EduFocal books profit
ONLINE learning company EduFocal Limited, for the six-month period ended June, reversed losses seen during the same period last year to earn profit of $11.5 million, just months after listing on the Jamaica Stock Exchange.
The ten-year-old provider of online study courses, during the period, also saw revenues more than double to total $133 million — 163 per cent above that seen in the previous year’s period.
“We are happy to report a 321 per cent increase in our net profit performance for the second quarter. The group successfully recorded a net profit of $11.6 million for the 6 months ended June 2022 when compared to a net loss of $5.3 million in the corresponding period 2021. Achieving this level of turnaround is no small feat,” co-founder and chief executive officer (CEO) of the company, Gordon Swaby said in a report accompanying the financials.
“We listed on a 9-month loss, which means that what we would have made for profit during the full year 2021, we made during the fourth quarter. So far this year we’ve had first- and second-quarter profits so it’s not unreasonable to think that we will have a spectacular performance for financial year 2022, with profits even surpassing our projections outlined in the prospectus,” Swaby said while commenting on the company’s performance during an interview with the Jamaica Observer on Monday.
Raising over $130 million in new funds from the successful launch of its initial public offer (IPO) in March, the junior market-listed company is intent on building out its footprint in the digital educational services market. Total assets climbed to $336 million — up 148 per cent — while earnings per share increased to $0.018 over the reporting period.
“I’m very excited about the next set of quarters, and we have some serious deals in the pipeline. We have one deal that is massive, which when closed and announced will surprise a lot of people,” he told the Business Observer, remaining tight-lipped about the details of this deal. He however indicated that the deal will help to leverage a recent partnership with the Jamaica Library Service (JLS).
Under the partnership EduFocal is to establish learning centres across the JLS network, offering digital services and technical assistance for student users, and training for staff members. The company, via its private sector partners, will also provide marketing, sponsorship and financial contributions to facilitate improvement of the JLS.
The educational services firm, which had initially indicated its intention to use the proceeds from the raise to repay short-term loans and invest in product development to drive expansion, said this mission remains on track. Its growth forecast sees the company earning over $50 million in profit this year and up to $70 million in 2023 — even as revenues increase to trend above the $300-million mark.
Bemoaning current economic challenges including rising interest rates, Swaby said the company is well positioned to withstand the difficulties of the environment. “Despite capital being expensive, I think we are still in a good position to take advantage of the opportunities that are ahead of us,” he stated.
Through its learning platform which has engaged thousands of students in helping them to prepare for major exams such as the Primary Exit Profile (PEP) and Caribbean Secondary Education Certificate (CSEC), the CEO said the delivery of more deals over time will further help to unlock new services whilst strengthening the company’s growth position.
“I am just as incentivised to ensure that the company is giving good returns to our shareholders. We still have an opportunity in the future to undertake another raise in the form of an additional public offer (APO) or rights issue, or even by using debt to pull out additional funds from the market if we see a strategic opportunity to do so,” he said.