Durban - Private education group ADvTECH said the continued growth of the middle class had provided it with more expansion opportunities in the continent.
The group said middle class parents wanted to seek quality education for their children, meaning that there would always be a need for private education over and above the education provided by the government.
It said research conducted by the African Development Bank had shown that the middle class surged 60 percent by 2010 from a decade before, and the number kept growing.
ADvTECH said the report highlighted the fact that increased prosperity led to a rise in investment in education, and that private education was increasingly seen as an attractive option for parents.
Jaco Lotz, head of international business development at ADvTECH, said this had made private schools and universities to mushroom across the continent. He said businesses were now focused on capitalising on the demand.
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“The private education sector is experiencing unprecedented growth, with private providers in the rest of Africa lining up to partner with credible and experienced counterparts in South Africa to be able to sustainably grow in response to the huge demand for quality basic and higher education institutions,” said Lotz.
ADvTECH has made some acquisitions to try to keep up with the demand in both school levels and tertiary space.
The company acquired a stake in a private tertiary institution, the University of Africa, in Zambia in 2016 and locally a 51percent stake of Oxbridge Academy, adding 21000 registered distance learning students in the process.
In the schools division, ADvTECH acquired the Summit College. A possible strategic acquisition of Glenwood House in George and Elkanah House in Cape Town is still on the cards, subject to due diligence and Competition Commission approval.
Co-exist
Chief executive Roy Douglas said, after the release of the results to end December, that there is a space for both public and private sector education as the issue of education cannot be left to the government alone. “Public and private education can co-exist and we have seen that parents are willing to pay for the education of their children. If they choose private education they don’t see money as an issue so long as their children get educated,” he said.
Over the years, ADvTECH has grown tremendously with three divisions in schools, tertiary and resourcing.
The group owns nine tertiary brands across 28 sites across South Africa and the rest of Africa. Its higher education division, The Independent Institute of Education, is SA’s largest and most accredited private higher education institution. In schools it has seven brands with 90 schools across South Africa as well as Gaborone International School in Botswana.
Last year, the International Finance Corporation, a member of the World Bank Group, acquired a 4percent equity stake in ADvTECH. During the year to end December, the group reported revenue growth of 24 percent to R3.35 billion while headline earnings per share came in 39 percent higher at 71.1 cents a share.
ADvTech shares declined 1.35 percent on the JSE to close at R19.73.