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AEC Education

  • BY: Andrew Hore |
  • POSTED: 12/06/2009 |

AEC Education reported a significant increase in its 2008 revenues and profits.

Revenues increased 123% to £6.15m, while pre-tax profits jumped from £298,000 to £794,000. The educational qualifications and programmes provider has restructured its business over the past year. Classroom utilisation rates are improving.

Shares in AEC jumped 11p to 27.5p each, which values the company at £7.75m. AEC joined Aim on 10 December 2004 when it raised £500,000 at 41p a share.

Much of the growth came from taking full control of Education Resources Pte, which offers London Chamber of Commerce and Industry qualifications, at the beginning of 2008 for £410,000 in shares at 11.5p each. AEC previously owned 35% so the results were not consolidated. This business contributed around £3m in revenues and also made a significant profit contribution. The business did not make much money the previous year. The LCCI licence covers 24 countries in Asia and 120,000 LCCI exams were sat by AECís students last year. 

Chief executive David Ho is a major shareholder in KSP Investments, which owns 29.5% of AEC.

Broker WH Ireland is due to release its first forecasts for the company in the next few weeks.

The business is cash generative because fees are paid up front. The operating cash inflow was £1.85m in 2008, with £1m of that related to an increase in creditors. That is mostly down to deferred income where students have paid for courses that are still running after the year end. There was net cash of £1.96m at the end of 2008 and that figure had increased to £3.23m at the end of April 2009.

Since the year end AEC has raised a further £1.2m at 12p a share.

AEC is keen to acquire a UK-based college so that it does not lose out on Asian students who decide to come to the UK for their education. AEC would also like to expand in other Asian countries. The expansion will always be focused on vocational and professional qualifications.

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