Education giant Navitas has reported a 5% fall in end-of-year profits as its university programmes, student recruitment and English divisions all suffered from regulation and currency issues in Australia and the UK. Costs associated with a previous acquisition also had impact, leading CEO Rod Jones to call 2012 “probably the toughest year in Navitas’ history”.
Despite growth in the second half of of fiscal year 2012, overall profit fell 24% for the English division which operates wholly in Australia (in both the public and private sectors). Australia’s high dollar and ongoing visa concerns were said to have hit private ELICOS enrolments, although “costs associated with new government English language contracts” were more at fault, according to the company.
“We are now starting to see signs of green shoots following several years of very tough conditions”
The University Programmes (UP) division, which offers in pathways and degree programmes in 30 colleges worldwide, fared better with revenue falling 2% to $366.7m and enrolments down 3% (to 14,097) – a “moderately improving situation”, according to Navitas.
The company said UP centres were adjusting to visa restrictions in the UK and Australia’s high dollar while growth had been positive in North America and Singapore.
“As indicated by our latest University Programs enrolment data released today we are now starting to see signs of green shoots following several years of very tough conditions,” Jones said.
With 15 offices across India, SOL especially suffered the UK’s tightening of visa policy
Similar market challenges dented profits in the company’s student recruitment division which includes the education agencies SOL, EduGlobal, EOL and StudyLink. With 15 offices across India, SOL especially suffered the UK’s tightening of visa policy (with profits falling 56%), while Canadian based Edulang lost Chinese business because of the high Australian dollar.
Nonetheless, Jones predicted FY2013 would be a stronger year across the company as found in a review by the consultants Parthenon.
“The external environment in key markets is improving for all divisions, Navitas has reduced costs and is more efficient and the Parthenon review is providing us with a robust framework for future growth. On this basis we are confident of steady growth into FY13 and beyond,” he said.
