Shares of IDP Education Ltd (IEL.AU) plummeted 31.99% in intraday trading, following a series of disappointing announcements that paint a grim picture for the company's near-term future. The education services provider shocked investors with projections of a significant decline in its core business and reduced profit expectations for the upcoming fiscal year.
IDP Education revealed that it expects student placement volumes for fiscal year 2025 to decrease by 28% to 30%, a substantial drop that directly impacts the company's primary revenue stream. In light of this projection, the company estimates its adjusted earnings before interest and taxes (EBIT) for FY25 to be between A$115 million and A$125 million, likely falling short of previous market expectations.
Adding to investor concerns, IDP Education noted that the recent UK immigration policy white paper has heightened uncertainty in one of its key markets. This development could further complicate the company's operations and future growth prospects. In response to these challenges, the company announced it is conducting a detailed review of longer-term cost, productivity, investment, and commercial levers, signaling potential strategic shifts or cost-cutting measures in the pipeline. The confluence of these factors has evidently shaken investor confidence, leading to the sharp sell-off in IDP Education's stock.
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