Picture: 123RF/VITEE THUMB
Picture: 123RF/VITEE THUMB

Private higher education group Stadio says its on course for achieving its ambitious student number targets in spite of the Covid-19 pandemic, which may have further increased the attractiveness of distance learning.

Stadio’s student base has surged from 840 in 2017 to more than 30,000 and the group is still on track to achieve its target of 56,000 in 2026, said CEO Chris Vorster.

This requires growth of 9% a year, but enrolments have been surprisingly resilient amid the pandemic, and the group’s 2020 drop-out rate has, in fact, decreased 3.5%, he said.

First semester student enrolments grew by 10% to 31,053 in the group’s six months to end-June, with distance-learning students rising by 12%.

The group swung into a R78m loss from profit of R52m previously, partly due to writedowns of existing brands as it shifts to a single brand under the name of Stadio. This resulted in R60m in writedowns of the value of some of the trademarks of transferred schools, such as Prestige Academy.

There was also a fair-value adjustment of R74m related to the group’s acquisition of CA Connect — where student enrolments have exceeded initial expectations, and where the performance of the business was part of the sales agreement.

Core headline earnings, which exclude one-off items such as the trademark writedowns, rose 22% to R56.8m, the group said. The group had a cash balance of R123m, from R349m previously.

Stadio said it is confident in its outlook, with the Covid-19 pandemic shifting the relative attractiveness of distance learning, and it is considering further opportunities for growth, and planning to roll out new online courses and qualifications in coming months.

Courses offered by ADvTech and Stadio align themselves perfectly to the Covid-19 normality, and distance learning will surely be a growth vector in the future, said Small Talk Daily’s Anthony Clark.

“Overall, a solid result given the rise in online courses and the ongoing need for upskilling by those either seeking employment or those in employment wishing career advancement,” he said.

“The demand and growth in online tertiary platforms should remain far more robust for Stadio than its bigger brother Curro,” said Clark.

In afternoon trade on Wednesday, Stadio’s share had jumped 10.79% to R1.54, on track for its best performance in more than a month.

Update: August 26 2020
This article has been updated with comment and information throughout.

Correction: August 26 2020
An earlier version of this article mistakenly referred to the group’s year to end-June, when this is in fact its half-year results

gernetzkyk@businesslive.co.za

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