Advtech Limited · JSE:ADH
Advtech — H1 2006 Earnings Presentation
26 slides from Advtech's earnings presentation, August 2006
Slide 1: Interim results for the six months ended June 2006
Results presentation for the six months ended 30 June 2006 interim results for the six months ended 30 June 2006
Slide 2: Overview
Results presentation for the six months ended 30 June 2006 OVERVIEW • The ADvTECH Group is a leader in Southern Africa in the area of Education, Training, Skills Development and Career Placement • The Group is focused on the development, deployment and management of human capital • The business oper
Slide 3: Schools, Tertiary, Skills
Results presentation for the six months ended 30 June 2006 SCHOOLS TERTIARY SKILLS
Slide 4: Recruitment
Results presentation for the six months ended 30 June 2006 RECRUITMENT
Slide 5: Share Statistics and relative performance
Results presentation for the six months ended 30 June 2006 Share Statistics (25/08/2006) Share Price - cents 250 Highest price – cents (10 Apr) 290 Lowest price – cents (27 Jun) 191 Market Cap - Rm 984 MARKET Shares in Issue - m 394 DATA Shares Traded – m (Jan – Jun ‘06) 46.5 ADvTECH relative to its
Slide 6: Market place – National Education
Results presentation for the six months ended 30 June 2006 Did you know? Education remains single largest expenditure item in national budget – R92bn Market place – National Education 30 out of every 100 people in SA are either learners or students Of every 1 000 learners/students in SA: 857 are in
Slide 7: Market place – Schools: national statistics
Results presentation for the six months ended 30 June 2006 National Statistics – 2005: 12 200 000 learners 382 000 educators Market place - Schools 26 600 schools Num ber of Le arne rs - 2005 2.6% Num ber of Educators - 2005 5.1% 97.4% Public Independent 94.9% Public Independent Source: Dept of Educ
Slide 8: Market place – Independent Schools
Results presentation for the six months ended 30 June 2006 Independent Schools – 2005: 315 500 learners 19 400 educators Market place - Schools 1 017 schools Per cent ag e o f Ind ep end ent Lear ner s p er Pr o vince Eastern Cape 5% Free State 15% 9% 5% Gauteng KZN 5% Limpopo 10% 39% M pumalanga Le
Slide 9: 5 Year CAGRs: public and independent learners
Results presentation for the six months ended 30 June 2006 5 YEAR CAGR’s 3.8% 0.4% PUBLIC INDEPENDENT LEARNERS LEARNERS Source: Dept of Education, Education Statistics at a glance, 2004
Slide 10: Market place – Tertiary
Results presentation for the six months ended 30 June 2006 Public Institutions – 2004: 774 500 students 15 400 educators Market place - Tertiary 50 FET & 29 HE institutions (108 private) T er t iar y St ud ent s - Pub lic Inst it ut io ns 36% Contact 64% Di stance Field of Study 2004 26% 27% 15% 32%
Slide 11: Market place – Recruitment
Results presentation for the six months ended 30 June 2006 Did you know? Market place - Unemployment rate in SA = 30% - Government committed to Recruitment halving unemployment by 2014 Formal economy only employs 56% of students from top universities Employment has grown from 9.5m to 12m jobs since
Slide 12: Operational Highlights
Results presentation for the six months ended 30 June 2006 OPERATIONAL HIGHLIGHTS o Continued growth and margin improvement across the Group o Strong cash flow performance resulted in a maiden interim dividend o Acquired Vertex, a response handling business o Disposal of Mast Bookshops, Mast Publica
Slide 13: Financial Highlights
Results presentation for the six months ended 30 June 2006 FINANCIAL R55m 9.4 HIGHLIGHTS cents 41.9 cents R413m 50% 40% 35% 24% REVENUE OPERATING DILUTED FREE OPERATING CASH PROFIT HEPS FLOW PER SHARE
Slide 14: Financial Overview: Group first half revenue
Results presentation for the six months ended 30 June 2006 Strong enrolments and widened market appeal of the Group’s brands FINANCIAL have driven real growth …. OVERVIEW Group 1st Half Revenue 500 400 300 Rm 200 100 - 2002 2003 2004 2005 2006
Slide 15: Profitability and returns
Results presentation for the six months ended 30 June 2006 Sound overhead control coupled with more productive utilisation of FINANCIAL expanded infrastructure has improved profitability and shareholder OVERVIEW returns …. Profitablity and Returns 35.0% 16.0% 30.0% 14.0% 25.0% 12.0% 10.0% 20.0% 8.0%
Slide 16: Financial Overview: cash flow and balance sheet
Results presentation for the six months ended 30 June 2006 A continued focus on working capital management underpinned a FINANCIAL strong cash performance and solid balance sheet … OVERVIEW 1st Half Operating Cash Flow 200 150 Rm 100 50 - 2001 2002 2003 2004 2005 2006 Net Cash on Hand Cash generated
Slide 17: Segmental Review
Results presentation for the six months ended 30 June 2006 Buoyant market environment, increased capacity and greater appeal of SEGMENTAL the Group’s brands have driven real growth … REVIEW Education 1st Half Revenue 400 350 300 250 Rm 200 150 100 50 - 2001 2002 2003 2004 2005 2006 Resourcing 1st Ha
Slide 18: Segmental Review – Education
Results presentation for the six months ended 30 June 2006 % change 2006 2005 Rm SEGMENTAL REVIEW - Revenue 21% 354.3 292.7 EDUCATION Operating profit 26% 59.2 47.0 Operating margin 16.7% 16.1% REVENUE 2006 14% Education Resourcing 86%
Slide 19: Segmental Review – Resourcing
Results presentation for the six months ended 30 June 2006 % change 2006 2005 Rm SEGMENTAL REVIEW - Revenue 48% 59.1 39.9 RESOURCING Operating profit 93% 10.3 5.3 Operating margin 17.4% 13.4% OPERATING PROFIT 2006 15% Education Resourcing 85%
Slide 20: Sustainability – compound annual growth rates
Results presentation for the six months ended 30 June 2006 R169m 10.1 SUSTAINABILITY – cents 5 YEAR CAGR’s* R55m 61% R413m 43% 28% 7% REVENUE OPERATING HEPS CASH FROM PROFIT OPERATING * Compound Annual Growth Rate based on interim results to 30 June each year ACTIVITIES
Slide 21: Report Card: Group
Results presentation for the six months ended 30 June 2006 REPORT • Consistent progress and re-investment = a secure platform, CARD enhanced and widened appeal for Group’s brands Group revenue up 24% Strong enrolments • Sound overhead control and efficiencies and attention to working capital managem
Slide 22: Report Card: Divisions
Results presentation for the six months ended 30 June 2006 REPORT • Sustainable performance from Education CARD Divisional revenue up 21% Divisional operating margin improved to 16.7% (2005: 16.1%) • Refocusing of Recruitment division D Divisional revenue up 48% E S Divisional operating margin impro
Slide 23: Growth Strategy
Results presentation for the six months ended 30 June 2006 At Group At Divisional level At Campus level GROWTH level STRATEGY Strategic Expansion Organic Platform for Sustainable Growth Strong Financial Investment in Academic Competent Academic Track Record Infrastructure Achievement Management Capa
Slide 24: Press coverage
Results presentation for the six months ended 30 June 2006 Meer skole wat na wins najaag, verwag– Sake Rapport, 23 July 2006 Kelly Group geared for JSE listing – Business Day, 18 Aug 2006 Half SA’s education degrees fail to make the grade – Mail & Guardian, 4 Aug 2006 Pressure to perform has SETAs r
Slide 25: Prospects
Results presentation for the six months ended 30 June 2006 Through its: • Continued investment in infrastructure and capacity, • Broader academic service offering, PROSPECTS • Sustained track record of academic achievement, and its • Increased student enrolments The Education division is expected to
Slide 26: Learn something new every day …
Results presentation for the six months ended 30 June 2006 Learn something new every day …