Embark confirms occupancy at 81.8%, pending NZ delisting and director change in bumper market update

Listed ASX early childhood education and care provider Embark Education Group, formerly known as Evolve Education, has confirmed that average occupancy levels across its network is now approaching 82 per cent building on the strong gains reported at its full year results in March 2023. 

 

Occupancy is now 7.8 per cent higher than the 74.0 per cent reported for January of this year with the outlook for further growth across the seasonally more supportive second half of the year encouraging. 

 

Separately the Group confirmed that the strong trading performance experienced thus far in 2023 has generated revenues of $13.9 million and centre based earnings of $3.0 million in the first three months of the year, 21 per cent and 47 per cent higher than last year. 

 

The strong organic growth evident across the portfolio is consistent with previous comments from the group that have highlighted an emphasis on improving performance of its existing centres via a range of occupancy, revenue and cost management initiatives.

 

Embark to delist from New Zealand and re-domicile business to Australia

 

In addition, the Group confirmed that it will be proceeding with re-domiciling its business from New Zealand to Australia, a move that will see it give up its dual listing status. 

 

The transition will see Embark seeking approval via a scheme of arrangement that, if approved, will see a new Australian incorporated company, Embark Early Education Limited, created and then listed on the Australian Stock Exchange whilst the legacy business are delisted from both the New Zealand and Australian stock exchanges.

 

“The proposed re-domiciling provides a more natural alignment of the parent company’s place of incorporation and primary listing with Embark’s operations, given it currently only operates in Australia following the divestment of its New Zealand child care centres in September 2022,” Managing Director Chris Scott said. 

 

The Board noted that it believes this change will allow Embark to continue pursuing the organic growth of its Australian business in a more focused and tax efficient manner for shareholders, and that it anticipates the scheme to be implemented on or about 28 June 2023 with the new listing in place by 29 June 2023. 

 

Adrian Fonseca to step down as non executive director 

 

In a final statement, Embark confirmed that Adrian Fonseca has notified the Group of his intention to retire from the Board and that he will not be seeking re-election at the expiry of his current term at the Group’s Annual General Meeting to be held in June. 

 

Mr Fonseca, the founder and managing director of Oxanda Education, a medium sized Australian based early childhood education and care (ECEC) provider, was appointed as a non-executive director in September 2019. 

 

“We appreciate Adrian’s valuable contribution to the company since he joined the Board in September 2019 and particularly over the last twelve months during the Company’s recent change of strategic direction,” Chair Hamish Stevens said. 

 

Mr Fonseca will remain in his position until the end of the upcoming AGM in June 2023.