ADvTECH Limited
(Incorporated in the Republic of South Africa)
(Registration number 1990/001119/06)
Share code: ADH ISIN: ZAE000031035
(“the company” or “ADvTECH” or “the group”)
VOLUNTARY TRADING STATEMENT AND OPERATING UPDATE FOR THE YEAR ENDED 31 DECEMBER 2020
Commenting on the group’s operating update for the year ended 31 December 2020, ADvTECH CEO, Roy Douglas said: “One of the measures of a business’ success is how robustly it responds to the unexpected. In the face of fluctuating challenges in 2020, ADvTECH came through with flying colours.”
Overview of Performance
ADvTECH had a strong start to the financial year with our schools, tertiary and resourcing divisions all reaping the rewards of strategic decisions taken in previous periods. ADvTECH enjoyed good enrolment growth and witnessed the benefits from our restructuring, rationalisation and cost saving initiatives, resulting in the group being well-positioned to withstand the effects of the COVID-19 pandemic.
The commitment and adaptability of our employees, together with the support of our students, resulted in not a single academic day being lost in the rapid and smooth transition of more than 75 000 students to high-quality online tuition. Subsequently the group’s students, both in schools and tertiary divisions, completed their academic years successfully. This underscores the group’s core strategy, and ability, to continue with our educational offering at any time, at any place and through our students’ preferred mode of delivery, either in person or online.
The underlying financial performance of the group during the year ended 31 December 2020 has been most encouraging with a sustained level of performance, resulting from an improved operational performance in schools, continued profit growth in tertiary and a robust result from the rest of Africa resourcing business. The good performance in the education divisions was regardless of an increase in the loss allowance due to the impact of the weaker economy.
ADvTECH remains sustainable, well positioned and is confident that we will navigate through this period, responding efficiently and effectively to any changes in the operating environment. Our confidence is based on the fact that we have enjoyed good school enrolments in 2021, and while the tertiary enrolment cycle has been unavoidably affected due to the disruption of delayed matric results, our student retention rates are encouraging and the new student enrolments are at this stage, in line with expectations.
Trading Statement
The group reports normalised earnings per share ("NEPS") as a way of excluding the effect of one-off transactions and corporate action costs from its results.
NEPS for the year ended 31 December 2020 is expected to be between 2% and 7% higher than the comparative reporting period for the year ended 31 December 2019 ("the comparative period") or between 86.9 and 91.2 cents per share as compared to 85.2 cents per share in the comparative period when omitting the one-off aspects from consideration.
To calculate Headline earnings per share (“HEPS”), the following adjustments are excluded from NEPS:
HEPS is expected to be between 3% and 8% higher than the comparative period or between 88.6 and 92.9 cents per share as compared to 86.0 cents per share in the comparative period.
To calculate Earnings per share (“EPS”), the following adjustments are excluded from HEPS:
Shareholders are advised that basic earnings per share ("EPS") for the year ended 31 December 2020 is expected to be between 5% and 0% lower than the comparative period. EPS is expected to be between 82.7 and 87.1 cents per share as compared to 87.1 cents per share for the comparative period, including the effect of the above adjustments.
ADvTECH expects to release results for the year ended 31 December 2020 on the Stock Exchange News Service on or about Tuesday, 23 March 2021. Any forward-looking statements contained in this announcement have not been reviewed nor reported on by the company’s auditors.
15 March 2021
Johannesburg
Sponsor: Bridge Capital Advisors Proprietary Limited