In a trading update on Wednesday (18 August), Independent school network Curro said that its average learner numbers for the first half of the 2021 year increased by 7% to 66,167 learners, boosting revenue by 12% to R1 784 billion.
“The strong learner growth recorded this year endorses the credibility of our robust offering, including an increased focus on digital education solutions,” said Andries Greyling, chief executive officer of Curro Holdings.
Tuition fees increased by 9.8% from the corresponding prior period due to the growth in learners, coupled with the annual inflationary fee increase. It said that revenue growth was weighed down by lower ancillary school income, which was R8 million less than the first half of 2020.
The levels of bad debts and fee discounts granted were also higher during the first half of 2020 than what the company experienced historically before the pandemic, Curro said. The group granted non-recurring discount relief of R60 million to its clients in the comparable period due to Covid-19.
Discounts granted increased marginally to 9.1% of tuition fees from 8.8% in the comparable period if this discount is excluded.
EBITDA (earnings before interest, taxation, depreciation, amortisation and head office expenditure) decreased by 6.8% to R509 million for the period, while EBITDA (after head office expenditure) declined by 16.3% to R390 million (2020: R466 million).
Headline earnings and headline earnings per share (HEPS) decreased by 27.5% from R160 million to R116 million and 48.8% from 37.9 cents to 19.4 cents, respectively.
Recurring headline earnings and recurring headline earnings per share decreased by 30.5% to R116 million and by 51.1% to 19.4 cents, respectively.
Curro said it invested a further R374 million in the business during the period under review, mainly to complete projects already started in 2020 to expand capacity and construct the new Curro Durbanville high school. “The primary objective for Curro remains to increase capacity utilisation of its existing facilities,” it said.
The acquisition of Heronbridge College remains subject to approval by the Competition Commission, “and we are on track with our overall Capex programme to invest up to R1.1 billion in the business this year,” the group said.
“The ongoing Covid-19 pandemic and its associated impact on the economy and our business remain unpredictable. Curro is in a healthy financial position following the R1.5 billion rights issue concluded during 2020. The strong learner growth recorded this year endorses the credibility of our robust product offering,” said Greyling.