Like how learning is often compared to the process of osmosis, education tech company Janison Education Group (ASX: JAN) is dispersing its way into some well known adult education institutions with several enterprise contract wins leading to the company setting new revenue records in FY22.
Enterprise clients remain the softest target for Janison where online learning has been widely adapted since pre-COVID with the edutech company adding Cambridge Assessment Box-Hill Institute and the Australian Children’s Education & Care Quality Authority (ACECQA) as clients during the year.
At Box Hill Institute, Janison’s online testing services are applied to English language testing for healthcare workers in a deal expected to deliver $1 million in platform licence revenue annually.
For ACECQA, the contract will see Janison produce an online knowledge assessment platform to provide early childhood educators as a proof-of-concept. Although the deal is estimated to be worth only $300k, the opportunity it presents is the more appealing aspect for Janison with the childcare industry undergoing major staff shortages and becoming increasingly reliant on workers from LOTE backgrounds. In addition to the sector’s demand, the changing nature of childcare education standards creates ongoing education requirements where Janison is seeking to position themselves for recurring revenue opportunities.
This was reflected in recent sector news that included early childhood education operators Evolve Education (ASX: EVO) attributing a decline in performance to the 80 teaching vacancies they had advertised and were unable to fill to service demand. Competitor G8 Education (ASX: GEM) have also encountered the same issues with educator shortages as their key challenge prompting an emphasis on providing better career pathways.
For the full year ended 30 June 2022, Janison recorded $36 million in total revenue (unaudited) which represents a 20% increase on the previous year. That number could have been even higher had the company not lost high margin revenue from its ICAS and PBTS divisions with management attributing the lost revenue to COVID. They do however, expect to secure it in FY23 or FY24.
Despite that increase in revenue, it was not reflected in earnings where EBITDA came in at $1.5 million, a 50% decrease on the $3.0m reporting in FY21.
Janison reported a net loss after tax of $3.25m in FY22 and will release its full audited FY22 results towards the end of August with JAN shares following downtrends in line with expected earnings to last close at $0.46, down from its 52-week high of $1.45 in November 2021.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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