Goodstart delivers strong performance across numerous metrics in 2024 Annual Report

Jason Roberts

Jan 20, 2025

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Goodstart Early Learning has released its 2024 Annual Report in which the provider reports strong performance across all of its strategic metrics with particular outperformance highlighted in the financial area, as the Group delivers its first net surplus since 2021.

“I am pleased to report that Goodstart Early Learning has now returned towards a financially sustainable footing after a challenging few years marked by the impacts of the pandemic, severe workforce shortages and rising inflation,” Paul Robertson AO, Chairperson said.

This sentiment was echoed by Dr Ros Baxter, Goodstart's CEO who noted that “Having weathered three operating deficits in the last four years, we made deliberate decisions across this financial year to support even more families, and to tightly control costs. I am delighted with our improved financial performance.”

Alongside the shift towards a more sustainable financial footing, Goodstart continued to invest heavily in quality, inclusion and workforce initiatives across its network of 653 centres whilst also actively managing its portfolio with four new purpose built centres opened, five centres closed and a further three contracted to join the Group in November 2024.

Robust financial performance creates foundation for ongoing commitments

Goodstarts’ network of centres reported fee income of $1.4 billion, up 12.8 per cent from last year, driven by (as the Annual Report notes), “moderate improvements in attendances and carefully considered pricing adjustments” during the period.

Notably, the proportion of fees made up by contributions from the Child Care Subsidy (CCS) rose to 70 per cent, up from 64 per cent the previous year, as the full impact of affordability changes triggered by the implementation of the Cheaper Child Care Bill in July 2023 came into effect.

Fees received from parents in 2024 actually fell 6.0 per cent, which against a backdrop of moderately rising occupancy, suggests substantial savings generated by the legislation change were passed on and retained by Goodstart families.

From a cost perspective, “efficient cost management including labour management, and reduced employee vacancy and attrition rates” saw more measured cost growth than previous years, and wages as a percentage of revenue, a key cost metric, fell from 74.5 per cent in 2023 to 70.8 per cent in 2024.

The combination of improved revenues and increasingly anchored costs saw operating profits (profits before finance costs) bounce back to $81.9 million, compared to a loss last year and operating cash flows reached $227 million, and a positive net surplus even after adjusting for an $8.6 million positive impact a change in estimates used to account for lease liabilities was applied.

99 per cent meeting or exceeding milestone reached as social purpose spend sustained

Goodstart reported over 99 percent of its centres assessed as holding a rating of Meeting or above the National Quality Standard as at the end of FY2024, a record high level for the Group and substantially above the sector average of 89 per cent.

Investment in quality focused initiatives increased by 12.3 per cent with professional development spending up 5.9 per cent to $24.4 million and quality improvement program spending up 32.5 per cent to $10.2 million.

The Group’s specialised teaching, learning and support team that offers expert advisory services for centres broadened out to include 80 professionals, up from 45 last year, with the team covering a wide range of areas including modelling best practices, addressing inclusion barriers, providing instructional coaching, and fostering peer-to-peer learning.

Spend associated with inclusion amounted to $20.1 million, broadly similar to 2023, with a shift in emphasis across the three program verticals, away from programs and affordability and towards support for children with additional needs. “Not only is Goodstart still Australia’s largest early learning provider, and the nation’s largest non-government provider of preschool and kindergarten, but we also now support more children experiencing vulnerability than is the norm in the early learning sector,” Dr Baxter said.

Team turnover drops to three year lows as July 2023 wage increases flow through

As team turnover and recruitment initiatives drove vacancy rates lower, Goodstart employed around 16,000 employees of which 12.5 per cent, or around 2,000 employees, were teachers as at the end of June 2024, cementing the Group’s position as the largest early childhood education and care (ECEC) employer in Australia.

A key development during the financial year, and another important contributor to improved workforce metrics, was the introduction of new pay rates on 1 July 2023 which saw the Group pass a seven percent increase, its largest ever, with educators now paid at least five percent above Award, and teachers upwards of 15 percent above award.

In the past year, more than 585 Goodstarters furthered their studies in early learning and teaching, including 129 trainees who completed their Certificate III, 66 educators who completed their Diploma of Early Childhood Education and Care, and 390 Goodstarters, up from 35 last year, who received support while undertaking their bachelor’s degrees.

Trainee intake fell in 2024 to 568 compared to 800 in 2023 reflecting an environment in which overall urgency to recruit shifted down.

“To our in-centre and centre support teams, thank you for the fierce commitment you bring to providing all children with the high quality early education they need to have the best possible start in life,” Dr Baxter said, highlighting the value the organisation places on its educator workforce. To access the 2024 Annual Report please click here.

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