Stadio Holdings Limited ($SDO)

Good morning, ladies and gentlemen, and welcome to STADIO Holdings' Annual Results Presentation for the year ended 31 December 2025. With me this morning to do our results presentation, as normal, is our Group CFO, Ishak Kula and the 2 of us will do the presentation this morning. Before we start with the presentation, I would just briefly like to acknowledge the lady in the picture there in our opening slide. That is Marjorie Gladi, or let me just correct myself, Dr. Marjorie Gladi. Marjorie recently obtained her doctor degree, and she is also our Head of Campus at Centurion. So Marjorie, again to you, congratulations on obtaining your doctor degree. Ladies and gentlemen, our presentation this morning will focus, firstly, I will start us off with a reflection on the 2025 year. I would then hand over to Ishak, who will unpack our financial results in more detail. And after Ishak's presentation, I will come back and just give us a peek into the future and what the group is planning going ahead. After that presentation, we will then open for a question-and-answer session. For those of you who would want to download this presentation, it is part of the handout. Firstly, I would like to use this opportunity also to give a big thank you to all the STADIO staff in the group from the 3 institutions. Our people are key to our success, and these financial results are the outcome of all their hard work and dedication during the year. So to all of them, a big thank you for another solid year of financial results. When we look at the 2025 year, we can say that it's been a good year for STADIO Group again, even taking into consideration the continuous challenging environment, the economic environment that we operate in. Consumers are definitely still under pressure, but we still managed to show good growth during the period, especially the STADIO Higher Education Institution's comprehensive strategy is really starting to bear fruit, and we see accelerated growth in that institution. Very proud to announce this morning our Durbanville campus. We've completed Phase 1 during 2025. And we've opened our doors on that Durbanville campus here in the Western Cape for students in January this year. I'll talk more to Durbanville later in the presentation. In 2025, we've seen good contact learning growth. If we just think back a bit to 2020, during the COVID period, we've seen our student numbers in the contact learning mode of delivery coming under pressure. And it was really only in 2024 when we reached pre-COVID numbers again. But this set of results will show that there is good growth in our contact learning business and exciting also to see that, that trend is continuing in 2026. The group has shown 11% increase in contact learning for 2025. And then especially, I think the highlight in the contact learning world is STADIO Higher Education, where we saw a 21% growth in students taking or studying by way of contact learning. Technology and processes improvements continued during 2025, bringing efficiencies that will enhance the student experience. This will remain a focus for the group, for the next formidable future, I would say, 5 to 10 years still to come with all the plans that we have in this regard. And we have continued in developing and accrediting exciting new qualifications. With all the accreditations that we've received in 2025, the group was in the position to offer more than 100 accredited programs in the 2026 academic year. And then exciting also to report back our new CEOs in AFDA, Diaan Lawrenson and then Dr. Stan du Plessis the CEO of STADIO Higher Education settled in well and they are doing very well. We're very excited about these 2 appointments. And these appointments have now also given the Holdings executive team, the option to explore other growth opportunities. Milpark, our pure online institution continued to be the largest contributor to the CA pipeline in South Africa with more than 20% of successful SAICA IAC Board candidates being Milpark graduates. It was another award winning year for AFDA. You can see there on the picture on the left-hand side, all the awards that AFDA have won over the last few years. This year, I think the highlight is AFDA alumni were nominated again for an Oscar with the movie, The Heart is a Muscle. The AFDA Hatfield campus, we're also excited to announce opened in January, giving the AFDA offering or the AFDA institution presence in the Pretoria region. We're very excited with the prospects of that new campus in Pretoria for the AFDA brand. Then I think a big highlight for us in 2025 was the implementation of our new academic model. We are really excited about this model. The reason for that being, it will ensure quality offerings at scale, and that's really exciting. And we believe as the institution grows further, this will become a real game changer for us. A big thank you to Professor Divya Singh and Esther Venter with all their hard work in implementing this new model, and we really are very excited about what that will bring to the group in the future. In 2025, we received accreditation for our new school of engineering. And I can also report back that we've opened registrations for the school of engineering in 2026. At this stage, we are only offering the engineering school here in the Western Cape at the Durbanville campus, but the plans are there to also extend it to our Centurion campus in Gauteng over time. Then on the sport field for 2025, the STADIO Higher Education Institution participated in the USSA tournaments during the year, and both our rugby and netball teams won their respective divisions that they played in. And then another very exciting news for us as a group. STADIO Higher Education became the official education partner of the Springboks and actually not just the Springboks, of all South African Rugby Union national teams. So why the sponsorship of the Springboks and the Saru teams. For us, it is actually very clear that there is a lot of synergy between the 2 brands. Both these brands being very proudly South African brands, and both these brands working tirelessly for the betterment of our country and its people. We strongly believe that this partnership will make STADIO a household name in the duration of this partnership, and we are very excited about where this will go in the next few years. I must say, looking at that photo again this morning, if you do not know who the people in the picture is, you would easily make the mistake by thinking the guy with the tie is one of the players, but no, that is not the case. Let's move on to the numbers. A strong set of financial results, as I've said. Student numbers increased in the first semester by 9% up to 51,197, an additional increase of 7% in the second semester to 53,303 students. So good growth during the 2025 year from a student number perspective, looking at our revenue increased by 14% to ZAR 1.841 billion. EBITDA margin is something that we are very excited about to report back. Over the last few years, we've also indicated that we believe this business can get to an EBITDA margin of 30% and that it is sustainable. We are very glad to announce that we have now reached that 30% EBITDA margin. Profit after tax up by 24%. Earnings per share, up 25%. Core headline earnings per share, up 22% and then cash generated from operations up 16%. And then exciting also to announce dividends per share, up 22% and then return on equity, up 16%. So well on our way to get to that target of 20%. With that, I will now hand over to Ishak that will go and unpack these financial results for us in more detail. Over to you, Ishak.

Good morning. Good morning, ladies and gentlemen. I have the privilege of taking you through the financial results in a bit more detail. As Chris alluded to, a very solid set of results for the year. I'll start off by sharing perhaps a brief overview, and then I'll unpack some of the detail in the slides that follow. We produced another strong set of results, as Chris had alluded to, with revenue increasing by 14% to just over ZAR 1.8 billion, really underpinned by the student number growth in S1 of 9% and then 7% in semester 2. EBITDA margins, as Chris also said, very exciting. Our efficiencies are starting to show with our margins improving to 30% and up from the prior year's 28.4%. Our loss allowance is in line with the prior year at 8.8% versus the 8.7% in 2024. Off the back of those results, we still generated very good cash flows, with our cash generated by operations up by 16% to ZAR 540 million for the year under review. Just highlighting some of our key capital and other investments during the year, that amounted to ZAR 303 million. To give that some color, we invested ZAR 205 million in our Durbanville campus to -- which includes ZAR 3.5 million worth of borrowing costs that we incurred during the 2025 period. We also invested another ZAR 31 million for other campus enhancement across the group, and then another ZAR 33 million in support of our curriculum development and software investments during the period. Then we also concluded the sale of our Randburg property, which was finalized in October, and we sold that Randburg property in STADIO Higher Education for ZAR 19.4 million. Then for the year, we also returned over ZAR 204.3 million to our shareholders via 2 mechanisms. One, we declared a dividend, which was paid in 2025 in April of ZAR 128.6 million, which is off the back of -- that was the dividend that we declared. And we also paid ZAR 11.3 million to our minority shareholders in the period. The ZAR 204 million we returned to our shareholders also included ZAR 75.7 million, which we returned to our shareholders through a share repurchase during the period in order to avoid shareholders' dilution as we've communicated to all our shareholders in the past. We've also issued 4.5 million shares worth ZAR 35 million for those individuals that participate in the long-term incentive scheme. Ladies and gentlemen, we continue to have a strong balance sheet with low levels of gearing. At the year-end, we had ZAR 120 million of debt on our balance sheet that rose predominantly as a result of the investment in our Durbanville campus, which was then subsequently paid post year-end, which also allows us to act on any good opportunities as and when they come. Exciting we're declaring a dividend for the 2025 financial year of ZAR 0.184 which equates to ZAR 156 million, which is payable on the 17th of -- which declared on 17th of March and payable on 28th of April in later next month. Then what does that mean in student numbers? Ladies and gentlemen, I'll take you through a bit more and give you some more context there. Total student numbers for the -- for S1, our semester 1 intake, we grew that by 9% to 51,197 students. That then gives us a 10% CAGR for the period June 2020 to June 2025. Again, as a reminder for our audience that we -- in our Milpark business, we continue to see the impact of our cyclical B2B business, and excluding the impact of that, our half year student numbers would have raised by 11%. Then moving on to our 31 December total student numbers. That grew by 7% to 53,303 students, which is a CAGR of 9% over the period December 2020 to December 2025. And again, excluding the B2B impact, our student numbers would have risen by 9% for the full year. So what does that look like in contact learning for semester 1 and 2? Semester 1 student numbers, we saw growing by 11% year-on-year, really off the back of good site extensions where we've taken our programs to more sites during the period, and that's continuing to feed into our growth. And as Chris alluded to earlier, our STADIO Higher Education really showing solid contact learning growth, up by 21% for the period. And then -- but what we did see is a higher price point qualifications showing limited growth in the period. So for CAGR purposes, our contact learning at the half year grew by 2% for the period June 2020 to June 2025. Then what does our contact learning numbers look like for the full year? Full year also up by 11% for the same reasons mentioned earlier to a full year contact learning student number of 6,980 students, just below the 7,000 mark at the full year. Moving on to our distance learning student numbers. At the end of semester 1, our distance learning student numbers rose by 9% to 44,179. Similarly, we continue strategically to roll out new programs and new offerings in the group, and that continuously is adding to our momentum in our group. Excluding the impact of our B2B component, our student numbers, therefore, at the end of semester 1 would have grown by 11%. And we saw that same trend continuing in semester 2, solid growth at 6% for semester 2 to 46,323 students and the growth similarly was impacted by new programs that we enrolled, but they're adding back our B2B component, our student numbers full year would have grown to 9%. How did that translate into revenue for the full year? Our revenue is up by 14% to just over ZAR 1.8 billion, as mentioned earlier, the 14% revenue growth could be broken down in distance learning and contact learning. Our growth in contact lending was 15% revenue growth to just over ZAR 589 million with distance learning revenue growing by 14%, just over ZAR 1.2 billion, which gives us a 5-year CAGR of just over 15%. Then EBITDA and adjusted EBITDA margins. No real difference between our adjusted EBITDA and EBITDA during the period. But as mentioned earlier, very exciting for us as a group is our efficiencies starting to show with our EBITDA margins on 30%, which is our ambition for 2025. Then if we look at our margin analysis, our key costs in our business, if we look at '24 and '25, we grew our revenue by 14%. Our employee costs grew by 9% for the period. And if you look at that employee costs as a percentage of revenue, that's part of the efficiencies coming through. That margin improved from 41.3% in December 2024 to 39.2% in the 2025 period. Our operating expenses grew by 15% and that operating cost margin remained flat year-on-year. What did our loss allowance do? That increased slightly above revenue to 16%, but on a margin basis, increased from 8.7% to 8.8% for the period. Looking at our trade receivables and loss allowance, that just gives you a good sense from December 2024, what our loss allowance margin was up to December 2025. We continue to see good collection processes that we've introduced that that's bearing fruits, and that continues to be rolled out in the wider group, and various initiatives are -- we continue to invest in that space to make sure that we collect as quickly as we possibly can. Just a reminder, ladies and gentlemen, the operational changes we introduced in semester 2 in the previous years. We prevent students to reenroll in semester 2, if they haven't engaged with the institution or they haven't settled their balances up to a certain point, just to allow us to continue to curb the loss allowance and to manage our loss allowance margins effectively. The loss allowance margin, therefore, for the year is just marginally up from 8.7% in last year to 8.8% in the current period. Moving on to a breakdown just of our trade receivables split by current year to prior year. Our trade debtors book. Our current year book grew by 12%, whereas our revenue grew by 14%. So we're quite happy with that. And as always, the biggest risk category of debtors in our book, is the prior year debtors, those debtors that came from prior years that continues to move forward into the current year, and as always, provided prudently against that debt at 93% for the period. So from a profit and loss perspective, our profit and loss for the year is up 24% from ZAR 276 million in the prior year to ZAR 341 million in the current year off the back of the organic growth that I cited earlier, and supported by new qualifications that continuously is adding to our growth story. And just a reminder, in the prior year also, we had an impairment charge for our Randburg property, which therefore reduced the 2024 earnings and consequentially contributed to a bigger growth in the current year of 24%. What does it mean in earnings and our earnings per share and our headline earnings per share, both earnings per share up 25% for the period from ZAR 0.309 per share to ZAR 0.386 per share and our headline earnings up 23% from ZAR 0.314 per share to ZAR 0.385 per share. If you look at it over the period from a cumulative -- from a CAGR perspective December 2019 to December 2025, our headline earnings CAGR is up 29%. Then looking at our core headline earnings and core headline earnings per share numbers, that is up 22% in both instances. Our core headline earnings is up from ZAR 267 million to ZAR 327 million for the year. And our core headline earnings per share, up from ZAR 0.315 per share to ZAR 0.385 per share. Then just looking at our core headline earnings movement. Just to give you a sense of the key movements and how we got to the 22%. If we look at the underlying organic growth of our institutions, that organic growth pre our loss allowance is up 27% on the prior year. If you deduct the net loss allowance, which is up 6%, that gives you a total organic growth inclusive of the loss allowance of 21%. And then accounting favorably this year compared to the prior year, last year, we brought out some minorities in our group, and we used some borrowings to do so. And we incurred interest to do so in the prior year, which is not repeated in the current year, which also contributed 1% to our core headline earnings movement in the current year, taking the full year to 22%. Moving over to our statement of financial position. Ladies and gentlemen, we're quite proud. It's a strong balance sheet. As I cited earlier, if you look at our balance sheet with total equity still over ZAR 2.1 billion for the group, with pretty limited borrowings. We had ZAR 120 million of borrowings at the end of December 2025, which was subsequently repaid in the new financial year. That, despite the fact that we continue to invest significantly in the group, and we invested ZAR 303 million in capital expenditure broken down as follows: In Durbanville, we invested ZAR 205 million for our new Durbanville comprehensive campus. We invested another ZAR 10 million in software development during the period as part of our strategy to -- as a technology-led institution, we invested curriculum development of ZAR 23 million for the period. And then other campus developments across the group amounted to ZAR 31 million. Then our recurring CapEx number was ZAR 34 million for the period, taking our full investment cumulatively to ZAR 303 million for the period. Strong cash balance at year-end was ZAR 156 million. Then looking at our gearing ratio was 12.1%, inclusive of IFRS 16 assets and liabilities. If you exclude the impact of IFRS 16, our gearing ratio drops to 5.6%. And as I mentioned, we repaid our debt facility post year-end. Then unpacking our cash flow from operations from December 2020 to December 2025. If you look at our net cash flows from operations before working capital, that amounted to ZAR 568 million, with working capital changes of ZAR 28 million, taking our net cash generated from operations to ZAR 540 million, and then if we express the cash generated by operation as a percentage of our EBITDA number, that is at 98%. Then when we look at free cash flows for the period, which is free cash flows less recurring CapEx, that is also up significantly to ZAR 397 million for the year, up from the prior year's ZAR 327 million. Capital invested over the period cumulatively. If you look at 2025, we invested ZAR 303 million which was split into ZAR 280 million for infrastructure and other capital assets with our curriculum or program development at ZAR 23 million, which takes our cumulative investment to just over ZAR 2.7 billion, year life to date. How did we use our cash during the period? I'm walking through the slide from left to right. We opened the year with a ZAR 132 million cash. We generated ZAR 431 million in operating activities. We then spent ZAR 205 million on our Durbanville campus. We spent ZAR 33 million on curriculum and software development collectively. Then we spent ZAR 31 million on other campus enhancements during the period, supported by ZAR 34 million in recurring CapEx during the period as well. As mentioned earlier, we then had proceeds from our Randburg property of just over ZAR 19 million, and we repaid ZAR 30 million for all our leases across the group. Then looking at our net proceeds from borrowings, that was ZAR 120 million for the period. That's the amount that was subsequently repaid after the year, and we declared ZAR 129 million dividend to our shareholders and ZAR 11 million was also paid to minority shareholders during the period. Then on our net share repurchases of ZAR 73 million, that is net of the cash received on our long-term incentive scheme. So therefore, a net outflow of ZAR 73 million, taking our year-end cash position to ZAR 156 million. Then moving over to 2026 and looking at some of our key CapEx projects there and what you can expect to see. We continue to invest in curriculum intangibles. We anticipate spending ZAR 47 million there for the 2026 year. To conclude the last phase of our Durbanville property campus expansion, there's another ZAR 110 million earmarked for the 2026 year. We've also earmarked ZAR 105 million for other campus expansions off the back of very good contact learning growth that we've seen, and we've earmarked another ZAR 32 million for recurring CapEx that we anticipate spending in 2026. So our total capital projects for the year, we anticipate to be ZAR 294 million. Then ladies and gentlemen, just a snapshot of the 7-year financial overview. I think we're very, very proud of the results that we've delivered under the year, and again, it just proves our strong track record that we've had for 7 years consistently. Thank you very much.

Thank you, Ishak, for unpacking the results for us in that detail. Let us continue with our presentation, ladies and gentlemen, I think by now, we have a proven track record of delivering quality higher education to our students. And at the same time, balancing that we're producing good value to our shareholders. I want to use this opportunity also to thank our shareholders for supporting us on this path of widening access, and giving more people access to quality higher education. Every day, we come to work, we are making a difference in this beautiful country of ours. We're still well on track in reaching our pre-listing statement target of 56,000 students. We should get there by the end of this year, 2026, and our focus is already on our next target that of 80,000 students by 2030. Our growth strategy is solid, and it produced good growth for the group. The growth strategy is built on those 5 pillars. The first one being accrediting in-demand programs. As I've already indicated, 101 programs or more than 100 programs would be offered in the group in the 2026 academic year, including a whole wide range of programs from different faculties and academic schools. The second pillar there is taking programs to new sites of delivery. I can now confirm that all the campuses in the STADIO Higher Education brand are now comprehensive campuses. A few years ago, when we started off, the majority of our campuses were single school campuses offering, for example, only education, but we are now in a position to really offer comprehensive offerings at each one of our campuses. And that's also one of the main reasons for us seeing this nice steady growth in contact learning at these different campuses. Looking at the third pillar, opening of new faculties and schools again in 2026 [Technical Difficulty] Yes. All good. Thank you. Sorry about that. Coming to the third pillar, again, as I indicated, 2026, see the launch of our new school of engineering with 2 programs, and we then also in the process of accrediting 3 more programs for our school of engineering to hopefully start offering those programs in 2027. Moving on to the fourth pillar in our growth strategy, that of opening new comprehensive campuses. Two new campuses for 2026. The first one, our very exciting new Durbanville campus. And then as I've also indicated the Hatfield campus in Pretoria for the AFDA brand. I can confirm that we are also exploring further campuses to expand to in 2027. Then our fifth pillar is that of exploring new markets and new opportunities. As we've already indicated, with the appointment of the CEO in STADIO Higher Education, this will free up more time for the Holdings executive team to now really focus on exploring new markets. So a lot of new exciting opportunities that we are working on currently. It's still early days, but we will make announcements as we conclude some of these exciting projects. Moving on to our breadth of our qualifications. There we go. We have a wide range of faculties and academic schools at STADIO in the group that is very similar to what you will find at our bigger public universities. These schools include the school of accounting, schools of commerce, management and administration, financial services, the school of education, the schools of film, fashion, humanities, then we also have the schools of information technology, the school of law, policing and law enforcement and then the newly added school of engineering and architecture. We offer a wide range of programs and ever increasing these offerings. Our programs range from entry-level access programs at higher certificate level, NQF Level 5, all the way to NQF Level 10 being doctorate degrees. Currently, as I've already indicated, more than 100 programs accredited for the 2026 academic year. What is interesting to note here, ladies and gentlemen, is that these numbers will continue to change as after every registration period, we evaluate, we reevaluate these numbers. And if we see that programs are no longer in demand nor are they are relevant, we will put these programs and teach out, and we will then look at replacing that with more in-demand new programs. Distance learning is now 87% of our group's enrollments, meaning 46,000 of the 53,000 students in the group study by way of distance learning mode. This is bigger than our initial long-term target of a 80-20 split. The main reason for this is we see continuous good growth in our distance learning, which is very exciting for us as a group. The distance learning offering underpins our margin and expansions in geographic scalability, and we use our contact learning infrastructure to support and strengthen our distance learning model. With this all being said, the good growth that we see in distance learning, I think we are really excited about what is happening also in the contact learning part of our business. As I've already indicated, good growth in 2025, and we see that continuing in 2026. Just a few interesting points I would like to share at this point. Interest in the Centurion campus, one of our first comprehensive campuses up in the north. At this point, we already see a 30% growth in student numbers for the 2026 academic year in Centurion. More excitement. As we've said, we've opened the Durbanville campus in 2026. We've set ourselves the target of 1,000 students to open that campus. And I'm very happy to report back that we've already passed that number, and we are actually tracking very well in growing that number substantially. So with this great excitement and good growth being seen in contact learning, the group also took the decision to add to our capacity and to extend our campuses, the offerings that we can -- that we currently have at our different campuses. What did we do? For example, at our Durbanville campus, we've now decided to continue with Phase 2 of the construction, and that will take the capacity of that Durbanville campus from 1,800 students to excess of 5,000 students. At the Centurion campus, where we also see good growth, we've converted our big hall into more lecturing space, and we will start in the second half of this year with the construction of a new hall on that Centurion campus. At Waterfall, we were in the privileged position to acquire the Curro building on our property in Waterfall. And that will then also make -- or give us more capacity at our Waterfall campus to expand our offerings there. And then in Musgrave, we also went ahead and leased more space across the road from our current campus, and we are converting that space also into additional lecturing space. So really building on our footprint and expanding our capacity at all our comprehensive campuses in the STADIO Higher Education brand. There is just -- I would like to share a few photos of the new campus in Durbanville. It was very well received by all our students and everybody visiting the campus. We must say the feedback is overwhelming positive. We're very excited about that campus, and we have decided to conduct our half year results from the Durbanville campus, and we will then gladly take our shareholders and all stakeholders on the tour of the facilities during our half year results presentations later in the year. There is just a photo of the engineering lab at Durbanville as well as our IT lab at our Musgrave campus in Durban. Photo of the AFDA campus in Hatfield, also came out very nicely, receiving very good feedback on the look and feel at that campus. So ladies and gentlemen, 2026 is the year for the STADIO Group to shift gears. And with that in mind, we've launched Project 100. Project 100 is all about the focus on reaching 100,000 students in the future. Without giving away too much at this early stage, Project 100 will focus on quite a number of projects, and I will just share a few of them today. The first one is that of university status. That is a real priority for us. We've invested a lot in preparing us and getting us ready for university status. We've seen a fantastic growth in our post-graduate offerings as well as in our research outputs. And we believe that we are very well positioned to become a university when regulations do allow us to do so. We will continue with our campus optimization strategies as well as building the brand even further. And then obviously, very important for us to get to 100,000 students and making sure one service and support these students well. When you reach these type of numbers, technology will become of utmost importance. Last year, I've announced the appointment of a new CIO for the group, Mr. Merwe Roux. Since that appointment, we've really invested in building that department. We've appointed a number of new employees to bolster that division with Merwe in Merwe's office, and we've appointed several business as well as data engineers over the last few months. Then a big focus of Project 100 will definitely be the exploration and expansion opportunities. Currently, ladies and gentlemen, we predominantly offer or we only offer higher education programs in the group. We haven't touched any of the further education and training programs nor are we offering any QCTO programs. We will investigate artisan training as well as looking at exciting possibilities in the short learning program market. So a lot of runway, a lot of scope still for us to look at expansion and growth opportunities in STADIO. And then lastly, as I really actually alluded to, is the management team will really investigate opportunities in new markets as well as in new markets going forward. Just briefly, the market landscape. Higher education continues to grow. I think every year, at this time of the year, we see thousands and thousands of students being disappointed where they applied to get in at a higher education institution of their choice, and they can't do so. In 2023, we saw 1.3 million students in the higher education space. And according to the National Development Program of government, the target is to get to 1.6 million students by 2030. Currently, private higher education institutions make up 21% of the higher education market, where the global average is more in the range of 33%. So there's still a lot of scope for privates in South Africa. Regulations changing, which will allow private higher education institutions to be called universities. It is coming. And we believe that this will change the higher education landscape materially. My view is that we will also see more consolidation in this space, as it would become more and more difficult for smaller players to compete with private institutions that are also becoming universities. With all the good news, ladies and gentlemen, there are also some headwinds for the year. One of them being the announcement in Namibia last year by the newly elected President that higher education would be free in that country. That led to a lot of confusion in the higher education space. We see reducing numbers, not just in private institutions, but also in the public institutions. We think this will normalize soon as more and more Namibians understand what that announcement actually entail. STADIO took the decision then also to register in Namibia as a Namibian university or a Namibian institution that would allow us then in the future to apply for government grants if that opportunity becomes available. Another headwind, I think we are all aware of is what is currently happening in the film industry with the closing of the channel Showmax as well as the Department of Trade and Industry cutting their financial support to the industry. That is putting our AFDA business, especially registrations in the AFDA business under pressure. But we are excited with the new campus in Hatfield that we've added to the AFDA brand to stimulate their growth opportunities going forward. But despite these 2 challenges, we are very upbeat, and we remain very optimistic about our growth prospects for 2026. Ladies and gentlemen, I want to conclude by saying that STADIO will be a university once regulations allow us to do so. It is of strategic importance for us to be a university, and we will definitely apply as soon as the regulations allow us to do so. In conclusion, ladies and gentlemen, 2026 starts the next key step in our journey to come to 100,000-plus students, and we are very excited about the future. Thank you very much. We will now move to a question-and-answer session.

The first question comes from Nadeem. He says who is running the student accommodation at the Durbanville campus?

So STADIO took the decision not to build our own student accommodation. We are partnering with developers in the area. Exciting happenings there at the moment is the group STAG Africa, which is a group that is very well known for student accommodation will start with construction soon on the site right next to our campus. And that we are very excited about that development as it will give students access from the student accommodation area right into the campus. So the accommodation next to the campus will be built by STAG Africa, and they plan to start with their construction around about May to the middle of the year.

Thank you, Chris. A question from Paul. Is it possible for the institution to award the Masters graduates an opportunity to tutor?

So obviously, to become a tutor or a lecturer at the institution, you have to apply. There must be a vacant position. And then you go through the necessary criteria and interviews system that we set. And we then make the decision to employ or not to an employ. But definitely, it's always open for STADIO graduates, especially post graduates to apply for these positions.

Thank you, Chris. A question now to Ishak. Can you please unpack in more detail the recurring CapEx of ZAR 30 million to ZAR 40 million. What is spent on and how it looks when the group serves 80,000 students in the future?

Thank you, Kate. If we look at the 2025 results, the recurring CapEx number was ZAR 34 million. We envisage a plan that the 2026 recurring CapEx number will be ZAR 32 million. So it's in line with 2025. Majority of our recurring CapEx as a higher education group, a lot of it is off the back of computers. So a lot of components because of our staffing. There's lots of computers that we cycle through a life cycle. That's a big proponent of it. But probably, by and large, the biggest component sits within our AFDA business, there where we use a lot of expensive equipment to service the needs of our students to provide them with the world-class education that they receive. So there's audio, camera, lighting equipment, costume, those type of things are what predominantly drives our recurring CapEx number. As a guide to when we get to 80,000 students because our recurring CapEx number is predominantly based on our contact learning student base largely, we don't expect that number to grow significantly more or in line with our revenue number growth.

From Henry, in the financial statement presentation, there was an indication that minority shareholders were bought out. If that is the case, could you show how much was borrowed, the interest rate and the duration of servicing the debt.

Thank you, Kate. Maybe a clarification point, if I may. We bought out minorities in our Milpark business at the back end of December 2023 that was paid for in January 2025. That transaction -- the full minority transaction at that stage was ZAR 123 million, which we paid for using borrowings that we -- that rose in January 2024. By March, April 2024, that debt was fully settled. So the interest component on that entire transaction was net of tax, just about ZAR 3 million -- just over ZAR 3 million.

Congratulations on a solid result. Three questions, and I'm going to ask them more, on additional response. If we focus the distant learning business ex B2B volume growth has decelerated to 9% versus 11% in H1 and much higher growth rates historically. Some of this is due to the bigger base, but it does also look like absolute additions have declined. Can you talk to the slowdown in growth here? Nice to see current year debtors book growing slower than revenue. Is there an opportunity to continue this in this tough macro environment? And then thirdly, a big step up in the prior year debtors book. Can you please unpack this result for us?

Yes, I will take the first one, Ishak. I think looking at our performance of -- in the distance learning for semester 2, firstly, to note that the second semester is always smaller in the academic year. The majority of students do register in the first semester. So it is normal to see a smaller intake in the second semester. What is also important to note is that last year, we took the decision to be more strict on reregistering students with outstanding balances. And that is just to protect the institution as well as the student not to continue occurring more debt if they are in a situation where they cannot pay their tuition fees. This does not mean that the student can't come back and complete their programs. They always have the opportunity to come back and complete their studies once they have reached a certain threshold for us to register and then again to continue with their studies.

Thank you, Chris. I'll take question 2 and 3. So to respond specifically to the question around the current year book relative to revenue. We were quite pleased with that result indeed. We believe it's sustainable. Of course, in a macroeconomic environment where the consumer remains under pressure, it's hard to say whether it will last forever, but I can assure you, we do everything that we can to try and make sure that we collect as fast as we can. To that end, we've got a number of critical projects in our pipeline to make sure that we remain agile and nimble when it comes to collecting on that book. Then speaking to 20 -- the prior year debtors I think that in particular, as we've seen systemically, if a student, the longer the debt is outstanding, obviously, your probability of collections reduces. But there, we have a number of interventions to try and make sure we collect from those students that into the prior academic year book. We've seen the growth really predominantly on older contact leaning and distance learning students. And what we've done there is we've made sure if we hand over sooner, those students when there's signs of weakness in collections. So we actually see better recoveries. But I think the second thing we're also seeing in that book is as that ages, students try and make plans by taking up loans. So we're seeing more and more students in that category, in particular, taking up loans and then servicing them or servicing them slower. And off the back of that, despite the fact that those loans are being taken out and that book growing from 2024 into '25, we remain prudent to make sure we try and cover above the 90% threshold.

Maybe, Ishak, if I could also add just go to my first answer to that. Obviously, our numbers are not finalized yet for the 2026 academic year. Registrations are still being processed. But I can report back that the distance learning student number growth is double-digit growth. So we are at double-digit growth again in our distance learning business.

Sorry, I joined late. What is the payout per share and when do we receive payoffs? I think that's the dividend.

Yes. Thank you, Kate. The dividend we declared around ZAR 0.184, up 22% from the prior year, and you can expect payout on the 28th of April.

Congratulations on the results. So next one. ECL rates moved higher from 62% to 70% in 2025. Can you unpack which programs or cohorts drove this and whether this is the new normal for the student credit profile?

Thank you. Kate. I'll take that. So certainly, the big thing we're seeing there is, I think I cited it also in our contact learning student number growth. Definitely, we're seeing it on the higher price point products, where students are definitely taking longer to pay. And therefore, we're making sure that we've got sufficient provisions in place. And again, I think to say whether this will last forever, I think the prudent thing to do is to provide at these levels until we see significant differences by students paying quicker. So those are the current levels, and we believe they are appropriate.

Question, do you offer bursaries to post-graduate students?

Yes, we do. Every year, not just for post-graduate students, but there are also bursary opportunities for students in the second and third year, and these bursaries are made available to current students as well as then post-graduate students applying in the new academic year.

Question from Catherine. Can you give an indication yet of your student number growth in S1 2026?

I think this is a bit dangerous as we are still in the process of registering. I can say, thus far, we are well on track for another solid year, but it is just too early to really talk to those numbers with a lot of confidence. I have in the presentation some of the numbers that we've already concluded, for example, what we see at our 2 big comprehensive campuses in Centurion and in Durbanville, where we see student number growth in excess of 30%. So I think that's very exciting for us. In the distance learning part of the business, we are tracking ahead where we were last year at this stage. But I think it's just too early to share those numbers at this stage.

Thanks, Chris. You mentioned nonmarket qualifications will be discontinued to better align programs with employment opportunities. At the same time, the group is expanding with developments such as the new AFDA Hatfield campus. How do you -- how does management reconcile the expansion with the current decline in employment opportunities in the film industry?

Yes, I think we took the decision to add an additional campus for the AFDA brand due to overwhelming demand from that area. Our market research has shown the Pretoria market is demanding AFDA program or AFDA campus in that area. And with that in mind, looking at the high demand, we took the decision to put down the campus. We must remember that Hatfield business was part of our property ownership, and it made sense for us to then use that property and give AFDA that opportunity to service the market in Pretoria.

Question saying for any acquisitions or consolidations in the sector, will the brands be kept or rebranded to STADIO as rebranding will need to impair the brand value.

I think, again, that is too early. We look at various opportunities at this stage. It can be a combination. Yes, I just think it's too early for us to make that call at this stage.

Question from Benjamin. Is there a plan to build or acquire a campus in Bloemfontein considering its central location?

Not at this stage. Our focus up to now was more to put down comprehensive campuses in our bigger cities. But it's not to say that we won't explore and expand over time into smaller cities. But to be dead honest, Bloemfontein is not on the priority list at this stage.

There's another question also related to new campuses? Are you planning to open a branch in northern part of Namibia?

We have a regional office in the northern part of Namibia already, and that is an office that supports our distance learners. Currently, we only offer distance learning in Namibia, and we believe that, that office currently is servicing and supporting those students well.

A question saying, can you rank the opportunities and unpack the opportunities that both are looking at if you have more time?

Yes, I think at this stage, it's still early days. We only started earlier this year to really focus on these opportunities. I think it's a bit premature for me to talk to it now. And it's also some of them are at a sensitive stage. So I would rather not talk to them today.

Quickly going through, I think we have a lot of questions from market research shareholders. Some of these are related to studies and around specific study questions, which we will respond to specifically and not in this forum. There's a question saying, what is the institution's view on assisting needy students in terms of bursaries or affordability?

So I think the institution has done a lot in this regard already. Ishak, perhaps you can share the numbers on our bursary scheme and the amount of money that we make available to support needy students.

Yes. Thank you, Chris. So as a rule of thumb in our organization, we earmark round about between 2% to 3% of our revenue number in bursaries and discounts and to assist students where there's both a financial need and also where students have been unable to, I suppose, come up with the means and they've engaged with the institution and they have been a good student, earmarked funds accordingly to assist them.

I'm just quickly seeing if there are any other investor-related questions. I don't see any others. So the rest, I will respond to directly. And then yes, I'll hand over to you, Chris, to close.

Yes. Thank you, everybody. I think that is our presentation. Have a good day.

Thank you.

Bye-bye.