Education services provider IDP Education (ASX: IEL) has announced a 42% growth in net profit for the first half of fiscal 2020 on the back of strong English language teaching and testing volumes and higher student placement levels.
The Melbourne-based company reported a net profit after tax of $57.7 million compared to $40.7 million in the first half of the 2019 financial year.
It also posted a 25% increase in total revenue to $379 million and a 49% jump in earnings before interest and tax of $86.9 million.
IDP chief executive officer and managing director Andrew Barkla said the company’s global platform was exceeding its expectations in terms of pipeline growth and conversion.
“Our organisation has pivoted to focus deeply on the experience of our customers, which is delivering strong returns across all business lines,” he said.
In the six months between July and December 2019, the company opened 37 new International English Language Testing System (IELTS) centres, expanding its network to 167 centres.
It also launched a digital campus in Chennai in eastern India in November.
IDP posted a 30% volume growth in its student placement business, assisted by higher conversions in the sales cycle, and reported an 11% rise in IELTS volumes for the period.
“Our India, Canada and United Kingdom markets all delivered stand-out contributions to our overall business performance,” Mr Barkla said.
Impact of coronavirus
IDP also tried to ease investors’ anxiety about the impact of the coronavirus outbreak on its business, declaring the disruptions being caused by 2019-nCoV are “not currently having a material impact on the financial performance of the company”.
However, it noted the situation is “constantly evolving and the ultimate impact is uncertain”.
“The longer-term structural drivers remain, regardless of any timing-related impact from the novel coronavirus,” Mr Barkla said.
“Our current focus is providing our students with the support they require to continue to achieve their study goals,” he added.