CIBT Education Group Provides Fiscal 2017 Corporate Update and Outlook for Fiscal 2018
Vancouver, B.C., September 7th, 2017 – CIBT Education Group Inc. (TSX: MBA, OTCQX International: MBAIF) (“CIBT” or the “Company”) is pleased to provide a shareholder update from the CEO on notable progress achieved in the fiscal year ending August 31st 2017 (“Fiscal 2017”).
The Company continues to successfully integrate their education business with the fast growing GEC® branded student housing portfolio, the aggregate value of which $600 million. CIBT continues to add value to a growing need for readily available student housing in the Greater Vancouver Area. With the demand by students, both domestic and foreign, for housing expected to rise for the foreseeable future, CIBT is positioned well to capture more of the market and become Canada’s leading student housing provider.
Education Real estate milestones achieved during Fiscal 2017:
- GEC® Burnaby Heights commenced operations in November 2016 and achieved 100% occupancy for all available residential units
- An aggregate of $17.5 million was raised through private placements undertaken by two limited partnerships to initiate the development of the GEC Education Super Center® and GEC Education Mega CenterTM, two significant projects totaling over $450 million in value
- Formal agreement was signed with a leading Vancouver developer to construct the GEC Education Mega CenterTM in Surrey, B.C.
- Received City of Surrey Design Panel approval to move forward and seek City Council and neighborhood approval of the GEC Education Mega CenterTM development
- Consistently maintained 95+% and higher occupancy rate of all available beds across all GEC® properties
- Expanded partnership with over 100 public and private schools, colleges and universities in Metro Vancouver by feeding their student residence requirements to GEC® properties
- Property value of all GEC® properties (owned, under-contract and under-development) increased in value by approximately $120 million dollars
Education milestones achieved during Fiscal 2017:
- Increased enrollment of VIC Vancouver International College, an acquisition transacted in July 2016, by 30+%, expanded program offerings and added locations
- Acquired the debt owed by the defunct KGIC Inc. (TSXV: LRN, formerly Loyalist Group Inc.) from its secured creditor for $3.1 million
- Integrated the acquired KGIC Inc. assets with Sprott Shaw College and VIC Vancouver International College assets and created a new division called Sprott Shaw Language College to house all language school students under one brand as compared to 13 former KGIC brands
- Increased total number of campuses in Canada from 16 to 25
Corporate milestones achieved during Fiscal 2017:
- Total number of recruitment centres, offices and campuses increased from 34 to 44 locations
- Bought back and cancelled 1.238 million shares, 5th time in 4.5 years with an aggregate of 11.315 million shares being bought back and cancelled by the Company
- Completed private placement of $2.2 million to fund the acquisition of KGIC Inc. assets
- During the 9 months ended May 31, 2017, total revenue increased by 35%, student housing development fees increased by 54%, housing rental income increased by 265%, and total assets increased by 61%
- In addition, the Company achieved net income of $8.42 million, EBITDA (Earnings Before Interest Taxes Depreciation Amortization) of $10.53 million, and earnings per share of $0.07 per share during the 9 months ended May 31, 2017
“We saw tremendous growth in all areas of our business in Fiscal 2017, and we anticipate that this trend will continue well into 2018 as the relevant limited partnerships take possession of additional properties and we progress toward our target of an aggregate $1-billion-dollar GEC® student housing portfolio,” commented Toby Chu, Chairman, President and Chief Executive Officer of CIBT Education Group. “With the addition of the KGIC education assets along with the increased demand of international students coming to Vancouver, the need for rapidly expanding our platform to feed this growth sector has never been stronger.
Projected milestones expected for the fiscal year ended August 31, 2018 (“F2018”):
- Obtain rezoning approval for GEC Education Mega CenterTM in Q1 with construction slated for Q3, F2018
- Completion of renovation at GEC® Viva Tower which will increase the number of available rental units at GEC® Viva by 100% in Q1, F2018
- Arrange for two limited partnerships to undertake private placements to raise a total of $112 million for the development of the GEC Education Super Center® and GEC Education Mega CenterTM from Q1 to Q3 of F2018
- Planned exit of two GEC® projects while re-engaging a long term management contract for the same projects with new owners and additional development fees by Q2, F2018. These exit exercises will monetize our share of significant increase in property values from these two projects
- Opening of GEC® Pearson by Q2 F2018 which will add over 300 rental beds for students attending colleges and universities located at the south and west side of Vancouver and Richmond such as University of British Columbia, Langara Community College, Kwantlan Polytechnic University, BCIT Richmond campus and Sprott Shaw College Richmond campus
- Refinance our entire mortgage portfolio by utilizing our stabilized income and aggregated mortgage volume today as compared to the past two years which, if successful, will substantially reduce our interest expense
- Obtain rezoning approval for GEC Education Super Center® slated for Q1 and commence construction by Q4, F2018”.
About CIBT Education Group:
CIBT Education Group Inc. is one of the largest education and student housing investment companies in Canada, focused on the global education market since 1994. Listed on the Toronto Stock Exchange and U.S OTCQX International, CIBT owns business and language colleges, student housing properties, recruitment centers and corporate offices at 44 locations in Canada and abroad. Total annual enrollment for the group exceeds 15,000 students. Its education providers include Sprott Shaw College (established in 1903), Sprott Shaw Language College, Vancouver International College and CIBT School of Business. Through these schools, CIBT offers business and management programs in healthcare, hotel management, language training, and over 150 career, language and vocational programs. CIBT’s property investments are held by Global Education City Holdings Inc., an investment holding and management company focused on developing education related real estate such as student hotels, serviced apartments and education super centers totalling over $600 million. CIBT also owns Global Education Alliance (“GEA”) and Irix Design Group (“Irix Design”). GEA recruits international students for many elite kindergarten, primary and secondary schools, colleges and universities in North America. Irix Design is a leading design and advertising company based in Vancouver, Canada. Visit us online and watch our corporate video at www.cibt.net.
Chairman, President and Chief Executive Officer
CIBT Education Group Inc.
Investor Relations Contact: 1-604-871-9909 extension 318 or | Email: email@example.com
Some statements in this news release contain forward-looking information (the “forward-looking statements”) about plans for certain GEC® projects in which CIBT has invested. Forward-looking statements are statements that are not historical facts and in this news release include, without limitation, statements about plans for certain GEC® projects in which CIBT has invested. The forward-looking statements are subject to various risks, uncertainties and other factors (collectively, “Risks”) that could cause CIBT’s actual results or achievements to differ materially from those expressed in or implied by forward-looking statements. The Risks include, without limitation, the ability of the relevant limited partnerships in which CIBT is invested to raise equity investment and secure other required funding to acquire the project, usual construction risks, the ability to obtain all required municipal approvals, and the ability of the relevant limited partnerships in which CIBT is invested to enter into and complete exit transactions. Forward-looking statements are based on the beliefs, opinions and expectations of CIBT’s management at the time they are made, and CIBT does not assume any obligation to update its forward-looking statements if those beliefs, opinions or expectations, or other circumstances should change, except as may be required by law.