MindChamps PreSchool reported a net profit of $4.9 million for FY2023, 65% higher than the $2.9 million in 2022. 

 

This follows higher revenue, which increased 13% to $69.6 million. This is attributable to an increase in franchise income in the US and Western Australia, an increase in school fees revenue as well as an increase in royalty revenue, among others.

 

Cost of sales improved by 4% y-o-y to $31.7 million. Gross profit grew by 33% y-o-y to $37.87 million.

 

As at Dec 31, 2023, cash and cash equivalents stood at $5.77 million.

 

MindChamps signed two Master Franchise Agreements in the US in March and September 2023 respectively. 

 

In addition to its company owned centres in Australia, MindChamps currently has a total of 26 new franchisees and expanded its footprint from Sydney to its first Melbourne centre this year, as well as an upcoming flagship centre in Perth, slated for the second half of this year. 

 

See also: The Place Holdings back in black with net profit of $2.96 mil for FY2023

 

The tailwinds such as growing demand for better education in the preschool sector has contributed to the growth in FY2023 and will continue its growth momentum into FY2024, the company says in its outlook.

 

&ldquo The group remains cautiously optimistic about the outlook for FY2024 in the face of high interest rates and inflation in operating costs, which the Group monitors closely and has implemented strategies such as school fees adjustment from FY2024 to cushion some of these challenges. 

 

&ldquo The group will continue to ride on the good momentum established in the past year and take active steps to build and expand its business in the coming years to create a more sustainable growth,&rdquo it adds.

 

MindChamps PreSchool shares surged more than 40% this morning, following the company' s significantly improved 1HFY2023 earnings.

 

For the six months ended June, the company reported earnings of $7.1 million, up 373% y-o-y versus just $1.5 million recorded in the year-earlier 1HFY2022.

 

Revenue in the same period was up 11% to $35.2 million, as it was able to book higher franchise fees, especially in US and Western Australia.

 

On the other hand, the company incurred lower costs, particularly in manpower following the sale of subsidiary business units.

 

MindChamps, under executive chairman David Chiem, is trying to shift towards an asset-light business model where it sells franchises for its pre-school education brand, instead of trying to own its own centres.

 

As at June 30, the company has a net asset value per share of 31 cents, up slightly from 30 cents as at Dec 31 2022.

 

For the FY2023 and FY2024 ahead, MindChamps says it is seeing a " healthy recovery" and that it is capitalizing on the reopening of economies and return of working parents back to the workplace.

 

However, it remains mindful of the uncertain macroeconomic environment with higher rates and inflation driving up operating costs.

 

To address these trends, MindChamps has increased school fees starting from FY2023 to cushion the impact of rising operating costs.

 

" Suitable subsidiary corporations have also been identified for divestment to our franchisees to lower borrowings and reduce interest expense," the company says.

 

It will continue to execute its strategy of transiting its business model from company-owned centres and focussing on accelerating its franchise sales in key markets such as Singapore and Australia, as well as most recently, the US market.

On Apr 6, MindChamps : CNE -1.23% PreSchool non-independent non-executive director Catherine Du acquired 70,000 shares at S$0.15 per share. With a consideration of S$10,500 this increased her total interest in the company from 52.13 per cent to 52.16 per cent. As the co-founder and director of the MindChamps group, Du been instrumental in the company&rsquo s growth and expansion globally, with a keen focus on addressing the global gap in early childhood education

 

MAINBOARD-LISTED education provider MindChamps PreSchool expects to open its 40th pre-school in Singapore by year-end, the company announced on Monday.

 

MindChamps, which also offers infant care and enrichment services, already had nine company-owned and company-operated centres and 41 franchised centres in Singapore as at mid-2020.

 

The latest pre-school is a franchisee operation, a MindChamps spokesperson told The Business Times.

 

It did not say in its bourse filing whether the latest pre-school is a franchisee or not.

 

The 13,000 square foot facility will be located next to the Hard Rock Hotel at Resorts World Sentosa. As part of an opening promotion, complimentary resort membership, with free parking at Resorts World Sentosa, as well as a Sentosa Islander Pass will be included in new enrolments.