Private schools and universities show strong growth in South Africa

 ·25 Mar 2024

Private school and tertiary education administrator AdvTech has noted a strong demand for private education in South Africa, with double-digit revenue growth and over 93,000 enrolments for 2024.

AdvTech revealed in its results for its 2024 financial year that its revenue grew 13%, and headline earnings per share was up 19%.

“Our schools and tertiary divisions benefitted from good enrolment growth, moderate fee increases, and enhanced operating leverage,” said outgoing AdvTech CEO Roy Douglas.

Across AdvTech’s schools and tertiary institutions, enrolment grew by 6% to 93,728 students at the end of 2023 – comprising a 7% increase in tertiary division enrolments and a 4% increase in its high schools.

The group noted that 32,786 students are enrolled in its South African schools.

Locally, AdvTech noted revenue increased by 13% to R2.81 billion (2022: R2.49 billion), and operating profit increased by 18% to R570 million (2022: R484 million), with the operating margin improving
to 20.3% (2022: 19.4%).

The group added that it recorded exceptional results in the 2023 Independent Examinations Board examinations, retaining a leadership position in private education in South Africa.

Students achieved a 99.7% pass rate, and 87.7% obtained a bachelor’s degree pass.

The company’s tertiary division also posted strong growth, with its Independent Institute of Education generating R3 billion in revenue or 38% of total revenue.

This translated into solid growth for the company, with revenue climbing 13% to R7.86 billion and profit shooting up 18.56% to R998 million.

Interestingly, the group highlighted that the Varsity College campuses in Pretoria and Midrand were expanded in response to growing demand.

Equally, Rosebank College acquired additional capacity at its mega-campuses in Braamfontein and Pretoria and opened a new digitally enabled campus in Mbombela in January 2024.

The company still has room to grow, with only 68% of its ultimate school capacity being utilised.

AdvTech also crossed a significant financial milestone, with it now generating more cash than is needed to fund its investments.

Thus, the company increased its dividend payout to shareholders by 45% to 87 cents for the financial year.

“AdvTech remains very well positioned to benefit from the increase in demand for education in South Africa and particularly in the rest of Africa.

“Our focus on productivity, efficiency and leveraging scale to deliver value in quality education remains key to our continued growth,” said Douglas.

While he acknowledged that the current economic conditions had put South African consumers under pressure, he believes that AdvTech is uniquely positioned to leverage all its advantages to benefit from continued growth in demand for education in South Africa.

Read: South Africa kisses thousands of doctors, professionals and businesses goodbye

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