Parents are thinking differently, says Stadio, as student numbers beat targets

accreditation

Private higher education group Stadio [JSE:SDO] says it has observed a paradigm shift in the way South African parents perceive the quality of private tertiary education, and this change is driving demand at a much faster pace than it anticipated when it listed in 2017.

The group, which was founded by Dr Chris van der Merwe, the same man who started Curro with 28 children in a church in Cape Town, says its student numbers rose to 31 869 by the end of 2019.

In its prelisting presentation in September 2017, Stadio told investors that it was targeting 16 577 students by 2019 and its prelisting statement aimed for 56 000 students by 2026.

"What I’m seeing now is a real chance of striking 40 000 students sooner than we thought. It might be over a year, a year-and-a-half, who knows? But that’s our next target," said Van der Merwe.

The group, which counts Milpark Education, AFDA and Prestige Academy among its brands, is now building two multi-faculty campuses in Centurion and Durbanville, which will respectively open in 2021 and 2022. Van der Merwe said the group thinks it can comfortably accommodate 100 000 students, 25% of which will be contact learners and 75% distance learning students, if it builds two more multi-faculty campuses in future.

Van der Merwe thinks this growth is possible because more parents are struggling to get their children enrolled in public universities, even when they did well in matric. He said the group will "do [its] utmost" to keep the tuition fee affordable in its quest to grow student numbers.

Currently, Stadio’s tuition for contact or full-time students is around R50 000 a year, and for distance learners, the cost is around R22 000, on average.

"Some are cheaper, some are more expensive, but those are the averages. We will do our utmost best to keep it at this price point. If you look at these price points, it’s more or less the price point of the state enrolment as well, and I think that’s the competitive advantage," said Van der Merwe.

He said while households are stretched and their disposable income shrinking, they are not falling behind with their fee payments. This contrasts with Curro, which reported last month that its decision to retain learners whose parents are struggling to keep up with the school fees increased its net bad debt expense in the 2019 financial year.

Van der Merwe said the group had also seen a fundamental shift in the way parents perceive the quality of private higher education. "When we started to communicate that the written curriculum in both the private and public institutions must be scrutinised and accredited by the same Council on Higher Education, and that there’s no difference in quality, it seems to me that parents are thinking totally otherwise about private institutions," he added.

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