Wey Education hails FY20 as a year of ‘significant growth’
The UK online education company reported that turnover for the period had increased by nearly 40% to £8.4m (FY19: £6m) after witnessing ‘significant growth’ in student enrolment across all year groups. To date, over 3,000 students receive an education from the group.
1H20 revenues were positively impacted by COVID-19, representing 54% of revenues for the year. It said a proportion of the £4.5m, which primarily occurred in the final quarter of the financial year, is intended ‘to deliver increased revenue and profits for 2021 and beyond.’
The group’s administrative expenses increased to £4.5m (FY19: £3.4m) as a result of increased marketing expenditure to capitalise on the current market opportunity as the awareness of online schooling continues to increase amid the ongoing global pandemic.
On an adjusted basis, operating profit rose significantly to £0.5m (FY19:£0.05m) as FY19 was ‘heavily impacted’ by restructuring and other one-off costs while PBT more than doubled, to £0.65m.
The group’s cash position is ‘very strong’ at year end at £6.5m (FY 19: £5.0m) which will enable a solid basis for future investment considerations in new materials and technology.
Chairman, Barrie Whipp, said “Wey achieved all short to medium term goals set out since its proposed growth strategy which commenced in November 2019, whereby the company focused the activities of Wey Education through its InterHigh and Academy 21 divisions.”
He said the business is performing ‘well against’ all of its internal metrics with the growth of the student base ‘very pleasing’. He added that it is becoming increasingly clear that Wey represents ‘a true alternative to a traditional education in a bricks and mortar environment.’
Outlook
The company described its outlook as ‘unequivocally optimistic’ following its previous 1H20 market consolidation with a robust strategy for accelerated growth. It added that growth and subsequent changes in human behaviour have presented ‘yet further opportunities.’
Wey said its ‘key factor’ in determining future investment decisions is its clear angle of differentiation and skill set in comparison to emerging providers. It said it is well placed ‘to capitalise on structural shifts with improving lifetime value.’
‘The biggest opportunity of our lifetime is to fundamentally reshape the way we think about, develop, and value education systems around the world. Wey is going forward into the 2020/21 academic year with mastery, autonomy and a great sense of purpose,’ it said.
Shares in Wey Education have traded strongly over the past two weeks at around 30p to open 26.5% lower this morning at 26.5p following the announcement.
3 Reasons to Follow Wey Education
With a track record, Wey believes it has established itself as the UK’s leading company in this sector, successfully educating thousands of students over its history.
Wey Education operates two established divisions – InterHigh, a non-selective fee paying online secondary school, established in 2005 and Academy21, B2B division serving other educational providers, schools, local authorities and other public bodies.
Structural Change in the Education System
Due to a new reality of distance learning in the age of the COVID-19 pandemic, the edtech space has surged with analysts reporting an average increase in revenue of 335% according to an industry impact analysis by Rootstrap. And the market is set to grow even further.
According to market data published by MarketsandMarkets, the EdTech and Smart Classroom Market size is expected to grow globally from $85.8 billion in 2020 to $181.3 billion by 2025.
Rapid Growth
The online educational specialist previously told investors in July 2020 that group turnover was expected to be in excess of £8 million for the financial year ended 31 August 31 2020.
As part of the company’s wider business strategy adopted in November 2019, Dr Sara de Freitas was appointed in January 2020 in order to provide Leadership of the Education Strategy ‘to enhance quality, improve student engagement and scale for growth.’
'Best-In-Class'
Since 2019, Wey said its education provision has been restructured to ensure the best individual learning experience across the Wey group for an increasing number of students.
Currently, Wey said its technology architecture successfully delivers the needs of today's business, however it has been preparing to scale to the next level growth for its business.
With the appointment of a CTO, the company’s division has been planning the new technology strategy and investment into the target Wey technology architecture which has commenced with new platforms planned for delivery in 2021 and beyond.
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