51Job Turns Up the Heat

The China recruiting company wipes out estimates.
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(JOBS) - Get Report

, the Chinese employment agency whose shares are up 72% on the year, reported sharply higher earnings Wednesday, boosted by rising sales and expanding margins.

Earnings rose 189% from a year ago to $3.3 million, or 12 cents an American depositary share, in the quarter. Excluding stock-options expenses and foreign currency losses, 51Jobs earned 15 cents per ADS in the most recent quarter, beating the consensus estimate of 9 cents.

First-quarter revenue rose 21% to $21.5 million, matching estimates. 51Job said print advertising revenue rose 14% to $13.3 million, while online recruitment revenue rose 53% to $6.1 million.

In after hours trading, the stock jumped $2.45, or 9.7%, to $27.80.

51Job's gross margin was 55.3% in the first quarter, up from 48.7% a year ago.

The company expects to earn 13 cents to 15 cents a share on revenue of $21.2 million to $22.5 million in the current second quarter. Analysts surveyed by Thomson First Call were forecasting 9 cents a share on sales of $21.3 million.

"In the first quarter, we successfully acquired new online customers through our sales and marketing efforts," it said. "We also saw increased purchases of our higher-priced online advertising products and services to attract job seekers during the post-Chinese New Year peak recruiting period."

"Leveraging the scale benefits of our operating model, we further improved our margins and reached a gross margin level above 55% in the first quarter. We continue to execute our business strategy while maintaining a sharp focus on profitable growth, cost efficiency and shareholder value. We remain well-positioned financially and competitively to capture opportunities from the ongoing development and evolution of the Chinese HR services market," the company said.