Taaleem Holdings Pjsc · DFM:TAALEEM
Taaleem Holdings Pjsc — Q1 2024 Earnings Presentation
32 slides from Taaleem Holdings Pjsc's earnings presentation, Jan 16, 2024
Slide 1: Investor Presentation: 3-month period ended 30 November 2023
IN V ESTO R PR ESEN TA TIO N 3-month period ended 30 November 2023 TAALEEM HOLDINGS PJSC 1
Slide 2: Disclaimer
DISCLAIMER • These materials are the sole responsibility of Taaleem • Past performance is not indicative of future results. The • These materials are not intended for publication or Holdings PJSC, ‘Taaleem’ (the “Company”, the “Group”) Company is under no obligation to update or keep current distrib
Slide 3: Content
CONTENT 01 Executive Summary 02 Progressing the Execution of the Growth Strategy 03 Portfolio Update 04 Financial Highlights 05 FY 2023-24 Outlook 06 Closing Remarks 07 Glossary 3
Slide 4: 1. Executive Summary
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Slide 5: Executive Summary Q1 2024: Double-Digit Underlying Growth (Pre-Tax)
EXECUTIVE SUMMARY Q1 2024: DOUBLE-DIGIT UNDERLYING GROWTH (PRE-TAX) *Movement of KPIs & P&L pertains to Q3 22/23 vs Q3 21/22; however, Balance Sheet (Net Debt) pertains to Q3 22/23 vs FY ENROLMENT REVENUE EBITDA 21/22A NET PROFIT CAPEX* **EPS calculation: Q3 22/23 Net Profit / Weighted Average Share
Slide 6: Executive Summary Q1 2024: Strong Underlying Financial KPIs (Pre-Tax)
EXECUTIVE SUMMARY Q1 2024: STRONG UNDERLYING FINANCIAL KPIs (PRE-TAX) CAPACITY EBITDA MARGIN NET PROFIT MARGIN PROFIT PER STUDENT NET DEBT* UTILISATION EEEEE 87.5% 38.8% 31.5% AED 2.3K AED (493.2)M +3.9% +5.0% +9.6% +26.8% -23.9% Movement in metrics pertain to Q1 2024 vs Q1 2023, however, Balance Sh
Slide 7: Executive Summary Q1 2024: Corporate Tax P&L Impact (Post-Tax)
EXECUTIVE SUMMARY Q1 2024: CORPORATE TAX P&L IMPACT (POST-TAX) • Corporate tax applied from 1 September 2023 onwards • First payment to be made by May 2025 o The current effective tax rate is 8.9%, however it reflects the timing of expenses and recognition of revenue at this stage of the year NET PR
Slide 8: 2. Progressing the Execution of the Growth Strategy
2. PROGRESSING THE EXECUTION OF THE GROWTH STRATEGY 1 RAMP UP 2 EXPAND 3 OPTIMISE 4 SUSTAIN 8
Slide 9: Ramp Up: Growth in Enrolments
GROWTH IN ENROLMENTS FY23 JOINERS MIX +26.6% YoY 42.5% 19.8% 37.7% 35,715 26.6% 58.0% 28,490 28,218 RAMP UP 3x 39.6% 35.6% 39.4% 20,961 21,768 24.7% 15,778 15,674 2.6% 13,257 9,547 New Joiners from New Joiners from New Entrants 11,939 Dubai/AD Overseas reaching school age 3,273 4,174 12,712 12,544 1
Slide 10: Ramp Up: Closing the Capacity Gap in Existing Assets
PREMIUM SCHOOLS 16,856 16,856 16,856 16,856 Growth Growth -32.5% Potential 11,995 12,080 Potential 4,312 Capacity Gap 2,909 13,947 12,712 12,544 11,414 RAMP UP 8,666 9,083 FY20 FY21 FY22 FY23 Q1-23 Q1-24 Physical Cap acity Enrolment Seats Ava ilable CLOSING THE CAPACITY GAP IN EXISTING ASSETS GOVERN
Slide 11: Expand: Development of New Campuses
EXPANSION DEVELOPMENT OF NEW CAMPUSES GREENFIELD INTERNATIONAL SCHOOL 4 NEW GREENFIELD PROJECTS Opening on Sept 24 DBS JUMEIRA EXPAND GIS NEW BUILDING • Land lease signed in January 2022 • +20 classrooms to satisfy pent up demand • +1.9k student capacity • Additional capacity of c.500 students • The
Slide 12: Expand: M&A and Government Partnerships
M&A – ACTIVELY LOOKING FOR A VALUE- PROVEN ABILITY TO SCALE UP ACCRETIVE SCHOOL TO ACQUIRE GOVERNEMENT PARTNERSHIPS ‘Dubai Schools’ - 3 Schools managed EXPAND • Taaleem remains financially prudent and only value- accretive transactions that would fit well in the portfolio will • Schools at 96% capac
Slide 13: Sustain: Inspiring Young Minds for a Sustainable Future
INSPIRING YOUNG MINDS FOR A SUSTAINABLE FUTURE CORPORATE, SOCIAL AND ENVIRONMENTAL RESPONSIBILITY ESG PLAN Taaleem’s inaugural ESG report was delivered in October 2023 Work continues to develop the company's 5-year ESG policy, focusing at this stage on streamlining data collection, finalizing target
Slide 14: 3. Portfolio Update
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Slide 15: Premium Schools Q1-24
PREMIUM SCHOOLS Q1-24 10 SCHOOLS 13,947 STUDENTS (+11.2% vs Q1-23) 236M REVENUE IN AED (+10.7% vs Q1-23) 91.2% REVENUE CONTRIBUTION Portfolio Update 16
Slide 16: Double-Digit Growth of the Premium Schools Portfolio
DOUBLE-DIGIT GROWTH OF THE PREMIUM SCHOOLS PORTFOLIO ENROLMENT +11.2%, REVENUE +10.7% Number of Premium schools Enrolments Premium schools Revenue AED'M 13,947 12,712 12,544 10 10 10 10 11,414 236.0 213.2 8,666 9,083 +11.2% +10.7% 9 9 Q1-23 Q1-24 Revenu e FY20 FY21 FY22 FY23 Q1-23 Q1-24 FY20 FY21 FY
Slide 17: Premium Schools: Higher Utilisation and Growing Profitability per Student
PREMIUM SCHOOLS – HIGHER UTILISATION OF THE ASSETS AND GROWING PROFITABILITY PER STUDENT RISKCC JAS DBS 47.2% 94.6% 101.8% Average Utilization Rate 82.7%, up +8.3% from 74.4% in Q1-23 DBSJP RISGC 108.1% 98.5% • UK cluster has the highest capacity utilization of 100.8% up +7.7% from 93.1% in Q1-23 DB
Slide 18: Premium Schools Results & Inspection Updates
PREMIUM SCHOOLS RESULTS & INSPECTION UPDATES SCHOOL AWARDS TOP SCHOOLS AWARDS • DBS-JP “Best School for Theatre, Dance and Performing Arts” from Schools Compared EDUCATION EXCELLENCE AWARDS • AAG – Teaching Assistant of the Year • DBS JP – Foundation Stage Team of the Year • UIS – Arabic Teacher of
Slide 19: Government Partnerships Q1-24
GOVERNMENT PARTNERSHIPS Q1-24 21 SCHOOLS 21,768 STUDENTS (+38.9% vs Q1-23) 22.7M REVENUE IN AED (+21.2% vs Q1-23 ) 8.8% REVENUE CONTRIBUTION Portfolio Update 20
Slide 20: Scaling Up Government Partnerships
SCALING UP GOVERNMENT PARTNERSHIPS NUMBER OF SCHOOLS ENROLMENT 21 +38.9% 16 16 21,768 8 4 4 15,778 15,674 5,318 8 3 3 3 2,388 2,402 2,576 4 4 2 9,547 9 9 10 1,966 1,968 6 3,273 4,174 1,213 13,874 4 4 8,334 11,424 11,304 FY20 FY21 FY22 FY23 Q1-23 Q1-24 3,273 4,174 FY20 FY21 FY22 FY23 Q1-23 Q1-24 Abu
Slide 21: 4. Financial Highlights
4. FINANCIAL HIGHLIGHTS 22
Slide 22: Statutory Results Summary Q1-23 vs Q1-24
STATUTORY RESULTS SUMMARY Q1-23 vs Q1-24 AED M Q1-23 Q1-24 Variance % Enrolment # 28,218 35,715 7,497 26.6% Operating Revenue 231.9 258.7 26.7 11.5% STRONG MOMENTUM AND EXPANSION OF MARGINS Non-operating Revenue 1.6 6.9 5.2 323.2% Total Revenue 233.6 265.5 32.0 13.7% • Revenue growing faster than ex
Slide 23: Statutory Consolidated Balance Sheet: Strong Position to Execute Strategy
STATUTORY CONSOLIDATED BALANCE SHEET: STRONG POSITION TO EXECUTE STRATEGY AED M FY23 Q1-24 Movement % Property and equipment 1,168.9 1,188.7 19.8 1.7% Investment in property and finance lease 14.5 14.1 (0.4) -2.7% Right of use assets on lease (IFRS 16) 211.4 207.6 (3.9) -1.8% Goodwill & other intang
Slide 24: Movement in Cash, Net Debt and Free Cash Flow to Firm
MOVEMENT IN CASH (excludes restricted cash for managing Charter Schools) 143.6 13.0 (5.0) 200.3 194.2 Net cash reduction following payment of (1.6) (110.0) (11.5) dividend and deployment of capital (34.6) expenditure 3 sh es s id t 23 Y2 . ar ng pa os v- F Ca ap & h wi ec o sh g C its nS ro en d c h
Slide 25: Capex Breakdown: Pursuing the Execution of the Strategy
CAPEX BREAKDOWN: PURSUING THE EXECUTION OF THE STRATEGY CAPITAL EXPENDITURE1 • Maintenance capital expenditure has historically ranged from AED Maintenance Capex (% of revenue) 12M – AED 27M (2.3% - 3.4% of revenues) on a full year basis 3.3% • Expansion capital expenditure in FY21 pertained to RIS
Slide 26: 5. Outlook 2023-2024
5. OUTLOOK 2023-2024 27
Slide 27: Outlook 2023-24: Further Growth Expected Based on a Strong Start
OUTLOOK 2023-24 – FURTHER GROWTH EXPECTED BASED ON A STRONG START REVENUE GROWTH EBITDA MARGIN • Expected to grow at solid double-digit pace • Expected to expand by c. 200 basis • Positive enrolment at outset of academic year points CAPEX NET LEVERAGE • activity , revenue up, EBITDA up, Net Profit u
Slide 28: 6. Closing Remarks
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Slide 29: Closing Remarks: Strong Q1-24 Performance Expected to Continue
CLOSING REMARKS: STRONG Q1-24 PERFORMANCE EXPECTED TO CONTINUE 04 ESG Growing further social and environmental responsibility of Taaleem ACTIVE EXECUTION OF STRATEGY 03 Sustained activity, revenue up, EBITDA up, • F uNet • r t h e r Profit Perfectly equipped to drive further growth with greenfield p
Slide 30: Taaleem
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Slide 31: Contact Us
CONTACT US NORA GHANNAM SENIOR MANAGER INVESTOR RELATIONS NGhannam@taaleem.ae ir@taaleem.ae MOB: 050 114 2365 IR WEBSITE IR CALENDAR 32
Slide 32: Glossary
GLOSSARY : Management Information: books of accounts, admissions enrolment reports, HR headcount reports Revenue: Operating revenue as per IFRS reporting definition Free Cash Flow to Firm: operating cashflow - lease cash rent - maintenance capex P/E Ratio: Market price / EPS or where market price is
Taaleem Holdings PJSC — Q1 2024 Earnings Presentation on 6ix