EpicQuest Education Enters into Agreement for a New Foundational Program

Rhea-AI Summary

EpicQuest Education (NASDAQ: EEIQ) has announced that its Davis University has entered into an agreement with South China University of Technology to establish a foundational program on its University Town Campus, effective until January 2027.

The program, which represents EEIQ's third foundational program in China, will enable students to complete two years of study before transferring to Davis' Toledo, Ohio campus to complete their bachelor's degree. Each incoming class is expected to consist of approximately 120 students, with the program scheduled to launch in Fall 2025.

The company's revenue streams include:

• International students studying in North America at Davis University and EduGlobal College
• International students studying in their home countries through foundational programs
• Domestic students at Davis and EduGlobal
• Student services fees from on-campus attendance

Positive

• Expansion of revenue streams through new foundational program with expected enrollment of 120 students per class
• Strategic growth in international markets with third foundational program in China
• Partnership with prestigious institution enhances brand value
• Program creates clear pathway for international student enrollment at Davis University

Negative

• Program launch delayed until Fall 2025
• Agreement to January 2027 timeframe
• Enrollment dependent on China's national entrance examination results

Insights

Education Industry Analyst

EpicQuest Education's new foundational program agreement with South China University of Technology represents a strategic expansion of their educational footprint in China. As their third such program following partnerships with elite institutions Peking University and Shanghai Jiao Tong University, this demonstrates consistent execution of their international strategy.

The two-year foundational structure creates a student pipeline with two valuable pathways: students can either continue to Davis University's Ohio campus to complete their bachelor's degree, or leverage pathway programs to transfer to other top US institutions. With an expected 120 students per incoming class starting Fall 2025, this creates a meaningful enrollment channel that should begin to generate revenue shortly after China's national entrance examinations in June.

For education providers, these foundational programs represent an increasingly valuable business model - they require less infrastructure investment than full campuses while creating reliable student flows and multiple revenue opportunities. The program simultaneously addresses challenges in international student recruitment by establishing an in-country presence at prestigious partner institutions, which enhances credibility and visibility in the Chinese education market.

Financial Analyst

This agreement establishes a potentially significant revenue stream for EpicQuest Education, a microcap company with a market capitalization of just $9.7 million. The expected enrollment of 120 students per class creates a new recurring revenue source that could meaningfully impact financial performance given the company's size.

What's particularly noteworthy is how this agreement advances EEIQ's multi-pronged revenue diversification strategy. The company has clearly articulated four distinct revenue channels: international students at North American campuses, international students in foundational programs in their home countries, domestic students, and student services fees. This balanced approach reduces dependency on any single market or student demographic.

The agreement's timeframe extending to January 2027 provides nearly two years of revenue visibility. While specific financial projections aren't provided, the company's explicit characterization of these programs offering "robust revenue potential" suggests material impact. For investors, this execution against the company's stated internationalization strategy demonstrates management's ability to secure partnerships with prestigious institutions despite EEIQ's relatively small size in the education sector.

The Foundational Programs in Students' Home Countries Provides Robust Revenue Potential and Increases Student Enrollment

MIDDLETOWN, Ohio, March 26, 2025 /PRNewswire/ -- EpicQuest Education Group International Limited (NASDAQ: EEIQ), ("EpicQuest Education", "EEIQ" or the "Company"), a provider of higher education for domestic and international students in the US, Canada and the UK, today announced that its owned and operated Davis University ("Davis") entered into a Contract Agreement (the "Agreement") with South China University of Technology for the Company to establish a foundational program on its University Town Campus, one its three main campuses. The Agreement is effective until January 2027.

Jianbo Zhang, Chief Executive Officer of EpicQuest Education, commented, "Our foundational programs represent a distinct revenue stream for the Company in addition to our other sources of revenue including revenue generated from our US and Canada-based institutions. Our Agreement with South China University of Technology is our third foundational program in China, and it is a first-class and internationally renowned university."

CEO Jianbo Zhang continued, "The two-year foundational program enables students to attend their following two years on Davis' Toledo, Ohio campus where they can apply their course credits to achieve a four-year bachelor's degree. It can also serve as a means of admission to one of Davis' pathway programs that enables our students to transfer to top schools. We believe that creating options for our students to chart their academic journeys and achieve their career goals is of paramount importance," CEO Jianbo Zhang concluded.

EpicQuest Education's Diversified Sources of Revenue

• International Students Studying in North America: Comprises students from foreign countries that are enrolled in Davis University and EduGlobal College
• International Students Studying in the Home Countries: Comprises students enrolled in the Company's foundational programs
• Domestic Students: Comprises students studying at Davis and EduGlobal as well as recruiting activities for the Miami University Regionals
• Student Services: Comprises residential and other fees from on-campus attendance

Davis' foundational programs constitute a course of study for students to acquire the skills needed for Davis' bachelor's degree programs, as well as pathways for admission to other US universities. The Company also has foundational programs at Peking University and Shanghai Jiao Tong University, both of which are elite universities in China.

For South China University of Technology, each incoming class for the foundational program is expected to consist of approximately 120 students. The foundational program at South China University of Technology is expected to launch in the Fall of 2025 semester. The program has already begun to enroll students, and enrollment is expected to accelerate following China's national entrance examination for higher education in early June 2025.

EpicQuest Education's Mission of Internationalization

The Company believes that internationalization is a key element of its strategic growth plan. EpicQuest Education's growth plan is to have its operated colleges, Davis University and EduGlobal College, become increasingly focused on international recruiting and enhanced globalized learning to its students as well as pathways to achieve university degrees. The Company's strategic growth plan is to achieve international expansion and establish EpicQuest Education as a truly international service provider of higher learning.

About South China University of Technology

South China University of Technology ("SCUT") is a prestigious public research university located in Guangzhou, China. SCUT has grown into one of China's leading universities, recognized for its excellence in a wide array of notable academic programs; it ranks among the top universities in China and is internationally recognized, particularly for its engineering programs. Popular programs include Computer Science, Civil Engineering, Materials Science, International Economics, and Artificial Intelligence. SCUT also fosters global partnerships with over 50 institutions worldwide, promoting student exchanges and joint research. SCUT hosts over 39,000 students, including more than 2,000 international students from over 100 countries. For more information, please visit https://www.scut.edu.cn/en/.

About EpicQuest Education Group International Limited

EpicQuest Education Group International Limited ("EpicQuest Education" or the "Company") provides comprehensive education solutions for domestic and international students seeking university and University degrees in the US, Canada and the UK. The Company owns and operates EduGlobal University, based in British Columbia, Canada, which focuses on English proficiency educational programming for students pursuing academic degrees. The Company operates and is a 70% owner of Davis University, a career training University located in Toledo, Ohio. In addition, the Company has a recruiting relationship with the Miami University Regional campuses, where it maintains residential facilities, a full-service cafeteria, recreational facilities, shuttle buses and an office for the regional campuses that provides study abroad and post-study services for its students; these facilities are not owned, maintained, operated or are a part of Miami University. The Company is also a recruiting agent for the University of the West of Scotland (through The Education Group (London) Ltd) and Coventry University, both of which are located in the UK. EpicQuest Education recently established a wholly owned subsidiary, Gilmore Inv LLC, in Ohio, that will offer international educational programs related to kinesiology and recreation education. The Company also established a company in Ohio, SouthGilmore LLC that has been formed to organize sports-related entertainment projects, which is 40% owned by Gilmore. For more information, please visit www.epicquesteducation.com/.

Safe Harbor Statement

Certain of the statements made in this press release are "forward-looking statements" within the meaning and protections of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements in this press release include, without limitation, the expected enrollment in its foundational programs, and the increased revenue expected from such programs. Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance, capital, ownership or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "plan," "point to," "project," "could," "intend," "target" and other similar words and expressions of the future.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our most recent Form 20-F and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov. We have no obligation and do not undertake to update, revise or correct any of the forward-looking statements after the date hereof, or after the respective dates on which any such statements otherwise are made.

Contacts:

EpicQuest Education Group International Limited
+1 513-649-8350
info@epicquesteducation.com

Investor Relations:
Precept Investor Relations LLC
David Rudnick
+1 646-694-8538
david.rudnick@preceptir.com

Source: EpicQuest Education Group International Limited

 

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SOURCE EpicQuest Education Group International Limited

FAQ

What is the expected enrollment size for EEIQ's new foundational program at South China University of Technology?

Each incoming class at the South China University of Technology foundational program is expected to have approximately 120 students.

When will EEIQ's new foundational program at South China University of Technology begin?

The program is scheduled to launch in the Fall 2025 semester.

How long is the agreement between EEIQ's Davis University and South China University of Technology valid?

The agreement is effective until January 2027.

How many foundational programs does EEIQ now operate in China?

This is EEIQ's third foundational program in China, with other programs at Peking University and Shanghai Jiao Tong University.

What is the structure of EEIQ's foundational program at South China University of Technology?

It's a two-year foundational program followed by two years at Davis' Toledo campus, leading to a bachelor's degree.