Revenue Falls 6.9% as Academies Australasia Posts $1.42 Million Net Loss

Revenue and Profitability Under Pressure

Academies Australasia Group (ASX:AKG) revealed a 6.9% fall in revenue to $44.27 million for the financial year ended 30 June 2026, extending a challenging trend for the private education provider. The company’s net loss after tax widened by 11% to $1.42 million, up from $1.27 million in FY25. Adjusted EBITDA also declined by 12%, dropping to $6.61 million from $7.5 million the previous year.

The results reflect ongoing headwinds in growth opportunities and uncertainties surrounding international student policies, which led to deferred renovation works at the Goulburn Street premises. Despite these setbacks, the company managed to reduce expenses by 5.7%, from $46.47 million to $43.82 million.

Cash Flow and Balance Sheet Movements

Operating cash flow was a rare bright spot, improving 26.7% to $4.84 million, up from $3.82 million in FY25. This improvement suggests tighter cash management even as revenue and profitability contracted. However, cash on hand decreased to $1.88 million, down from $2.72 million, with total net cash (including guarantees) falling to $5.02 million from $6.31 million.

On the liabilities front, total borrowings rose, driven in part by unsecured director and director-related loans increasing to $6.2 million from $5.2 million. These loans carry a 9% simple interest rate and are repayable within 12 months, highlighting ongoing reliance on internal funding sources.

Capital Management and Share Buy-Back

In a notable capital management move, Academies Australasia completed a buy-back and cancellation of 5 million shares issued under its Employee Incentive Plan, reducing the total shares on issue to 127.6 million. This $2 million buy-back extinguished the corresponding company-provided loans, potentially easing some balance sheet pressure.

The company did not declare or pay any dividends during the period, consistent with its ongoing loss-making position.

Lease Costs and Deferred Renovations

Lease expenses related to the Goulburn Street premises remained a significant cost, with depreciation, amortisation, and finance costs totaling $2.42 million, largely unchanged from the prior year. Renovation plans remain on hold pending clearer Federal Government policies on international students, underscoring the sector’s sensitivity to immigration and visa regulations.

These deferred capital expenditures, while limiting near-term cash outflows, also signal uncertainty about the company’s growth trajectory and ability to enhance its physical infrastructure.