Dubai school operator Taaleem reports 14% increase in first-quarter profit

Revenue for the three months to the end of November climbed to $63 million

An artist's impression of one of Taaleem's new schools that will open in the next two years. Photo: Taleem

Dubai school operator Taaleem Holdings has reported a 14 per cent increase in its first-quarter profit on the back of higher revenue as enrolment continued to rise across its schools.

Net profit for the three months to the end of November climbed to Dh51 million ($14 million), from Dh44.6 million during the same period in the previous year, the company said in a filing on Tuesday to the Dubai Financial Market, where its shares are traded.

Taaleem's financial year is from September 1 to August 31.

Revenue during the first quarter rose by 32.4 per cent annually to about Dh232 million, mainly as a result of organic growth and a ramp-up across its premium school portfolio.

The company's total expenses were up 38 per cent to Dh183.4 million, with finance costs more than doubling to Dh6.89 million.

“The quarter has been one of strong progress with the company’s financial performance ahead of expectations,” chief executive Alan Williamson said.

“With exciting new projects to be launched in the near future, we will further provide exceptional education establishments to serve the new and growing communities in Dubai and Abu Dhabi.”

Mr Williamson said the company was currently seeking to recruit more teachers from around the world.

Taaleem, formerly known as Beacon Education, was founded in Dubai in 2004. It operates 26 schools across the UAE, offering British, American and International Baccalaureate curriculums to more than 27,000 pupils.

Earnings before interest, taxes, depreciation and amortisation (ebitda) rose 22.1 per cent to Dh78.3 million in the quarter, compared with the same period in the previous year, generating an ebitda margin of 33.8 per cent.

The net debt-to-ebitda ratio stood at minus 6.45 at the end of the quarter, indicating that the company has more cash than debt. This will be the case until the capital is used in line with the business strategy.

The adjusted net debt-to-ebitda ratio will be 2.5 if initial public offering proceeds are not included in the calculation.

The company raised Dh750 million from its IPO last year after selling 254.2 million shares, or a stake of 25.32 per cent.

The listing drew strong demand from UAE and international investors, and was more than 18 times oversubscribed, the company said in November.

Total enrolments in the first quarter of 2023 surged more than 45 per cent annually to 28,218 pupils.

Taaleem is the first education company to be listed on the DFM.