Gems Education reports increase in six-month revenue

Higher enrolment and the acquisition of a group of two schools contributed to the rise.

Dubai-based Gems Education yesterday said its six-month revenue through the end of February rose by 15.5 per cent year-on-year to US$539.1 million thanks to an uptick in student enrolment.

The education provider also attributed the rise to “an increase in annual average revenue per student, acquisition of a group of two schools and an increase in other income because of an increase in the number of schools and students”, in a statement to Nasdaq Dubai. Gems was not available for comment.

The education ­provider, which runs more than 88 schools in the UAE and abroad, said student enrolment increased by 10 per cent to 113,345 students at the end of February, up from 102,361 students a year ago. The total capacity, however, was 132,438 students at the end of February, up 18.6 per cent from 111,652 students a year ago.

Gems aims to boost its school capacity over the next 24 months by opening new facilities and extending existing buildings.

During the six months since August 31, Gems has spent $242.7m, including on the repurchase of three leased school buildings, which were originally financed by a sale and leaseback transaction.

It also opened four schools in the UAE and extended six schools in the country. It acquired a group of two schools, under a sale and purchase agreement in July, and entered into a $40.8m bilateral facility agreement to finance the acquisition. The company issued a $200m sukuk in 2014. “Efficient private schools can make around 15 per cent to 20 per cent net profit margins once a school is stabilised,” says the consultancy Colliers International.

Dubai had 173 private schools with 265,299 students in the 2015-2016 academic year. The Knowledge and Human Development Authority in Dubai said last year that 15 to 20 private schools were set to open during the 2016-2017 academic year.

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