EDUFOCAL on Thursday released its financials for the January to March quarter, showing a 73 per cent dip in revenues during the period as the company shifted its dependence on one-off contracts — from which it has been having difficulties collecting — in favour of more predictable, recurring sources of revenues.

The financials show the EduFocal Group generated revenues of $30 million from January to March, down signficantly from the $112 million it generated in the same period a year earlier.

“This change is part of our strategic shift towards more predictable recurring revenue streams,” the company said in the management discussion and analysis which accompanied its consolidated numbers.

It pointed to its Amigo software, which was developed at a cost of $60 million, as being the main initiative designed to produce significant recurring revenues based on the proposed business model.

For now, the company contends not only with a decline in revenues but also $21 million in operational losses during the first quarter, coming from operational profits of $51 million in the same period last year.

So far, to help shore up its position and reduce losses, it reports that 43 staff members were “let go” between January 2023 and March 2024. That number comprises both permanent staff and contract workers. The changes are expected to save the company close to $7 million per month, or a little over $80 million annually. Before the cuts EduFocal had a staff bill of $130 million in 2023, representing more than a third of its total expenses.

“These changes [to the headcount] will not affect our ability to execute and achieve our targets as we leverage technology to increase productivity,” the company said.

Turning to its segment report, EduFocal said its Learn division is concentrating on the expansion of its market presence globally, aligning with the group’s strategic objectives for growth and market penetration. With the closure of the company’s academy and the acquisition of Clever School Teacher (CST), EduFocal Nigeria and EduFocal Africa, the company said the division remains committed to widening the group’s footprint in these territories.

On the other hand, it said its business division is expected to contribute about $200 million to group revenues this year. The division primarily leverages contract labour, as needed, to meet project demands, which the company says helps it to manage associated expenses by ensuring it only spends what is earned.

But, operational issues aside, the financials also show the main shareholder Gordon Swaby, who is also the CEO, reducing his holdings in the company, with a new name in the top 10 largest shareholders at the end of March compared to the beginning of the year.

At the end of December 2023 Swaby held 201.6 million shares in EduFocal, or about 31.08 per cent of the total; however three months later, at the end of March 2024, his holdings shrunk by 20.29 million shares to 181.3 million shares. At that level Swaby now holds 28 per cent of EduFocal. At the same time, a new name appears amongst the company’s top 10, Dale McFarlane, who at the end of March held 17.5 million shares, which is equivalent to three per cent of EduFocal. The holdings make McFarlane the sixth-biggest shareholder in EduFocal.