Market pioneer reaps fat reward
The first education company to be floated on the Stock Exchange has reported record profits and a rocketing turnover - giving its multi-millionaire founder a fat reward.
Former teacher Kevin McNeany, who founded Nord Anglia Education 25 years ago, has seen his wealth grow by Pounds 2 million in just nine months. Before the company was listed last February, Mr McNeany had said that education was "not a way to make a fortune".
The first annual accounts of Nord Anglia Education plc show that profits shot up by 49 per cent from Pounds 1.63m to Pounds 2.42m over the last financial year.
Company turnover increased from Pounds 27.9m to Pounds 40.4m, a rise of 45 per cent - with the most significant rise coming in the booming educational services division, which competes for work in Britain in areas traditionally dominated by the public sector, up from Pounds 6.5m to Pounds 16.2m.
Profits for educational services, which this year among other ventures carried out 150 school inspections and embarked on a joint venture to provide the training for the new National Professional Qualification for Headship, shot up from Pounds 181,000 to Pounds 662,000, a rise of 265 per cent.
Company chairman Mr McNeany, 54, received a package of Pounds 179,000 for his year's work, and is also set to receive a total dividend of around Pounds 169,000 for his holding of 46 per cent of the company's shares. The company was floated at Pounds 1.40 a share, and by just before Christmas shares had shot up to Pounds 1.80, increasing the value of Mr McNeany's holding from Pounds 7.9m to Pounds 10m.
Mr McNeany said that the Labour Government's willingness to work with the private sector meant that there would be a wealth of opportunities for his Cheshire-based company in the future.
He said he recognised that many people in education remained suspicious of commercial concerns, but was confident that companies like his would provide benefits for all.
"Ours is the genuine voice of the private sector in British education, " said Mr McNeany. "The company wishes to respond to the DFEE's challenge to create and sustain partnerships with the private sector.
"However, it would be facile to ignore the suspicion of the private sector that still exists within the education community. We have pledged to do everything we can to allay these fears. The private sector represents a robust and innovative resource that can only benefit the national crusade for standards and competitiveness.
"We suggest a renaming: call us the 'business sector'. In Britain the notion of the 'private sector in education carries too much unhelpful ideological baggage. Yet companies like Nord Anglia wish to support and sustain state education, not supplant it."
Nord Anglia's most longstanding interests are in a chain of independent schools in Britain, and in a worldwide chain of international language schools, but Mr McNeany has given clear indications that the state was likely to become his company's most important client as the Government increasingly turns to the private sector for work in mainstream education.
He said: "We are active in many aspects of state-funded education: in headteacher training, in careers guidance, in school inspections, in the New Deal and in early-years provision.
"We look forward to the extension of these activities which present trends appear to be offering us."
All his bullish talk was a far cry from the statement he made before his company was listed.
"Education is not a way to make a fortune, but the quality of the earnings is one of its delights," he said. One entry in the company accounts was positively dwarfed by the mammoth Pounds 40.4m turnover: Nord Anglia's charitable donations for the last year totalled Pounds 387.