Canaccord BUY Rating

Canaccord Releases Sales Note for OpenLeaning (OLL) with BUY Rating (04/03/20)

“University Closures”, “Sydney Uni $200M shortfall due to Corona virus”, and “$1B virus hit” are some of the recent headlines in the Media (see articles below).

OpenLearning (OLL) is a SaaS company that provides a next-generation online learning platform for education providers to design and deliver high-quality courses . The Company’s platform has blue-chip university and government SaaS customers in Australia, Malaysia, and other offshore markets. With over 10K registered users in mainland China.

OLL traded as high as 38c in January and is currently trading at 16c .

Current OLL clients include UNSW, UTS, Melbourne University, WSU, Charles Stuart university, Macquarie University

To date, OpenLearning has had over 2.5 million enrolments from 1.72 million registered learners across over 7,900 courses provided by 60 education providers, making it one of the world’s largest online education platforms.

In the current environment, at what stage do universities make a bigger push to deliver their material online quickly and efficiently??? At what stage does government intervene and fund educators and delivery platforms?

OLL is key leverage to the sector. They are pushing for $4M ARR this CY, current mkt cap $23M with $7.74M in cash as at end of CY19… BUY!

Top unis warn of $1b virus hit
https://www.copyright link/politics/federal/top-unis-warn-of-1b-virus-hit-20200214-p540u9
Sydney University halts spending to manage $200 million shortfall due to coronavirus
disallowed/national/sydney-university-halts-spending-to-manage-200-million-shortfall-due-to-coronavirus-20200303-p546ef.html
University closures on the table in response to potential coronavirus outbreak
disallowed/national/university-closures-on-the-table-in-response-to-potential-coronavirus-outbreaks-20200302-p545ze.html

One of Australia's largest universities is preparing for a full or partial closure of its campus if a major coronavirus outbreak occurs in Sydney.

The closure option proposed by the University of Technology Sydney is among a number of strategies being discussed in the higher education sector, already suffering from the virus through the absence of foreign students particularly from China.

Phil Honeywood, who chairs the global reputation taskforce co-ordinating the federal government and education sector's response to the coronavirus, said Japan had set a precedent by closing its schools in response to local outbreaks.

"There is ample precedent for some temporary closure of institutions whether schools or post secondary to mitigate or reduce the spread of the virus," he said.

"If the international precedent is anything to go by if a pandemic takes hold, then all options are on the table."

UTS deputy vice chancellor (education and students) Shirley Alexander said the university has a pandemic plan and would work closely with NSW Health.

With a partial or full campus closure, the university will make alternative teaching arrangements available depending on the duration of the outbreak including online, private study or altered teaching periods.

"Like any other organisation the health of our community is our major priority," she said.

"If there is a major outbreak we will follow the advice of NSW Health and that advice will probably include whether or not we need to close the campus in full or in part."

Charles Sturt University Vice-Chancellor Andrew Vann said his university campuses have installed extra sanitiser stations while encouraging stricter hand hygiene.

"In the event of an outbreak, we are prepared for additional cleaning, self-isolation and to close residences, or if necessary an entire campus," Professor Vann said.

"As an experienced provider of online learning, we will enable our students to switch to online modes if face to face is not available. Around this, we have student support services and processes to request extensions or special consideration.

"Our staff will also have ability to work from home if required. Critical operations have continuity plans to enable us to continue operations should an outbreak occur."

The University of Sydney said it is considering a range of options to mitigate risks.

"These include provisions for increased cleaning and sanitiser stations, use of masks, online teaching and meetings, flexibility and support for staff and students, cancellation of larger events, daily monitoring of our community and more – depending on how the situation ultimately unfolds," a university spokeswoman said.

"We will continue to adhere to the advice of health authorities, and take any further required actions as directed by NSW Health. The safety and wellbeing of our community is our highest priority."

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Another university said online learning would be restricted because not all faculties could maintain the same level of quality without face-to-face teaching.

A Western Sydney University spokesman said: "Above all else, this is a public health issue, and we are following the advice of the Chief Medical Officer, and Commonwealth and State authorities.”

Australian Catholic University said it was considering a number of options in the event of an outbreak including flexibility around class and exam timetabling and online course delivery.

Universities Australia chief executive Catriona Jackson said each university would have developed its own approach with measures and actions "appropriate for its unique circumstances".

A TAFE NSW spokesman said it would look at changes to the delivery of courses "in the event of extended disruption to operations" as a result of the coronavirus.