Evolve announces full year results for FY 31 March 2020

Evolve Education Group Limited (NSX/ASX: EVO) has released its audited finalised results for financial year ended 31 March 2020 (the period from 1 April 2019 to 31 March 2020). Key features of the results: o Revenue of $140.6m (FY19 $137.2m) o Net loss after tax at $13.3m (FY19 loss of $101.6m) including non-cash asset impairments of $12.3m. The impairments are primarily attributable to Right of Use assets on adoption of new IFRS16 accounting standard this FY and do not affect Underlying EBITDA o Underlying EBITDA of $8.2m (FY19 $13.3m) Managing Director Chris Scott commented that it has been a year of change for the company but one that has seen necessary changes implemented to facilitate a reset for stabilisation and growth. Following a revamp of the EVO Board on 19 September 2019, EVO experienced a stabilisation in occupancy levels, the streamlining of support office, a reduction in Board fees and the curtailment of fee discounting. FY20 was also the year EVO expanded into Australia with the acquisition of 10 centres. Mr. Scott noted that EVO was starting to see the fruits of actions taken being reflected in underlying EBITDA of $8.2m for FY20 which is at the top end of the guidance range of $7.8m to $8.2m provided on 20 May 2020 and higher than the earlier guidance of $6m to $6.5m given on 28 November 2019. Additional evidence for the progress being made is reflected in the following table which indicates that the underlying EBITDA in the second half of the financial year was stronger than the first half. Historically, the first half of the FY has been stronger than the second half due to seasonality. Financial Year First Half Second Half 2020 $3.9m $4.3m 2019 $9.2m $4.1m 2018 $12.5m $9.1m EVO acknowledges the uncertainty caused by Covid-19, particularly the impact on the overall economies in New Zealand and Australia. "The Governments of New Zealand and Australia have been very supportive of the early learning services sector and clearly recognise the important role of early childhood education to the economy and within the community," Mr. Scott said. "Assuming no further lockdown due to a second wave of Covid-19, EVO is well placed to build on occupancy levels at both our New Zealand and Australian centres. EVO will continue to work on generating organic growth from operational improvements in New Zealand while growing by way of acquisitions in Australia". For any further inquiries please contact: Chris Scott Managing Director Evolve Education Group Limited Email: chris.scott@evolveedu.com.au Edmund Mah Chief Financial Officer Evolve Education Group Limited Email: edmund.mah@eeg.co.nz End CA:00355269 For:EVO Type:FLLYR Time:2020-06-26 08:31:42