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For the year ended December 2021, ADvTECH achieved revenue growth of 8%. The Schools South Africa division could only manage revenue growth of 4% and the Tertiary / University division achieved a similar result. The higher growth numbers came from Rest of Africa (up 36%) and the Resourcing division (up 20%).
Despite the modest revenue growth in some areas, restructuring efforts and cost controls led to an increase in operating profit of 22% to R1.1 billion, reflecting an operating margin of 18.7%.
The cash followed the earnings nicely, with cash generated by operating activities up by 21%.
Normalised earnings, which the company reports to help investors understand the underlying result without the impact of once-offs, increased by a meaty 35% to R656 million.
The standard measure that investors always look at is headline earnings per share. HEPS increased by 33% to 121.6 cents, so yesterday’s closing price of R16.48 is a Price/Earnings multiple of 13.6x.
The dividend has increased sharply from 20 cents per share in 2020 to 50 cents per share in 2021. This is a 3% yield on yesterday’s closing price. The final dividend still to be paid to shareholders is 31 cents per share (included in the 50 cents for the year).
ADvTECH’s share price is down 7.4% this year. In the peer group, Curro Holdings is down by a similar amount and Stadio is up 13.3%.
