Malvern revenue more than doubles in first half

Learning and skills specialist Malvern International updated the market on its first half of trading on Thursday, with revenue more than doubling to £4.8m from £2.3m year-on-year.

The AIM-traded company projected a return to profit for the six month period, recovering from the £0.7m loss experienced in the first half of 2022.

It put the turnaround down to robust University Pathways student admissions in September 2022 and January 2023, coupled with 40% growth in its English language teaching (ELT) revenues compared to the prior year.

In University Pathways, Malvern said the positive trend showed no signs of abating as it projected an increase in new students for September.

It anticipated around 440 newcomers at the International Study Centre at The University of East London (UEL) - a substantial rise from the 230 in September last year, and from a mere 46 in September 2021.

Financially, that would mean that roughly one-third of the income from the admissions would be reflected in the second half, while the remainder would appear in the first six months of 2024.

Malvern credited the uptick to the augmentation of its international sales team, efficient student recruitment pipeline management, and significant recruitment ventures to essential feeder markets.

It noted its joint marketing expeditions to India and Nepal in partnership with UEL, adding that its ambition to further bolster its University Partnerships division was supported by investments in top-tier consultants specialising in the sector.

On the partnership with UEL, Malvern said its contract with the UEL International Study Centre had been automatically extended for the 2023-2024 academic year.

At the same time, negotiations for a long-term contract extension are ongoing.

Meanwhile, Malvern said that while the NCUK centre expected an intake of about 10 students in September, a larger group was expected by January.

With ongoing efforts to build a recognisable brand in China, Nigeria and south east Asia, the board said it was optimistic about the centre's potential.

Looking at English Language Teaching (ELT), Malvern said July and August - traditionally peak months - had seen an approximate 20% increase in bookings compared to 2022.

That mirrored a rejuvenated confidence in the market, driven by more students from the Middle East and North Africa (MENA) region travelling to the UK.

Facilitating the trend had been the introduction of the electronic visa waiver for Saudi Arabian students, effective from 1 June last year.

Finally, looking at juniors, Malvern said that in line with predictions, the Italian government-funded programmes proceeded as planned over the summer.

The programmes saw a broader nationality mix, including student groups from MENA, the Commonwealth of Independent States (CIS), Latin America and Taiwan.

During July and August, Malvern catered to more than 2,000 students, thus generating revenue of about £3.7m.

For comparison, the dame period in 2022 had revenues of roughly £1.4m.

Malvern said the earnings from the venture would be recognized in the second half.

“The board feels that this is a very good result and, together with a large increase in the number of agents, the group has a solid base on which to keep building for 2024 and beyond,” Malvern’s directors said in their statement.

“As at 30 June, the company's debt facility with BOOST&CO remained at £2.6m, and cash balances were £2.1m, which includes payments on account for juniors.

“The board believes the group's working capital position is more than sufficient to fund ongoing investments in the business.”

At 1410 BST, shares in Malvern International were up 13.33% at 20.4p.

Reporting by Josh White for Sharecast.com.