Edu Holdings Limited · ASX:EDU
Edu — FY2023 Earnings Presentation
35 slides from Edu's earnings presentation, Feb 27, 2024
Slide 1: FY23 Results Presentation
CAREER-READY QUALIFICATIONS IN HEALTHCARE, EDUCATION & COMMUNITY SERVICES OCCUPATIONS FY23 RESULTS PRESENTATION
Slide 2: Contents
CONTENTS 01 02 03 04 05 06 FY23 Financial Business Unit Capital & Debt Priorities & Appendices Highlights Results Performance Structure Outlook Pg. 5 Pg. 12 Pg. 17 Pg. 22 Pg. 25 Pg. 28
Slide 3: Snapshot
SNAPSHOT EDU HOLDINGS LIMTED ACN 108 962 152 COMPANY OVERVIEW 2 tertiary education providers: $21.6m 94 7 FY23 Revenue 1 Permanent Campuses + Online Team Members NSW, VIC, QLD, SA $3.1m 2,100 21 Higher Education Vocational Education Cash at 31-Dec-23 Students at year-end2 Courses Certificates, Diplo
Slide 4: Healthcare, education and community services specialist - qualifications aligned to long-term skills shortages
HEALTHCARE, EDUCATION AND COMMUNITY SERVICES SPECIALIST - QUALIFICATIONS ALIGNED TO LONG-TERM SKILLS SHORTAGES Large and growing Occupations with critical Pathways to skilled employing industry skills shortages migration Healthcare and Social EDU qualifies students in 3 of EDU qualifications lead to
Slide 5: FY23 Highlights
01 FY23 HIGHLIGHTS 5
Slide 6: Operational Highlights
OPERATIONAL HIGHLIGHTS Higher Earnings Vocational (ALG) Material education (Ikon) leverage in Ikon enrolments latent capacity enrolments1 delivered rebuilding remains up 44% FY23 net profit after tax T4’23 enrolments up To deliver further up $1.2m on $3.7m 9% on PCP operating leverage as additional
Slide 7: Financial & Student Metrics
FINANCIAL & STUDENT METRICS FINANCIALS STUDENT METRICS FY23 vs FY22 FY23 vs FY22 Revenue1 $21.6m $17.7m Letters of Offer 3,172 2,732 $0.5m ($1.5m) 1,462 1,036 New Student EBITDA2 Enrolments (NSEs) Net loss after tax ($3.0m) ($4.8m) Enrolments3 6,807 6,463 1 Revenue includes $0.3m of rental income on
Slide 8: HE (Ikon) Momentum Continuing
HE (IKON) MOMENTUM CONTINUING Ikon now firmly established in international student market - leveraging EDU’s 3-year enrolment CAGR of 32% substantial agent network Mark Falvo joins EDU Former Senior Vice President International, Torrens University, appointed GM, Future Students to lead sales, market
Slide 9: Positive Trend in VET (ALG) NSEs
POSITIVE TREND IN VET (ALG) NSEs NSEs up 41% on PCP (LTM to T4’23) Leading indicator up 41% • Bodes well for 2024 4 consecutive terms of enrolment growth • Smaller cohorts of graduating students being replaced with larger commencing cohorts • 24-month average study duration means students that comme
Slide 10: Program Strategy Delivering
PROGRAM STRATEGY DELIVERING Higher value Longer study Alignment to Expansion of Leverage online courses duration skills shortages course portfolio delivery 55% of Group revenue 28 months in FY23 vs 22 83% of 2023 enrolments 21 courses in 2023 Online enrolments3 up was HE vs 11% in FY18 months in FY1
Slide 11: Latent Capacity Remains National Campus Footprint
LATENT CAPACITY REMAINS NATIONAL CAMPUS FOOTPRINT Further operating leverage to emerge 7 campus locations across 4 states + Online 49 Classrooms 2,302 sqm space in Sydney operating at 58% capacity IKON & ALG BRISBANE CAMPUS IKON & ALG MELBOURNE CAMPUS 1,918 sqm space in Melbourne operating at 65% ca
Slide 12: Financial Results
02 FINANCIAL RESULTS 12
Slide 13: Revenue and Earnings Improving
REVENUE AND EARNINGS IMPROVING Consolidated Profit & Loss Statement FY23 FY22 Variance Variance $'000 $'000 $'000 % ALG and Ikon Total revenue and other income 21,559 17,667 3,892 22% Cost of sales (10,176) (8,562) (1,614) (19%) Group revenue up 22% - Ikon up Gross profit 11,383 9,105 2,278 25% Gros
Slide 14: EBITDA Bridge ($'000)
EBITDA BRIDGE ($’000) Operating leverage emerging With relatively flat operating costs, $2.3m gross profit growth delivered $2.0m improvement in EBITDA 14
Slide 15: Cash Impacted by Operating Loss & Investment
CASH IMPACTED BY OPERATING LOSS & INVESTMENT Consolidated Balance Sheet As at 31-Dec-23 31-Dec-22 Variance $'000 $'000 $'000 Cash draw due to operating loss Cash and cash equivalents 3,121 6,075 (2,954) and investment in product Trade and other receivables 304 1,229 (925) development (intangibles) G
Slide 16: Cash Flow Bridge ($'000)
CASH FLOW BRIDGE ($’000) Operating cash inflows of $1.1m, up $3.0m against outflows of $1.9m in PCP CBA market rate loan principal payments recommenced in November 2023 at $250k per quarter Cash balance of $5.3m at 31 January 2024 16
Slide 17: Business Unit Performance
03 BUSINESS UNIT PERFORMANCE 17
Slide 18: Business Unit Performance
BUSINESS UNIT PERFORMANCE FY23 FY22 FY23 FY22 All metrics moving in right direction Revenue1 $11.6m $7.9m $10.0m $9.8m Strong start to 2024 - growth in EBITDA $2.1m $0.5m ($44k) ($419k) Ikon and ALG continuing Students at year- end2 955 645 1,145 1,051 NSEs3 555 393 907 643 1 Includes other income 2
Slide 19: Enrolments
ENROLMENTS Student and unit enrolments Enrolments and NSEs 3-year enrolment CAGR of 32% Ikon now firmly Continued shift to Continued strength in ALG NSEs and established in the Online for Ikon domestic Early Childhood enrolments trending up international student enrolments – 56% in Education – in bo
Slide 20: Momentum in Ikon
MOMENTUM IN IKON Ikon Profit & Loss Statement FY23 FY22 Variance Variance $'000 $'000 $'000 % Revenue Revenue up 47% due to ongoing International student revenue 5,491 2,259 3,232 143% Domestic student and other income 6,105 5,626 479 9% growth in international and Total revenue and other income 11,
Slide 21: ALG Improving
ALG IMPROVING ALG Profit & Loss Statement FY23 FY22 Variance Variance $'000 $'000 $'000 % Revenue Revenue flat with slight decline in International student revenue 9,587 9,732 (145) (1%) Domestic student and other income 376 50 326 652% enrolments offset by annual price Total revenue and other incom
Slide 22: Capital & Debt Structure
04 CAPITAL & DEBT STRUCTURE 22
Slide 23: Capital Structure
CAPITAL STRUCTURE Supportive institutional investors alongside meaningful Board and Management holdings ISSUED CAPITAL & ENTERPRISE VALUE1 SHAREHOLDERS1 Number % Diluted Ordinary shares 165,214,443 97.6% Performance rights 4,066,197 2.4% 18% Board & Management Fully diluted 169,280,460 100.0% Instit
Slide 24: Cash and Debt
CASH AND DEBT Gearing 31-Dec-23 31 Dec-22 Variance $'000 $'000 % Cash and cash equivalents 3,121 6,075 (49%) $5.3m $2.0m Market rate loan (2,000) (2,250) (11%) Cash at 31 Jan 24 Market rate loan Net cash 1,121 3,825 (71%) Gearing ratio 31-Dec-23 31 Dec-22 Variance Gearing ratio – debt1 16% 15% 1% Ge
Slide 25: Priorities & Outlook
05 PRIORITIES & OUTLOOK 25
Slide 26: Current Priorities
CURRENT PRIORITIES Student volume Boost sales and Product development Integration of HE and growth admissions capability Program underway to VET operations Several strong new hires, materially expand EDU’s To drive productivity, cultural more to follow. course offering and efficiency gains Building
Slide 27: FY24 Outlook and Guidance
FY24 OUTLOOK AND GUIDANCE Enrolments and revenue up NSE and enrolment growth to NSE and enrolment growth to sharply continue continue at modest pace Further operating leverage to Commensurate revenue and Positive and growing EBITDA emerge earnings growth ‘Watch and see’ approach to Continued investm
Slide 28: Appendices
06 APPENDICES 28
Slide 29: Deep Education Sector & Corporate Experience Aligned Through Significant Equity Interest
DEEP EDUCATION SECTOR & CORPORATE EXPERIENCE ALIGNED THROUGH SIGNIFICANT EQUITY INTEREST EXECUTIVE MANAGEMENT BUSINESS UNIT LEADERSHIP ADAM LYNDON RYAN DR EHSAN MARK DAVIS CATZEL LAWSON AHMED FALVO Chief Executive Officer Chief Financial Officer General Manager, Executive Dean, General Manager, & Ma
Slide 30: Global Recruitment Network
GLOBAL RECRUITMENT NETWORK Diverse student & agent mix 280 active education agents 80 source markets 2 business units 7 campus locations across 4 states + Online Student enrolments1 by source country (Top 20)2 43.3% 29.4% 16.6% 10.7% Asia Other Latin Europe Ikon and ALG international student enrolme
Slide 31: Group Half on Half Analysis
GROUP Half on Half Analysis Group 2H23 1H23 Variance 2H22 1H22 Variance $'000 $'000 % $'000 $'000 % ALG and Ikon Total revenue and other income 11,307 10,252 10% 8,786 8,881 (1%) Cost of sales (5,473) (4,703) (16%) (4,000) (4,562) 12% Gross profit 5,834 5,549 5% 4,786 4,319 11% Gross margin (%)* 52%
Slide 32: Ikon Half on Half Analysis
IKON Half on Half Analysis Ikon 2H23 1H23 Variance 2H22 1H22 Variance $'000 $'000 % $'000 $'000 % Revenue International student revenue 3,216 2,275 41% 1,332 927 44% Domestic student and other revenue 2,832 3,273 (13%) 2,969 2,657 12% Total revenue and other income 6,048 5,548 9% 4,301 3,584 20% Cos
Slide 33: ALG Half on Half Analysis
ALG Half on Half Analysis ALG 2H23 1H23 Variance 2H22 1H22 Variance $'000 $'000 % $'000 $'000 % Revenue International student revenue 5,072 4,515 12% 4,431 5,301 (16%) Domestic student and other revenue 187 189 (1%) 54 (4) n/a Total revenue and other income 5,259 4,704 12% 4,485 5,297 (15%) Cost of
Slide 34: Disclaimer
DISCLAIMER This presentation, dated 27 February 2024, provides additional While all reasonable care has been taken in relation to the commentary on the Annual Report for the period ended 31 December preparation of this presentation, none of the Company, its 2023 for EDU Holdings Limited (EDU, EDU Ho
Slide 35: Contact
CONTACT Adam Davis, CEO E: adam.davis@eduholdings.com.au P: 1300 254 000 M: +61 408 400 888 Lyndon Catzel, CFO E: lyndon.catzel@eduholdings.com.au P: 1300 254 000 M: +61 414 907 384 35