JSE-listed independent education group Curro has seen a 9% surge in learner registrations this year, surpassing the 66 000-mark countrywide.
This is according to the group’s latest results, for the full-year ending December 31, 2020, published on Wednesday.
The strong growth comes on top of a 6% increase in learner numbers within the group in 2020, highlighting the continued move to private schooling in South Africa.
“Despite the challenging conditions brought on by Covid-19 and a period whereby learners were mostly educated remotely, average learner numbers increased… from 57 597 in 2019 to 60 777 at the end of 2020,” Curro notes.
“Educational excellence is now more sought-after than ever before; this is why we saw a further increase in registered learners to 66 153 in February 2021,” comments Andries Greyling, CEO of Curro Holdings.
The latest stats highlighting growth in learner numbers saw Curro’s share price firm more than 4.5% to R14.62 by midday on Wednesday, despite the group opting not to declare a dividend for its 2020 financial year.
This points to market expectations for a better financial performance in 2021 on the back of higher learner numbers.
Curro’s decision not to declare a final dividend is in-line with similar moves by several other JSE-listed companies in various sectors. These companies have elected to rather retain dividends to bolster balance sheets and liquidity levels to weather the Covid-19 storm.
“Pursuant to the uncertainties brought about by the ongoing Covid-19 pandemic and in light of the recent rights issue concluded, the board has resolved to not pay a dividend in respect of the year under review  in order to preserve cash and to deliberately use capital to fund Curro’s further expansion and growth prospects,” the group points out in its ‘long form’ results presentation.
“The declaration of a dividend is suspended for this year and the board will re-evaluate Curro’s dividend policy at the end of this year,” it adds.
While Curro’s revenue for its 2020 financial year increased 5% to R3.1 billion (2019: R2.9 billion), the group was hit by impairments of R207 million (net of tax).
“The significant non-headline impairment of property, plant and equipment, intangibles and goodwill during the year under review contributed to the decrease in earnings per share [EPS] from a profit of 48 cents in the previous year to a loss of 6.5 cents [for 2020],” it says.
“Schools’ Ebitda [earnings before interest, taxation, depreciation, amortisation)… increased by 1.4% to R886 million [2019: R873 million] for the year under review, while Ebitda after head office expenditure declined by 1% to R686 million [2019: R693 million].”
Curro’s 2020 headline earnings decreased by 32% (2019: R253 million) to R171 million, while headline earnings per share (Heps) decreased 39% from 59.9 cents to 36.4 cents. Recurring headline earnings and recurring Heps decreased by 15.6% from R212 million to R179 million and by 24% from 50 cents to 38 cents, respectively.
Besides the impact of Covid-linked impairments, the group’s R1.5 billion equity raise last year will have also had a dilutionary effect on its Heps performance.
“For the first quarter of last year, Curro traded above expectations in terms of learner number growth and fee collections,” says Greyling.
“Revenue was impacted by lower ancillary school income, which was lower than in 2019, and an increase in discounts granted from 7.2% of revenue to 10.9% of gross revenue. This includes once off Covid-19 related discounts amounting to R81 million.”