Idp Education Ltd. · ASX:IEL
Idp Education — Investor Presentation (February 2024)
26 slides from Idp Education's investor presentation, Feb 14, 2024
Slide 1: IDP Education H1 FY24 Results Presentation
IDP Education H1 FY24 Results Presentation
Slide 2: Important notice and disclaimer
Important notice and disclaimer Disclaimer Non-IFRS Financial Information The material in this presentation has been prepared by IDP IDP Education uses certain measures to manage and report on Education Limited (ASX: IEL) ABN 59 117 676 463 (“IDP Education") its business that are not recognised unde
Slide 3: Agenda
Agenda 1 Business Update 2 Financial Results 3 Industry & Strategy 4 Summary
Slide 4: Business Update
1 Business Update
Slide 5: Strong performance highlights the quality of diversified business model
Strong performance highlights the quality of diversified business model Strong financial Revenue EBIT (Adjusted)* NPAT (Adjusted)* Interim Dividend performance highlights the quality of IDP’s diversified $579m $159m $107m 25cps business model Our global scale and unique offering means we are the Up
Slide 6: Financial Results
2 Financial Results
Slide 7: 25% increase in adjusted EBIT driven by 15% revenue increase and rising margins
25% increase in adjusted EBIT driven by 15% revenue increase and rising margins Income statement summary Constant Total revenue up 15% with growth driven by student placement volumes, and price Half Year Actuals Growth Currency increases across all products and services Six Months to 31 December H1
Slide 8: Strong growth in student placement volumes and average price
Strong growth in student placement volumes and average price Key operational metrics Constant Student Placement Volumes Half Year Actuals Growth Currency • Strong 33% volume growth for Australia from diversified source markets Six Months to 31 December H1 FY24 H1 FY23 ‘000s / $ % Growth (%)*** with
Slide 9: Student placement volumes significantly outperforming the market
Student placement volumes significantly outperforming the market IDP student placement volume growth v industry growth* CY23* v PCP H1 FY24* v PCP IDP Student Placement Total +41% IDP Total +33% Industry Total +15% Industry Australia Canada UK USA Australia Canada UK USA Total -3% Industry IDP Indus
Slide 10: Our focus on quality is evidenced by our superior visa approval rates
Our focus on quality is evidenced by our superior visa approval rates Average Student Visa Approval Rates (H1 FY24)* • Our outperformance and rising market share is being driven by: o Strategic and operational focus on quality Australia Canada o A direct to student model with highly trained counsell
Slide 11: IELTS volumes impacted by weaker market conditions in India
IELTS volumes impacted by weaker market conditions in India, partially offset by continued growth in the rest of the world India Market Indian IELTS v Indian study visa applications for Australia, UK & Canada • A cyclical decline against a long-term structurally growing market Indian study visa appl
Slide 12: Cost growth below revenue growth driving margin expansion
Cost growth below revenue growth driving margin expansion Cost Summary Constant Direct Costs Half Year Actuals Growth • Student placement costs growing in line with revenue for stable gross profit margin Currency Six Months to 31 December H1 FY24 H1 FY23 $m % Growth (%)* • Increase in fee paid to Ca
Slide 13: Rising margins reflect underlying operating leverage
Rising margins reflect underlying operating leverage Gross Profit Margins EBIT (Adjusted) and NPAT (Adjusted) Margins* H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H1 H1 H1 H2 H1 H2 H2 H2 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY18 FY19 FY20 FY21 FY22 FY23 FY24 IELTS Student Placement Total EBI
Slide 14: Strong balance sheet with $142m of cash and $143m of net debt
Strong balance sheet with $142m of cash and $143m of net debt as at 31 Dec 2023 Summary balance sheet Cash & Debt As at 31 Dec emb er 2023, A$ mil l ion 31-Dec -23 30-Jun-23 Change • Cash and cash equivalents plus short-term investments (a 6-month term deposit) total $142m and drawn debt of $285m de
Slide 15: Industry & Strategy
Industry & 2 Strategy
Slide 16: Unchanged long-term macro drivers delivering structural growth of 7% CAGR
Unchanged long-term macro drivers that have delivered consistent through-the-cycle structural growth of 7% CAGR for over 20 years Positive long-dated structural growth drivers Outbound Internationally mobile students (all countries)* • Large and growing youth population in markets where higher educa
Slide 17: A more restrictive policy environment will increase focus on quality and conversion
A more restrictive policy environment will increase the sector’s focus to quality and conversion Australia UK Canada USA • Tightening of visa rules to • Dependents not eligible • Temporary cap on new • No change in policy settings discourage “non-genuine” for visa unless student in international stu
Slide 18: We have a unique portfolio of services that will drive market share gains
We have a unique portfolio of services that will drive market share gains IDP’s student placement volumes versus market size* A unique portfolio of client services to support the end-to-end recruitment needs of institutions and drive market share gains Strategic Planning Strategic Data Insights Cons
Slide 19: Our student placement strategy is delivering a differentiated customer experience
Our student placement strategy is delivering a differentiated customer experience powered by human connection and enhanced by technology Unmatched Building Differentiated Driving Physical Unique Customer Productivity & Digital Scale Data Assets Experiences Student Placement A global omni channel Ext
Slide 20: Our IELTS strategy leveraging trusted brand, distribution and product innovation
Our IELTS strategy is leveraging our trusted brand, extensive physical and digital distribution, and product innovation to enhance our leading position Unmatched The Most A Scalable Customer Centric Physical Recognised, and Flexible English Language Testing Product Innovation & Digital Scale Trusted
Slide 21: Summary
4 Summary
Slide 22: Well positioned to create significant long-term shareholder value
Well positioned to create significant long-term shareholder value Strong Financial Performance Diversification Financial Strength A record interim result for H1 FY24 A diversified business across A financial profile that features with ongoing revenue growth and business lines and geographies strong
Slide 23: Appendices
ices Appendi 5
Slide 24: Earnings Adjustments
Earnings Adjustments EBIT and NPAT Adjustments H1 FY24 H1 FY23 Growth (Adjusted) Adjustments Adjustments Reported Adjusted Reported Adjusted Unrealised FX Intangible Credit Loss Unrealised FX Intangible Credit Loss Six Months to 31 December M&A Costs M&A Costs $m % Losses Amortisation Provision Loss
Slide 25: Cashflow following normal seasonal pattern
Cashflow following normal seasonal pattern Summary of cashflows H al f Y ear Ac tual s Grow th • GOCF* of $80m reflects conversion from reported EBITDA of 46% which is higher than the 37% reported in H1 FY23 Six Months to 31 Dec emb er H 1 F Y 24 H 1 F Y 23 $m % EBIT DA 173. 3 144. 0 29. 3 20% • The
Slide 26: Segmental Earnings
Segmental Earnings Revenue and EBIT by Geographic Segment • IDP manages its business on a geographic basis. Country and regional Half Year Actuals Growth management are responsible for all activities in their geographic region across each of the company’s key products Six Months to 31 December H1 FY
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