Operating Costs Weigh Heavily On ONE’s Bottom Line  

• One-on-One Limited has recorded a net loss of $37.76Mn for the financial year ending August 30, 2023, versus a net profit of $12.26Mn, last year.
• Revenue for the year slightly declined by 0.1% yoy to $266.58Mn. The performance was influenced by a fourth-quarter revenue dip; the company experienced a decline in revenues from $72.5Mn in 2022 to $44.3Mn in 2023. This drop can primarily be attributed to the dip in non-recurring project revenues, as the company’s strategic emphasis has been increasingly shifted towards building sustainable, recurring business lines. Consequently, the value of projects undertaken during this period was less than 2022.
• Despite revenues being flat year over year the company had growth in the B2G business line, which benefited from increased revenues from existing government contracts.
• Significant increase in expenses targeted at investing in the development and expansion of new products, and selling activities to increase awareness, led to a rise in operating expenses from $171.5Mn in 2022 to $230.4Mn for the comparative period in 2023.
• One’s stock price has declined by 18.7% since the start of the calendar year. The stock closed Wednesday’s trading session at $1.00 and currently trades at a P/B of 7x which is below the Junior Market Others Sector Average of 5.1x.
• One-on-One has made substantial investments over the year in the One Academy for Schools solution, which is expected to generate significant recurring revenues for the business going forward. While the 2023/24 financial year will commence with the company’s engagement in 25 schools for the One Academy, its target is to aggressively onboard a significant number of schools before the end of the financial year. This is a major initiative for the company and is expected to boost the company’s performance and ultimately, increase shareholders’ value.

(Sources: JSE and NCBCM Research)