IQE
30/11/2015 08:30
FORECAST
PRICE SENSITIVE
REL: 0830 HRS Intueri Education Group Limited
FORECAST: IQE: IQE - Intueri Reaffirms Quality Strategy
30 November 2015
IQE - INTUERI REAFFIRMS QUALITY STRATEGY
o Intueri has today reaffirmed its quality strategy and its focus on quality
student outcomes
o The company remains in a sound financial position with strong margins and
cash flows, appropriate funding and the full support of its bankers
o The company continues to comply with its continuous disclosure obligations
under NZX and ASX Listing Rules
o Intueri notes a number of significant sector events in Australia recently,
which have impacted on overall investor confidence in the wider sector
o Intueri is committed to co-operating fully with the Tertiary Education
Commission (TEC) reviews of two of its New Zealand schools, which it
understands are primarily focused on legacy issues, and reiterates that none
of the group's other schools are subject to review
o Staff continue to focus on building enrolments for 2016 and delivering
quality vocational education outcomes
Intueri Education Group (NZX/ASX: IQE) has reaffirmed its positioning as a
high quality provider in the vocational education sector, with a focus on
quality student outcomes. The Board believes Intueri's commitment to quality,
strong values and growth strategy will allow the company to benefit from the
opportunities in the sector, generate sustainable profits and build enduring
value for shareholders.
Following the significant share price movement on 27 November 2015, Intueri
confirms that it continues to comply with its continuous disclosure
obligations under both the NZX Listing Rules, including Listing Rule 10.1.1,
and the ASX Listing Rules.
The tightening regulatory environment in Australia has resulted in a number
of sanctions against vocational education providers in recent weeks,
culminating in a high-profile listed Australian vocational education provider
announcing it had been placed into voluntary administration on Thursday 26
November 2015. The Intueri Board believes these events have impacted on
overall investor confidence in the wider sector, however it is important to
note that Intueri's business model is significantly different from those
under review in Australia.
Intueri remains in a sound financial position, with strong margins and cash
flows, appropriate funding and the full support of its bankers.
Revenue growth continues, particularly in Intueri's International and
Australian Online segments, which now represent half of total revenue. The
company continues to generate strong EBITA margins and solid cash flows.
Intueri reported EBITA of $11.7m for the recent 2015 interim result, which
enabled the company to pay a 6.1 cent fully imputed interim dividend, equal
to 63% of the NPATA .
The company's bankers have recently reaffirmed their undertaking to provide
debt facilities to complete the upcoming NZ Institute of Sport group
transaction and the final acquisition payment for OCA group in Q1 2016, along
with an increase in Intueri's minimum debt/EBITDA banking covenant ratio.
As announced on 23 November 2015, Intueri is committed to co-operating fully
with the TEC reviews of two of its New Zealand schools, which it understands
are primarily focused on legacy issues, and reiterates that none of the
group's other schools are subject to review.
The TEC review is expected to have a one off impact on 2015 full year
earnings of $4m - $5m (excluding any recourse received from vendors). EBITA
margins are still expected to remain comfortably above 20%, generating a
solid and stable cash flow. Intueri will update the market as necessary as
the TEC review progresses.
The company's focus is on maximising returns and realising opportunities in
existing operations, and staff continue to build enrolments for 2016 and
deliver quality vocational education outcomes.
-Ends-
Rob Facer
Chief Executive and Director
T: +64 27 675 3538
E: [email protected]
Chris Kelly
Chairman
T: +64 27 249 8883
E: [email protected]
End CA:00274300 For:IQE Type:FORECAST Time:2015-11-30 08:30:33
