Edu Holdings Limited · ASX:EDU
Edu — H1 2021 Earnings Presentation
29 slides from Edu's earnings presentation, Feb 26, 2021
Slide 1: 1H21 Results
1H21 RESULTS AHEAD OF EXPECTATIONS RESPONSIVE DURING COVID-19 LONG-TERM STRATEGY INTACT
Slide 2: 1H21 Key Financial Metrics Exceeded Expectations
1H21 KEY FINANCIAL METRICS1,2 EXCEEDED EXPECTATIONS 1 The Company’s financial year ends 30 June. 1H refers to the 1st half of the financial year, from 1 July to 31 December. 2H refers to the 2nd half of the financial year, from 1 January to 30 June 2 Financial information presented in this results p
Slide 3: 1H21 Key Developments
1H21 KEY DEVELOPMENTS Student numbers New HE programs Responsive and up on PCP - including online resilient to COVID-19 Bachelor and Diploma of Early Early decisive action and cost Ikon students up 10.8%1 Childhood Education and management. Online capability ALG students up 1.5%2 online HE offer ens
Slide 4: Group Overview
GROUP OVERVIEW Multi-sector tertiary education provider – vocational and higher education Focused on Health and Community Services fields of study – underpinned by strong employment growth Diversified student base – international and domestic Online and campus-based delivery with national ca
Slide 5: Operating Business Units
OPERATING BUSINESS UNITS 1H21 1H20 1H21 1H20 Revenue: $8.9m $9.4m $3.0m $3.3m EBITDA: $2.1m $2.3m $1.3m $0.8m Education sector1: Vocational Higher Education Student market1: International (97%) Domestic (87%) Students enrolled2: 2,220 349 Student recruitment1: Education agents Direct Funding source1
Slide 6: Strategy on Track
STRATEGY ON TRACK Short-term Long-term Domestic and onshore international Expand course offering student focus, until borders re-open Extend customer lifetime value through Continued investment in academic quality pathways and packaging and student experience Increased focus on online deli
Slide 7: Operating Highlights
OPERATING HIGHLIGHTS UCW LIMITED 1H21 RESULTS | 7
Slide 8: Proposed Takeover of RedHill Education Limited
PROPOSED TAKEOVER OF REDHILL EDUCATION LIMITED Highly strategic merger opportunity to create leading tertiary education group Off-market takeover bid announced 14 December 2020 Short-term benefit – preserve cash through cost savings not available to either entity on stand-alone basis Long-te
Slide 9: Student Enrolments
STUDENT ENROLMENTS1 ALG 1H21 student enrolments up 1.5% on PCP National rollout of Community Services courses continued to support growth, up 19.1% on PCP, now 55.5% of total enrolments Despite the pandemic, ALG had record enrolments in Melbourne and Brisbane, offset by weakness in Sydney and
Slide 10: Student Profile
STUDENT PROFILE1 - Product diversification strategy working - Geographic diversification strategy - Duration extension strategy underway - Community services represents 62.1% paying off - Diplomas now 49.1% of ALG enrolments, with of total enrolments in 2Q21 (55.5% for - Sydney reached 57% at its pe
Slide 11: Building Foundations for Growth
BUILDING FOUNDATIONS FOR GROWTH 1 During the peak of the pandemic, the Company exited one of its leases in Melbourne, reducing the number of available rooms. Now that students are returning to face-to-face study in Melbourne, the Company signed a heads of agreement in February for a 12-month sub-lea
Slide 12: Financial Results
FINANCIAL RESULTS UCW LIMITED 1H21 RESULTS | 12
Slide 13: Key Highlights – Group Profit and Loss
KEY HIGHLIGHTS – GROUP PROFIT AND LOSS 1 Operating EBIT represents the earnings of UCW’s operating businesses (ALG and Ikon) before interest and tax. This excludes UCW corporate costs and one-off items 2 Venue costs have been added back in from 1H20 onwards to provide a more meaningul comparison (as
Slide 14: Group Profit and Loss Cont.
GROUP PROFIT AND LOSS CONT. RESILIENT FINANCIAL PERFORMANCE Strong growth in earnings - Underlying EBITDA of $2.9m, up 13.4.% 1H21 1H20 V a r i a nce Va r i a nce and NPAT before impairment of $0.5m, up 135.3% on PCP Gr o up $'000 $'000 $'000 % UCW benefitting from diversification across VET and
Slide 15: ALG
ALG COMMUNITY SERVICES PROGRAMS SUPPORTING BUSINESS IN CHALLENGING MARKET CONDITIONS 1H21 1H20 V a r i a nce Va r i a nce A LG $'000 $'000 $'000 % R e ve nue International student revenue 8,564 8,828 (264) (3.0%) Domestic and other revenue 335 583 (248) (42.5%) To ta l r e ve nue 8, 899 9, 411 (512)
Slide 16: Ikon
IKON HIGHER EDUCATION PROVIDING DIVERSIFICATION AND GROWTH 1H21 1H20 V a r i a nce Va r i a nce 1H21 earnings well ahead of PCP, supported by COVID-19 relief Ikon $'000 $'000 $'000 % Ongoing refinement of business - core HE revenue now 98% of total R e ve nue International student revenue 384 58
Slide 17: Balance Sheet and Cashflow
BALANCE SHEET AND CASHFLOW STRONG CASH GENERATION 31 De c- 20 30 Jun- 20 31 De c- 19 Cash balance strengthened to $7.7m at half-year end from $6.6m at 30 $'000 $'000 $'000 June 2020 Cash and cash equivalents 7,686 6,621 3,186 Operating cashflow1 steady at $2.6m (1H20: $2.7m) due to tight cost Tr
Slide 18: Debt Structure
DEBT STRUCTURE GEARING AND NET CASH IMPROVED - $5.3M IN LAST 12 MONTHS Ge a r i ng 31 De c- 20 30 Jun- 20 Va r i a nce 31 De c- 19 Va r i a nce $'000 $'000 $'000 $'000 $'000 Acquisition facility 3,833 4,167 (334) 4,500 (667) Bank guarantee facility 901 875 26 1,001 (100) To ta l gr o ss d e b t 4, 7
Slide 19: FY21 Priorities & Outlook
FY21 PRIORITIES & OUTLOOK UCW LIMITED 1H21 RESULTS | 19
Slide 20: FY21 Priorities
FY21 PRIORITIES RedHill takeover Academic quality and student experience Launch Bachelor and Diploma of Early Childhood Education and online HE offer Student retention Enhance capability in domestic student recruitment Further program development UCW LIMITED 1H21 RESULTS | 20
Slide 21: FY21 Outlook
FY21 OUTLOOK ALG Ikon Group Flat to slightly lower Growth in core HE student Net cashflow expected student enrolments numbers, unit enrolments to be positive for full until Australian border and revenue year1 reopens and Unwinding of COVID-19 Well positioned to international student suppor
Slide 22: Appendices
APPENDICES UCW LIMITED 1H21 RESULTS | 22
Slide 23: Capital Structure
CAPITAL STRUCTURE MEANINGFUL SHAREHOLDER AND BOARD ALIGNMENT Numbe r % Di l ute d Ordinary shares 117,514,448 95.1% 1 Options 800,000 0.6% 2,3 Performance rights 5,200,000 4.2% F ul l y di l ute d 123, 514, 448 100. 0% $'000 4 Market capitalisation at $0.195 per share 22,915 Cash 7,686 Debt (3,833)
Slide 24: Course Offering
COURSE OFFERING HEALTH AND COMMUNITY SERVICES FOCUS Health and Community Services HE courses - Ikon Typical job outcomes focus – underpinned by strong underlying employment growth Arts Therapy Counselor or art therapist 8 HE and 16 VET courses Counselling and Psychotherapy Counselor or psychothe
Slide 25: ALG International Student Diversity
ALG INTERNATIONAL STUDENT DIVERSITY DIVERSE STUDENT BASE WITH LOW CONCENTRATION RISK Student enrolments by source region1 Latin America, 30.1% Asia, 34.3% Europe, 26.8% Other, 8.8% Immigration Risk Rating – Level 1 Highly diverse student population with students from 75 source countries Student
Slide 26: Executives and Directors
EXECUTIVES AND DIRECTORS Adam Davis, BAppFin (Macquarie University) Gary Burg, BAcc (Wits), MBA (Wits) Chief Executive Officer and Managing Director Non-Executive Chair Adam has extensive experience in the education sector as founder and CEO of Gary has been involved with Global Capital Group since
Slide 27: Contacts
CONTACTS Adam Davis Lyndon Catzel Chief Executive Officer Chief Financial Officer E: adam@ucw.com.au E: lyndon@ucw.com.au P: +61 2 9112 4541 P: +61 2 9112 4540 M: 0408 400 888 M: 0414 907 384 UCW LIMITED 1H21 RESULTS | 27
Slide 28: Disclaimer
DISCLAIMER This presentation, dated 26 February 2021, provides additional commentary on the Financial Report for the half-year ended 31 December 2020 for UCW Limited (UCW or the Company) and accompanying information provided to ASX on the same date. As such, it should be read in conjunction with tho
Slide 29: Slide 29