Revenue Climbs 1.5% as Adjusted EBITDA Doubles to $7.5 Million in FY25
Academies Australasia Group Limited reported a modest revenue rise and a dramatic 87% reduction in net loss for FY25, buoyed by improved cash flow and government visa policy changes affecting international student intake.
- Revenue up 1.5% to $47.54 million
- Net loss narrowed 87% to $1.27 million
- Adjusted EBITDA more than doubled to $7.5 million
- Operating cash flow surged 766% to $3.82 million
- Government visa policy changes impact eight colleges’ student intake
Financial Performance Highlights
Academies Australasia Group Limited has delivered a significantly improved financial performance for the fiscal year ended 30 June 2025. Despite a challenging operating environment, the education provider posted a 1.5% increase in revenue to $47.54 million. More notably, the company slashed its net loss by 87%, from nearly $9.8 million in FY24 to $1.27 million in FY25, signaling a strong turnaround.
Adjusted EBITDA, a key measure of operational profitability, more than doubled to $7.5 million, reflecting disciplined cost management and operational efficiencies. Expenses decreased by 6.5%, contributing to this positive momentum.
Cash Flow and Balance Sheet Developments
Operating cash flow experienced a remarkable 766% increase, rising from $441,000 to $3.82 million. This surge in cash generation provides the company with greater financial flexibility amid ongoing sector uncertainties. The balance sheet remains solid, with net assets of $16.2 million and manageable liabilities, although net tangible asset backing per share remains negative at 9.2 cents.
Strategic Moves and Operational Adjustments
During the year, Academies Australasia acquired the remaining 32.46% stake in the College of Sports & Fitness, consolidating full ownership. The company also streamlined operations by relocating Skills Training Australasia to a new Melbourne location and deferring renovation plans pending clearer government policies.
Impact of Government Policy on International Students
The Australian Government’s introduction of a new prioritisation system for offshore student visa processing and an increased National Planning Level for 2026 have directly influenced the group’s international student intake. Eight of its colleges are affected by these New Overseas Student Commencement (NOSC) allocations, which remain modest despite a 37% increase in total allocations for 2026. Visa rejection refunds fell significantly to $1.9 million from $6.2 million, indicating improved visa approval rates.
Funding and Loans
The company’s directors and related parties extended unsecured loans totaling $5.2 million, slightly up from the previous year, at an interest rate of 9% per annum. These loans provide short-term liquidity but also highlight ongoing reliance on related-party funding.
Overall, Academies Australasia’s FY25 results reflect cautious optimism. The company has navigated a tough regulatory and market environment with improved financial discipline and strategic focus, though challenges remain in scaling international student numbers and managing operational costs.
Bottom Line?
With improved profitability and cash flow, Academies Australasia is better positioned but must navigate ongoing visa policy uncertainties to sustain growth.
Questions in the middle?
- How will future Australian government policies on international education affect Academies Australasia’s growth?
- What are the risks associated with the company’s reliance on director-related loans for funding?
- Can the group convert improved cash flow and reduced losses into sustainable profitability in FY26?