Wey Education plc (LON:WEY), the educational services group which owns and operates two leading online independent secondary schools and an educational services division delivering lessons and other tuition to third party educational providers, has given DirectorsTalk a trading update for its year ending 31 August 2017.
-- Turnover expected to be at least GBP2.4 million (2016: GBP1.5 million) up on the prior year -- Maiden adjusted pre tax profit expected (2016: loss GBP795,000) -- Pupil numbers ahead of last year -- Business poised for further growth -- Significant growth expected in B2B -- Very attractive opportunities overseas being investigated -- Issue of shares to Chairman in settlement of Director's fees
The results for the year will demonstrate significant growth in turnover and a vastly improved trading result. Pleasingly the significant increase in turnover reported in the Company’s interim results continued in the second half. Turnover for the year is expected to have increased to at least GBP2.4 million, an increase of 60% over last year (GBP1.5 million) reflecting continuing growth in the core business and price increases.
The Company expects to report a pre-tax profit for the year (2016: loss GBP795,000) adjusted for equity share payments.
The Company enters its new financial year with its various divisions well placed to accelerate growth. The recently completed upgrade of the online learning platform has been designed to allow significant, seamless growth over all business divisions and new, additional products are being introduced.
Despite the investment made in IT, personnel and marketing, cash balances remain healthy at around the same level as at 31 August 2016 of GBP909,000.
Within the schools, recruitment of pupils continues for the new academic year. Overall pupil recruitment is on track with management expectations. Pupils already enrolled to study at InterHigh (www.interhigh.co.uk) are ahead of last year.
The new premium school brand Infinity Education (www.infinityeducation.org.uk) expects to accept its first pupils this September. It is considered this business will be judged by potential customers on its superior academic performance over its first few years of life (through the two year cycle of iGCSEs and A level) and therefore at this stage academic excellence is more important than student numbers. The Company has recently introduced a scholarship program to attract students of the highest calibre. The Company is therefore targeting only a small number of pupils for the current year and only expects a modest contribution to turnover.
Unlike many traditional “bricks and mortar” schools, Wey can continue to recruit pupils throughout the academic year without imposing a maximum number so expects pupil numbers and growth to continue through 2017/18.
The recently established B2B division finished this year well and it is expected that this division will grow significantly in the coming year. A number of potential contracts are under negotiation or have been tendered for.
Wey has recently launched Quoralexis (www.quoralexis.com), an online language school specialising in English as a Foreign Language (“EFL”). This will commence business in September and the Company is encouraged by initial reactions to its product offering.
The Company continues to explore overseas markets where it believes that subject to regulatory compliance, very attractive opportunities exist for its British education products.