Stadio sees earnings boost as student numbers rise

Private higher education investment company Stadio expects an earnings boost in its first half, driven by a steady rise in demand with student enrolment up 8% over the past year.

In a trading statement on Thursday, Stadio said it expected interim headline earnings per share (HEPS) of 15.5c-16.9c — up 14.8%-25.2% from the first half of last year. Core HEPS for the period are set to climb 14% — 24.3%. 

The expected earnings boost comes after a year of strong operational performance. In a recent AGM, Stadio reported that enrolment rose 8%, reaching a total of 46,300 students. Distance learning students made up 86% of this, while 14% were contact learners.

Markets responded positively to Stadio’s enrolment increases, which indicate growing demand for its services. Since the latest enrolment numbers were revealed to stakeholders on June 19, Stadio’s share price has risen almost 6%.

The positive outlook also comes after strong financial results in 2023, with the group reporting annual HEPS 23% higher than in the previous year.

Stadio began as a subsidiary of private school company Curro before unbundling in February 2017 to focus exclusively on higher education. From 2017 to 2018, the group acquired seven brands, including Afda, CA Connect, Embury, Lisof, Milpark Education, Prestige Academy and Southern Business School. After merging four of its subsidiary brands in 2020, the group now owns three registered private higher education institutions.

Earlier this year, Stadio announced plans to open its new Durbanville campus, after demand at its Bellville campus spiked 57% in three months. The new site will open in 2026, catering for 1,000 students and remote learners.

CEO Chris Vorster said at the recent AG M that he was encouraged by the steady rise in enrolment numbers despite a challenging economic environment. He was optimistic about the group’s trajectory, saying Stadio was a highly cash-generative business with a strong balance sheet. 

“We are still in a growth phase with the optimisation of our current campuses and staff and the construction of a second comprehensive campus in Durbanville, Cape Town, to commence later in the year. This follows our first comprehensive campus in Centurion, Gauteng,” said Vorster. 

“Our ultimate goal is to be the higher education institution of choice, an alternative to all public universities as well as an alternative to Unisa.” 

Stadio is set to publish its interim financial results on August 26.

websterj@businesslive.co.za