New ‘university’ breaking ground in South Africa in 2024

Stadio Holdings’ earnings have jumped as it prepares to start construction on a new tertiary campus in the Western Cape this year.

For the six months ended 30 June 2024, the group said that its total number of students grew by 10% to 47,024 (30 June 2023: 42,874).

Distance learning students grew by 10% to 40,702 (30 June 2023: 37,067).

“Strong demand in professional qualifications continued to drive healthy growth in registrations for the period,” said the group.

Contact learning student numbers grew by 9% 6,322 (30 June 2023: 5,807), following growth of 3% in in the prior year.

The group’s revenue increased by 16% to R826 million (June 2023: R714 million), and its EBITDA increased by 12% to R236 million (June 2023: R210 million).

The EBITDA remained at 29% and was impacted by increased costs in marketing and advertising, licensing and computer costs, as well as increased staff training costs.

Earnings per share and Headline Earnings per share both increased by 20% to 16.3 cents per share (cps) (June 2023: 13.6 cps) and 16.2 cps (June 2023: 13.5 cps), respectively.

“The growth in profit after taxation, EPS and HEPS for the period was primarily due to organic growth in the underlying institutions and lower growth in depreciation for the period of 3%,” said the group.

“Furthermore, profit attributable to the parent was positively impacted by the additional 15.4% shareholding acquired in Milpark Education, substantially effective 31 December 2023. Non-controlling interest in Milpark Education reduced from 31.5% in 2023 to 16.14% in 2024.”

“The group utilised R100 million of their rolling credit facility to fund the acquisition of the additional shares in Milpark Education, resulting in additional finance costs for the period.”

“These finance costs largely offset the higher interest income earned on higher cash balances for the Group (June 2023: net interest income of R1 million).”

The group did not declare an interim dividend as per its policy.

Looking ahead, STADIO Higher Education expects to start constructing its new comprehensive campus in Durbanville, Cape Town, in the second half of 2024, subject to regulatory approvals.

Earlier June of this year, the group said construction of the Durbanville campus would be funded 50% through long-term debt and 50% through cash reserves.

The group previously said that the number of students on its new Centurion campus increased by 52%, confirming its decision to start constructing its second comprehensive campus.

This will increase the number of physical campuses to seven, with the group also having structures in Bellville, Musgrave, Randburg, Hatfield, and Waterfall.

The group also saw new qualifications being accredited during the period, including IT, management, architecture, and fashion, which will be offered in 2025.

The group also said that AFDA continues to optimise its offerings on its four campuses in Johannesburg, Durban, Gqeberha, and Cape Town while looking at further expansion opportunities.

“We are encouraged by the positive growth in new students on our contact learning mode of delivery and excited about the growth opportunities evident in the distance learning mode of delivery,” said the group.

“Whilst we experienced good growth, we recognise that consumers remain under pressure given the tough economic climate and the impact this has on students’ ability to afford higher education offerings.”

“Notwithstanding the economic climate within which we operate, there continues to be a high demand for our offerings as students invest in themselves to create more prosperous opportunities.”

The group’s key financials can be found below:

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