The Academies Australasia Group Ltd
(ASX: AKG) share price was up more than 8% on Monday after the education business provided investors with a positive trading update.
What Does Academies Australasia Do?
Academies Australasia formed 111 years ago and listed on the ASX in 1977. The group comprises 18 separately licensed education businesses operating throughout Australia and Singapore and has taught more than 100,000 students from 130 countries.
Trading Update
In its announcement, Academies Australasia’s management said they expected EBITDA for the 2019 financial year to come in at $7.63 million, an increase of 2% on the previous financial year. The following video explains what EBITDA is and how to calculate it:
After adjusting for a one-off significant item, Academies Australasia’s EBITDA result becomes $9 million. The marginal improvement in profit was helped by a 6% increase in revenue from ordinary activities which is expected to come to $66.3 million.
According to the announcement released to the ASX, it was the higher education operations of Academies Australasia Polytechnic that was the main contributor to the revenue growth. The 2019 financial year saw the commencement of their second Bachelor Degree (Bachelor of Business – Leadership & Management).
Buy, Hold or Sell?
Academies Australasia has been aggressively reducing debt over the past couple of years and as of last month have paid off all outstanding debt. With the company making profits and likely to pay a dividend I think you could do a lot worse than consider Academies Australasia as a speculative small-cap share for your portfolio.
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Disclosure: At the time of publishing, Luke has no financial interest in any companies mentioned.
