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  • COVER SHEET

    I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I 1IIIIslTIIIIEIDIulciAITlIIoiNIIsiEIRlvlIlciEIsIIIII 111111 I II IGIRlolulpl,1IIINlcl.1I 111111111

    (Company's Full Name)

    I I I I I IslTIII IAlclAIDIEIMlllcl IclEINITIEIRI I I I I I I 10iRITI I IGIAI s I-I cl AI I I NITI AI, I 101 RI T I I IGIAI sl IAlvl EINlulEI I IElxITIEINlsllloINI,1 lelAlllNITIAI IRlllzlAILI 111910101 I

    (Business Address: No. Street City ITown IProvince)

    ARSENIO C. CABRERA, JR. I (61312) Islslll 3171111111 Contact Person Company Telephone Number

    ~~ Month Day

    Fiscal Year

    SEC FORM 17-C 1st Thursday of November FORM TYPE Month Day

    Annual Meeting

    Secondary License Type, IfApplicable

    I I I I Dept. Requiring this Doc. Amended Articles Number/Section

    .---_~Tota=l Am:::.::::;ountof Br=0rro=wing>:!._s_-----,

    ~ __ ~I ~I__ ~ Total No. of Stocholders Domestic Foreign

    To be accomplished by SEC Personnel concerned

    11111111111 - File Number LCU

    11111111111 - Document 1.0. Cashier

    STAMPS

  • SEC FORM 17-C

    SECURITIES AND EXCHANGE COMMISSIO

    CURRENT REPORT UNDER SECTION 1 OF THE SECURITIES REGULATION COD

    AND RSA RULE 17.2(c) THEREUNDER

    1. 21 January 2021 Date of Report (Date of earliest event reported)

    2. SEC Identification Number .... 0000113156 3. BIRTax Identification No ....000143457

    4. STI Education Services Group, Inc. Exact name of issuer as specified in its charter

    5. Philippines 6. ._I_--,-,-,,--,I (SECUseOnly) Province, country or other jurisdiction of incorporation

    7. STI Academic Center Ortigas-Cainta, Ortigas Avenue Extension, Cainta, Rizal Address of principal office

    1900 Postal Code

    8. (632)8812-1784 Issuer's telephone number, including area code

    9. ------------------------------------------------------------------------------ Former name or former address, if changed since last report

    10. Securities Registered Pursuant to Section8 and 12 of the SRCor Sections4 and 8 of the RSA

    Title of EachClass Number of Shares ofCommon StockOutstanding and Amount

    ofDebt Outstanding

    Common Stock Fixed Rate Bonds

    3,087,829,443 PJ,OOO,OOO,OOO.OO

    11. Indicate the item numbers reported herein: Item 9

  • Item 9. Other Events

    Philippine Rating Services Corporation (PRS) submitted a report to the Securities and Exchange Commission (SEC),with a copy to STI Education Services Group, Inc. (STI ESG) stating that the rating given to the bonds issued by STI ESG has been changed to PRS A plus from PRS Aa. The Outlook has likewise been changed from Stable to Negative.

    PRS also stated in its report that obligations rated PRS A have favorable investment attributes and are considered as upper-medium grade obligations. It also mentioned that although these obligations are somewhat more susceptible to the adverse effects of changes in economic conditions, the obligor's capacity to meet its financial commitments on the obligation is still strong. Further, PRS likewise stated that a Negative Outlook indicates that there is a potential for the present credit rating to be downgraded in the next 12 months.

    The PRS report also indicated that the assigned Issue Credit Rating took into account the following factors:

    • Relatively resilient demand for tertiary education, albeit with significantly increased competition brought about by the Universal Access to Quality Tertiary Education Act

    • Declining profitability due to lower enrollees and increasing expenses, largely attributed to depreciation and interest expenses, with net income significantly influenced by non-core items

    • Increasing economic uncertainty and the adverse impact of the community quarantine attributable to the COVID-19 pandemic on the company's business

    The management of STI ESG, on its part, has recognized the effects of the Universal Access to Quality Education Act and has sustained its initiatives to provide a wide range of course offerings for its tertiary level. New programs are introduced and existing ones are continuously developed and aligned with market needs and demands. Installment payment schemes are being offered for a lighter payment plan. For SY2019-2020,there was actually an increase of 44% in STI ESG's new college enrollees, that is, from 13,828 in SY2018-2019to 19,898 in SY 2019-2020. This resulted in a 6% increase in the number of total college students in SY2019-2020.

    The increase in depreciation and interest expenses is largely due to the facilities purchased and constructed by STI ESG in accordance with its strategy of bringing the schools closer to the students and to provide adequate and sustainable school facilities. Further, the facilities are designed to accommodate six levels of learning, that is, Grades 11 and 12 and the four levels in the tertiary. In school year 2021-2022,these six levels will be filled up.

    2

  • The COVID-19 pandemic has affected various industries and the education sector is not spared. In the case of STI ESG, COVID-19 stopped our plans to make 2020 a good year in terms of enrollment. Fortunately, though, it is prepared to transition into online learning. Since SY 2015-2016, STI ESG has been using the digital approach in teaching through the use of its electronic Learning Management System (eLMS). With the restrictions imposed by COVID-19, STI ESG has re-tooled its eLMS to become a wholistic approach to online and onsite learning.

    Further, STI ESG undertook a rationalization effort that encompassed resources and schools within the STI network. Management determined that continuing the operations of some schools in the network was no longer viable due to low enrolment turnout and/ or the high cost of rent. It thus made the difficult decision of suspending or ceasing operations of some schools in order to streamline the delivery of the educational content more effectively. STI ESG has prepared its campuses for the new normal and is continuing to improve its blended form of education.

    SIGNATURES

    Pursuant to the requirements of the Securities Regulation Code, the ssuer has duly caused this report to be signed on its behalf by the undersi d reunto duly authorized.

    STI EDUCATIONSE S GROUP, INC.

    21 January 2021 Date

    ARSENIOC.

    3

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