Navitas Trades In A Restricted Zone After AGM

  • Nov 15, 2018 AEDT
  • Team Kalkine
Navitas Trades In A Restricted Zone After AGM

Navitas Limited (ASX:NVT) came up with its AGM 2018, on November 15, 2018. The AGM was addressed by the Chairman. While addressing the shareholders, he presented about the group performance in the year 2018, key events and major proposals in line with the company’s strategy.

Navitas has performed and positioned itself well in the space of delivering quality educational services to varied partners and to thousands of students who enroll with it to pursue their goals by undertaking further educational programs.

Year 2018 remained a transitional period for Navitas. Key achievements during this period included the change of CEO, Rod jones who was replaced by new CEO David Buckingham. Various  structural changes at operational, strategic and organizational front have been undertaken by David ever since his appointment and his role commencement as Managing Director in July. His initiatives in this direction will help in future positioning of Navitas in educational space. NVT witnessed favorable and growing trends under core university partnerships by enrolments growth, increased investment for business development and new partnership agreements.

Meanwhile, University Partnerships recorded 6% increase in enrolments well ahead of 2020 targets set by the management. Various new partnership agreements were undertaken in the year 2018, like agreement with Virginia Commonwealth University and Murdoch University, agreement with University of Twente and The Hague University of Applied Sciences in Netherlands. Renewal of five existing partner contracts were also done in the year 2018. Investment in business development activities gave birth to the announcement of number of new contracts and some in pipeline giving a healthy outlook of the Company. Total of three new partnership contracts were signed in 2018.

On October 10, NVT received a proposal from BGH Consortium, under which acquisition of 100% of the outstanding shares of Navitas for $5.5 per share was indicated. However, the management found the proposal to be below the assessment value and rejected the proposal.

As per the chairman, till date in the 2019 financial year, two partnership contracts have already been signed, four contracts have been awarded to the company but are scheduled for signing formalities and two other contracts are in the process of execution. So, a total of 8 new partnership contracts are in the hands of the company for 2019 financial year. The company is actively pursuing ten potential contracts and building strong relations with its established partners.

Navitas witnessed one-off charge of approximately $123.8m that has adversely impacted the financial performance of Navitas in 2018 and resulted in after tax loss of $55.3m. Group posted a revenue of $931m and EBITDA of $142.1m which excludes C&I restructuring cost. Full year dividend was 17.4 cents per share, reflecting the healthy cash generation by the business despite of the lower posted results.

As per the management, “With strong proposals in line along with healthy and strong relationship with the established partners, Navitas is all set to achieve its financial forecasted targets by 2020”. The company has forecasted 2021 EBITDA of $200m and a 2023 EBITDA to exceed this and be around the target of $250m. New agreements along with enrollments and significant growth in the year 2018 will continue in the future.

NVT traded at $5.115, down 0.1% on November 15, 2018 (1:45 PM AEST).


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