G8 Education Limited · ASX:GEM
G8 Education — Investor Presentation (December 2020)
18 slides from G8 Education's investor presentation, Dec 8, 2020
Slide 1: Trading Update & Employee Payments Remediation Program
TRADING UPDATE & EMPLOYEE PAYMENTS REMEDIATION PROGRAM Investor Presentation 8 December 2020 1
Slide 2: Disclaimer
DISCLAIMER The material in this presentation has been prepared by G8 Education Limited (G8) and is general background information about G8’s activities current as at the date of this presentation. The presentation does not purport to be complete and should be read in conjunction with G8’s other peri
Slide 3: Agenda
AGENDA G8 EDUCATION LIMITED ASX: GEM Gary Carroll (CEO) and Sharyn Williams (CFO) TRADING UPDATE NEAR TERM STRATEGIC PRIORITIES & OUTLOOK Q&A APPENDIX 3
Slide 4: Executive Summary
EXECUTIVE SUMMARY • Occupancy and attendance is recovering well with current LFL occupancy of 75.5% • Revenue and costs have been underpinned by government support. This coupled with good cost management Trading allowed increased investment in R&M and resources in Q4 YTD (30 November 2020) underlyin
Slide 5: Trading Update
TRADING UPDATE
Slide 6: Trading Update
TRADING UPDATE Pre-AASB16, unaudited financials Financials Capex • YTD underlying EBIT1 of $98m • CY20 capex of circa $31m • Current LFL occupancy2 of 75.5%, 4.5%pts below prior year Debt Facilities • Revenue and costs underpinned by government support, allowing increased investment in R&M ($7.4m) a
Slide 7: Occupancy Trends
OCCUPANCY TRENDS Seasonal growth trend reinstated Monthly Like-for-Like Occupancy (%) • Occupancy recovering well, reducing the gap on prior year by around 5.5%pts from the April low • Occupancy has continued to grow even after parent co-payments returned • COVID disrupted the usual seasonal uplift
Slide 8: Attendance Trends
ATTENDANCE TRENDS Closely correlated to COVID case numbers Booked weekly occupancy, attendance (%) and reported Booked weekly occupancy, attendance (%) and reported new COVID cases – National excluding Victoria new COVID cases – Victoria Only • Gap between occupancy and attendances has normalised •
Slide 9: Wage Efficiency
WAGE EFFICIENCY Effective rostering reflected in improved efficiency • Expected rostering benefits captured during CY20 Wage hours per booking by fortnight - Efficiency improvements reflected in lower wage hours per booking in CY20 relative to the same occupancy level in CY19 (refer to 74% occupancy
Slide 10: Employee Payments Remediation Program
EMPLOYEE PAYMENTS REMEDIATION PROGRAM • Our team is critically important to providing the best learning foundations for our children and support for our families • A proactive review of award and legislative requirements was undertaken as part of new rostering system implementation • Inadvertent non
Slide 11: Near Term Strategic Priorities & Outlook
NEAR TERM STRATEGIC PRIORITIES & OUTLOOK
Slide 12: Near Term Strategic Priorities
NEAR TERM STRATEGIC PRIORITIES • Pilot group rollout on track with • Continuing 2020 improvement initial pilot utilising end to end program covering 100 centres New processes • 2019 pilot centres tracking in line with Improvement expectations in terms of occupancy Rostering • Second larger pilot gro
Slide 13: Outlook
OUTLOOK • The Group expects CY21 to be a recovery year given the absence of additional government subsidies and the continued impact of COVID-19, particularly on occupancy - either directly through movement restrictions or indirectly through economic impacts such as higher unemployment • Lower occup
Slide 14: Q&A
Q&A
Slide 15: Appendix
APPENDIX
Slide 16: Supply / Demand Dynamics
SUPPLY / DEMAND DYNAMICS New centre opening increase, offsetting H1 reduced growth Macro • LDC net supply annualised growth increased to 3.8% (vs 3.7% in Supply – Net New Centre Openings2 CY19), the decrease in net new centres in Q2 offset in Q3 • Unemployment levels have decreased from 7.5% to 7.0%
Slide 17: Government Support
GOVERNMENT SUPPORT Strong support keeps sector viable and retains employees Phase 1 Phase 2 Victorian Phase 3 Lockdown (6 Apr to 12 July) (13 Jul – 27 Sep) (13 July – 31 Dec) (28 Sep – 31 Jan) Relief Package Transition Package Transition Payment Plus Recovery Package - Victoria • Revenue capped at 5
Slide 18: COVID-19 Financial Impacts
COVID-19 FINANCIAL IMPACTS Subsidies and financial management • Phase 1 - Early Childhood Education & Care Relief Package revenue - $100.8m CY20 Revenue • Phase 2 and 3 - Transition Payment revenue - $59.5m expected in CY20 ($5.3m expected in CY21) • Optimised rostering to take account of changing a