IDP Education rallies despite 25% drop in HY profit on stricter immigration policies
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The news: Shares in IDP Education rallied in morning trade despite the company reporting lower year-on-year earnings in the first-half.
Shares rose 13.07% to $5.19 per share at 1:37pm AEDT
The numbers: International student placement services IDP Education reported a 25% drop in interim net profit after tax to $48.6 million and a 5% decrease in total revenue to $462.2 million.
Earnings before interest and tax shed 50% to $52.6 million, from $104.6 million a year ago, while student placement revenue came in at $227.9 million, a 10% drop from a year ago.
The company declared an interim dividend of 3 cents per share.
The context: The company said the profit decline was driven primarily by lower student placement and English language testing volumes across key destination markets, including Canada, Australia, the UK and USA.
The English language testing revenue was weaker, reflecting a 25% decline in India following regulatory changes affecting Canada-bound students and heightened competition.
IDP expects conditions to remain challenging in the near term as governments in key destination markets continue to adjust immigration policies impacting the higher education sector.
The group said it is targeting a $25 million in net cost reductions in FY25, and upgraded its FY26 adjusted earnings guidance to be between $120 million and $130 million.
The source: ASX
