EpicQuest Education Announces Fiscal Year 2024 Financial Results and an Operations Update
Rhea-AI Summary
EpicQuest Education (NASDAQ: EEIQ) reported its fiscal year 2024 results, showing a 43% revenue increase to $8.15 million, driven by higher international student enrollment in foundational and collaborative programs. Gross profit rose 26.1% to $5.31 million, though gross margin decreased to 65.2% from 73.7% due to increased costs.
The company experienced an operating loss of $7.43 million and a net loss of $6.57 million. Cash position decreased to $1.15 million, with negative working capital of $5.47 million. Davis University's foundational programs saw enrollment growth to 220 students for 2024-2025, up from 102 in the previous year.
Notable developments include Davis University's expansion to downtown Toledo, enhanced recruiting at EduGlobal College through cooperative diploma programs, and a new agreement with The Center of Advanced Studies in Tokyo for international student pathways starting Spring 2025.
Positive
- Revenue increased 42.7% YoY to $8.15 million
- Gross profit grew 26.1% to $5.31 million
- Student enrollment in foundational programs more than doubled to 220 students
- Sale of buildings generated $1.7 million (vs. $0.84 million carrying value)
- Net loss per share improved to $0.47 from $0.57
Negative
- Operating loss increased to $7.43 million from $7.02 million
- Cash position decreased 76.9% to $1.15 million
- Working capital turned negative at -$5.47 million
- Gross margin declined to 65.2% from 73.7%
- Operating expenses increased 13.4% to $12.7 million
News Market Reaction 1 Alert
On the day this news was published, EEIQ gained 4.05%, reflecting a moderate positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
Revenue Increased by a Robust
"We are pleased to announce a
"During the past year, Davis University expanded its campus to downtown
"We specialize in providing individualized academic journeys to both our domestic and international students that include Bachelor of Science program and planned Master's program that help our students to secure post-graduate employment. We are also in the process of developing an AI-powered tutoring and learning platform for adaptive learning and real-time feedback to improve student engagement and achievement. We believe that our innovative business model will continue to result in strong growth and that it offers a solid return on investment for both our students and our shareholders," concluded CEO Jianbo Zhang.
Fiscal Year 2024 Financial Results Ended September 30, 2024
Revenues were
Gross profit was
Operating Expenses were
Operating loss was
Income tax recovery was
Net loss was
Net Loss Per Basic and Diluted Share for the fiscal year ended September 30, 2024 was
Financial Condition
As of September 30, 2024, the Company had
Liquidity and Capital Resources
Net cash used in operating activities for the twelve months ended September 30, 2024 was
Net cash provided from investing activities was
Net cash provided from financing activities was
Operations Update
Our operations provide a diversified revenue stream that includes tuition and student service fees from our owned and operated colleges, Davis University and EduGlobal College, fees from our foundational programs located abroad, and revenue from our recruiting relationships with other prominent universities.
For our domestic programs, we provide practical educational programming that meaningfully connects to students who may not ordinarily pursue higher education but who see our programs as an effective way to reach their career goals. We also provide a Bachelor of Science in Business program and plan to offer a Masters degree program in the near future. We also provide academic pathways through articulation agreements with universities to provide additional options for our students. We believe we have a positive and effective business model where students can individualize their academic journeys, and which provides students with a solid return on their educational investments. An update as to our international foundational and collaborative programs are as follows:
Davis University's foundational programs have 220 students enrolled for the 2024-2025 academic year as compared to 102 students for the 2023-24 academic year. We believe that Davis' two-year foundational programs will secure sustainable revenue because the retention rate of students from the first to the second year is usually close to
Davis' foundational program students are enrolled in elite universities. The foundational programs are currently placed on the main campuses of Peking University, Shanghai Jiao Tong University, and the Beijing Institute of Technology, preeminent universities in
Davis University's recent agreement could lead to a substantial increase in international student enrollment. Its agreement with The Center of Advanced Studies, based in
EduGlobal College recruiting has been enhanced by its cooperative diploma programs. The co-op programs, which began for the Fall semester in September 2024, entail students alternating between attending academic semesters with working at paid, full-time jobs. We believe that this will enhance our domestic recruiting efforts since the co-op programs provide students with a great hybrid approach which helps students secure job offers upon graduation.
EpicQuest Education's Strategy of Internationalization
Our strategic plan is to achieve sustainable growth through our strategy of internationalization which is a key element of our strategic growth plan. EpicQuest Education's owned and operated colleges, Davis University and EduGlobal College, have become increasingly focused on international recruiting and enrollment as they provide enhanced globalized learning to their students as well as pathways to achieve university degrees. The Company's foundational programs essentially exports our academic programming at an affordable cost for students since they study in their home countries and earn course credits prior to their attendance at our two institutions of higher learning. In addition, a vital component of EpicQuest Education's strategic growth plan is to become increasingly involved with international collaborations in order to leverage our distinct academic programming and unique culture of learning. The Company's mission is to achieve international expansion and establish EpicQuest Education as a renowned international service provider of higher learning.
About EpicQuest Education Group International Limited
EpicQuest Education Group International Limited ("EpicQuest Education" or the "Company") provides comprehensive education solutions for domestic and international students seeking university and college degrees in the US,
Safe Harbor Statement
Certain of the statements made in this press release are "forward-looking statements" within the meaning and protections of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, without limitation, the ability of the Company to achieve the enrollment goals outlined and the ability of the Company to achieve meaningful future revenue increases. Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance, capital, ownership or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "plan," "point to," "project," "could," "intend," "target" and other similar words and expressions of the future.
All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our most recent Form 20-F and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date hereof, or after the respective dates on which any such statements otherwise are made.
FINANCIAL TABLES FOLLOW
EPICQUEST EDUCATION GROUP INTERNATIONAL LTD
CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2024 and SEPTEMBER 30, 2023 (US$, except share data and per share data, or otherwise noted) | ||||||||
September 30, | September 30, | |||||||
US$ | US$ | |||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | 1,150,042 | 4,966,839 | ||||||
Restricted cash | 338,712 | 338,712 | ||||||
Accounts receivable, net | 85,279 | 36,503 | ||||||
Other receivable | 473,271 | 107,179 | ||||||
Prepaid expenses | 1,305,935 | 2,326,185 | ||||||
Inventory | 48,470 | 41,185 | ||||||
Income tax receivable | 889,766 | 894,743 | ||||||
Total current assets | 4,291,475 | 8,711,346 | ||||||
Non-current assets | ||||||||
Property and equipment, net | 1,597,823 | 2,041,242 | ||||||
Long-term prepaids | 7,500,023 | - | ||||||
Intangible assets | 4,464,226 | 4,686,228 | ||||||
Right-of-use assets | 2,785,008 | 1,117,554 | ||||||
Goodwill | 2,652,772 | 2,652,766 | ||||||
Total assets | 23,291,327 | 19,209,136 | ||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
Liabilities: | ||||||||
Current liabilities | ||||||||
Accounts payable and other liabilities | 3,233,471 | 2,121,051 | ||||||
Loan payable | 409,956 | - | ||||||
Income tax payable | 4,294 | 1,872 | ||||||
Due to related party | 140,000 | 140,000 | ||||||
Lease liabilities – current | 641,254 | 559,375 | ||||||
Deferred revenue | 5,332,194 | 4,057,517 | ||||||
Total current liabilities | 9,761,169 | 6,879,815 | ||||||
Non-current liabilities | ||||||||
Lease liabilities – non current | 2,181,769 | 571,131 | ||||||
Deferred income tax liabilities | 470,468 | 824,480 | ||||||
Total liabilities | 12,413,406 | 8,275,426 | ||||||
Commitments and contingencies | ||||||||
Shareholders' equity | ||||||||
Common shares, 13,113,173 and 11,998,173 shares issued and outstanding as of September 30, 2024 and 2023, respectively | 20,814 | 19,045 | ||||||
Additional paid-in capital | 20,142,071 | 18,129,000 | ||||||
Deficit | (14,958,678) | (8,968,555) | ||||||
Accumulated other comprehensive loss | (35,803) | (36,284) | ||||||
Total shareholders' equity | 5,168,404 | 9,143,206 | ||||||
Non-controlling interests | 5,709,517 | 1,790,504 | ||||||
Total liabilities and shareholders' equity | 23,291,327 | 19,209,136 | ||||||
EPICQUEST EDUCATION GROUP INTERNATIONAL LIMITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS FOR THE YEARS ENDED SEPTEMBER 30, 2024, 2023 AND 2022 (US$, except share data and per share data, or otherwise noted) | ||||||||||||
September 30, | September 30, | September 30, | ||||||||||
US$ | US$ | US$ | ||||||||||
Revenues | 8,153,546 | 5,712,480 | 6,330,428 | |||||||||
Costs of services | 2,840,112 | 1,502,255 | 2,021,058 | |||||||||
Gross profit | 5,313,434 | 4,210,225 | 4,309,370 | |||||||||
Operating costs and expenses: | ||||||||||||
Selling expenses | 1,537,006 | 1,018,894 | 952,888 | |||||||||
General and administrative | 11,201,445 | 10,210,960 | 10,521,551 | |||||||||
Total operating costs and expenses | 12,738,451 | 11,229,854 | 11,474,439 | |||||||||
Loss from operations | (7,425,017) | (7,019,629) | (7,165,069) | |||||||||
Other (income) expenses: | ||||||||||||
Other income | (495,276) | (186,137) | (819,135) | |||||||||
Interest income | (22,731) | (53,089) | (26,463) | |||||||||
Foreign exchange gain | - | (5) | - | |||||||||
Total other (income) expenses | (518,007) | (239,231) | (845,598) | |||||||||
Loss before provision for income taxes | (6,907,010) | (6,780,398) | (6,319,471) | |||||||||
Current income tax expense | 18,186 | 11,590 | 16,459 | |||||||||
Deferred income tax expense (recovery) | (354,012) | 277,874 | (207,488) | |||||||||
Income taxes expense (recovery) | (335,826) | 289,464 | (191,029) | |||||||||
- | - | - | ||||||||||
Net loss | (6,571,184) | (7,069,862) | (6,128,442) | |||||||||
Net loss attributable to non-controlling interest | (581,061) | (410,421) | (164,887) | |||||||||
Net loss attributable to common stockholders | (5,990,123) | (6,659,441) | (5,963,555) | |||||||||
Unrealized foreign currency translation adjustment | 481 | (7,345) | (28,939) | |||||||||
Comprehensive loss | (6,570,703) | (7,077,207) | (6,157,381) | |||||||||
Basic & diluted net loss per share | (0.47) | (0.57) | (0.54) | |||||||||
Weighted average number of ordinary shares-basic and diluted | 12,637,968 | 11,655,642 | 11,010,240 | |||||||||
EPICQUEST EDUCATION GROUP INTERNATIONAL LIMITED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED SEPTEMBER 30, 2024, 2023 AND 2022 (US$, except share data and per share data, or otherwise noted) | ||||||||||||
September 30, | September 30, | September 30, | ||||||||||
2024 | 2023 | 2022 | ||||||||||
US$ | US$ | US$ | ||||||||||
Cash Flows from Operating Activities: | ||||||||||||
Net loss | (6,571,184) | (7,069,862) | (6,128,442) | |||||||||
Adjustments for items not affecting cash: | ||||||||||||
Depreciation and amortization | 425,763 | 407,013 | 252,097 | |||||||||
Share-based compensation | 1,977,187 | 2,061,810 | 4,813,049 | |||||||||
Net gain from disposal of fixed assets | (477,115) | - | (813,064) | |||||||||
Impairment of goodwill | - | 14,038 | - | |||||||||
Non-cash lease expenses | - | - | (25,643) | |||||||||
Deferred income tax expense | (354,012) | 277,874 | (207,488) | |||||||||
Changes in operating assets and liabilities | ||||||||||||
Accounts receivable and other receivable | (414,866) | 217,407 | 118,608 | |||||||||
Prepaid expenses | (6,479,773) | (1,323,593) | 614,548 | |||||||||
Operating lease – lease liabilities and right of use assets | 25,064 | (45,022) | - | |||||||||
Inventory | (7,285) | (21,170) | - | |||||||||
Accounts payable & accrued liabilities | 1,112,423 | (212,817) | (1,320,563) | |||||||||
Deferred revenue | 1,274,677 | 233,493 | (1,283,314) | |||||||||
Income tax receivable | 7,399 | 254,342 | 2,293 | |||||||||
Student deposits | - | (46,040) | (635,778) | |||||||||
Net cash used in operating activities | (9,481,722) | (5,252,527) | (4,613,697) | |||||||||
Cash Flows from Investing Activities: | ||||||||||||
Purchase of property and equipment | (40,343) | (14,231) | (51,410) | |||||||||
Collection (addition) of notes receivable | - | - | (305,000) | |||||||||
Repayment to related parties | - | - | (270,000) | |||||||||
Share buyback | - | (1,250,007) | - | |||||||||
Acquisition of additional interest in subsidiary | - | (187,505) | - | |||||||||
Net cash acquired from (used for) business acquisitions | - | 574,108 | (1,945,931) | |||||||||
Proceeds from sale of fixed assets | 757,115 | - | 1,920,861 | |||||||||
Net cash provided from (used in) investing activities | 716,772 | (877,635) | (651,480) | |||||||||
Cash Flows from Financing Activities: | ||||||||||||
Long term investment received for Gilmore | 3,737,727 | - | - | |||||||||
Share issuances, net of issuance costs | 800,000 | - | 200,000 | |||||||||
Proceeds borrowed from third party | 409,956 | - | - | |||||||||
Net cash provided from financing activities | 4,947,683 | - | 200,000 | |||||||||
Effect of exchange rate changes on cash and cash equivalents | 470 | (7,346) | (28,938) | |||||||||
Net increase/(decrease) in cash, cash equivalents | (3,816,797) | (6,137,508) | (5,094,115) | |||||||||
Cash and cash equivalents and restricted cash, beginning of year | 5,305,551 | 11,443,059 | 16,537,174 | |||||||||
Cash and cash equivalents and restricted cash, end of year | 1,488,754 | 5,305,551 | 11,443,059 | |||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION: | ||||||||||||
Interest paid | ||||||||||||
Income taxes paid | 10,787 | 10,575 | 14,166 | |||||||||
Non-cash investing activities – acquisition of operating lease right-of-used assets | 2,267,597 | 561,247 | 574,483 | |||||||||
Non-cash investing activities – assumption of operating lease obligation | 2,238,099 | 572,564 | 574,483 | |||||||||
The accompanying notes in the Company's 20-F for fiscal 2024 as filed with the SEC form an integral part of these consolidated financial statements.
Contacts:
EpicQuest Education Group International Limited
+1 513-649-8350
info@epicquesteducation.com
Investor Relations:
Precept Investor Relations LLC
David Rudnick
+1 646-694-8538
david.rudnick@preceptir.com
Source: EpicQuest Education Group International Limited
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SOURCE EpicQuest Education Group International Limited
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