Business Maverick


Curro’s star keeps rising as private school group posts healthy results

Curro’s star keeps rising as private school group posts healthy results
(Photo: Gallo Images / Misha Jordaan)

The numbers are up, it’s investing R800m in capital expansion to maintain, refurbish and expand, and is keeping a close eye on bad debt.

You can’t put a price on a great education. Or, in Curro’s case, a lid on the growth of a solid private offering. The private education group has delivered robust annual results, with top academic outcomes alongside growth in profitability, revenue and pupil numbers, in spite of the weakening economy.

It’s also paying a final dividend of 11.08 cents per share from income reserves for the year ended 31 December 2022. 

Boasting a 6.4% upswing in pupil numbers, from 66,447 in 2021 to 70,724 in 2022, Curro grew revenue for the year by a healthy 17.3% to R4.156-billion (up year on year from R3.543-billion). This 17.3% comprises both revenue from fees and ancillaries from scholar transport, boarding school and aftercare. Tuition fees increased by 14.1% due to the growth in pupil numbers, coupled with the annual fee increase. 

In addition to swelling pupil numbers, Curro’s recurring headline earnings increased by 34.7% to R330-million.

Its schools’ operational performance increased by 18% to R1.195-million for the year, while for head office, it rose 17.4% to R926-million.

Headline earnings were up 49% to R365-million and earnings per share by 50.1% to 61.4c.

Curro CEO Cobus Loubser told Business Maverick that ancillaries received a 36% boost, but were still lagging from pre-pandemic numbers. 

The group was managing costs stringently by decreasing discounts granted on tuition from 9.1% in 2021 to 7.8%.

“If you unpack that carefully, fee revenue, comprising gross fees that we invoice and discounts that we provide thereon, went up 15.8%.

“Gross fees went up about 14.5%… but that’s a combination of 6.4% in learner growth plus 2% above inflation.” 

Loubser said they had invested R60-million on acquisitions in 2023 and R284-million in 2022 on the purchases of HeronBridge College and of buildings in Cape Town and in Randburg for the high-growth DigiEd schools.

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R800-million has been set aside for infrastructure: ​​R450-billion has been earmarked for the expansion of classrooms and/or facilities such as sports fields and bathrooms, while about R250-million has been earmarked for maintenance, replacement of assets and the refurbishment of existing buildings and sites.

To fortify its business against power outages by about two levels of blackouts, Curro has also invested R45-million in backup power and metering solutions in 2022, enabling it to achieve greater energy independence, reduce costs and mitigate disruptions.

“We bought generators and put electricity meters in all of our schools to manage and monitor consumption and use. Generators become exceedingly expensive, so I think the opportunity is increasingly available to invest in solar and battery technology that may take our business, in due course, off the grid altogether.”

It has also had to take firmer action to guard against bad debt: Expected credit losses of R147-million have been provided for during the year (up from R131-million the previous year), and Curro has sold the non-performing portion of its debtors’ book, which relates to pupils who have left the Curro system. 

The remaining debtors’ book, net of the expected credit loss provision, consists of R137-million of actively enrolled accounts and R112-million of inactive accounts.

Loubser noted that since they play in an aspirational space – private education – they attract parents from across the spectrum of the economy, and that includes people who really want the best for their children but who may be on the edge in terms of affordability.

While Curro’s vision is to extend quality private education to more pupils throughout the country, it needs to remain a profitable business. 

“From our perspective, it’s probably the worst thing for us to look at any of our learners and say you can’t come back because your parents can’t pay the bill. We can’t offer a service for free.

“We do have bursary programmes and we’ve created this incredible partnership with the Ruta Sechaba Foundation, which supports talent and potential in the case of adverse financial circumstances.”

This year, Curro marks its 25th year in private education. BM/DM


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