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OPERATIONS & FINANCIAL REVIEW
INCOME STATEMENT
Total Revenue
For the financial year ended 31 December 2013, OEL
achieved a 6.9% year-on-year growth in total revenue to
$103.10 million, mainly due to an increase in revenue from
tuition fees, enrichment programmes and interest income.
• Tuition fees revenue increased from $91.38 million in
FY2012 to $98.65 million in FY2013 mainly due to an
upward revision of tuition fees across all grades of OFS
for the academic year that commenced in August 2013.
• Revenue f rom registrat ion fees decreased f rom
$2.70 million in FY2012 to $1.81 million in FY2013.
• Revenue from school bookshop sales remained relatively
stable at $1.17 mi l l ion in FY2013 compared with
$1.14 million in FY2012. Enrichment programme revenue
increased from $0.81 million in FY2012 to $0.92 million in
FY2013 on the back of higher enrichment fees last year.
• Interest income of $0.44 million in FY2013 was twice the
$0.22 million recorded in FY2012 as interest earning bank
balances increased due to the IPO proceeds received in
the rst quarter of 2013.
• Other revenue decreased from $155,000 in FY2012 to
$115,000 in FY2013.
Operating Expenses
In FY2013, the Group’s total operating expenses increased
by $3.84 million to $75.77 million on the back of higher
personnel expenses which increased from $53.32 million
to $56.07 million over the previous scal year. The increase
in personnel expenses was mainly attributed to salary
adjustments and higher staff headcount, resulting in a rise
in aggregate salaries and CPF contributions.
However, the increase in operating expenses was partly
offset by a decline in depreciation and amortisation costs
from $4.35 million in FY2012 to $4.00 million in FY2013,
as more xed assets (particularly renovations) were fully
depreciated during the rst half of last year.
Other operating expenses increased from $4.11 million in
FY2012 to $4.60 million in FY2013, mainly due to a general
increase in expenses.
A share subsidy of $1.08 million was also recorded during
FY2013, to provide for staff subsidy of 9.6 cents per reserved
share, subscribed by the 166 staff shareholders during the
IPO exercise last year.
Profitability
Taking into account the above, pro t before taxation rose
by $2.85 million from $24.47 million in FY2012 to $27.32
million in FY2013.
Effective tax rate increased from 15.6% to 17.3% in FY2013,
mainly due to a refund of $176,000 received in FY2012.
As a result, profit after taxation increased by 9.5% or
$1.95 million from $20.66 million in FY2012 to $22.61 million
in FY2013.
BALANCE
SHEET
OEL reported net cash position of $124.70 million as at
31 December 2013.
Property, plant and equipment increased from $8.92 million
to $58.81 million in FY2013, mainly due to the alienation
premium of $37.10 million paid for the leasehold land located
at Pasir Ris Drive 3. In addition, there was $15.21 million
capital expenditure incurred for the development of the new
school campus, net the $3.26 million depreciation charge in
FY2013 and $0.62 million depreciation charge on leasehold
land that was transferred to construction-in-progress, as
part of other property, plant and equipment.
Fee protection insurance deposits of $2.03 million were
reclassi ed to current assets during the year as the deposits
would be withdrawn within the next 12 months. Notably,
the deposits are also no longer required as OFS has since
moved to the Fee Protection Scheme which provides the
full protection of fees paid by the students.
Trade receivables decreased by $0.08million over the nancial
year, primarily due to the higher collection of outstanding
receivables as at 31 December 2013. Prepayments declined
by $0.89 million to $1.12 million, mainly due to the absence
of prepaid IPO expenses of $1.13 million which comprised
part of the prepayment amount in FY2012.
Overseas Education Limited AR 2013
INVESTING IN EDUCATION
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