ICOLLEGE : FY22 Interim Financial Report

iCOLLEGE H1 FY22 INTERIM FINANCIAL REPORT

ASX / MEDIA RELEASE23 FEBRUARY 2022

onlyThe directors are pleased to present this Interim Financial Report for the consolidated entity consisting of iCollege Limited (ASX: ICT) (iCollege or the Company) and its controlled entities (Group) for the half year period ended 31 December 2021 (H1 FY22).

Financial highlights

In H1 FY22 iCollege delivered record revenues and a strengthened balance sheet driven by the RedHill Education Limited (RedHill) acquisition and growth in its domestic student markets. Key highlights included:

use	• Record revenue of $18.2m, up 131% on the previous corresponding period (pcp) (H1 FY21: $7.9m);
	• EBITDA (before M&A costs) of $1.6m, a $0.4m decrease on pcp (H1 FY21: $2.0m), due primarily to
	higher expenditure targeting growth in domestic student revenues; and
	• Significantly stronger balance sheet with cash at bank (including term deposits) as at the end of
	December 2021 of $22.4m (December 2020: $5.0m).

Integration of RedHill into iCollege

iCollege completed the acquisition of RedHill during H1 FY22, achieving a 92% ownership interest on 1 October 2021. Undertaking a robust integration has been a key focus and significant progress has been made with critical milestones achieved so far including:

personal	• Completing the acquisition with financial results consolidated into iCollege effective from 1 October
	2021;
	• Confirming senior executive appointments and organisation structure which includes management with
	demonstrated track records of education industry success from both iCollege and RedHill;
	• Launching a new integrated HR system and payroll platform across the Group;
	• Launching a new integrated IT service helpdesk for all employees;
	• Refreshing websites for iCollege and other key brands in the Group; and
	• Establishing an integrated financial reporting system which went live in January 2022.

ForWith the RedHill acquisition now completed, iCollege is confident of delivering annualised cost synergies of between $1.0 million to $1.35 million, predominantly being savings in governance and corporate costs. Over the medium term, additional cost and revenue synergies will be pursued.

Return of international students to Australia - strong positive lead indicators

Australia's international borders reopened from mid-December 2021 allowing international student arrivals to resume. After suffering annualised international student revenue decreases of approximately 45% (~$28.0 million) since international borders closed in March 2020, iCollege anticipates that its international student enrolments and revenues will start recovering from the second half of FY22.

iCollege Limited

Level 2, 7 Kelly Street, Ultimo, NSW, 2007

T [phone] | E [e-mail] | W www.icollege.edu.au

Lisa Jones Company [e-mail]

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ForFor further information: Glenn Elith

Chief Executive [e-mail]

CEO commentpersonaliCollege CEO Glenn Elith said:

"I'm extremely pleased how our swift, robust and disciplined approach to integration has ensured iCollege has laid solid foundations which enable us to confidently shift our focus to growth.

I'm delighted by the strong lead indicators being experienced by iCollege as we strive to rebuild our international student revenues, which I believe is a testament to the determination and commitment of our people and the groundwork we prioritised during the COVID pandemic. iCollege is ready to re-ignitethis part of the business as circumstances continue to improve.

Our executives and directors are determined to leverage iCollege's strong balance sheet and recovering international student revenues by prioritising the development of a refreshed strategic roadmap which is xpected to include bold growth plans."

This announcement has been approved for release by the Board of iCollege Limited.

$4.7 million increase in contract liabilities (deferred revenues) between the end of December 2021 and the end of January 2022 (balance at end of January 2022 of $19.0 million), representing tuition fees paid in advance or due and payable for studies that are yet to be undertaken.

New international student enrolment confirmations more than doubling each month since the reopening of Australia's borders, with most of those newly enrolling students scheduled to commence their studies in March and April 2022; and

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The majority of international students arriving into Australia will undertake a period of English language studies before they achieve sufficient language proficiency to progress onto other vocational or higher education

usecourses. In our experience an average of 6 to 9 months of English language studies are usually required, which varies depending upon the level of exposure a person has had to English in their home country. Due to the almost 2 year pause in international students arriving into Australia (since March 2020), iCollege expects it will take approximately 2.5 to 3 years to recover its international student revenues back to pre-COVIDpandemic levels where there are students enrolled into all stages of its English language, vocational and higher education programmes.

iCollege is delighted to report that it's experiencing strong lead indicators to support recovery of its international student revenues, including:

• Significant increases in student enquiry rates from offshore international student agencies, including for iCollege's Go Study Australia business;

For personal use only

iCollege Limited

and its Controlled Entities

ABN 75 105 012 066

Interim Financial Report

for the Half-Year Ended

31 December 2021

For personal use only

Contents
CORPORATE DIRECTORY...............................................................................................................	2
APPENDIX 4D...............................................................................................................................	3
DIRECTORS' REPORT ....................................................................................................................	5
AUDITOR'S INDEPENDENCE DECLARATION ...................................................................................	9
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ...........	10
CONSOLIDATED STATEMENT OF FINANCIAL POSITION ................................................................	11
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY .................................................................	12
CONSOLIDATED STATEMENT OF CASH FLOWS ............................................................................	13
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ............................................................	14
DIRECTORS' DECLARATION.........................................................................................................	51
INDEPENDENT AUDITOR'S REVIEW REPORT................................................................................	52

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For personal use only

CORPORATE DIRECTORY

Directors

Simon Tolhurst - Independent chairman Badri Gosavi - Executive director Ashish Katta - Non-executive director

William Deane - Independent non-executive director Sandra Hook - Independent non-executive director

Company Secretary

Lisa Jones

Registered Office

Level 2, 7 Kelly Street

Ultimo

NSW 2007

Telephone: [phone]

Email:[e-mail]

Website:www.icollege.edu.au

Auditor

Hall Chadwick WA Audit Pty Ltd

283 Rokeby Road

Subiaco WA 6008

Telephone: [phone]

Share Registry

Advanced Share Registry Ltd

110 Stirling Highway

Nedlands WA 6009

Telephone: [phone]

Toll Free: 1300 113 258

Fax: [phone]

Email:[e-mail]

Website:https://www.advancedshare.com.au

Securities Exchange

ASX Code: ICT

Australian Securities Exchange Level 40, Central Park

152-158 St Georges Terrace Perth WA 6000

Telephone: 131 ASX (131 279) - within Australia

Telephone: [phone]

Website:www.asx.com.au

ASIC registrations

ACN: 105 012 066

ABN: 75 105 012 066

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