Accounting and earn-out adjustments help Intueri's first half results

See also: Intueri defends growth comparisons

Intueri Education Group [NZX: IQE] boosted first-half profit 277% in a result bolstered by the reversal of charges it thought it would have to pay relating to an accounting error and potential earn-outs on two acquisitions.

Although the Auckland-based private training college has twice downgraded its annual earnings outlook, its net profit jumped to $6.1 million, or 6.1c per share, in the six months ended June 30, from $1.9 million, or 4.2c, a year earlier, 

That included a $1.1 million reversal on a charge to the Tertiary Education Commission over an accounting error, a $1 million gain after Academy Group NZ missed an earnout target, and a $1.9 million benefit on a lower-than-forecast earnout payment to the former owners of Online Courses Australia Group.

Revenue climbed 75% to $42.7 million, and earnings before interest, tax, depreciation and amortisation jumped 95% to $11.7 million.

Intueri anticipates annual underlying Ebitda of between $27 million to $29 million in calendar 2015, having downgraded the outlook twice this year due to weaker than expected sales in its Quantum Education Group unit, and higher than expected costs.

"Management's focus for the first half has been to integrate acquisitions, drive the quality and compliance programme to ensure quality outcomes for students, develop initiatives to offset the weaker performance from the domestic sector and continue to identify potential growth opportunities," chief executive Rob Facer says.

"We are expecting a stronger second-half result as we benefit from acquisition growth and the continuing positive growth trends in our online and international segments."

The board declared an interim dividend of 6.1c per share, payable on September 25 with a September 11 record date.

The shares last traded at $1.59 and have slumped 39% this year. They were sold in an initial public offering last year at $2.35 apiece.

Intueri has been acquiring businesses in the past 12 months and last month agreed to buy the New Zealand Institute of Sport for $19.3 million, including its subsidiary, New Zealand College of Massage, to give it scale in the sports and complementary health sectors.

The company's in-class vocational segment more than doubled profit to $3.9 million on a 53% increase in revenue to $33.2 million, while its online vocational unit boosted earnings to $2.1 million from $552,000 on a 251% jump in revenue to $9.5 million.

Intueri said it's working to resolve its case involving The Dive School and Worksafe by the end of the year. A court callover date has been deferred until September17 while it's in negotiations with the regulator.

The Dive School faces charges brought by WorkSafe over the death of a foreign student.

(BusinessDesk)