Greetings. Welcome to ATA Creativity Global's fourth quarter and year-end 2022 financial results. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Alice Zhang of The Equity Group. Thank you. You may begin.
Thank you, operator, and hello, everyone. Thank you for joining us. The press release announcing ATA Creativity Global's or ACG's results for the fourth quarter and year ended December 31st, 2022, is available at the IR section of the company's website at www.atai.net.cn. As part of this conference call, the company has an accompanying slide presentation available on its website. A replay of this broadcast would also be made available at ACG's website for the next 90 days. Before we get started, I would 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.
These forward-looking statements can be identified by terms such as anticipate, believe, could, estimate, expect, forecast, future, intend, look forward to, outlook, plan, should, will, and similar terms, and include, among other things, statements regarding ACG's future growth and results of operations, ACG's plans for mergers and acquisitions generally, ACG's growth strategy, anticipated growth prospects and subsequent business activities, market demand for and market acceptance and competitiveness of ACG's portfolio training program and other education services, the impact of the COVID-19 pandemic on ACG and its operations, and ACG's plan and anticipated benefits of the measures implemented in response to the COVID-19 pandemic. 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 risks associated with investing in ACG 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 two of the conference call presentation for further information. All U.S. dollar amounts in this conference call relating to financial results for fourth quarter and year ended December 31, 2022, are converted from RMB using an exchange rate of 6.8972 RMB to 1 U.S. dollars, the noon buying rate as of December 31, 2022.
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 percentage 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 three. In addition, we're more than happy to take investor questions during today's Q&A session or e-via email to the company. If you wish to ask questions, you can send your questions to the email address, azhang@equityny.com, and please specify whether you would like to have your name read during the Q&A session. On today's call, the company's CFO, Mr. Ruobai Sima, will provide a brief overview of operating and financial highlights for the fourth quarter and full year 2022.
As Chairman and CEO, Mr. Kevin Ma is unable to be here today. Mr. Sima will join President, Mr. Jun Zhang, in providing an update of the company's outlook and long-term growth strategy before opening the floor for questions. With that, I'll turn the call over to ACG CFO, Mr. Ruobai Sima. Please go ahead, Mr. Sima.
Thank you, Alice, Welcome everyone. Good evening to those in America. We appreciate everyone's time. Serving our students remain our top priority in 2022. We were fond of the continuous resilience of both our students and the teaching staff throughout the year as we faced an unpredictable, ongoing pandemic environment. Despite our core portfolio training business being impacted by periodically lockdowns in some of our key cities in response to local COVID-19 resurgences, we were pleased to see stable demand of those programs and increased demand for research-based learning programs, overseas study counseling, and other education services. During fourth quarter 2022, we achieved an 8.2% increase in total revenue to RMB 78.5 million, which contributed to the positive bottom line results for the period. Net income attributed to ACG of RMB 2 million.
Total revenues saw a modest 2.3% increase for full year 2022, which was primarily due to increased contributions from other educational services and portfolio training services. Excluding the one-time RMB 33.5 million investment gain from the disposal of our K12 business recognized in fiscal year 2021, which significantly narrowed losses year-over-year. Total students enrollment for fourth quarter 2022 was 908, compared to 1,052 in the prior year period. Keep in mind, the 908 excludes the number of enrolled students in the foreign language training service, which was primarily operated under an entity that ACG is consolidated that in third quarter 2022. Excluding these 167 students in the prior year period, total enrollment increased year-over-year.
Of the 908 students, 574 were enrolled in our portfolio training program, compared to 569 students in the prior year period. We were pleased to see a continued shift in credit hours delivered from time-based programs to project-based programs, with project-based credit hours increased 31.9% year-over-year, accounting for nearly two-third of total credit hours delivered during the quarter. We have continued to consciously shift students towards a more flexible project-based program designed to be tailored to students' needs and potentially raise a higher unit price. Portfolio training program revenue increased to RMB 57.8 million in the fourth quarter 2022, compared to RMB 54.2 million in the prior year period. With that, let's move to financials for the fourth quarter and full year 2022.
Total net revenue for fourth quarter 2022 increased 8.2% to RMB 78.5 million, from RMB 72.6 million in the fourth quarter of 2021. It was primarily driven by increased contributions from portfolio training services and other educational services, which is related to services delivered for new cooperation projects with schools and training organizations. Revenues from portfolio training services represented approximately 73.6% of total net revenue during the period. Gross margin was 60.6% during the fourth quarter 2022, compared to 62.8% in the prior year period.
The gross margin decrease was primarily a result of increased cost of service related to higher compensation incentives for ACG's teaching staff, as they become more engaged in ACG's international management process to enhance the efficiency and quality of service delivery, as well as help drive sales and students engagement. Net income attributed to ACG was RMB 2 million, compared to net loss attributed to ACG of RMB 2.5 million in the prior year period. To the full year of 2022 results, net revenue was RMB 206.8 million, up 2.3% from RMB 202.2 million in 2021. This increase was driven primarily by increased revenue contributions from other educational services, which is mainly related to services delivered for new cooperation projects with schools and training organizations, and portfolio training services, as noted earlier.
Gross margin was 49.6% from 51.8% in the prior year. Net loss attributed to ACG was RMB 47.9 million, compared to net loss of RMB 33.6 million, which was primarily due to a RMB 33.5 million investment gain related to disposal of the HRL education assessment business in the prior year period, which was offset by decreased general and administrative expenses of RMB 10 million related to the Tsinghua University front-office pay in the prior year period, as well as RMB 6 million impairment loss on investment recorded in the prior year period. Moving to balance sheet, we continue to be in a solid financial position with our $8 million in cash and cash equivalents.
Working capital deficit was $33 million, and total shareholders' equity was $30.8 million at December 31st, 2022, compared to working capital deficit of $30.2 million and shareholders' equity of $30 million, respectively, at December 31st, 2021. Now, turn our attention to ACG's outlook and growth strategy. Over the course of 2022, ACG remains steadfast in its commitment to helping our students achieve positive outcomes. We are very pleased that our students have continued to pursue their studies with ACG, thereby demonstrating their confidence and faith in our ability to provide them with the quality programming and emotional support they deserve and need, for them to realize their creative studies and potential.
As it has been more challenging by the ongoing pandemic environment, I would like to recognize our teaching and support staff for their dedication to the students, regardless of whether classes are delivered in person or online. The remote course delivery platform has provided us the flexibility to change classes delivery format overnight as necessary in recent years. This has been invaluable to students and teachers during the periodic lockdown and temporary campus closures that occurred in 2022. Our portfolio training programs continue to see stable demand and even delivered modest revenue growth despite the impact COVID-19 continued to have on our business in 2022. Because our ability to deliver stable top-line results while controlling expenses, we have continued to narrow losses excluding one-time items.
During 2022, ACG continued to curate and launch various research-based learning programs for students to enhance students' creative journeys. As international travel was highly restricted in China during the year, we focused our attention domestically and host programs such as environmental protection themed design camp in Sanya, Hainan Province. The ceramic art themed exclusive host program in Jingdezhen, Jiangxi Province, and an intense training class for the 2022 UWEE International Art Exhibition. We also offered courses around the more contemporary topics such as NFTs and the metaverse. All these programs were created with the idea that participating students walk away with an enhanced understanding of a particular subject matter through our real-lab experience. Some of those may also result in creations that can be added to students' art portfolios.
We continue to serve as a trusted advisor to students looking to apply to overseas art college and universities, providing high-quality curricula and hands-on experience to admission counseling services. We are thrilled to share some of the initial 2023 full admission results. We have heard from our students. Some have began to receive offers from prestigious creative institutions such as a fashion design program at Parsons School Design, which is known to be quite competitive. Other schools, including Rhode Island School for Design, New York Academy of Art, New York University, and University of Oxford. We opened the ACG International Arts Foundation Program Center in Beijing in 2021. I'm pleased to share that all the enrolled students at the center have started their first year in college in the U.K.
We are excited that the ACG's program designed for students that are unable to follow the traditional high school path, have played a crucial role in helping these students achieve the next step of their creative arts education journey. We continue to believe that our growth relies on the continued investment in our institution and foster long-term relationships with our institutional partners. As we look forward in 2023, we are optimistic about the near-term outlook for our business as international travel continue to pick up and more students realize that their desire to study overseas is more possible today than perhaps before these past couple of years. We look forward to continue to, giving positive outcomes for all students. I'd like to turn over to Jun Zhang, ACG's President, to provide an update on our current growth initiatives.
Jun will make his remarks in Mandarin, which will be followed by an English translation. Jun, please go ahead.
Thank you, Sima.
[Foreign language]
Thank you, Mr. Sima. Our students have demonstrated a great deal of dedication and determination in the pursuit of art study. As their trusted partner along this journey, ACG has strived to ensure that our offerings remain first rate, educational and relevant to real world experience.
In the first quarter 2023, one of our feature programs is the Open Hack Project, designed for Shanghai Fashion Week 2023. During this 5-day-long project, participating students will create branding proposals, start a fashion book, fashion look book from scratch, and have an opportunity to interview fashion icons and influencers. Students could also win VIP access to Shanghai Fashion Week 2023, which took place this month. Additionally, as this project is designed for students who are looking to add highlights to their resume, not only would they gain first hand experience working as part of a professional fashion week team, but also complete the project with reference letters and internship certificates.
ACG initially introduced online research-based learning programs during the COVID-19 pandemic. We were able to do so primarily thanks to a strong partnership base with international education providers, including art colleges and universities, and its programs have been well received by participating students. As international travel was now feasible to many students over the past couple of years, we developed programs to encourage students to explore cultural heritage by visiting cultural heritage sites in China. Intangible cultural heritage is a term used by UNESCO to describe culture beyond monuments and collections of objects.
As described by UNESCO, intangible cultural heritage also includes traditions or living expressions inherited from our ancestors and passed on to our descendants, such as oral traditions, performing arts, social practices, rituals, festive events, knowledge and practices concerning nature and the universe, or the knowledge and skills to produce traditional crafts. We understand how valuable these types of learning experiences are for students applying to overseas art schools. In 2023, we plan to continue offering these programs to our students, as well as other programs to keep up with the latest trends in the arts world.
Just like what we did with the Metaverse and Post Pandemic Era program. As international travel continues to pick up and as China has lifted its zero COVID policy, we're working closely with our international partners on resuming international summer school programs for the first time since 2020. As Mr. Sima mentioned earlier, the ACG International Arts Foundation Program Center achieved great success in its initial class, all of whom are currently in the first year of college in the U.K. We are pleased to enroll a larger class of students in 2022 and look forward to guiding them in the year ahead.
We're excited about the new opportunities that the ACG International Arts Foundation Program Center has created for the students with non-traditional study paths. We remain confident in our competitive position in the creative arts education industry in 2023. We're prepared to optimize ACG's instructional resources by seeking different forms of cooperation with existing and potential academic partners in regional markets. We look forward to serving more students with diverse needs of our growing portfolio of offerings. This is supported by our strong operational foundation with on-site access in various cities nationwide and first-rate teaching staff, a track record of delivering positive student outcomes, as well as a strong partnership base. With that, I'll turn it back over to Mr. Sima
Thanks, Jun and Alice. In closing, we are excited about the opportunities ahead of us in 2023. We remain optimistic about taking the lead in race on the runway of China's creative arts education industry, and we will continue striving to become an international leader. We cannot wait to see what our students will achieve in 2023, and are committed to be the provider of new experience, valuable guidance, as well as the supporter along their art study journey. With that, operator, let's open things up for questions.
Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment while we pull for questions. This will conclude our question and answer session. I would like to turn the conference back over to Mr. Sima for closing comments.
Thanks again to all of you for joining us. If anyone has questions for us, please feel free to reach out directly to our investor relations for the ACG Group. We are always available to speak to investors and look forward to speaking with you all during our next quarterly call. Thank you.
Thank you. This will conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.