HONG KONG — International school operator China Maple Leaf Educational Systems continued a strong climb here Friday, lifted by glittering fiscal 2015 earnings on growing demand for a global education.
The shares soared 10% to 3.23 Hong Kong dollars (42 cents) in the afternoon before closing up 1.7% at HK$2.99. Earnings released midday for the year ended August showed net profit skyrocketing more than 400% to 205 million yuan ($32 million), grabbing investors’ attention. China Maple Leaf’s stock has risen from HK$2.66 on Nov. 18.
Revenue for the year increased 21% to 652 million yuan, with tuition income rising 19% to 554 million yuan. Gross profit surged 27% to 298 million yuan. International education is increasingly important in China, spurring demand for China Maple Leaf’s services. Tuition hikes at schools in the cities of Dalian, Wuhan and elsewhere also underpinned earnings growth.
China Maple Leaf at the end of August ran a network of 40 schools, covering preschool through high school, in nine cities including Chongqing and Shanghai. Enrollment grew 19% on the year to 16,078, while the number of educators rose 24% to 1,576.
The company expects little effect on earnings from China’s economic slowdown, saying it is unlikely to dampen the desire of urban middle-class families to send their children to international schools. The country’s upper classes typically send their children to schools abroad, indicating latent demand for international schools at home, the earnings release said. China Maple Leaf hopes to have 40,000 students by 2020.
Posted by Sasha Thomas