Higher education and recruitment group ADvTech expanded in their home market and across Africa and reported a 16% increase in earnings for the year to December 31.
The owner of the Varsity Colleges in South Africa that enrolled over 100 000 students last year reported moderate fee increases, better margins, and further investment in technology a statement said Monday.
“We are also pleased to report double-digit enrolment growth in both our schools and tertiary divisions and that our education business has broken through 100,000 students for the first time,” CEO Geoff Whyte said.
A final dividend of 63 cents (2023: 57) a share brought the full-year dividend to 101.0 (87) cents per share. Revenue was up 8% to R8.52 billion after increasing 8% in the education division and slipping 8% in the resources division. Operating profit increased by 14% to R1.79bn. Normalised earnings a share increased by 16% to 202.5 cents.
The Resourcing division reported lower placement numbers that led to operating profit declining in South Africa. In the rest of Africa, the replacement of low-margin contracts with higher-margin contracts led to lower revenue, but operating profit lifted, said Whyte.
Group operating profit increased 14% to R1.79 billion - the education division’s operating profit increased by 15%. The resourcing division regression had minimal impact on group profitability. The operating margin widened to 21% (20.1%).
Operating margin in the education division improved through operating leverage benefits and efficiency gains. This offset additional costs incurred to introduce additional global benchmarking measures, artificial intelligence tools to support personalised learning, and student information systems.
Normalised earnings increased by 17% to R1.11bn (R950m), while normalised earnings per share increased by 16% to 202.5 cents.
Cash from operating activities increased 16% to R2.25bn (R1.94bn). Capital expenditure of R982m was mainly on increasing capacity on existing sites to meet incremental demand (R328m), the development of a new school (R64m), acquiring new sites for expansion (R238m), and for equipment (R78m).
BUSINESS REPORT