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UPDATE 1-Australia's Navitas H1 profit plunges over 50 pct, shares drop

Published 2018-01-29, 07:31 p/m
© Reuters.  UPDATE 1-Australia's Navitas H1 profit plunges over 50 pct, shares drop
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* Cautions difficult U.S. business environment to continue

* Shares drop almost 10 percent to lowest since Nov. 3 (Adds revenue, details on U.S. operations)

Jan 30 (Reuters) - Australia's largest listed private education provider Navitas Ltd NVT.AX saw its net profits crumble by more than 50 percent over the first half of the year, hurt by college closures and lower demand for its English language programmes for migrants.

The provider of English proficiency courses for foreign students also cautioned that a tough business environment in the United States, where it operates seven colleges, would continue as uncertainty due to immigration changes and higher visa rejection rates impacts enrolments. of the company plunged almost 10 percent to their lowest in nearly three months after results were announced.

Navitas' net profit after tax for the six-months ended Dec. 31 was A$24.7 million ($20 million), versus A$53.3 million a year ago, below a Deutsche Bank (DE:DBKGn) estimate for A$34.4 million.

Results were also hit by a A$7.5 million charge incurred by the firm due to a U.S. tax overhaul. company had previously said it expected to be affected by the loss of some government contracts for migrant language classes last year, and the closure of two colleges in Australia.

Its revenue fell 4.6 percent to A$456.7 million, the company said in a statement to the Australian Securities Exchange.

It declared an interim dividend of 9.4 Australian cents per share, same as last year.

Shares of the company, which also operates schools in Canada and Britain, were down more than 7 percent at A$4.85, while the benchmark was 0.6 percent lower. The stock hit a low of A$4.72 earlier in the session, the weakest since Nov. 3. ($1 = 1.2350 Australian dollars) (Repoerting by Rushil Dutta and Aaron Saldanha in Bengaluru; Editing by Himani Sarkar)

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