Update on Outstanding Debtor and Short-term Loans
Trading and Covid Update
Malvern International plc (AIM: MLVN), the global learning and skills development partner, announces an update in respect of the trade debtor and short term loans referred to in the Company’s announcement of 8 January 2021 (the “January Announcement”), and a broader update on trading.
The January Announcement referred to a significant trade debtor amounting to in excess of £900,000. The Company is pleased to report that it has now received payments amounting to £760,920 in respect of this debtor. Further payments are expected to be received in Q2 2021 but the full extent of these is uncertain and the Company is now not expecting to make a complete recovery of the remaining debt.
The short term loan agreement of £350,000 with Boost & Co. Ltd, details of which were set out in the January Announcement, to provide bridging finance to ensure the Company had sufficient working capital pending the payment by the debtor, will now be repaid.
The repayment date of the Director Loan Note amounting to £30,000, details of which were also set out in the January Announcement, has been extended from 30 April 2021 to 31 January 2022.
Trading and Covid Update
University Pathway programmes will continue to be delivered online while universities follow a tiered approach to returning to on-campus teaching. Further clarity is expected on this return following updated government guidance currently scheduled for mid-April.
University Pathway student numbers for the January UEL International Study Centre (ISC) intake resulted in 43 students. This takes the total number of foundation students in UEL ISC to 167 for the 2020-21 academic year, representing growth of 90% from the previous year’s academic calendar. It is a significant achievement to grow the centre in such challenging conditions.
Following demand from the international student market and at the request from the UEL International Office, the Malvern team has designed two extra courses which have been validated by UEL:
-International Year One in Computer Science
-International Year One in Hospitality.
These courses will be delivered in UEL ISC from the September 2021 intake and form a sound foundation for further growth.
In line with the Government guidance, our language schools will open for face-to-face teaching from 8 March.
Language student bookings had been rebuilding in H2 of 2020. Following the latest government COVID restrictions, 80% of the existing language students who were already in the UK transitioned to online study via Malvern Online Academy. The remaining 20% decided to wait until our language schools reopened for face-to-face teaching.
Until international travel opens we will be focused on targeting the students within the UK.
Further to our successful application to become a NCUK accredited delivery centre in London, there will be a marketing launch on 17 March to officially open our NCUK London centre in Kings Cross. From September 2021, Malvern will accept international and EU students on a nine-month NCUK International Foundation Year.
NCUK is a consortium owned by leading UK universities dedicated to giving international students guaranteed access to universities worldwide.
The programme is designed to prepare international students for undergraduate study, usually at a UK university. On completion of the course, students have guaranteed progression options to over 20 leading partner universities in the UK, as well as established universities in USA, Canada, Australia and New Zealand.
The NCUK partnership will add to additional revenue streams that are likely to grow in 2022 and beyond as student numbers increase. The programmes will help attract a wider diversity of students from key recruitment markets. As part of the group strategy, we see these academic foundation programmes as an area of growth.
During Q1 we are delighted to have recruited three senior executives to develop and grow the company. These comprise a Centre Director for the UEL International Study Centre who will also assist in developing Malvern’s foundation programme provision across the Group, a Head of Operations for Malvern International and a Financial Director.
As part of our recruitment strategy, we have identified the need for a regional Head of Sales in China and plan to build a sales team in that market. China is the biggest international student market to the UK for Higher Education provision and junior summer camps.
There remains strong demand for our education products. We expect further growth in the University Pathway division in September 2021. With the accelerated vaccine rollout, we are hopeful that there will be a plan to safely open international travel before the summer and expect the language business division to build up to normal levels by the end of the year.
For these reasons and with a significantly stronger and experienced management team now in place, we remain positive about the outlook for the Company.