- The Vancouver residential market is showing signs of stabilization, which will likely further strengthen the city’s rental market, boosting our outlook on CIBT’s student housing projects.
- In Q1-FY2020 (quarter ended November 2019), CIBT reported $17 million in revenue, up 0.2% YoY.
- Revenue was lower than our estimate, but the company continued to report organic growth in both its key segments – Educational (2.2% YoY) and Rental (10.7% YoY).
- Gross margin increased YoY from 56.4% to 58.1% in Q1-FY2020, and beat our expectations, due to a strong increase in gross margins of rental revenues (46% to 60%).
- EBITDA was $3 million in Q1-FY2020, up 179% YoY. A 55% YoY increase in interest expense impacted the bottom line. After deducting non-controlling interest, CIBT reported a net loss of $0.04 million (EPS: -$0.00), versus net profit of $1.18 million (EPS: $0.02) in Q1-FY2019.
- We are raising our FY2020 net profit estimate from $5 million / EPS: $0.06 to $6 million / EPS: $0.08.
- On December 3, 2019, CIBT announced an agreement to sell one of its properties for $70 million. The sale is expected to be completed in May 2020, which will likely be the next major catalyst for the company’s share price.
Visit CIBT Education Group Inc. page for more research, discussion boards and to like, and share.