3P Learning (3PL) H2 2024 earnings summary

Executive summary

• Revenue for FY24 was AUD 110 million (up 2–2.5% year-over-year), with underlying EBITDA at AUD 12 million, below guidance due to challenging school market sales, especially in North America.

• Statutory net loss after tax was AUD 57 million, driven by significant non-cash goodwill impairment and expensing of U.S. distribution rights.

• Major product releases, including Writing Legends, Brightpath Progress, and enhancements to Mathletics and Reading Eggs, position the company for future growth.

• Transitioned sales strategy to focus on complete program suites, launching the 3 Essentials suite in Australia and New Zealand, with further rollouts planned.

• Tight cost control led to improved gross margins and annualized savings of AUD 5 million from March 2024.

Financial highlights

• Revenue grew 2–2.5% year-over-year to AUD 110 million; B2C up 6% to AUD 43.1 million, B2B flat at AUD 66.9 million.

• Underlying EBITDA was AUD 12 million, down 24–25% from FY23, mainly due to increased investment in people, U.S. go-to-market costs, and one-off items.

• Statutory net loss after tax of AUD 57 million, impacted by a AUD 44.5 million non-cash B2C goodwill impairment and AUD 14.4–20.5 million expense for reacquiring U.S. distribution rights.

• Underlying cash flow from operations was AUD 11 million, closely aligned with EBITDA.

• Ended the year with AUD 5.1 million in cash, after significant investments in product development and share buybacks.

Outlook and guidance

• No specific guidance for FY25 due to transition to the 3 Essentials suite and new sales model; expect revenue and EBITDA to improve over FY24.

• Full impact of cost savings and new product suite expected in FY25, with recognized revenue growth anticipated in FY26.

• Focus on operational leverage by maintaining expenses while growing revenue.