IDP Education shares rise as full-year profit beats forecasts
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The news: IDP Education shares advanced after the education services company beat full-year profit forecasts, boosted by double-digit growth in its student placement business.
The numbers: IDP shares were up 3.1% to $16 by 2:30pm AEST, having dropped more than 35% in the last 12 months.
The group reported adjusted net profit after tax of $154.3 million, 1% lower than last year's result, but ahead of consensus estimates of $149.5 million, according to Visible Alpha data.
EBITDA fell 2% year on year to $265.8 million and came in 1.9% short of average forecasts of $270.9 million. Revenue increased 6% to $1.04 billion, higher than consensus estimates of $1.03 billion, driven by 27% growth in student placement revenue.
IDP declared a final dividend of 13 cents per share, lower than average expectations of 17.2 cents per share.
The context: IDP said its student placement business "significantly outperformed the market", achieving 17% volume growth, while the broader industry contracted 13% due to tighter visa settings in key destination markets.
The Melbourne-based company — which offers student placements in Australia, New Zealand, the USA, UK, Ireland and Canada — did not report a FY25 outlook for volumes, margins or costs, but flagged it will pursue a targeted cost-out program to reduce headcount, in line with previous announcements.
It noted that the regulatory and market environment for international education "remains dynamic", including "an assumed decline" in Australia in light of the federal government's proposed international student caps announced this week.
IDP reiterated its expectation that international student volumes across its six key destination markets will reduce by 20% to 25% in FY25 relative to FY24.
What they said: "While [IDP] reported a robust FY24 result, the outlook for FY25 volumes (particularly for both Australian and multi-destination student placement volumes) remains the key risk to our view," said Jarden analysts.
The sources: ASX announcement, Jarden research
