Affinity Education has increased the valuation of its intangible assets in its full-year 2025 accounts, a move that stands out against a broader backdrop of challenging conditions for the childcare sector.
The private equity-owned operator’s financial statements reveal a significant uplift in balance sheet values, driven by the revaluation of goodwill and other intangibles, even as industry peers grapple with operational headwinds.
This accounting stance reflects a broader trend in private equity-owned services businesses, where asset revaluations can significantly impact reported equity and leverage ratios.
The divergence in valuation approaches is particularly notable given that Affinity shares an auditor with competitors who have adopted more conservative accounting treatments.
According to the Australian Financial Review, the discrepancy has raised questions among market observers about the consistency of valuation methodologies within the industry.
While some operators are writing down assets or maintaining flat valuations due to softening demand and rising costs, Affinity’s figures suggest a continued belief in the long-term value of its network and brand equity.
This accounting stance reflects a broader trend in private equity-owned services businesses, where asset revaluations can significantly impact reported equity and leverage ratios.