ADvTECH, the private education group, is likely to continue its robust growth trend and good cash generation after reinstating its dividend payment ratio in the year to December 31 to the same level as prior to the disruption caused by Covid-19, CEO Roy Douglas said yesterday.
A final dividend of 31 cents was declared, bringing the full year dividend to 50 cents (2020: 20 cents) per share.
The group lifted normalised earnings per share by 35 percent to 121.5 cents after good enrolment growth, a significant improvement in collections and better efficiencies.
Douglas said ADvTECH had delivered strong results, reinforcing a consistent performance and highlighting its robust business model.
“We continue to benefit by revising structures, improving systems, enhancing our technological capability and strong financial management,” he said in a statement yesterday.
Strong cash generation allowed borrowings to be reduced and a sound balance sheet was maintained.
Revenue grew 8 percent to R5.9 billion, while operating profit increased by 22 percent to R1.11bn. Group operating margins strengthened to 18.7 percent from 16.5 percent in 2020.
The schools division in South Africa benefited from restructuring, brand portfolio alignment and improved customer service. Enrolments climbed, while extramural and aftercare recovered in the second half of the year.
After foregoing a fee increase, schools in South Africa increased revenue 4 percent to R2.2bn. Operating profit improved by 10 percent to R413m while the operating margin increased to 18.9 percent from 17.9 percent.
Schools in the rest of Africa recorded good enrolment growth, were operationally sound and posted higher profitably and returns on investment. Revenue increased 3 percent to R268m and an operating profit of R47m was well up on a R10m operating loss in 2020. The operating margin of 17.7 percent is on par with schools operated by ADvTECH in South Africa and was expected to improve further.
The tertiary division’s 2021 student enrolment and registration cycle was disrupted by the 2020 matric results delay.
However, enrolments, face-to-face and distance online, grew. Revenue in the tertiary division increased 4 percent to R2.4bn, while operating profit improved 13 percent to R609m. The operating margin increased to 25 percent from 23 percent.
In the resourcing division expansion into the rest of Africa paid dividends with the division increasing its presence and number of placements. Revenue increased 20 percent to R1.02bn and an operating profit of R39m was well up from R3m in 2020.
Douglas said they were well positioned to leverage the advantages of their brands, structures, systems and financial strength to benefit from the growth in demand for education that was anticipated to continue both in South Africa and on the rest of the continent.
ADvTECH’s Schools division comprises nine brands with more than 108 schools across South Africa and the rest of Africa, including Gaborone International School in Botswana, and The Makini Group of Schools and Crawford International in Kenya.
It owns nine tertiary education brands, across 32 campuses across South Africa and the rest of Africa. ADvTECH’s eight resourcing brands place thousands of candidates annually.
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