Chairman’s message

Dear Shareholders,

In the financial year ended 31 March 2018 (“FY2018”) the Group consolidated its business units and continued efforts to improve operational efficiency. For FY2018, the Group recorded total revenue of $8.8 million, representing an 18% decline from $10.8 million in the financial year ended 31 March 2017 (“FY2017”). The Group reported a loss before tax of $5.8 million which represents a 5.5% increase compared to the loss of $5.5 million in FY2017. Much of the losses were incurred in the first half of FY2018, prior to the realisation of efficiency gains in the second half of FY2018.

The Group continued to make progress in streamlining its processes and leveraging on technology to realise greater cost efficiencies. We made significant reductions to headcount in July 2017 and the leaner management structure has resulted in the reduction of staffing costs by 13% and another 10% from other operating expenses, which in turn reduced $1.8 million in total expenses to represent an 11% improvement over the previous year.

RENEWED BUSINESS FOCUS

The business entities in Singapore and UK of Informatics Academy and NCC Education continued rationalisation efforts, throughout the financial year which resulted in greater efficiencies from shared manpower and teaching content.

This higher level of collaboration has enabled the licensing of increased numbers of programmes globally, provided wider online offerings and made consistent the quality of product development throughout our distribution network, whilst maintaining the key financial metrics.

The sustainability of Informatics Academy as a private education provider in Singapore was further validated when it had its Enhanced Registration Framework (ERF) License renewed for four years in May 2018. Throughout 2017, the impending ERF license expiry in May 2018 had proven to be a burden in the recruitment of students for degree pathways exceeding one year, which in turn, had impacted revenue.

A rationalisation of office leases during FY2018 also resulted in $0.5m worth of cost savings.

The Committee for Private Education (CPE) has become more exacting in its expectation of high standards of governance and compliance upon private schools in Singapore. In spite of this, we renewed the EduTrust certification (awarded by the CPE in December 2016) for four years and that has placed our Singapore business on solid ground to recover.

In the UK, The Office of Qualifications and Examinations Regulation (Ofqual), similarly continued to maintain its high regulatory standards and against that backdrop, NCC Education has maintained its annual Ofqual certification.

It was the decision to only focus on profitable programmes that led to the closure of our e-Campus, Informatics Global Campus in FY2018. We remain committed to online delivery of our programmes for both Informatics Academy and NCC Education programmes, but only where there is sustainable student demand.

NCC Education continued to gain traction with additional teaching sites for the Digi Qualifications programme series. Digi provides a comprehensive primary and secondary level computing curriculum and it was developed by NCC Education in accordance with the revised English 
National Curriculum for Computing, for students ages 5 to 16 years. Digi is now being delivered into private schools in Africa, Asia and the UK, with plans to expand the reach of the programme into other markets and to develop an online digital interactive format by the second half of FY2019.

Recently, a new Diploma and Advanced Diploma in esports was developed in partnership with (Singapore) Cybersport & Online Gaming Association (SCOGA) and launched in May 2018. The Group will be one of the first to offer an esports programme in Singapore and Southeast Asia. The Diploma programme, which has been approved by CPE, will be taught in Singapore through Informatics Academy in FY2019, and thereafter, will be offered globally under license by NCC Education to meet the demand in this new and exciting industry.

Once again, on behalf of the Group, I would like to record my appreciation to the directors, staff, partners, students and shareholders for their continued support. I am confident that we will continue to steer the progress of the Group to a better performance in the new financial year and beyond.

Dato’ Sri Robin Tan Yeong Ching

Non-Executive Chairman