Listed private school and university group AdvTech has reported resilient growth in earnings and profit for the full year ended December 2020, despite a strained year operating education facilities during the Covid-19 pandemic.
The group reported revenue up 8% to R5.5 billion, while EBITDA was up 7% to R1.26 billion from R1.17 billion the year prior.
Operating profit improved 5% to R910 million (2019: R869 million) and normalised earnings per share increased by 5% to 89.8 cents. The group declared a final dividend of 20 cents.
AdvTech attributed its satisfactory performance to a quick pivot to online learning within weeks of the Covid-19 lockdown, as well as operating robust distance learning platforms to facilitate this.
However, financial stress on parents, as well as a general move away from pre-primary education during the year did lead to some student withdrawals.
School revenue was up 4%, and operating profit up 7%, the group said.
Fee collection was slightly short of targeted levels, but improved in the second half of the year – and capital expenditure focused on increasing capacity on sites to meet demand and enhancing equipment to assist in the delivery of online and hybrid solutions.
AdvTech opened its Evolve Online School at the start of 2021, offering an MIT developed programme where students are placed within subjects according to their abilities. The programme has enrolled 447 students already.
It said that the Evolve school complemented its pivot to online learning during the pandemic and various levels of lockdown, where there was a “seamless move to an online environment”.
Despite the push to online learning, however, the group said it has experienced some student withdrawals at its other schools – mainly due to financial reasons.
The greatest number of withdrawals and temporary withdrawals were experienced at Pre-Primary level, however, where more supervision is required for online or hybrid learning. This reflects a similar trend seen with Curro, where it was also forced to move away from nursery schools.
Even with these losses, though, AdvTech noted an increase in enrolments at some institutions, with overall enrolments for 2021 up by 4% to 27,334, from 26,393 the year before.
“We experienced encouraging growth in all three of our school campuses opened in January 2020: Pinnacle Linden (mid-fee); Pinnacle Waterfall (mid-fee); and Trinityhouse Glenvista (premium-fee),” it said.
Two underperforming premium-fee school campuses, Trinityhouse North-Riding and Trinityhouse Palm Lakes, were closed, affecting approximately 200 students.
“Where possible, these students and employees were absorbed into our nearby schools. The Abbotts College fee reduction pilot programme in Centurion continued to work well and has been rolled out to other Abbotts Colleges in 2021,” it said.
AdvTech said that the socio- and macro-economic environment is expected to remain subdued in South Africa , with a persisting level of uncertainty due to the ongoing Covid-19 pandemic.
As a result, and given the financial pressures on consumers and a contraction in the economy, the group decided not to increase school fees for 2021, and only increase tertiary fees marginally.
The education group said that its tertiary division was resilient, given that only two thirds of students were allowed to return to campus at various stages of lockdown.
“The balance were required to access online teaching. The division negotiated reduced-fee data bundles for students and reassessed the delivery model across all our campuses, introducing more online and blended learning options,” it said.
- Vega moved current short courses to an online mode of delivery
- Oxbridge Academy, greater student support was implemented to allow continued access to education.
- The IIE brands further initiated ‘boot camp’ programmes as additional academic support to students to assist with their studies and review of their work.
- The Private Hotel School was incorporated into the IIE and rebranded as the IIE School of Hospitality and Service Management.
- MindSharp, a dynamic digital learning platform, was launched to upskill individuals and corporate teams.
“In 2015, we invested in a state-of-the-art learning management system (LMS) in our tertiary division. The experience gained within our tertiary division, prior to the Covid-19 lockdown, allowed us to transition some 75,000 students to online teaching and learning within three weeks.
“This is a standout example of the direct benefits of our combined schools and tertiary academic function and the central academic team. The tertiary division’s use and experience of the system was invaluable in swiftly implementing a full online academic offering within the schools division,” it said.
“Our dedicated online platforms continued to grow with distance online education revenue increasing by R18 million, reaffirming our capacity to deliver regardless of mode of delivery,” it said.