,860,553 ₱ 2,538,918,364 ₱ 2,612,702,587

184,262,754 199,155,782 208,333,217
15,935,475 19,148,926 20,545,886
28,647,142 22,234,062 62,786,149
73,015,944 153,502,823 178,303,107
2,576,721,868 2,932,959,957 3,082,670,946

749,840,018 823,940,675 882,087,561

54,933,802 120,843,322 131,916,522
1,069,134,580 1,066,094,306 1,194,318,933
1,873,908,400 2,010,878,303 2,208,323,016

702,813,468 922,081,654 874,347,930

(154,635,023) (244,097,915) (222,036,414)

(63,223,407) (79,245,342) (219,411,899)
63,152,578 111,477,617 114,629,851
5,785,710 4,907,330 28,527,141
2,830,674 3,264,786 4,555,297
(466,998) 135,199 14,790
- (60,829,455) -
553,448,521 - -
406,892,055 (264,387,780) (293,721,234)

1,109,705,523 657,693,874 580,626,696

123,414,765 103,832,952 84,487,773

103,237,746 (4,561,593) (6,679,096)
226,652,511 99,271,359 77,808,677

883,053,012 558,422,515 502,818,019

883,053,012 558,422,515 502,818,019

(292,749,090) (148,323,150) 124,968,590

 (377,254) 847,120 391,610
11,269,319 (4,022,703) 226,977
(281,857,025) (151,498,733) 125,587,177

561,443 18,979,723 176,372

(5,306,329) 32,270,210 58,838,953
537,225 (3,227,021) (5,882,268)
(4,207,661) 48,022,912 53,133,057

(286,064,686) (103,475,821) 178,720,234

596,988,326 454,946,694 681,538,253

874,228,253 550,204,057 496,017,439

8,824,759 8,218,458 6,800,580
883,053,012 558,422,515 502,818,019

592,012,475 448,129,130 672,418,815

4,975,851 6,817,564 9,119,438
596,988,326 454,946,694 681,538,253

0.088 0.055 0.050

 STI EDUCATION SYSTEMS HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITIO

ASSETS
Current Assets
Cash and cash equivalents (Notes 6,34 and 35)
Receivables (notes 7, 30, 34 and 35)
Inventories (Notes 8)
Prepaid expenses and other current assets (Notes 9, 27 28 34 and 35)

Non-current asset held for sale (Notse 10 and 13)

Total Current Asset
Non-current Assets
Property and equipment (Noes 11 and 28)
Investment properties (Notes 12)
Investments in and advances to associates and joint ventures (Notes 13, 14 and 35)
Available-for-sale financial assets (Notes 15, 34, and 35)
Deferred tax assets - net (Notes 29)
Pension assets - net (Notes 27)
Goodwill, intangible and other noncurrent assets (Notes 16, 28, 34, and 35)
Total Non-Current Assets
TOTAL ASSETS

LIABILITIES AND EQUITY

Current Liabilities
Accounts payable andother current liabilities (Notes 17, 34, and 35)
Current portion of interest-bearing loans and borrowings (Notes 18, 34, and 35)
Current portion obligations under finance lease (Notes 28, 34 and 35)
Unearned tuition and other school fees
Nontrade payable (Note 1)
Income tax payable
Total Current Liabilities
Non-current Liabilities
Bonds payable (Notes 19)
Interest-bearing loans and borrowing - net of current portion (Notes 18,34 and 35)
Obligations under finance lease - net of current portion (Notes 28, 34, and 35)
Pension liabilities - net (Note 27)
Other non-current liabilities (Note 20)
Deferred tax liabilities (Note 29)
Total Noncurrent Liabilities
Total Liabilities (Carried Forward)

Total Liabilities (Brought Forward)

Equity Attribute to Equity Holders of the Parent Company (Note 21)
Capital stock
Additional paid-in capital
Cost of shares held by a subsidiary
Cumulative actuarial gain
Unrealized mark-to-market gain on available-for-sale financial assets (Note 15)
Other equity reserve (note 3)
Other comprehensive income associated with non-current asset held for sale (Note 13)
Share in associates:
Unrealized mark-to-market loss on available-for-sale financial assets (Note 13)
Cumulative actuarial gain (Note 13)
Remeasurement loss on life Insurance reserves (Note 13)
Other Equity reserve (note 13)
Retained earnings (Note 13)
Total Equity Attributable to Equity Holders of theParent Company
Equity Attributes to Non-controlling Interests
Total Equity
TOTAL LIABILITIES AND EQUITY
NGS, INC.

NCIAL POSITION
March-31
2017 2018

₱ 3,198,723,556 ₱ 1,857,507,750
443,059,848 517,981,482
123,577,199 139,581,592
149,024,884 135,778,279
3,914,385,487 2,650,849,103
- 716,586,558
3,914,385,487 3,367,435,661

6,875,570,837 8,426,842,079
1,891,231,534 1,863,718,647
856,701,443 41,871,654
51,602,130 68,093,740
32,875,741 32,897,980
2,763,398 53,474,883
427,185,971 561,494,360
10,137,931,054 11,048,393,343
14,052,316,541 14,415,829,004

460,093,058 782,343,048
812,800,000 167,400,000
5,667,168 7,134,449
100,320,948 149,368,406
67,000,000 67,000,000
19,585,731 17,490,337
1,465,466,905 1,190,736,240

2,947,028,638 2,951,879,134
916,400,000 1,071,208,112
7,172,214 14,627,824
48,092,221 42,455,457
119,353,609 106,743,001
236,505,372 235,730,783
4,274,552,054 4,422,644,311
5,740,018,959 5,613,380,551

March-31
2017 2018
5,740,018,959 5,613,380,551
 4,952,403,462 4,952,403,462
1,119,127,301 1,119,127,301
(498,142,921) (498,142,921)
44,398,122 96,727,608
462,127 847,989
(1,667,792,370) (1,667,792,370)
- 90,645,302

(16,188,913) (114)
722,894 215,592
(18,078,114) -
718,885 -
4,303,426,945 4,611,356,907
8,221,057,418 8,705,388,756
91,240,164 97059697
8,312,297,582 8,802,448,453
14,052,316,541 14,415,829,004
 STI EDUCATION SYSTEMS HOLDINGS
CONSOLIDATED STATEMENTS
YEAR ENDED MAR

CASH FLOW FROM OPERATING ACTIVITIES

Income before income tax
Adjustments to reconcile income before income tax to net cash flows:
Depreciation and amortization (Notes 11, 12, 16)
Equity in net losses of associates and joint ventures (Note 13)
Interest Expense
Interest Income
Dividend Income
Net change in pension assets and liabilities (Note 27)
Provision for impairmen5t losses on investment in and advances to an associate (Note 2
Loss (gain) on sale of property and equipment
Effect of derecognition of a subsidiary (Note 13)
Excess of consideration received from collection of receivable (Note 32)
Operating income before working capital changes
Decrease (increase) in:
Receivables
Inventories
Prepaid expenses and other current assets
Increase (decrease) in:
Accounts payable and other current liabilities
Unearned tuition and other school fees
Other non current liabilities
Net cash generated from operations
Income and other taxes paid
Interest received
Net cash from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition of:
Property and equipment (Note 3, 11, 36)
Investing properties (Notes 12 and 36)
Subsidiary, net of cash acquired (Note 3)
Increase in:
Investments in and advances to associates and joint ventures
Intangible assets and other non-current assets
Non-current receivable (Note 33)
Dividends received (Note 15)
Proceeds from sale of property and equipment
Nontrade payable (Note 1)
Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from:
 Availment of long-term loans
Issuance of bonds (Note 18)
Availment of short-term loans (Note 18)
Payments of :
Short-term loans (Note 18)
Long-term loans (Notes 18)
Long-term loan transaction costs
Obligations under finance lease (Note 28)
Bond issuance costs (Note 19)
Interest paid
Dividends paid
Dividends pais to non-controlling interests (Notes 21)
Net cash from (used in) financing activities

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR

CASH AND CASH EQUIVALENTS AT END OF YEAR (Note 6)

TION SYSTEMS HOLDINGS INC. AND SUBSIDIARIES
SOLIDATED STATEMENTS OF CASH FLOWS
YEAR ENDED MARCH 31
2016 2017

₱ 1,109,705,523 ₱ 657,693,874.00

358,130,553 375,621,499
154,635,023 244,097,915
63,223,407 79,124,092
(5,785,710) (4,907,330)
(2,830,674) (3,264,786)
3,856,648 4,986,604
ces to an associate (Note 25) 519,414 1,643,844
466,998 -135,199
60,829,455
e (Note 32) (553,448,521)
1,128,472,661 1,415,689,968

(23,278,719) (140,068,422)
(4,138,069) (83,893,498)
(128,975) (52,471,204)

(248,891,821) (147,291,865)
33,521,956 46,216,182
31,364,795 30,871,502
916,921,828 1,069,052,663
(71,122,774) (131,955,347)
5,785,710 4,907,330
851,584,764 942,004,646

(335,180,807) (1,578,753,015)
(6,360,205) (34,352,144)

(52,956,814) (1,643,844)
(52,144,657) (45,178,798)
(15,214,930) 4,626,924
2,437,946 352,436
510,210
(28,650,000)
(487,559,257) (1,654,948,441)
 3,000,000,000
1,993,000,000

(1,248,000,000)
(236,000,000) (166,800,000)

(9,438,557) (6,004,730)
(52,971,362)
(65,863,875) (76,111,185)
(188,049,982) (181,786,027)
(3,346,086) (14,437,088)
(502,698,500) 3,246,889,608

(138,672,993) 2,533,945,813

803,450,736 664,777,743

₱ 664,777,743 ₱ 3,198,723,556
 2018

₱ 580,626,696.00

398,836,776
222,036,414
219,411,899
(28,527,141)
(4,438,297)
2,787,099
591,839
-14,790

1,391,310,495

(44,359,784)
(17,194,516)
20,077,929

44,352,600
49,047,458
(12,610,608)
1,430,623,574
(83,612,782)
28,527,141
1,375,537,933

(1,614,691,820)
(3,631,991)
5,828,110

(548,841)
(183,108,754)
15,982,712
16,000

(1,780,154,584)
 570,000,000

(985,000,000)
(67,800,000)
(7,791,888)
(6,917,665)
(845,760)
(238,385,492)
(196,558,444)
(3,299,906)
(936,599,155)

(1,341,215,806)

3,198,723,556

₱ 1,857,507,750