Edu Holdings Limited · ASX:EDU
Edu — FY2021 Earnings Presentation
33 slides from Edu's earnings presentation, Feb 25, 2022
Slide 1: FY21 Financial Results
FY21 FINANCIAL RESULTS 31 DECEMBER 2021
Slide 2: Change of Financial Year-End
CHANGE OF FINANCIAL YEAR-END • Year-end changed to 31 • To provide more meaningful December to align with comparative information to academic calendar investors, FY21 referred to in this presentation is for the 12 • ‘Transitional financial year’ months ended 31 December reflects 6 months to 31 2021
Slide 3: Financial Summary
FINANCIAL SUMMARY Statutory result Pro-forma 12 months 12 months 6 months ended 12 months ended Group ended ended 31 Dec 2021 30 Jun 2021 31 Dec 2021 31 Dec 2020 Revenue $10.7m $23.4m $22.3m $24.6m Cost of sales ($5.2m) ($11.1m) ($10.9m) ($10.8m) Gross profit $5.5m $12.3m $11.4m $13.8m Operating exp
Slide 4: Key Financial Metrics
KEY FINANCIAL METRICS1,2 Year ended 31 December 2021 1 The Company’s financial year ends 31 December. 1H refers to the 1st half of the financial year, from 1 January to 30 June. 2H refers to the 2nd half of the financial year, from 1 July to 31 December 2 The financial results for 2H21 include $0.3m
Slide 5: FY21 Key Highlights
FY21 KEY HIGHLIGHTS1 Growth in Ikon New Ikon Resilience in Community COVID impact Balance sheet enrolments2 programs ALG enrolments Services to earnings intact gaining traction2 proportion growing mitigated 41.8% 59.0% $6.3m 89 Early Down 16.6%3 due Proactive cost Childhood to extended management, T
Slide 6: Group Overview
GROUP OVERVIEW MULTI-SECTOR HEALTH & EDUCATION QUALITY COMMUNITY EDUCATION, SERVICES FOCUS PROVIDER EXPERIENCE vocational and higher & OUTCOMES underpinned by strong education domestic employment ‘work-ready’ opportunities graduates GROWTH STRATEGY DIVERSIFIED CAMPUS & ONLINE STUDENT BASE organic an
Slide 7: Operating Business Units
OPERATING BUSINESS UNITS 12 months ended 12 months ended 12 months ended 12 months ended 31 Dec 2021 31 Dec 2020 31 Dec 2021 31 Dec 2020 Revenue: $16.3m $18.5m $6.0m4 $6.1m4 EBITDA: $2.9m $5.1m $0.4m $2.5m Education sector1: Vocational Higher Education Student market1: International (100%) Domestic
Slide 8: Strategy On Track
STRATEGY ON TRACK Short to medium-term Long-term • Build scale in Ikon VET Certificates • Expand course offering – • Position ALG to participate in recovery HE and VET Typical duration: 9 months Typical price: $7,000 • Accelerate program development in • Extend customer lifetime value both ALG and I
Slide 9: Operating Highlights
OPERATING HIGHLIGHTS
Slide 10: Student Enrolments
STUDENT ENROLMENTS1 ALG • FY21 enrolments down 16.6%2 on PCP, due to extended border closure • Community Services courses (with strong job and migration prospects) remain a ‘bright- spot’ – now 59.0% of total enrolments, declining only 6.3% on PCP • Return to growth expected in 2H22 - Australian bor
Slide 11: Student Profile
STUDENT PROFILE1 By Course By Location Average Duration (months)2 Product Geographic Sydney now Duration Ikon HE programs diversification diversification 40.4% extension delivering much of strategy underway strategy working strategy the growth down from peak - paying off, 3 or 4-year programs 56.4%
Slide 12: Foundations for Growth
FOUNDATIONS FOR GROWTH Training Rooms Course Offering Room Capacity – By City1 National campus 14 VET 8 HE programs including new Surplus capacity in all states to footprint optimised qualifications accommodate volume rebuilding, programs since 1H20, flexibility Underperforming accredited in 2020, d
Slide 13: Financial Results
FINANCIAL RESULTS
Slide 14: Key Highlights
KEY HIGHLIGHTS Revenue ($’000) Operating EBIT ($’000) 1 Operating scale achieved pre-pandemic FY20 benefited from government support, rent and other relief and cost initiatives FY21 impacted by lower student numbers (in ALG), costs returning Ikon 2021 enrolments to pre-pandemic levels and continued
Slide 15: Group Profit and Loss
GROUP PROFIT AND LOSS Financial Performance Impacted by Pandemic 6 months ended 12 months ended 12 months ended Group Variance Variance 31 Dec 2021 31 Dec 2021 31 Dec 2020 $'000 $'000 $'000 $'000 % Diversification across Gross margin ALG and Ikon VET and HE, domestic declined by 5.0% pts 10,715 Tota
Slide 16: ALG
ALG Community Services Programs Supporting Business In Challenging Market Conditions 6 months ended 12 months ended 12 months ended Total enrolments down Course delivery challenges ALG Variance Variance 16.6%, Community largely overcome – can now 31 Dec 2021 31 Dec 2021 31 Dec 2020 $'000 $'000 $'000
Slide 17: Ikon
IKON Investing 3-5 Years Ahead Enrolments up 18.3% scholarship pricing of Bachelor and Diploma of Early Significant Growth Opportunity new BECE program Childhood impacting Education launched average revenue Trimester 1 2021 - 89 6 months ended 12 months ended 12 months ended enrolments in Ikon Varia
Slide 18: Balance Sheet and Cashflow
BALANCE SHEET AND CASHFLOW Balance Sheet Intact Despite Pandemic 31 Dec 21 30 Jun 21 31 Dec 20 $'000 $'000 $'000 Cash & cash equivalents 6,275 7,818 7,686 • Cash balance relatively Trade & other receivables 293 1,412 550 stable with net cash down by $0.4m against PCP, including Goodwill 11,918 11,91
Slide 19: Debt Structure
DEBT STRUCTURE Gearing Improved, Net Cash Slightly Down on PCP Gearing 31 Dec-21 30 Jun-21 Variance 31 Dec-20 Variance $6.3m cash balance 31 December 2021 $'000 $'000 $'000 $'000 $'000 Acquisition facility 2,750 3,250 (500) 3,833 (1,083) Typical gearing and Bank guarantee facility 1,021 925 96 901 1
Slide 20: FY22 Priorities & Outlook
FY22 PRIORITIES & OUTLOOK
Slide 21: FY22 Priorities
FY22 PRIORITIES Student volume and Online capability - scale recruitment and delivery Governance, academic Program Disciplined quality and student development M&A activity experience 21
Slide 22: FY22 Outlook
FY22 OUTLOOK GROUP • ‘Green shoots’ emerging - new • Growth in student • EBITDA loss in FY22 – student commencements in numbers, unit enrolments growth in Ikon not fully Term 1, 2022 up 55.1% on prior and revenue continuing offsetting decline in ALG term • FY22 EBITDA leverage • Return to growth and
Slide 23: Appendices
APPENDICES
Slide 24: Group
GROUP Half on half analysis 6 months ended 6 months ended 6 months ended 6 months ended Variance Variance* Variance Variance* 31 Dec 2021 31 Dec 2020 30 Jun 2021 30 Jun 2020 $'000 $'000 $'000 % $'000 $'000 $'000 % ALG and Ikon Total revenue 10,715 11,822 (1,107) (9.4%) 11,608 12,789 (1,181) (9.2%) C
Slide 25: ALG
ALG Half on half analysis 6 months ended 6 months ended 6 months ended 6 months ended ALG Variance Variance* Variance Variance* 31 Dec 2021 31 Dec 2020 30 Jun 2021 30 Jun 2020 $'000 $'000 $'000 % $'000 $'000 $'000 % Revenue International student revenue 7,039 8,564 (1,525) (17.8%) 8,769 9,141 (372)
Slide 26: Ikon
IKON Half on half analysis 6 months ended 6 months ended 6 months ended 6 months ended Ikon Variance Variance* Variance Variance* 31 Dec 2021 31 Dec 2020 30 Jun 2021 30 Jun 2020 $'000 $'000 $'000 % $'000 $'000 $'000 % Revenue International student revenue 674 384 290 75.5% 327 399 (72) (18.0%) Domes
Slide 27: Capital Structure
CAPITAL STRUCTURE Meaningful Shareholder and Board Alignment Number % Diluted Ownership4 Ordinary shares 117,514,448 95.3% Performance rights1,2,3 5,800,000 4.7% Fully diluted 123,314,448 100.0% $’000 Market capitalisation - $0.16 per share4,5 18,802 Cash (6,275) Debt 2,750 1. 2,200,000 performance
Slide 28: Course Offering
COURSE OFFERING Health and Community Services Focus HE Courses – Ikon Typical Job Outcomes Arts Therapy Counselor or Art Therapist Counselling and Psychotherapy Counselor or Psychotherapist Early Childhood Education Early Childhood Teacher VET Courses – ALG Typical Job Outcomes Ageing Support Reside
Slide 29: ALG International Student Diversity
ALG INTERNATIONAL STUDENT DIVERSITY Immigration Risk Rating – Level 1 Diverse student base with low source country concentration risk Highly diverse student population with 35.5% 29.0% 26.6% 8.9% students from over Asia Latin Europe Other 70 source countries America Student enrolments by source coun
Slide 30: Executives and Directors
EXECUTIVES AND DIRECTORS Adam Davis, BAppFin (Macquarie University) Lyndon Catzel, BEc (Sydney University), CA Chief Executive Officer and Managing Director Chief Financial Officer and Company Secretary Adam has extensive experience in the education sector as founder and CEO of formerly Lyndon has o
Slide 31: Contacts
CONTACTS Adam Davis Lyndon Catzel Chief Executive Officer Chief Financial Officer E: adam@eduholdings.com.au E: lyndon@eduholdings.com.au P: +61 2 9112 4541 P: +61 2 9112 4540 M: 0408 400 888 M: 0414 907 384 31
Slide 32: Disclaimer
DISCLAIMER This presentation, dated 25 February 2022, 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 2021 for EDU Holdings Limited (EDU, EDU Ho
Slide 33: Holdings
L Holdings