The ratings assigned to Curro Holdings Limited are underpinned by the relative stability of the education sector in the currently uncertain operating environment, coupled with the group’s positive earnings growth trajectory and proactive management of liquidity. Curro’s financial profile continues to be burdened by high leverage, necessitated by capital expenditure and various acquisitions to achieve growth targets.
Curro has funding lines across six different financial institutions, with cognisance taken of funding being obtained from development finance institutions such as DBSA. It is noted however, that debt is moderately concentrated towards Standard Bank, which accounts for 38% of the group’s borrowings through fairly long-term bullet maturity loans, resulting in some refinancing risk. In particular, half of all outstanding debt is due to mature in 2024.