Acquisitions boost Stadio’s earnings


Acquisitions boost Stadio’s earnings


Published Date: 2018-09-04 | Source: Stephen Gunnion | Author: Stephen Gunnion

Acquisitions boost Stadio’s earnings

The tertiary education group has warned that costs in the second half of the year are likely to be higher as it prepares for next year's intake

Stadio spent R417 million in the first half of its financial year, buying 100% of fashion design school Lisof, an 87% stake in Milpark Business School and education services business CA Connect. It spent another R36 million expanding its facilities and developing new programmes. With no gearing and R304 million in the bank, it says it's looking for future acquisitions and is in talks with some potential targets.

The tertiary education group grew contact learning students by 16% compared to the 2017 first semester intake while distance learning students rose by 9% over the same period. This lifted total enrolments by 10% to 27 777. With its second semester enrolment still in progress, numbers have increased further. It's longer-term goal is for 100 000 students.

While acquisitions boosted its half-year earnings, it said organic growth assisted too. It grew student numbers at the existing Embury Institute for Higher Education campus in Musgrave; through the opening of the 2 new Embury campuses in Montana and Waterfall; and through the consolidation of acquired institutions including South African School of Motion Picture Medium and Live Performance, Southern Business School, LISOF and Milpark.

Revenue for the period jumped 795% to R297 million and earnings before interest, tax, depreciation and amortisation increased to R60 million from a R1 million loss last year. Headline earnings per share rose to 3.5c from -0.8c, while core headline earnings per share came in at 4c for the six months, up from -0.7c. It said given the timing of expenses as well as the expenses it will still incur to meet next year's operational requirements, second-half costs will be higher so shareholders shouldn't expect the same degree of earnings growth.

It says it's on course to meet its prelisting statement targets for the full financial year.

Its shares closed 6.4% higher at R4.67.


Similar Stories