FIL Fairview International Plc

Fairview International PLC

("Fairview" or the "Company")

Operations and strategic update

Fairview, the operator of international schools following the International Baccalaureate curriculum, is pleased to provide an update on its operations and its strategy for 2025.

Highlights

·    Increased student numbers last year supported higher profitability

·    Those profits were immediately reinvested in marketing campaigns to drive sustainable growth

·    The use of AI techniques within the curriculum maintains Fairview's reputation as a forward-thinker within the industry

·    Implementation of a structured pastoral care system

·    Ongoing review of expansion opportunities, primarily in the UK and South-East Asia

·    Dr Vincent Chian, Principal and head of business development at Fairview, discusses the year ahead with focusIR here: https://youtu.be/RVyEh_N27WE  

Financial review

As announced on 4 December 2024, student numbers for the year to 30 June 2024 rose by 12 per cent. over the previous period.  This reflects the Company's ongoing strategy of working closely with its network of agents, ensuring they are able to fully reflect Fairview's strengths to their underlying client base - this includes, in particular, demonstrating consistency in academic excellence, accessibility and the International Baccalaureate ("IB") curriculum. This effort was backed up by targeted campaigns in key overseas regions where management has ascertained a rising demand for quality English-medium education.

The Company plans to build on that momentum in 2025 by investing in strategic marketing campaigns and face-to-face engagement with international families. This will include open houses, visiting trade event fairs abroad and continuing to develop its agent network. Fairview will also commit additional resources to digital marketing to reach students and parents who might not otherwise encounter the Fairview brand.

Driven by the increase in student numbers, the Company reported a 32 per cent. increase in gross profit to £2,395,000 in the year to 30 June 2024, evidencing the economic gearing in the business model.  The higher proportion of foreign students, who generally pay higher fees, further enhanced this growth. Alongside that, Fairview continued to standardise certain academic resources and centralise administrative tasks, to enable the Company to serve a larger student body without proportionately increasing overheads. By creating a consistent framework and shared resources, Fairview is able to keep the quality of its offering high as student numbers rise.

The Directors are reinvesting this increased profit, along with part of the proceeds of the IPO, in high-impact marketing areas to position Fairview for sustained future growth.

Fairview expects to announce its interim results for the six months to 31 December 2024 during March 2025.  During this current financial year, the Company expects to continue to benefit from its tight control of administrative expenses and, more particularly, on fee increases that it is being able to implement as the international schools sector continues to recover in the aftermath of the Covid pandemic.

Initiatives for 2025

Alongside these continued marketing plans, one of Fairview's core objectives for 2025 is to integrate AI-driven tools into its teaching methods to create more personalised learning experiences. By way of example, the Company is currently exploring adaptive learning platforms that can instantly adjust English or Mandarin lessons to a student's proficiency level, whilst at the same time giving teachers real-time data so they can offer targeted support where it is needed most. Furthermore, by automating routine tasks like grading quizzes and providing instant assessments, the Company enables teachers to have more time to address students' individual requirements.

As regards extracurricular activities, in common with other independent schools, Fairview continues to ensure that students benefit from an all-round education that is not based on academic success alone. To support this, Fairview has combined its pastoral efforts into a single framework, "RISE", which contains four integrated programmes designed to develop well-rounded individuals:

·    Anchor centres on wellbeing, creating an emotionally secure school environment that fosters consistent performance and long-term trust in the Fairview brand.

·    Ascend cultivates leadership through the 7 Habits methodology*, equipping students with qualities that employers often identify as catalysts for both organisational and personal growth.

·    Aspire guides students toward promising career paths via Jim Collins' hedgehog concept**, ensuring they align their strengths with areas that have genuine market demand.

·    Beyond encompasses off-campus expeditions, excursions and learning camps that broaden horizons beyond the classroom.

By combining these elements, Fairview seeks to address what universities and future employers seek. The Board of Directors believes that parents increasingly value a school that offers a purposeful, structured cultivation of essential soft skills, positioning their children for sustainable success.

Acquisition and expansion strategy

Since completing its IPO in October 2024, the Fairview management team have continued to assess opportunities to expand its business with management considering both acquisitions and new builds applying the criteria of economic growth, demand for quality education and sustainability in their assessments.

As part of this strategy, Fairview will explore options to extend its network of schools outside of Malaysia and, within South-East Asia, where management have identified Indonesia and Vietnam as particularly interesting markets, and in Hong Kong  The attraction of these countries is that they are experiencing strong economic growth, but they also have a rising demand for high quality international education. Beyond South-East Asia and Hong Kong, the United Kingdom remains a core focus for the Company, reflecting both the positive attitudes of Asian families to a British education and the growing interest in the IB curriculum.  The recent VAT and National Insurance changes on independent schools is, as expected, producing numerous opportunities as schools experience falling demand and higher costs in the new tax regime.   The Board of Directors believes that the Company's cost effective model and resource sharing capabilities gives it the resilience and growth potential to take advantage of these opportunities.

Prior to any expansion, management carry out a feasibility study taking account of:

·    the regulatory environment;

·    the ease of setting up foreign-owned schools;

·    partnerships with local stakeholders; and

·    demographic trends, including assessing whether there is a sustainable market for IB education.

Daniel Chian, Chairman of Fairview, said: "Listing on the London Stock Exchange last October allowed us to access new capital and we have wasted no time putting it to work. One of our immediate actions has been to increase international marketing, both to expand our reach and also reflecting the higher fees and margins typically realised with international students. We have also launched several upgrades with a particular focus on technology enhancements to enrich the learning experience.

"I would also like to offer my thanks to the Fairview board, who together bring a wealth of expertise and connections. Their input has played a key role in helping us develop our global expansion strategy and I hope to provide further updates on that as the year progresses.

"For 2025, we will keep up momentum going: increased marketing and modern academic programmes provide the platform for higher enrolments, particularly from international markets. We will always seek to ensure that our growth is sustainable and that the quality of a Fairview education continues to rise."

*https://www.franklincovey.co.uk/solutions/7habits-foundations/

** https://www.jimcollins.com/concepts/the-hedgehog-concept.html

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About Fairview International PLC

Fairview owns and operates two private independent schools in Malaysia that offer the International Baccalaureate programme. One of these schools is located in Kuala Lumpur, the capital of Malaysia, and the other is located in the southern state of Johor close to the border with Singapore.  These schools trade under the Fairview brand which was founded in 1978, and were subsequently acquired by Agodeus Sdn Bhd, a company owned by the Chian family, in 2012. 

There are three other schools in Malaysia and one in the United Kingdom that also trade under the Fairview brand, which are under common control but outside of the Company's group.  All schools in the Fairview network are individually recognised by the International Baccalaureate Organisation as fully accredited to offer the IB programme across the primary and middle years; ages 5 to 16, with Fairview Kuala Lumpur also offering the diploma programme for 16 to 19 year olds.  Each of the schools not owned by the Company use the Fairview brand under licence from the Company accessing the resources of the Fairview Network. 

The school in Kuala Lumpur is the largest and flagship school that uses the Fairview brand, whilst the school in Johor focuses on the expatriate market in Singapore and so is internationally focused.

The Company plans to acquire more schools which can offer international education including the International Baccalaureate programmes both in Asia and the UK.  The Company in particular believes there is an opportunity to acquire underperforming private independent schools in the UK and adapt its product offering to be authorised to offer the International Baccalaureate programme.  With a rise in popularity of the International Baccalaureate programme in both the independent and state sector in the UK, with a growing acceptance of International Baccalaureate graduates by UK universities, the Directors believe that the Company's schools will appeal particularly to the ASEAN, China and Hong Kong market; particularly families looking for an educational foundation in the UK prior to studying at a UK university.