NextEd Group (NXD) H2 2024 earnings summary

Executive summary

• Achieved record revenue of $111.4 million in FY24, up 8.9% year-over-year, despite a challenging regulatory environment impacting international student numbers.

• Strategic initiatives included new campus launches in Gold Coast and Adelaide, expansion of vocational course offerings, and exclusive regulatory accreditation for new qualifications.

• Cost base was prudently managed, with $5 million in annualized savings implemented from early FY25 and a $10 million contingent liability facility established to release $9 million in cash.

• The business was significantly impacted by government policy changes, including visa restrictions and proposed caps on international student commencements for 2025.

Financial highlights

• Revenue increased to $111.4 million (FY23: $102.2 million), with growth in International Vocational (14.9%), Go Study (14.3%), and Domestic Vocational (5.2%) segments.

• EBITDA before impairment was $15.0 million, down 10% from $16.7 million in FY23.

• Net loss after tax was $31.2 million, compared to a profit of $3.6 million in FY23, primarily due to a $28.9 million impairment charge on intangible assets.

• Adjusted net profit after tax (excluding impairments and certain costs) was $0.2 million, down from $6.0 million in FY23.

• Operating cash flows were $1.7 million, a decrease of $23.5 million from FY23.

• Cash at bank as of 30 June 2024 was $19.3 million (FY23: $40.2 million).

Outlook and guidance

• The company is proactively preparing for tighter immigration policy and proposed national caps on international student commencements in 2025.

• Focus is shifting to domestic business and industry-aligned courses in skills shortage areas.

• No dividend will be declared for FY24.