Educational gap fuels private sector – drives Advtech earnings higher

(ANA) – Mismanagement of the SA economy is a quandary in which investors and ordinary citizens alike find themselves mired. The spiral towards bequeathing minimal skills – let alone a broader educational outlook – frightens many with its precognition of generations upon generations lacking a basic education on which those essential skills for growth are ultimately founded.

School_ClassroomThe increasing awareness of this has influenced many canny investors to capitalise and establish their own variations on attuned education. This makes the latest report by Advtech (a private education group) of as much significance as the major players in the economy. On Monday Advtech said it had lifted operating profit by 73 percent, from R117 million to R203 million in the six months to June – on revenue of R1.3 billion, a 33 percent improvement on the R959 million recorded in the previous comparable period.

The group said improvements had been “tempered” at earnings level by interest charges arising from the funding of large acquisitions in recent months. Profit after taxation, interest and finance charges came in at R105 million, a 29 percent improvement on R81 million recorded previously.

Acquisitions during the year under review included Centurus Colleges, the Gaborone International School, the Maravest Group, the assets of Boleng Pre-primary and Primary School, and Kathstan Academy.

Advtech noted that it was itself the subject of “an unsolicited approach” during the reporting period. The approach came from rival education group Curro, which released its own very good set of results earlier this month. The offer, described as “conditional and unclear on several key issues”, had been unanimously rejected by the board as “not in the best interests of the group”, after being discussed with advisers and a wide range of stakeholders.

Advetch said in a statement: “The directors are pleased to release record interim results which highlight the acceleration and momentum behind the group’s financial performance. This is the outcome of years of focus on sustained growth, made possible by strong and deep strategic management and significant financial capacity as reflected in the group’s strong balance sheet and cash flow.”

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