Nord anglia education 2 qfy2014 presentation vfinal

For the period ended February 28, 2014

Nord Anglia Education Second Quarter Fiscal 2014 Results Presentation

April 23, 2014

Disclaimer

Neither Nord Anglia Education Inc. nor any of its subsidiaries or affiliates is making any representation or warranty, expressed or implied, as to the accuracy or completeness of the attached materials. Please note that the attached materials and our oral explanations of the attached materials may constitute forward-looking statements within the meaning of applicable U.S. securities laws and such forward-looking statements are made based on our current expectations. Forward-looking statements relate to events involving certain risks and uncertainties, and actual results may differ materially from the views expressed. A number of potential risks and uncertainties are outlined in our public filings with the Securities and Exchange Commission. Nord Anglia Education Inc. does not undertake any obligation to update any forward-looking statement, except as required under applicable law. You are cautioned not to place undue reliance on any forward-looking statements.

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Nord Anglia Education (NYSE: NORD) is the leading international operator of premium schools serving students from kindergarten through the end of secondary (K-12). We have over 18,000 full time equivalent students (FTEs) at our 28 premium schools in China, Europe, the Middle East/South East Asia and North America.

Overview

28

12

18,166

22,637

$58bn

Premium Schools

Countries

FTEs

Capacity

Global Market

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Nord Anglia Education is the world’s leading premium schools organization

Outstanding Education • Focus on a British style of education

• Distinctive educational features at all Nord Anglia Education schools

– Global Classroom for our students

– Nord Anglia University for our teachers

• Scale, reach and a contemporary approach

• Superior academic results with students outperforming national and global averages

Educational Quality

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Three growth methods

Expansion to meet increasing demand funded by a developer or landlord

Example: recent addition of 300 pre-paid seats in one of our Qatar schools

Business Strategy

Development of a new school or campus funded by a developer

Example: our new 1,500 seat greenfield school in Dubai opening in September 2014

Acquire at attractive multiple with the ability to significantly improve earnings

Example: Dover Court School in Singapore completed April 22, 2014

Same school – organic

Greenfield – organic

Acquisitions – quasi organic

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Operational - Average full time equivalent students (FTEs) up 74.8% from 9,764 to 17,069

- Capacity up 73.9% from 12,503 seats to 21,737 seats

- Utilization at 79% from 78%

- Adjusted Revenue/FTE down 8.2% from $8.5k to $7.8k (mix impact)

Second Quarter Fiscal 2014 Highlights

Financial - Revenue up 52.8% from $89.5 million to $136.8 million

- Adjusted EBITDA up 63.4% from $26.2 million to $42.8 million

- Adjusted Net Income up 99.0% from $6.4 million to $12.7 million

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Same school - organic 300 seat expansion at Madinat Khalifa, Doha all pre-paid

Continued organic growth within our other schools

Recent Developments

Greenfield - organic New schools in Hong Kong and Dubai opening September 2014

Applications received to date for September 2014 very strong

New Chicago campus construction commenced

Acquisition – quasi-organic April 22, 2014 — completed the acquisition of Dover Court School in Singapore

Founded in 1972, Dover Court has approximately 650 FTEs with 900 seats of capacity

IPO/Refinancing March 31, 2014 — completed our IPO, issued $515 million Term Loan B (“TLB”) and refinanced our $640 million outstanding notes

Full Time Equivalent Students Increased from 17,161 FTEs as of March 9, 2014 to 18,166 FTEs as of April 22, 2014

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Financial Performance

Second Quarter Fiscal 2014 Results Presentation

Group Performance Summary

$ millions Q2 FY14(4) Q2 FY13 Variance Premium Schools(1) 131.9 78.3 68.5%

Loss making start-up schools 0.9 4.7 (80.9%)

Sub total Premium Schools 132.8 83.0 Actual: 60.0% CC(2): 57.5%

Other 4.0 6.5 (39.0%)

Total Revenue 136.8 89.5 Actual: 52.8% CC(2): 50.7%

Gross Profit 74.1 47.7 55.4%

Gross Profit Margin 54.2% 53.3% 0.9%

Adjusted EBITDA 42.8 26.2 Actual: 63.4% CC(2): 60.8%

Adjusted EBITDA Margin(3) 31.5% 30.9% 0.6%

Adjusted Net Income 12.7 6.4 99.0%

(1) Premium schools excluding loss making start-up schools (2) CC denotes Constant Currency (3) Adjusted EBITDA margin calculated by excluding revenue and EBITDA from loss making start-up schools (4) Fiscal year end August 31

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Q2 FY14 Premium Schools Revenue Bridge

$ millions

10

110.8

132.8

27.8 11.4

10.6

83.0

0

20

40

60

80

100

120

140

Q2 FY13 RevenueActual

Q2 FY13 WCLRevenue

Q2 FY13 RevenuePro forma

Q2 FY14 Revenueex acquisitions

Q2 FY14Guangzhou and

Bangkok Revenue

Q2 FY14 RevenueActual

$23.0m

Revenue & EBITDA Performance by Region

Europe North America Middle East / South East Asia China

$49.3m

$39.9m

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$24.6

$9.2m

$6.3m NEW REGION

REVENUE

EBITDA

REVENUE

EBITDA

REVENUE

EBITDA

369% EBITDA

$19.7m NEW REGION

$8.5m

18% 24%

20% 425%

REVENUE

21%

Highlights

• Utilization at 69% down from 75% due to capacity expansion in Sanlitun and Pudong over the summer of 2013

• Q2 FY14 Average Revenue/FTE $10.3k up from $9.8k

• China contribution to total Premium Schools EBITDA 50% Q2 FY14 vs 70% Q2 FY13

• Acquired The British School of Guangzhou on July 25, 2013

• Continued growth in student numbers with strong pricing power

• Nord Anglia International School Hong Kong to open in September 2014

China

Q2 FY14 Revenue $49.3m from $39.7m 24% Q2 FY14 Adj. EBITDA $24.6 from $20.5m 20%

4,052

4,806

FTEs

Q2 FY13 Q2 FY14


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Highlights

• Utilization unchanged at 85%

• Q2 FY14 Average Revenue/FTE unchanged at $8.9k

• Acquired International College Spain, Madrid as part of WCL Group on May 22, 2013

• Moderate enrollment and fee growth in line with macroeconomic climate

Europe

Q2 FY14 Revenue $39.9m from $33.7m 18% Q2 FY14 Adj. EBITDA $9.2m from $7.6m 21%

3,766

4,501

FTEs

Q2 FY13 Q2 FY14


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Highlights

• Utilization at 88% up from 79%

• Q2 Average Revenue/FTE $4.6k down from $5.2k due to acquisitions and growth in lower fee locations

• Acquired four schools in Qatar as part of WCL Group on May 22, 2013 and St Andrew’s Bangkok on August 2, 2013

• Recent expansion of 300 seats at Madinat Khalifa, Doha in early Q3 FY14 all pre-paid

• Acquired Dover Court School Singapore on April 22, 2014

• Nord Anglia International School Dubai to open in September 2014

Middle East / South East Asia

Q2 FY14 Revenue $23.0m from $4.9m 369% Q2 FY14 Adj. EBITDA $6.3m from $1.2m 425%

951

5,026

FTEs

Q2 FY13 Q2 FY14


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Highlights

• Utilization at 80% up from 76% pro forma

• Q2 Average Revenue/FTE $7.5k up from $6.9k pro forma

• Acquired six schools in North America as part of WCL Group on May 22, 2013: Boston, Charlotte, Chicago, Houston, New York, Washington

• New campus in Chicago to open in September 2015 with ~1,100 seats

• Continued growth across North America

North America

Q2 FY14 Revenue $19.7m

NEW REGION

Q2 FY14 Adj. EBITDA $8.5m

NEW REGION

2,638 FTEs

Q2 FY13 Q2 FY14


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Highlights

• Q2FY14 Net Debt $562.1m

• LTM Q2 FY14 Net Leverage 4.7x

• Pro forma for IPO/refinancing LTM Q2 FY14 Net Leverage 3.5x

• Senior secured notes, PIK toggle notes and RCF repaid with $515 million TLB and IPO proceeds

• Moody’s and Standard & Poor’s corporate ratings B1/B+ up from B3/B

• Pro forma for the refinancing, interest expense would have been approximately $10.6 million lower for Q2 FY14

Balance Sheet & Cash flow

Summary Cash flow

Six Months Ended February 28,

($ millions) 2014 2013

Cash generated from operations (21.1) (22.5) Interest paid (33.8) (17.9) Tax paid (13.1) (10.6) Net cash used in operating activities (68.0) (51.0)

Net cash used in investing activities (14.3) (5.7)

Net cash from/(used in) financing activities 10.8 11.9

Net decrease in cash and cash equivalents (71.5) (44.8) Cash and cash equivalents at end of the period 102.9 68.2

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Outlook

Set out below are the Company’s expectations for the full fiscal year 2014:

Outlook for Fiscal 2014

$ millions

Revenue $468m - $472m

Adjusted EBITDA $125m - $127m

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Appendix


Set forth below is a reconciliation of EBITDA, Adjusted EBITDA and Adjusted Net Income to the most directly comparable IFRS measure, loss/profit for the following periods.

Reconciliation of Non-GAAP Financial Data

Three Months Ended February 28,


$ millions 2014 2013 2013 2014 2013 2013 (unaudited) Actual Actual Pro forma Actual Actual Pro forma

Profit for the period 14.6 1.4 2.1 18.1 8.7 11.9 Income tax expense 7.1 6.8 5.1 13.2 12.3 10.1 Net financing expense(1) 17.0 10.4 13.2 33.0 19.4 25.0 Exceptional items(2) 0.8 1.7 1.7 2.5 2.7 2.7 Amortization 2.5 1.0 2.0 4.9 1.9 3.9 Depreciation 5.5 2.4 3.8 10.7 5.0 7.9 EBITDA 47.5 23.7 27.9 82.4 50.0 61.5

Loss on disposal of PP&E(3) - 0.1 0.1 - 0.1 0.1 FX gain (4) (6.8) (0.3) 2.2 (4.6) (0.8) 1.1 Loss making start-up schools(5) 0.1 0.4 0.7 0.2 0.9 1.5 Share based payments(6) 1.3 - - 2.4 - - Management fees – Sponsor(7) 0.5 2.3 2.3 1.0 2.3 2.3 Other 0.2 - - 0.2 (0.1) (0.1) Adjusted EBITDA 42.8 26.2 33.2 81.6 52.4 66.4

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*Please refer to the footnotes on our Form 6-K quarterly report.

Reconciliation of Non-GAAP Financial Data Continued

Set forth below is a reconciliation of EBITDA, Adjusted EBITDA and Adjusted Net Income to the most directly comparable IFRS measure, loss/profit for the following periods.

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$ millions 2014 2013 2013 2014 2013 2013 (unaudited) Actual Actual Pro forma Actual Actual Pro forma

Adjusted EBITDA 42.8 26.2 33.2 81.6 52.4 66.4

Depreciation (5.5) (2.4) (3.8) (10.7) (5.0) (7.9) Net Financing Expense(1) (17.0) (10.4) (13.2) (33.0) (19.4) (25.0) Income Tax Expense (7.1) (6.8) (5.1) (13.2) (12.3) (10.1) Tax Adjustments(8) (0.5) (0.2) (0.4) (1.0) (0.4) (0.8) Adjusted Net Income 12.7 6.4 10.7 23.7 15.3 22.6


Detailed Profit & Loss



$ millions 2014 2013 2014 2013 (unaudited)

Revenue 136.8 89.5 271.9 178.6 Cost of sales (62.7) (41.8) (124.6) (82.5) Gross Profit 74.1 47.7 147.3 96.1

SG&A (26.6) (24.0) (64.9) (46.1) Depreciation (5.5) (2.4) (10.7) (5.0) Amortisation (2.5) (1.0) (4.9) (1.9) Exceptional expenses (0.8) (1.7) (2.5) (2.7) Total expenses (35.4) (29.1) (83.0) (55.7)

Operating profit 38.7 18.6 64.3 40.4 Finance income 0.5 0.6 1.1 1.2 Finance expense (17.5) (11.0) (34.1) (20.6) Net finance expense (17.0) (10.4) (33.0) (19.4)

Profit before income tax 21.7 8.2 31.3 21.0 Income tax expense (7.1) (6.8) (13.2) (12.3) Profit for the period 14.6 1.4 18.1 8.7

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Key Operating Data

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2014 2013 2013 2014 2013 2013 Actual Actual Pro forma Actual Actual Pro forma

Full-time equivalent students (average for the period)(1) China 4,806 4,052 4,052 4,812 4,041 4,041 Europe 4,501 3,766 4,437 4,501 3,764 4,442 Middle East/South East Asia 5,026 951 2,347 4,964 944 2,314 North America 2,638 - 2,421 2,629 - 2,391 Sub-total 16,971 8,769 13,257 16,906 8,749 13,188 Loss making start-up schools(2) 98 995 1,063 97 988 1,056 Total 17,069 9,764 14,320 17,003 9,737 14,244

Capacity (average for the period)(3) China 6,964 5,380 5,380 6,964 5,370 5,370 Europe 5,322 4,423 5,147 5,322 4,417 5,147 Middle East/South East Asia 5,691 1,200 3,291 5,691 1,200 3,291 North America 3,280 - 3,180 3,280 - 3,180 Sub-total 21,257 11,003 16,998 21,257 10,987 16,988 Loss making start-up schools(2) 480 1,500 1,980 480 1,500 1,980 Total 21,737 12,503 18,978 21,737 12,487 18,968


Key Operating Data Continued

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2014 2013 2013 2014 2013 2013 Actual Actual Pro forma Actual Actual Pro forma

Utilization (average for the period)(4) China 69% 75% 75% 69% 75% 75% Europe 85% 85% 86% 85% 85% 86% Middle East/South East Asia 88% 79% 71% 87% 79% 70% North America 80% - 76% 80% - 75% Sub-total 80% 80% 78% 80% 80% 78% Loss making start-up schools(2) 20% 66% 54% 20% 66% 53% Total 79% 78% 75% 78% 78% 75%

Revenue per FTE (in $ thousands)(5) China 10.3 9.8 9.8 20.1 19.4 19.4 Europe 8.9 8.9 8.5 17.8 17.9 17.0 Middle East/South East Asia 4.6 5.2 4.9 9.3 10.2 9.6 North America 7.5 - 6.9 14.8 - 14.0 Sub-total 7.8 8.9 8.0 15.5 17.8 15.9 Loss making start-up schools(2) 9.2 4.7 5.0 18.4 9.3 9.9 Total 7.8 8.5 7.7 15.5 16.9 15.5


Q3 and Q4 FY13 Key Operating Data

Three Months Ended May 31,

Three Months Ended August 31,

2013 2013 2013 2013 Actual Pro forma Actual Pro forma

Full-time equivalent students (average for the period)(1) China 4,121 4,121 4,140 4,140 Europe 3,779 4,455 4,460 4,460 Middle East/South East Asia 992 3,451 3,472 3,472 North America - 2,469 2,466 2,466 Sub-total 8,892 14,496 14,538 14,538 Loss making start-up schools(2) 1,028 71 74 74 Total 9,920 14,567 14,612 14,612

Capacity (average for the period)(3) China 5,380 5,380 5,385 5,385 Europe 4,423 5,175 5,190 5,190 Middle East/South East Asia 1,200 4,791 4,791 4,791 North America - 3,180 3,180 3,180 Sub-total 11,003 18,526 18,546 18,546 Loss making start-up schools 1,500 480 480 480 Total 12,503 19,006 19,026 19,026

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Q3 and Q4 FY13 Key Operating Data (continued)

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Three Months Ended May 31,

Three Months Ended August 31,

2013 2013 2013 2013 Actual Pro forma Actual Pro forma

Utilization (average for the period)(4) China 77% 77% 77% 77% Europe 85% 86% 86% 86% Middle East/South East Asia 83% 72% 72% 72% North America - 78% 78% 78% Sub-total 81% 78% 78% 78% Loss making start-up schools(2) 69% 15% 15% 15% Total 79% 77% 77% 77%

Revenue per FTE (in $ thousands)(5) China 10.0 10.0 4.4 4.4 Europe 8.6 8.1 3.6 3.6 Middle East/South East Asia 5.4 5.0 1.9 1.9 North America - 7.6 3.1 3.1 Sub-total 8.9 7.8 3.3 3.3 Loss making start-up schools(2) 4.0 9.9 4.1 4.1 Total 8.4 7.8 3.3 3.3


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Nord anglia education 2 qfy2014 presentation vfinal