MindChamps PreSchool (CNE) H2 2024 earnings summary

Executive summary

• FY2024 revenue rose 5% to $63.0m, while profit after tax fell to $0.2m from $5.2m; 2H2024 recorded a $1.2m net loss, improved from a $2.1m loss.

• Higher preschool fees supported revenue growth, while lower gains from exclusive territory sales and corporate transactions contributed to the lower FY pretax result.

Financial highlights

• FY2024 gross profit increased 6% to $30.2m from $28.4m; cost of sales rose 3% to $32.8m, mainly from higher centre teacher costs.

• 2H2024 revenue grew 9% to $33.8m; gross profit was $17.0m versus $14.9m, while loss before tax narrowed to $1.0m from $1.9m.

• FY2024 profit before tax was $0.5m versus $6.1m; net profit was $0.2m versus $5.2m, with basic and diluted EPS of 0.00 cents versus 2.24 cents.

• FY school fees increased $3.5m; service income declined $0.6m. Exclusive territory business sales fell 61% to $4.9m, and corporate transaction gains declined 73% to $0.9m.

Outlook and guidance

• FY2025 priorities include cost discipline, higher centre occupancy, operational efficiency, workforce initiatives, fee adjustments and franchise growth in domestic and international markets.

• Singapore’s 2025 budget measures are expected to support ECE demand; Australia’s Worker Retention Payment and three-day subsidised-care guarantee may support staffing and enrolments.

• Australia outlook is cautiously optimistic amid stable inflation, lower interest rates and rising operating costs; recent Queensland and South Australia franchise sales provide a platform for expansion.