Curro (COH) H2 2024 earnings summary

Executive summary

• Revenue increased by 8% to ZAR 5.144 billion for the year ended 31 December 2024, with EBITDA up 9% to ZAR 1.258 billion and operating margin rising to 18.2% from 17.8% year-over-year.

• Recurring headline earnings per share grew 13% to 83.0 cents, and recurring headline earnings reached ZAR 469 million, up 10% from 2023.

• Achieved record academic and extracurricular results, including the largest matric class and best results to date, with notable sporting and cultural achievements.

• Average learner numbers rose 1% to 72,758, but enrolment growth into 2025 was stunted by a weak consumer environment.

• Cash generated from operations exceeded CapEx by ZAR 200 million, continuing a positive free cash flow trend.

Financial highlights

• Fee revenue, the main revenue component, increased by 7% in 2024, with average fees per learner up 6%.

• Ancillary revenue (non-tuition) rose 12% year-over-year, now correlating with total school fee revenue growth.

• Total operating costs increased by 8%, with staff costs up 6.2% and facility costs up 9% to ZAR 435 million.

• Net debt decreased to ZAR 3.154 billion at year-end.

• Cash generated from operations was ZAR 866 million; free cash generated above CapEx increased by 23% to ZAR 197 million.

Outlook and guidance

• Tuition fees for 2025 increased by 5.5% per learner.

• CapEx for 2025 projected at ZAR 660 million, with a focus on maintenance, expansion, and risk mitigation.

• Slower total fee revenue growth and a slightly lower operating margin expected in 2025.

• Management remains confident in long-term growth, focusing on revenue, operating margin, and cash generation.

• Consideration of acquisitions with growth and cost-saving potential, funded by debt.