Margin management, occupancy momentum and takeover response shape Mayfield’s Q4 update

Mayfield Childcare Limited has released its Q4 FY25 report, highlighting improved centre-level performance, positive occupancy growth and disciplined cost controls – all under the backdrop of a live takeover bid from fellow ASX-listed operator Embark Early Education.

The company recorded underlying centre EBITDA of $2.9 million for the quarter ending 31 December 2025, a 7 per cent lift from Q3, with margin improvement attributed to flat operating expenses despite sector-wide cost inflation. Centre-level EBITDA margin rose from 11 per cent to 12 per cent quarter-on-quarter, driven by targeted wage-to-revenue discipline and operational controls.

Occupancy continues to show positive momentum, with spot occupancy rising to 64.8 per cent in early December – an increase of 0.7 percentage points compared to Q3. Notably, occupancy growth between August and November 2025 reached 2.2 per cent, outpacing the same period in 2024 and exceeding peer benchmarks.

The company’s Precious Cargo portfolio also remained EBITDA-positive, reinforcing gains from earlier integration and stabilisation efforts.

In terms of workforce funding, Mayfield confirmed it distributed $4.12 million in backpay to eligible employees under the Early Childhood Education and Care Worker Retention Payment program during Q4. This contributed to a net operating cash outflow of $3 million, but excluding the backpay, the business posted a net cash inflow of $1.16 million for the quarter.

The company continued to invest in marketing initiatives to lift enquiry flow and occupancy conversion, while preparing to execute targeted pricing actions in early 2026 to offset ongoing wage and input cost pressures.

Takeover bid from Embark Early Education

Q4 was also defined by corporate activity, with Embark Early Education announcing a proposed off-market takeover bid on 7 November 2025, offering shareholders either $0.50 per share in cash or equivalent value in Embark shares. Mayfield's board has unanimously recommended shareholders reject the offer, citing its intention to deliver value through its internal strategy.

A Target’s Statement outlining the board’s position was lodged with ASIC and issued to shareholders on 20 January 2026.

Looking ahead, Mayfield will maintain its marketing investment across community and digital platforms to accelerate occupancy growth. A revised pricing strategy is expected to support margin resilience in the face of cost inflation. Other strategic priorities include:

• rollout of the Mayfield 360 model to unlock scalable earnings growth
• enhanced child safety standards aligned with regulatory expectations
• ongoing improvements to curriculum, family experience and reputation

Mayfield’s Q4 update reflects a provider navigating sector pressures with a deliberate focus on margin control, operational quality and growth execution. As policy, pricing and workforce settings continue to evolve, its next moves, and shareholder responses, will be closely watched.

View the full ASX announcement here