LONDON (Alliance News) – AEC Education PLC Thursday said it narrowed its losses in 2013 helped by lower finance costs, the absence of restructuring costs and a hefty goodwill impairment it booked the prior year, but the group posted a 25% fall in revenue after losing business in Singapore.
The international education provider said that trading in the year again proved challenging due to the current visa policies on student recruitment in the UK, the loss of EduTrust status in Singapore, which meant it could no longer recruit overseas students. It said that cost levels could not be reduced whilst it applied for reinstatement.
However, it also said it saw London return to profitability, and Ireland generate a small operating profit.
“The fact that London has returned to profitably and our new operation in Dublin returned an operating profit in its first full year of trading augurs well for 2014. Additionally, action taken to enable Singapore to target breakeven in 2014 and the opportunity for growth in profits in Malaysia and Cyprus are encouraging signs for a return to profit,” said Chairman Liam Swords in a statement.
The group operates from centres in Southeast Asia and the UK, with its main operations in Singapore, Malaysia and London.
AEC reported a pretax loss of 1.7 million for the 2013 financial year, compared with a GBP3.6 million loss in 2012.
Revenues in the year fell by 25% to GBP11.3 million, down from GBP15.1 million a year earlier, which it said was due to the closure of two schools in London the previous year, visa policies continuing to affect the London market and the halting of student recruitment in Singapore.
“In Asia, our operations in Singapore suffered a severe setback resulting from the withdrawal of EduTrust status,” the company said in a statement.
AEC said that Malaysian revenues held up and fully regained the ground lost following the Middle East crisis, while its joint venture in Cyprus generated reduced profits as it was hit by the banking crisis in the early part of the year.
The group said that its English language teaching operations in the UK continue to feel the significant negative effects of the changing legislation and regulations regarding visas and work permits for overseas students.
“This made the market for our remaining UK school in Kings Cross difficult, and this, combined with the reduction in capacity implemented last year, reduced revenue year on year by 36%,” the company said.
The group said that the school in Oman has not lived up to expectations, and steps are being taken with its partners to improve trading.
“Student interest is low and it has not yet proved possible to expand into the surrounding regions,” it said.
Shares in the company were untraded Thursday morning at 2.375 pence.
By Rowena Harris-Doughty; email@example.com; @rharrisdoughty
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AEC Education Narrows Loss In 2013; Hit By Business Loss In Singapore