2 months ago
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EduFocal Limited is preparing for a rights issue later this year to raise equity capital that will fund the upgrades to the learning platform. The edutech company is also aiming to reduce its debt.
The precise date and amount of funds to be raised through the issue of new shares to current shareholders were not disclosed.
CEO Gordon Swaby said some of the proceeds of the issue would fund Quizzative, formerly Amigo, a programme developed by EduFocal for administering tests to students online.
Quizzative offers curated quizzes by educators, and is aligned with the National Standards Curriculum. The questions match learning needs and curriculum objectives, and the programme is said to simplify assessment administration, enabling teachers to add or choose questions to swiftly assign tests to students with a few clicks.
The Quizzative programme also allows teachers to print tests as worksheets if internet access is unavailable.
EduFocal continues to rack up losses, but Swaby noted that as the company develops and adds capacity, it has cauterised some of the bleed.
“Our loss before taxation of $83.8 million represents a substantial improvement, compared to the $178.1 million loss in 2022. We’ve made strategic investments in capacity building and development of our Amigo platform, which we believe is crucial for EduFocal’s future. What I’m particularly proud of is our ability to maintain positive operating cash flow throughout the year,” he said at the company’s annual general meeting last Thursday.
That meeting dealt with the company’s performance for the financial year ending 2023.
Noting that the last couple of years had been difficult for the company, Chairman Peter Levy said there would be improvements to its governance and oversight. He expects the company to prosper, with the turnaround starting this year.
“One of the things that I am doing as my contribution as chairman, is to ensure that this is the only time we’re going to have an AGM a year after we’re supposed to have had it,” Levy said. “I am going to make it a point … we will have our reporting and our meetings and resolutions completed in the allotted time,” he said.
EduFocal’s most recent accounts for the nine-month period ending September 2024 indicates that the company is still in a precarious position. Its revenue is down by two-thirds, from $257 million to $83 million, while its bottom line has spun from positive earnings of $76 million to a loss of $54 million.
The company said the decline in revenue reflects the ongoing transition towards a more predictable and resilient revenue model that’s focused on recurring income.
“While this shift has temporarily impacted our top line, management believes it is essential for building long-term stability,” EduFocal said.
Commenting on the way forward, Swaby said the company was shifting from one-off projects with long payment cycles to developing software with predictable revenue and high net margins.
English (US) ·