EQuestEducation Joint Stock Company (EQuest Group) is one of the giants in the education industry.
EQuest currently operates a diverse educational ecosystem, focusing on four areas: Bilingual high school system from grade 1 to grade 12, university and vocational college system, English training center and educational technology solutions.
EQuest operates on two models: self-employment and business acquisition.
To increase operating cash flow, EQuest has repeatedly received foreign capital worth hundreds of millions of USD. However, despite receiving cooperation from major financial institutions, EQuest has not stopped losing money. In fact, in 2022, not long after receiving hundreds of millions of USD from foreign investors, EQuest Group once again reported losses, raising its accumulated losses to thousands of billions of VND.
Not long after receiving VND120 million in capital from foreign investors, EQuest Education Group once again reported a loss and increased its accumulated loss to thousands of billions of VND. Illustrative photo
Continuously receive foreign capital
EQuest Education Joint Stock Company was established on April 3, 1999 at 3rd Floor, Quynh Lan Building, 60 Hai Ba Trung, Ben Nghe Ward, District 1, Ho Chi Minh City with legal representative Mr. Nguyen Quoc Toan. Mr. Toan is also Chairman of the Board of Directors and General Director.
Initially, EQuest was named American Education Organization Joint Stock Company. From December 18, 2019, the company changed its name to EQuest as it is today. EQuest's shareholders were not disclosed, only known as of May 10, 2023, EQuest's foreign shareholders include: Zen Investments Holding Ltd (owning 2.008% of capital, equivalent to VND 30.9 billion) and Equinox II Pte.Ltd (owning 67.468% of capital, equivalent to VND 1,040 billion).
This is the result of many foreign capital injections into EQuest. Recently, in mid-May 2023, EQuest continued to receive the trust of foreign partner KKR through the successful mobilization of 120 million USD in the latest round of capital calling.
KKR's investment in EQuest includes loans and investment capital raised from KKR's Global Impact Fund.
Previously, in mid-2021, EQuest received a $100 million investment from KKR, through the Global Impact Fund.
Just received hundreds of millions of USD, increased accumulated loss to thousands of billions of VND, tax debt, debt to employees
Notably, despite receiving hundreds of millions of USD in foreign capital, EQuest has yet to end its losing streak. Even in 2022, despite receiving additional foreign capital, EQuest's accumulated losses reached a trillion VND.
Specifically, as mentioned above, in mid-May 2023, EQuest received an investment of 120 million USD, but in 2022 (period ending June 30, 2023), EQuets recorded a loss after tax of 37.5 billion VND, a sharp increase compared to the loss of 5.4 billion VND in 2021.
The company suffered losses as it continued to maintain a revenue of 0 VND. Meanwhile, business management costs increased sharply, increasing by 15.7 billion VND, equivalent to 69.8% compared to the previous year.
As a result, as of June 30, 2023, the company incurred an accumulated loss of VND 1,025 billion, an increase from the accumulated loss of VND 987 billion at the beginning of the period.
Along with continuous losses, EQuest increased its tax debt and debt to employees.
As of June 30, 2023, EQuest recorded that the target of Taxes and amounts payable to the State increased from VND 1.5 billion to VND 1.7 billion; Payables to employees increased by VND 2.9 billion, equivalent to 207% to VND 4.3 billion.
Many investments lost money
EQuest's ecosystem is quite large. According to the introduction on EQuest's website, the company owns and invests in many educational units such as: EQuest Academy (later renamed IvyPrep Education) specializing in studying abroad consulting and international certification exam preparation (TOEFL, SAT, GMAT, GRE, ...), iSMART - one of the first educational technology companies in Vietnam, VATC Vietnam-USA English System, Vietnam-USA College, Broward University Vietnam, Saigon Polytechnic College, Phu Xuan University, Alpha School Education System, Newton Inter-level School System, Victory Experimental Education System, 789.vn - online testing and assessment platform, iTD International Talent Institute specializing in teacher training and international testing organization, Victory Saigon High School (formerly Dong Do High School), Vietnam-USA College Hanoi (formerly Hanoi College of Economics and Technology), St. Nicholas School, Da Nang, Hanoi Educational Technology Primary School, Hanoi Star Education System, Happy School Primary - Secondary - High School (Ba Ria - Vung Tau).
As of June 30, 2023, EQuest had nearly VND 838 billion in long-term financial investments, accounting for 35.2% of total assets. However, not all investments are profitable because EQuest had to set aside VND 40.4 billion for provisions.
In addition, the investment of VND 838 billion brought EQuest very little dividends when in 2022, the company only had VND 1.6 billion in financial revenue, a sharp decrease compared to VND 17.4 billion in 2021.
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