Overseas Education Limited’s earnings plunge 67% to $1.8m

Depreciation expense soared 205% to $2.7m.

According to RHB, Overseas Education Limited, a company that provides education in English for overseas families residing in Singapore, grappled with a thundering 67% YoY profit crash to $1.8m in Q3.

While increased utilities expenses were expected due to Overseas Education’s larger campus, the company’s depreciation expense soared out of the blue, rising 205% to $2.7m.

During the quarter, revenue from tuition fees also stumbled back to $22.5m despite raised tuition charges, reflecting a 5% YoY dip. Registration fees dropped 34% YoY as well.

RHB posits that weak student enrollment may continue well into FY16 because industries in Singapore with high expatriate ratios, such as oil & gas and finance, keep experiencing contractions. As it stands, 60% of students have dropped out as their families relocated.