The company held its conference call for discussing result performance for the quarter ended September 2017. Top management of the company addressed the meet.
Key highlights
Consolidated Operating Revenue for Q2 FY18 at Rs 60.5 crore, up by 59%. PAT up by 55% to Rs 11.3 crore. The company took number of actions in the quarter towards upgrading our services and delivery systems
Rigor and discipline in operations helped accomplish an impressive margin performance and progress along the profitability path the mgmt had outlined earlier.
The company has improved its operating margin with the higher growth in revenue against expenses as majority of expenses are fixed in nature and incremental sales flowing to operating profit.
K-12 - had 49k student last year same time, now its 55K.
Preschool had 105k student last year same time, now its 122K.
There being no adverse impact of GST on the company
The student enrollment in Mount Litera Zee School has seasonality with 40-45% happen in Q4 and 35-40% in Q1 and 8-12% in Q2 & Q3.
Revenue from Educational Services / Activities breakup - 72% from pre-school, 22% from K-12 schools and 5% from youth business
Debtors increase has increased slightly over last year due to it K12 school and Man power recruiting business. K12 Schools receivable are recoverable 2 times in year, first in October and then in January/February.
Lease rental income for FY18 will be Rs 22-24 crore, it is not yet realized.
Mgmt fee income annually is around Rs 12-14 crore of which Rs 9 crore is received.
Preschool – the gross number of preschool open in the quarter is 110. Its own preschool opened was 6 in the quarter.
In FY17, it has closed more than 100 preschool. It expects to close 100-120 preschool in FY18.
The company may touch little more than 1900 at end of this year preschool. At start FY18, it was around 1700.
K12- It is gearing up for 14-15 schools, which will open in Q4 FY18.
The manpower recruitment & training business has huge opportunity and the company expects Rs 45 crore sales from this business in FY18.
In manpower recruitment & training business, it had 3 outside clients for the quarter. This company just started in Q1 and its building up. Going forward, has big scope for outside clients. The mgmt is looking from angel of providing training than employment. The company is recruiting people to manage this business, as result margin was down QoQ. Industry margin for this type biz is 1-1.5%, but this is a zero asset business, negative capital business and has very high ROC.
Over Rs 40 crore free cash flow at consolidated EBITA level generate during 6 months and with tax its is RS 32 crore.
Tax rate: - the company is at full tax company now.
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