Wey Education plc (LON: WEY) today published its interim results for the six months to 28 February 2019 and reports on a number of important developments within the business.
· Turnover up 54.7% at £2.70m (2018: £1.74m)
· Continued strong growth in both Interhigh and Academy21, reflected in turnover and gross profit margins
· Adjusted profit before tax on continuing operations of £124k (2018: £23k)
· Loss after tax of £895k (2018: £153k) after exceptional items of £571k and £310k of losses from discontinued operations in London and overseas
· Cash balances strong at over £4.96m (2018: £4.35m)
· Wey now focuses on its two core brands, InterHigh and Academy21, and their clear market opportunities
· Investment in academic leadership, AI and quality of educational provision
· Further development of the IT platform to enable alignment and scalability of both brands
· Accreditation of Teaching Online qualification, setting standards in education delivery
Commenting on the results, Barrie Whipp Wey Education Chairman said:
“Wey is now completely focused on InterHigh and Academy21, our distinct brands for online education. With significant cash resources, and businesses with growing underlying financial performance I believe we have a great foundation for growth in our ever expanding and exciting market”
In the first half of the financial year, Wey Education took the decision to evaluate its investments and activities in a range of wider brands and geographies. Following the illness and then sad passing of David Massie, the former Executive Chairman the Board decided that the best course of action was to concentrate on developing its two core brands in online education; InterHigh, where we provide live online schooling, and Academy 21, which provides alternative provision to educational bodies. The success of the development of these two businesses is reflected in the growth of the Wey Group at the turnover level, where we achieved 54.7% growth, with a full six month contribution from Academy 21 in the current period.
The Company’s vision is for the Wey Group to become a provider of online education to a level where it is, in terms of numbers of students, the largest secondary school in the country and for it to go on to become the size of a Multi Academy Trust. This can only be achieved by the provision of excellent teaching and learning, and I am pleased to report that the appointment of Wayne Owens in November 2018 as Executive Head Teacher, working alongside the Academic Advisory Board, led by Dame Erica Pienaar, has seen positive improvements in the quality of our provision. We have a strong ethos of continuous improvement in this area and we aim to set the standard for online education.
InterHigh continues to grow its student numbers and we have embedded into its platform the ability to teach older primary school students which, along with its sixth form capabilities, means that parents can trust InterHigh to manage two life changing periods in education.
Academy21 also continues to grow. Its offering of alternative provision is an area where local authorities and other bodies find Wey an ideal solution to a range of issues such as capacity, funding and provision to students in difficult circumstances. The Academy21 business will be fully integrated into the Wey platform for the new school year starting in September 2019 allowing for margins to be improved whilst maintaining educational standards.
Whilst we have decided not to pursue investments in overseas territories, Wey is very much “open for business” to international opportunities. Fundamentally, location is not a barrier to the provision of our services and we have opportunities to increase export sales, without committing to infrastructure. Our brands have been enhanced and simplified to ensure consistency in marketing campaigns, in which we intend to invest more resources to promote our longer-term strategy. We are delighted to have entered into a partnership with Olympic athlete and commentator Colin Jackson as Wey’s brand ambassador.
Our IT platform is allowing us to explore AI opportunities and we have also recently received accreditation for our Teaching Online qualification. This will add to our goal of being capable of achieving early regulatory standards for online education. Regulation of home schooling is very much a matter of concern at the highest levels of government and it is our desire that Wey is seen as a gold standard in online provision.
Financially, the Board has taken the decision to write off the investments in operations in London and overseas. This amounts to £571,000 of exceptional costs and £310,000 of costs classified as exceptional items or losses from discontinued operations, however the Board believes there are no further significant costs related to this challenging process. The Company’s cash balance of £4.96m means that we can now focus on the future growth of InterHigh and Academy21 and invest in marketing and new sales representation respectively.