Demand for quality education drives ADvTECH's great annual results
ADvTECH continues to grow, say annual results for the financial year ended December 2018.
ADvTECH announced their annual results for the year ended December 2018 today with a revenue increase of 11 percent to R4.4 billion and operating profit for the period increased by 14 percent to R725 million.
Commenting on the results ADvTECH CEO Roy Douglas said:
“Our tertiary and resourcing divisions continue to show excellent growth following the restructuring we undertook a few years ago. We are now focusing on the schools division and we are confident that the reorganisation and consolidation measures will ensure sustainable performance improvement. Our expansion into the rest of the continent has been exemplary with revenue from schools outside South Africa increasing 131%. While operating profit was impacted by the initial upfront investment in our Crawford International School in Kenya, we have been greatly rewarded as we surpassed our initial student target.”
The financial highlights included:
- Revenue up 11 percent to R4.4 billion
- Operating profit up 14 percent to R725 million
- Normalised EPS increased 8 percent to 81.1 cents
- Final dividend of 15 cents per share declared
Tertiary division continues to deliver strong growth:
- The tertiary division continued its trend of excellent growth with revenue up 10 percent to R1.7 billion, contributing 39 percent to group revenue.
- Operating profit rose 23 percent to R395 million off the back of operational leverage from strong volume growth that saw the operating margin improve from 21 percent to 23 percent.
- Since inception, The Independent Institute of Education (The IIE), South Africa’s largest “private university” has produced over 43 700 students with 71 percent of graduates finding employment within six months of graduating.
- Subject to the completion of the necessary regulatory approvals, the acquisition of Monash South Africa (MSA) is expected to be effective from April 2019. This will bring the tertiary qualification suite to 233 accredited courses and the higher education student complement to more than 40 000 students, cementing ADvTECH’s leadership position as South Africa’s largest private university/private higher education provider.
School division continues to grow in scale:
- Revenue grew 15 percent to R2.0 billion, contributing 46 percent to group revenue.
- The strong growth in revenue was achieved mainly as a result of acquisitions and good growth in the mid-fee sector.
- Enrolment numbers continued to increase despite the prolonged economic downturn and ongoing emigration, that was particularly felt by our South African schools.
- Our first greenfield expansion outside South Africa exceeded our expectations. Our Crawford International School in Kenya has received significant interest with our current enrolments being 189 and an already substantial enrolment list for the 2019/2020 academic year.
Commenting on the group’s prospects, Douglas said:
“The demand for quality education continues and the business is in a strong position to meet this demand as we continually identify opportunities both in South Africa and on the rest of the continent. Our tertiary and resourcing divisions are well positioned and continue to perform strongly. Having significantly increased the scale of our schools division over the past four years, we are focusing on the integration, consolidation and rationalisation of operations which we are confident will drive operational efficiencies and sharpen market focus.”