Background and links

On 24/8/2018 Wey Education issued a detailed pre-close trading statement. Additionally their house broker WH Ireland issued a note, Graham Neary wrote a writeup and a private investor evening was held. The following day Executive Chairman David Massie did an interview:

(This follows much the same pattern as their previous substantial update in May:

)

Admission document

The following review was substantially written on the bank holiday weekend. It covers the events of last week and is based on the closing share price on 24/8/2018 of approximately 16p giving a market capitalisation of around £20m. It is written on the expectation the reader is familiar with Wey’s business and has read / listened to most of the above.

Trading Update

Timing

The timing of the update is noteworthy.

WEY’s year end is 31st August 2018. This is presumably to tie in with the academic year, however, unlike a traditional private school where the deadline for enrollment would have been before school holidays, WEY’s principal businesses will continue to take on new pupils right up to the start of term (10th September 2018) and beyond. Anecdotal evidence indicates there is a mini-surge going on in their InterHigh business around now for the following reasons:

  • Disorganised parents without a school place

  • Decisions being made following receipt of GCSE results last Thursday

  • Pricing generally incentivises starting at the beginning of term, but in particular they have a commitment-free half-term offer. The last opportunity to sign up for these and not miss a paid-for day of school was officially Friday, but certainly early next week at the latest.

Today’s announcement is 8 days before the year end and 11 days before the start of term.

The preliminary results are expected 29/10/2018 and so today’s announcement falls comfortably before the 2 months close period. I am not clear whether the timing of the preliminaries was set based on the timing of this update, or the timing of this update was to facilitate an aspiration to produce the preliminaries before then end of October. In either case, detailed, early reporting is very welcome and provides reassurance that the company are on top of their accounts.

Upbeat - really?

Thursday’s statement was widely viewed as upbeat, for example Graham…

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