Education services provider Navitas (ASX:NVT) will refocus its partnership with Curtin University on WA and Singapore and as a result close down the Curtin University Sydney.
Navitas operates and manages campuses on behalf of Curtin University. The company states that “the Curtin University Sydney operation will be gradually closed down with classes ceasing by February 2017.”
The decision allows Navitas to develop a primary campus in the Sydney CBD in conjunction with La Trobe University. Navitas expects significant benefits from having one large campus instead of two smaller campuses. Furthermore the education provider seeks to expand internationally and its refocus on Singapore fits in the bigger picture.
Students who have not completed their studies by 2017 will be provided with alternative solutions to complete their studies.
Deborah Terry, Vice Chancellor of Curtin University said that the partnership will not end: “Curtin has enjoyed a strong relationship with Navitas in the operation of the Sydney campus over the last 10 years and we look forward to continuing to develop our partnership in other areas of our operations.”
NVT’ stock has been trending down since Macquarie University terminated its partnership with Navitas in July 2014. The company never quite recovered from that announcement despite announcing solid full year results for FY15. The termination is expected to have a material impact on FY16 and FY17, however Navitas expects that the “impact will be mitigated by other growth initiatives.” In the past 12 months Revenue rose 11.6% to $980.3m while profit after tax jumped 42% to $72.1m.
NVT declined 21% in the past 12 months and is down nearly 50% from its high reached in mid-2014.
Author: Simon Herrmann
Sep 17, 2015
Simon is a financial analyst at independent research firm Wise-owl who wants to change the world by disrupting the cliché approach to investment decision making with convergent thinking. Wise-owl’s goal is plain and simple: Find the best opportunities for our members by following a proven methodology and to create long-term value through high-quality advice, innovation, technology and education. We combine industry experience and the agile mentality of a start-up. Wise-owl is the future of stock market investing.