Stadio Holdings says its tertiary education institutions are entering a new growth phase

Stadio Holdings, the private tertiary education company, reported a solid 24 percent increase in taxed profit in the six months to June off the back of an 11 percent increase in student numbers and 18 percent growth in new student enrolments.

The group services the higher education market in SA through three private institutions - Stadio Higher Education, Milpark and AFDA. It offers undergraduate and postgraduate programmes through contact, distance and blended learning.

CEO Chris Vorster said in a telephone interview the results were good and resulted from a strong demand in professional qualifications. “We have a high level of capital and are entering a growth phase,” he said.

All outstanding debt was repaid in the six months and there was a revolving credit facility of R200 million, with the group also holding R167m in cash as at June 30.

Smalltalkdaily Research commented on Twitter that Stadio was their top education play long term, “with a low asset asset, lower pesky bricks and mortar, needs little external funding, but needs to get those new courses accredited…”.

During the first semester to June 2022 Stadio’s student enrolments increased 11 percent to 38 348 students. Five new qualifications were accredited by the Department of Education and the group anticipated more in the second half, said Vorster.

Distance learning student numbers grew 14 percent to 32 686, while contact learning student numbers fell 4 percent to 5 662.

He said that looking ahead, he had to acknowledge the impact of weak economy on the group, but he said the good growth in distance learning was likely due to the less expensive pricing of these courses relative to other modes of learning.

“The decline in contact learning students is, in part, due to Milpark transitioning away from contact learning programmes to digitally enhanced distance learning. Covid-19 also reduced new student intakes in the prior year, resulting in less students rolling over into 2022, and negatively impacting total contact learning students in the current year,” said Vorster.

AFDA saw good growth in new students on its contact learning campuses in 2022.

He said regulatory delays in accrediting programmes and site extensions impacted growth plans in 2022 for many of its contact learning sites.

Core headline earnings a share grew by 17 percent to 11.3 cents per share. Revenue grew by 13 percent to R617m., following student number growth, cost management and increased operating efficiencies.

Vorster said R23m was invested to complete Phase II of the Stadio Centurion campus, while a further R5m was invested to expand the Stadio Higher Education distance learning operations centre in Krugersdorp.

This project is expected to be completed in February 2023 at a cost of R42m. Stadio Montana was disposed of in March 2022 for R52m.

A further R14m was invested across the group on the development of new programmes, existing facilities, systems and moveable assets.

BUSINESS REPORT