■Future outlook

(2) Intensive course

In the university business of Aoba-BBT ＜2464＞, the number of students enrolled in undergraduate courses at BBT universities and graduate schools is on a downward trend due to changes in the market environment. The reason for BBT University is that demand for online education, which was temporarily excited due to COVID-19, has calmed down, and since the number of business schools providing online services in response to COVID-19 has increased in graduate schools, and the same service continues even after COVID-19, the competitive environment has intensified more than before. Another factor is that demand for MBA acquisition has recently declined from before. In response to these environmental changes, the company has come up with a strategy to focus on intensive courses (short-term intensive courses) in the guise of capturing reskilling demand.

The intensive course is a 3-month short-term intensive course (fee is 0.33 million yen including tax), and programs that meet the needs of the times are developed and offered to individuals and corporations. The “Digital First Camp” and “Finance Driven Camp,” which were newly offered at BBT University, are both popular in the 2024/3 term, and it is planned that they will continue to be offered in the 2025/3 term. The characteristics of the program are that it is possible to intensively learn content directly connected to practice, and that students can acquire skills that can not only be understood but also put into practice by outputting and having many discussions with lecturers and other students, which is a differentiating factor from competitive services. Furthermore, the system of lecturers, learning advisors, etc. is substantial, and it is also characterized by the fact that generous feedback and support can be received. Furthermore, there are times when the enthusiasm of the students is high, so it can be said that one of the attractions is that they can build a network between students.

The average age group of students is in their late 40s, and they are good at capturing reskilling demand from middle and older age groups. Since it is a program eligible for benefits from the Ministry of Health, Labor, and Welfare, individual applications account for the majority, but applications via corporations also tend to increase after the 2nd year. Sales for the fiscal year ended 2024/3 were less than 0.1 billion yen, and since BBT University's sales were 0.43 billion yen, it accounted for about 20%. Courses are also scheduled to be offered at graduate schools for the 2025/3 fiscal year, and sales are planned to be just over 0.12 billion yen, aiming for growth at an annual rate of 2 digits. There are times when the benefit rate of benefits will expand from 40% to 50% from 2024/10, so sales are expected to remain strong.

As a customer acquisition policy, in addition to efficiently operating web advertisements and providing guidance to graduates of other services within the group, corporate sales representatives also guide the same program during business negotiations for corporations. Regarding the development of new courses, in addition to continuing to plan and develop programs that match the needs of the times, we will proceed with the development of courses that make use of resources within the group.

Furthermore, as a student acquisition policy for the undergraduate course, BBT University will continue promotion activities for the youth group, which accounts for over 20%, but from now on, they will focus on recruitment activities targeting working people, and leads will be acquired by holding web advertisements and seminars tailored to the target group. Meanwhile, with regard to BBT graduate schools, we will promote strengths such as abundant achievements related to online education services and high learning efficiency based on “AirCampus (R),” and also appeal that it is a program eligible for benefits from the Ministry of Health, Labor, and Welfare, and that salary levels for graduates have increased thereafter. Also, in the past, the majority of students aiming to start a business were the majority, but currently, the number of cases where CXO human resources take the course is increasing, so marketing activities targeting CXO human resources will also proceed. Furthermore, in order to raise awareness between BBT University and graduate schools, they are also working on holding joint seminars as a new measure.

Furthermore, as a measure to improve profitability, as described above, rationalization will proceed by integrating organizations that have been independent until now. Currently, it is operated by a total of about 30 people (including associate employees) of about 10 people each at BBT University and Graduate School, and 5 at BOND-BBT, but I see that there is room for slimming down by integrating the management secretariat and marketing departments.

(3) International school business

Regarding the international school business, it is a strategy to aim for business growth with multiple business models as demand for online international education increases both domestically and internationally.

a) Domestic virtual deployment

Domestically, in order to further spread and expand international baccalaureate education, the “Global Leadership Diploma” program will be offered to high school students in two forms: online completion type or blended type (combination of real and online). In addition to producing 2 of AJIS's first graduates in 2023 (online completion type), it also produced 1 (blended type) at the partner school (academic) Kyushu Lutheran Academy.

b) Domestic platform development

Since resources are limited by AJIS alone, partner schools will be expanded domestically and expansion through platform development will also be promoted. As the first step, a comprehensive partnership agreement was concluded with Kyushu Lutheran Academy in 2022, and provision of an international baccalaureate curriculum for high school students began. Kyushu Lutheran Academy established a system to accept children of employees visiting Japan from Taiwan to coincide with the opening of a factory of TSMC (Taiwan), which is a major semiconductor manufacturer, in 2024, and Aoba, which had built a GLD program to provide an international education curriculum, was selected as a partner. We see that there is a need for other high schools to introduce GLD programs, and it is a strategy to expand domestic business by expanding the number of schools that have introduced it.

Note that there are about 150 children of TSMC employees, and it seems that about 130 of them were infants to elementary school students, and these children went to Kumamoto International School, which is a school certified by PYP. However, since the same school only has a middle school, there is a high possibility that they will enroll in Kyushu Lutheran Academy when they advance to high school (several high school students will enroll in 2024).

c) Expansion in the Asia/Oceania market

The International Baccalaureate Organization has decided that trial operation of online programs targeting DP will begin in 2024, and as of 2024/4, 5 schools, including Aoba, were certified as online schools. Of these, for the Asia/Oceania region (time difference within ± 3 hours from Tokyo), only 1 Aoba school* will be deployed. Currently, we are in the process of recruiting students for the 2024 season. One person in charge is assigned at Aoba, and in addition to placing advertisements locally and collaborating with local agents, it is a strategy to acquire students while contacting schools that only provide MIP (middle school) even at international baccalaureate certified schools and making guidance announcements, etc. Depending on the region, it is conceivable that there will be students who attend regular high schools and take separate DP programs online.

※ Of the remaining 4 schools, 2 schools have been certified, 1 each in the Middle East region, Europe, and the Americas.

There is no need for large investments to begin overseas expansion, but it is planned to increase the number of teachers compatible with online education by 2 to 3 in the summer of 2024. Note that the trial operation is until 2025, and we believe that there is a high possibility that it will shift to operation to this service if there is no particular problem thereafter. There is a possibility that competitors will increase within the same area, but since there is a limit to carrying out promotions to raise awareness with only one Aoba company, I think that if awareness expands by entering multiple companies, it will be an opportunity for the company to accelerate growth.

d) Student Objectives for Online Courses

The policy is to initially carefully proceed with student acquisition for online courses (target is high school students), including domestic GLD programs, and the target number of students is 20 in 2025 to 100 in 2027. If the annual tuition fee is 100 to 1.5 million yen, the sales scale is expected to be 1 to 0.15 billion yen in 2027, and although the impact on business results is small, the potential for future growth is large.

e) Measures to improve profitability

As a measure to improve profitability in the future, in addition to implementing tuition price increases from 2024 as described above, the Shibaura Campus, which was operated on a small scale for AJB, will be closed at the end of 2025/3, and business efficiency will be improved by integrating it into the Harumi Campus. Issues include the fact that recruitment of foreign teachers has become stricter due to the depreciation of the yen, but the idea is to respond with wage revisions, etc. using tuition fee increases as capital.

※ AJIS and MIST will start the school year starting in 2024/8. AJB will be implemented from 2024/4.

(Author: FISCO Visiting Analyst Joe Sato)