Taaleem's numbers were boosted by a sharp increase in new student intake across its premium schools. Image Credit: Supplied

Dubai: Higher student intake at its premium schools boosted Dubai’s Taaleem’s results for the September to November period, with revenues up 32.4 per cent to Dh231.9 million and net profit weighing in with Dh50.9 million, up 14.1 per cent year-on-year. These are, incidentally, the school operator’s first announced financial results since its IPO. (The September to November phase represents the first quarter for the company.)

“As the first education company to be listed on the DFM, the confidence in the company was reflected in the tremendous demand for shares with an oversubscription of 18 times,” said Khalid Al Tayer, Chairman of Taaleem. “Our strategic growth plan is right on track to deliver several exciting new projects in the next few years, further adding to the strength and reputation of our rapidly growing portfolio of globally recognized schools.”

At the end of November, the company had 28,218 students enrolled, and which is higher by 45.4 per cent on an annual basis. Taaleem’s network of schools includes those owned and operated by it and those managed under a PPP basis.

More schools on the way

Alan Williamson, CEO, said during the reporting period, the operator recorded higher student intakes at its premium schools as well as at the one in Jebel Ali, which it had acquired. “The Jebel Ali School has grown significantly since Taeleem took over, whereby there were 1,419 students the year before and now it’s at 1,738,” he added.

“There is still space to close in our asset (school) utilisation; enrolment is up in our premiums schools by around 400 students and that’s just an incredible performance. It has meant a considerable increase in revenue and profitability and attests to the strength of the Taaleem brand.”

Scouting for schools outside UAE?
Taaleem is keeping options open on taking on schools under management outside the UAE.

"We made some initial strategy evaluations to move beyond the UAE," said Alan Williamson. "I can’t as yet declare any concrete plans - but we are not dismissing expansion beyond the UAE at a future date.

"It could be that a PPP (Public-Private Partnership) would represent the strongest outcome, and place us in a strong position to pivot into GCC should we decide that." (What the Taaleem CEO means by PPP is taking on government-owned schools under management contracts. It has a similar program running in the UAE.)

Numbers hold up

Taaleem, which completed its IPO and with its share trading at Dh2.58 as the market opened Tuesday (January 10), has a net debt/EBITDA ratio is of -6.45x ‘because the cash and cash equivalents (including deposits) far exceed the current bank borrowings position’.

“This will be the case until the capital is deployed as per the business strategy.”

Upcoming capex

The CEO said that Taaleem will have two new schools in Dubai up and running by September 2024, in Jumeirah and Mira districts. “At the time of issuing our IPO prospectus, we mentioned four new UK curriculum schools – approvals have been received for two,” said Williamson. “We will use the IPO proceeds to start work on them.

“As for the remaining two, we are in the process of bagging the approvals. As to where these schools will be, we have not decided that yet."

Net profit margin
Taaleem's first quarter net profit gained 14.1% to Dh50.9 million from a year ago.

This increase resulted in a net profit margin of 21.9%. The adjusted net profit margin of 25.9 per cent is higher and 'reflects the growth in the adjusted EBITDA margin mentioned above, which is partially offset by an increase in net finance costs driven by the significant increase in interest rates and additional depreciation costs from the previous year’s investments', the company said in a statement.