Thank you for standing by, and welcome to the IDP Education Limited FY 2023 financial results call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press the star one again. For operator assistance throughout the call, please press star zero, and finally, I would like to advise all participants that this call is being recorded. Thank you. I'd now like to welcome Tennealle O'Shannessy, Chief Executive Officer, to begin the conference. Tennealle, over to you.
Thanks, Operator. Good morning. For those of you I haven't met, my name is Tennealle O'Shannessy. I started as IDP's CEO in February this year. It's an honor to be with you today to present the results the team has delivered for the financial year 2023. Joining me on today's call are Murray Walton, our Chief Financial Officer, and Craig Mackey, our Director of Corporate Development. I'm pleased today as we present such strong results for the full year. This year we helped more students and test takers than ever before, as our customers realized their global ambitions for study, career, and migration. We delivered record performance on all key financial and operational metrics, reflecting IDP's industry leadership, our commitment to a strategy that builds on our competitive advantages, and the depth of our experienced and talented global team.
Along with our financial statements, this morning, we lodged with the ASX our investor presentation, which we'd like to take you through now. In doing so, we will review the highlights of our financial performance for the full year 2023. We will provide an update on the market opportunity and the positive macro settings that are underpinning through the cycle growth for IDP. We will summarize our strategic areas of focus and the key developments in those during the period, and at the end of the call, we will be very happy to take your questions. Let's get into it. I'll start on slide five with a summary of the key operational and financial statistics for the year. The headline is that the business has had a strong year, delivering a record full-year performance that reflects IDP's leadership, position, and innovation in a structurally growing industry.
We delivered revenue at AUD 982 million, up 24% on the prior period, with a 63% increase in student placement revenue to highlight. Adjusted EBIT at AUD 228 million, up 40% versus the prior period. Margin expansion, which has been a theme of recent results, was a key driver of this outcome. Adjusted NPAT at AUD 154 million, up a very strong 45%. We also announced a final dividend of AUD 0.20 per share, taking full-year declared dividends up to AUD 0.41 per share, which is an increase of 52% versus FY 2022. This reflects the unique characteristics of IDP, a growth company with a strong balance sheet that generates free cash flow. The key messages from today's results are that IDP has delivered record performance this year.
The business has a track record of delivering strong earnings and generating strong free cash flows, supported by balance sheet flexibility to fund disciplined reinvestment whilst delivering ongoing shareholder returns. It has a leading market position in large and structurally growing markets. Positive macro drivers continue to underpin long-term growth, with ongoing demand for international study and migration and a highly supportive policy environment. A diversified business model across both business line and geography supports sustainable performance through the cycle. We remain focused on executing a compelling strategy that is delivering results with an extensive runway for continued growth. I'll now hand over to Murray to take you through the detail of our financial results.
Thanks, Tennealle. I'm very pleased to be presenting the financial results for FY 2023, which was a record result for the company. These results represent a continuation of a long track record of strong growth. As is shown on page seven of the presentation, the FY 2023 results takes our 10-year CAGR for revenue to 16% and EBIT to 22%, average annual growth over that 10-year period. We've delivered these results through disciplined and strategic investment across the business to establish long-term sustainable returns for shareholders. I'm going to move on to slide eight on the financial summary. Revenue for the year was AUD 982 million, up 24%, and is a record result for the group.
English language testing revenue, at AUD 546 million, was up 7%, primarily a result of the increase in average price, with volumes increasing by 1% above the PCP. Student placement revenue, at AUD 351 million, is up 63%, with a strong rebound in Australian revenue underpinning the result, which was 86% higher than last year. Multi-destination revenue is up 49%, as the U.K., Canada, and the U.S.A. all delivered strong volume growth. Digital marketing and events revenue is up 10%, with clients investing in student events but reducing their spend on digital marketing. English language teaching revenue was up 50% as volumes rebounded and teaching returned to classroom-based learning. EBIT on an adjusted basis was AUD 228 million, up 40%, with a nice increase in margins reflecting the underlying operating leverage in the business.
Net Profit After Tax adjusted was AUD 154 million and was up 45%. I'll move on to slide nine, the operational summary. These op metrics are underpinning the record financial result. IELTS volumes for the year were 1,932,500, an increase of 1%, with a decline of 9% in India, offset by strong growth of 18% for the rest of the world. The decline in India was due entirely to lower volumes for Canada. Canadian-bound volumes for the year were down versus FY 2022, with test taker volumes heading to all other destinations growing.
The softer testing for Canada reflects a consolidation after very strong growth in FY 2022 of over 70% and reflects a period which featured visa processing delays and elevated rejection rates that contributed to a decline in sentiment towards Canada. This was clearly a market issue and not related to competition. The 18% growth outside of India was widespread. The highlights were strong performances from key growth markets like Vietnam, Pakistan, and Nigeria, which all delivered growth above 40%. Student placement volume growth accelerated to 53%, with 84,600 [APS] recorded for the year, with Australian volumes up 77% to 35,400.
This was delivered by a rebound in volumes from India, which was up 129%, China up 68%, and Vietnam up 80% as the key growth countries. Multi-destination volumes were up 39% to 49,200, with the U.K. up by 44%, Canada up by 34%, and the U.S.A. up by 33%. Again, India was a strong performer, with volumes up 36%, and the addition of the volumes from the Intake acquisition supplementing the growth for the U.K. If I move on to the average fee performance. The average test fee for IELTS increased by 6%, with the majority of that coming from price increases applied in many markets during the year.
The average student placement application processing fee increased to AUD 4,151, a 7% increase, with both Australia and multi-destination average prices increasing from higher commission rates and higher tuition fees. I'm going to move to slide 10 and talk to the student placement business model. The very strong performance from our student placement business reflects the nice diversification we have from over 30 source countries, six destination markets, and more than 900 clients. This diversified business model has enabled us to deliver through the cycle growth at above market rates for many years. This slide highlights how we've been able to grow volumes at a 10-year CAGR of 15%, increase average placement fees by a compounding average of 6% per annum, which combined, has delivered compound annual growth of 22% per year.
This demonstrates the through-the-cycle growth that Tennealle will talk to in more detail later in the presentation. I'm going to move to slide 11. This slide highlights our rising margins. The business model exhibits natural underlying operating leverage. This has been reflected in increasing margins over time, despite the significant investment we've made in the business. Gross profit margins continued to increase this year as we extracted cost per candidate reductions in IELTS through driving efficiency with technology investments in things like on-screen marking, video speaking, and computer-delivered testing. In student placement, the investment in technology and geographical expansion allow us to scale the business from both a gross profit and bottom-line perspective. Our group EBIT margin for the year was 23.2%, 250 basis points higher than last year.
We've been able to deliver rising margins despite ongoing investment in the business. This has been a feature of the company for many years and reflects our disciplined approach to investing for long-term sustainable growth. Doing so in a manner that ensures we can show near-term operating leverage. Now I'm going to move to slide 12 and talk to the investments we've made in the business over the last 12 months. Our overheads growth in FY 2023 reflect the investments made in the student placement business to continue to scale, with the acquisition of the Intake Education and expansion of the IDP student placement office network and counseling teams. The Intake acquisition added 25 student placement offices, and IDP opened 21 new student placement offices and expanded to larger footprints, a further 16 student placement offices, increasing our student placement capacity for FY 2024.
Headcount increased by approximately 1,500, with just over 1,000 of those engaged in the student placement business, including almost 300 from Intake. The increase in marketing spend was 35%, as we invested in strategic IELTS marketing programs for Canada and India. Marketing spend overall, however, remained at less than 3% of revenue for the year. I'm moving on to slide 13, the gross operating cash flow. Gross operating cash flow for the year was strong, with AUD 231 million generated, reflecting an 85% conversion from reported EBITDA. As expected, the second half cash flow conversion was strong at 140%. Combined with the AUD 37 million of July student placement collections, which related to FY 2023, the conversion to EBITDA would have been 99%.
Our CapEx program for the year was focused on key strategic initiatives. The AUD 39 million program delivered the FastLane innovations and the broader IDP Live functionality that Tennealle will talk to in more detail. The modernization of the IELTS platform, which was a precursor to the launch of IELTS Online and One Skill Retake, ongoing expansion of our student placement office network, and our computer-based testing capability. I'll move on to slide 14 on the balance sheet. IDP's balance sheet remains very strong, with net debt of only AUD 42 million and with cash on hand of AUD 166 million. The movements in contract assets reflect the strong growth in student placement revenue, which is booked ahead of university invoicing and taken to the balance sheet. I'm going to hand back to Tennealle now.
Thanks, Murray. Moving on from the financials, we'd now like to look ahead and take some time to highlight the significant market opportunity. On slide 15, from a macro perspective, IDP is operating in a large, growing industry, with over 6 million international students enrolled globally, and structural demand for international education and migration continues to benefit from long-dated global demand drivers. On the supply side, our source markets have large and growing youth populations and underdeveloped higher education systems. On the demand side, we are seeing aging populations in destination markets, forcing governments to focus on attracting international students to support education systems and to grow skilled workforce pools. These growth drivers have underpinned growth of 7% CAGR for over 20 years for IDP source markets. Here we can clearly observe the strong through-the-cycle structural growth that IDP is aligned to with our global network.
Going deeper into the addressable market opportunity for each of our major business lines. Starting with the English language testing market, slide 17 demonstrates the long-dated growth we have observed. This chart shows the growth for overall IELTS test volumes over the past 16 years, with the timeline of government recognition changes and the associated competition levels mapped out across the bottom. There's a bit going on in this chart, so I'd like to take a bit of time to talk through the key highlights. Firstly, the market is sizable, with the annual IELTS test volumes now in excess of 4 million a year. Secondly, the IELTS test volumes show consistent through-the-cycle growth, with a 16-year CAGR of 10%. Importantly, this growth has been delivered even as destination markets have evolved government recognition of tests and opened up to limited competition.
You can see down the bottom of the chart, for example, that Australia opened up in FY 2011, New Zealand in FY16, the U.K. in FY 2021, and most recently, Canada in FY 2024. Competition has been a feature of this market for an extended period of time. Over this period, the IELTS market has continued to grow. Moving finally to IDP's position within the market. You can see that today, IDP has around a 50% share of the IELTS market, with a strong track record of taking share, growing at a CAGR of 13% over the same period. The summary here is that IELTS is the leading test in a large global market exposed to the same positive macro growth drivers. The industry structure is attractive, with few global competitors and high barriers to entry.
Turning now to the student placement side of the business. Slide 18 demonstrates the broad-based rebound occurring across the global system as international mobility returns. This chart shows the aggregate student visa data for each of our major destination markets, showing a large addressable market of 1.8 million new students annually. Importantly, growth is from all markets, with IDP's exposure to a large number of both source and destination markets, a key feature of our diversified business model. The call-out here is that we have a large, growing, diversified market with a long runway of shared growth available, given the fragmented nature of competition. Shifting gears on slide 20, we've highlighted the market opportunity. I'll now spend some time outlining our strategic areas of focus and the key developments during the period.
For the past 50 years, IDP has been committed to putting our customers first. At the heart of our approach lies the trusted human connection. Today, IDP is leading the transformation of our industry, leveraging our digital capabilities and our unique data assets to enhance this human connection. This enables us to offer more tailored recommendations, to fast-track the student application process, and to deliver a high-quality experience for test takers, all at an unmatched scale. Look, we continue to execute strongly on this strategy, and it is really pleasing as part of this set of results to demonstrate the progress here. Our highly trusted brand, built over decades through local human connections, is now powered by our global scale and digital capabilities to deliver an experience that is life-changing for our customers.
Looking now at the strategic pillars for each of our business lines, starting with IELTS. As a reminder, IELTS is the world's most recognized, reliable, and secure English language test for study and migration. It is a test that uses both human examiners and digital technology for the best customer experience. Our strategy is focused on four pillars. We're focused on building an unmatched physical and digital footprint and providing the widest choice of flexible test delivery options. IDP administers IELTS across more than 80 countries and 2,100 locations. We provide a choice of paper-based, computer-based, and online formats of the test. In FY 2023, we rolled out IELTS Online, which is now available in more than 50 countries. In FY 2023, we also continued to scale our IELTS by IDP app, delivering 815,000 downloads.
Secondly, we continue to build the most credible, trusted brand, now recognized by over 11,500 organizations. Leveraging industry-best brand awareness, we are investing to build engagement and conversion through strategic brand campaigns. All of this is underpinned by a scalable and flexible technology platform. Together with our partners, British Council and Cambridge University, we are undertaking a complete modernization of the underlying technology infrastructure that supports test creation and delivery. This new platform will enable us to deliver significant enhancements to our customer experience and has already allowed us to launch new products, including IELTS Online and One Skill Retake. Supported by this flexible platform, we continue to focus on customer-centric product innovation. Our aim with IELTS is to be at the forefront of innovation, and we have a strong track record of delivering this. An example of this is IELTS One Skill Retake.
This is a new product that allows a candidate to retake one of the four skills, where improvement is needed in just one area. This changes the test taker experience dramatically and represents a very strong proposition for candidates, as they're able to retake a component of the test without jeopardizing their scores in the other three skills. We launched One Skill Retake in FY 2023. It will continue to be introduced globally throughout FY 2024. Moving to slide 22. As I spoke about earlier in the presentation, structurally, the IELTS test market remains unchanged, with high barriers to entry and only a few global competitors. With governments changing their recognition requirements regularly over the past 16 years, limited competition has been a feature of this market for an extended period of time. Over this period, IELTS has consistently grown at a historical CAGR of 10%.
Linked to the strategic pillars I outlined on the slide earlier, the three levers that underpin our competitive response include, firstly, leveraging our brand and marketing leadership. IELTS has the highest prompted and unprompted brand awareness, and we are investing to grow engagement and conversion through strategic brand campaigns, tactical marketing campaigns, and community-building activities. Second, IDP has an extensive established referral partner ecosystem that drives our adoption and distribution. Here, we are focused on growing and amplifying this channel through refreshed loyalty programs, enhanced recognition and incentive programs, and the introduction of value adds that improve our partners' business models. Examples of this include training programs, access to test preparation materials, and co-branding opportunities. Lastly, we continue to drive differentiated product innovation. As I mentioned, One Skill Retake delivers flexibility to test takers.
Our focus here remains on scaling the rollout of this product and securing government recognition. Importantly, in FY 2023, government recognition was achieved in Australia, and I'm very happy to announce that the U.K. government has formally granted approval for OSR. The management team are highly experienced in leveraging the considerable strategic moats that have been built to enhance our leading position in competitive markets, as well as continued disciplined investment to build new moats around product innovation. Moving to slide 23. Our student placement strategy is focused on delivering differentiated customer experiences on an unmatched digital and physical scale. We're doing this by leveraging our unique customer insights and digital capabilities to create services that allow us to both delight our customers and to increase productivity. Our student placement strategy is focused on four pillars. First, building an unmatched physical and digital scale.
As Murray touched on earlier, we continue to innovate and invest to enhance our global footprint. In FY 2023, we added 46 new student placement offices. We also acquired Intake Education to accelerate our growth in the strategically important African region. Second, building unique data assets. We continue to build out the most comprehensive dataset related to international education globally. Our data lake today is large in its scale, with more than 4 billion customer actions captured on the platform in FY 2023. As we are growing our new products, we are increasing the unique data assets associated with them. Today, we leverage data to power proprietary algorithms to drive real-time lead scoring and prioritization to improve conversion, as well as next best action recommendations to enhance the productivity of our counselors. We also provide sophisticated course and content recommendations to enhance the experience for our students.
Our comprehensive data set and data science capabilities ensures we're well-placed to exploit emerging technologies as new use cases emerge aligned to solving our customers' most important problems. We also continue to focus on driving productivity and efficiency to ensure our counselors can spend as much time as possible speaking with our students. With ongoing investment in our centralized application processing hubs and lead prioritization driving conversion improvement, we were pleased to see a 24% increase in counselor productivity in FY 2023. Finally, we are relentlessly focused on transforming the customer experience. Even with our growing scale and volume, our customers are increasingly pleased with our service. This is reflected in an increase of our student Net Promoter Score, which was up 4 points in FY 2023 and 13 points over the past 4 years. Moving now to slide 24.
I'd like to spend some time providing a little more detail on the innovation that is transforming the customer experience in student placement. An example of this innovation is the digital functionality we have incorporated within our app, IDP Live. A major focus here has been the scaling of FastLane. FastLane harnesses IDP's global dataset and client relationships to enable students to receive real-time in-principle offers from leading institutions. We've been very pleased with the adoption by our customers, with 860,000 app downloads this year alone, and 17,500 students receiving formal offers after using FastLane in FY 2023. This was up from 3,000 in FY 2022. We've made 4,200 courses available as of year-end, up from 1,200 the same time last year. With these new products, we're also building our unique data assets.
To date, we've created 50,000 FastLane student profiles and 56,000 structured client admission rules. These can be used to power solving key customer pain points. Most importantly, FastLane is delivering 6% higher conversion and a better experience, with an 11-point improved NPS above our traditional channels, and is delivering all of this at scale. We're just getting started here with a future pipeline of functionality planned as we build out this student placement ecosystem. An example of this is our acquisition of the Ambassador program, a technology platform that aligns with our strategic vision to build out digital peer communities. This acquisition is just one of many ways we are investing in new technologies and digital innovation to deliver beyond expectations to help students achieve global success.
It's also another point of difference in our proposition that we can offer our student customers and our university clients. I'd now like to move on to the summary slide, slide 26. To wrap up, I'd like to call out the business has delivered record results this financial year, with revenue up 24% and adjusted EBIT up 40%. These results reflect IDP's industry leadership, our commitment to a strategy that builds on our competitive advantages, and the depth of our experienced and talented global team. The business has had a track record of delivering operating leverage that supports ongoing margin expansion, generating strong free cash flows and supported by significant balance sheet flexibility to fund disciplined reinvestment or providing ongoing shareholder returns. It has a leading market position in large and structurally growing markets, with ongoing demand for international student and migration, and a supportive policy environment.
Our diversified business model across both business line and geography supports sustainable performance through the cycle. IDP remains focused on executing a compelling strategy that is creating a unique combination of digital and physical services for our customers through ongoing innovation and disciplined investment. Finally, I'd like to acknowledge our Chief Financial Officer, Murray Walton, who acted as Interim CEO during the period, IDP's global leadership team, and its broader global staff. IDP is an exceptional business driven by extraordinary people. It is a privilege to be part of an organization that fundamentally changes the lives of its customers through access to global education and careers. I'd like to thank you all for your time today. Murray, Craig, and I will now take questions. I'll turn you back to the operator.
Thank you, speakers. At this time, I would like to remind everyone, in order to ask a question, press star, then the one on your telephone keypad. In the interest of time and allowing as many participants questions today, we ask to please limit to two questions per person, and we'll address any further questions should time permit. We'll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Chris Gawler from Goldman Sachs. Your line is open.
Good morning, Tennealle, Murray, and Craig. Can you hear me okay?
Yes, loud and clear.
Great. First question for me, just on the IELTS business. Appreciate the commentary you provided on volumes in India and outside of India. You called out India to Canada as being a bit of an issue in FY 2023. Is that now starting to resolve itself, which could see India return to growth this financial year?
Yeah. As, as we called out, the softer-than-trend growth we saw in India was driven primarily by the lower testing volumes, was due entirely to lower volumes for Canada. What we said there was within India, volumes to a lot of other destinations were up. Just to provide a little bit more color on the driver there, the softer testing for Canada reflects both consolidation after a very strong growth in FY 2022, where we were up over 70%, but also reflects a period where what we saw in Canada was processing delays and elevated rejection rates that contributed to a decline in sentiment towards Canada.
This was clearly a market issue and not related to competition. What we can say is over the last, couple of months, we have seen an improvement in visa processing times, but it's not yet flowed through to a material pickup in testing volumes for Canada.
Great. That's clear. On the student placement business, strong result there this financial year. Can you talk a little bit about the lead indicators that you're seeing that could support continued growth in that business this year?
Yeah, absolutely. We included a slide in the appendix of our presentation, which shows that continued strong pipeline build. I think, I think the key point to note here, however, when we look at that pipeline, is, through the various strategic initiatives that we are focused on, including, lead prioritization, lead conversion, we are seeing very good improvements in conversion rates through the various stages of the funnel. The key to these improvements that we're seeing has been the increasing use of AI. I, I touched on in the call that several from proprietary lead propensity algorithms that we're using. What these do is they score our leads in real time and allow us to drive significantly greater conversion.
To give you a bit of color there, the top 30% of scores with leads under this model, we are seeing that these leads are 5 x more likely to apply. The summary is strong pipeline, filling us with confidence that the various strategic initiatives we're focused on are also looking at how we drive conversion improvements through the pipeline.
Thanks. I'll jump back in the queue.
Your next question comes from the line of Tim Plumbe from UBS. Your line is open.
Yeah. Hi, guys. Can you hear me?
Yes, Tim.
Great. Thanks, Tennealle. Just wanted to ask a question about FastLane. 4,200 courses. Looks like you've had a pretty decent uplift in the second half in terms of courses added to the platform. How do we think about that as a percentage of courses now on the platform? Maybe how do we think about the pathway to start leveraging that platform in, you know, second half 2024 or FY 2025?
Yeah, great question, Tim. For FY 2023, we achieved our goal, as you touched on, of having almost 50% of our courses, for which students applied for from Tier 1 countries. I think just to provide a bit more color there, we're a little behind the curve after half one, really pleased to see that uplifting momentum in the second half. This equates to having around 93 clients on platform. In terms of what that means for the, just, where we're landing and the scale that we're seeing, the 17,500 final offers via FastLane for us today represents about 12% of our total offers for FY 2023. Conversion results, as I touched on earlier in the call, are very encouraging, with FastLane students converting at, at 6.3% higher rate.
Looking forward, how we think about that in future years, we've spoken about FastLane as being a multi-year strategic program, and so we will continue to focus on that inventory build across Australia, U.K., and Canada for both postgraduate and undergraduate. What that means for FY 2024 is we're targeting around 25,000-30,000 full offers via FastLane, and we'll also be focused on adding additional functionality, which will, I guess, enhance the value that is available for both students and clients. Types of innovation that we're looking at in FY 2024 include exploring the opportunity to give clients the functionality to proactively extend offers to students, who match their admission rules. Now, this will be done in a very student-first, student-centric way, with the student controlling that process.
Over time, we will also look to functionality, including making available things like attaching scholarship offers, to those, to those proactive reach outs from universities. We believe this type of functionality will be very appealing to those highly ranked top brands, who will value the ability to be able to target students to drive strategic diversity and efficiency. I think you can probably hear from the tone in my voice, we're incredibly excited for the potential for FastLane, both as a differentiated proposition that we can offer to students and to clients, but also, as we touched on, the, the ability for us to collect and build unique data assets that help power further innovation in student placement.
Great. The second question is just on, you know, some of the improvements that you made throughout FY 2023, 24% improvement in productivity, counselor productivity, you know, 60% of the applications via centralized processing hub. How do we think about that rolling into FY 2024? I'm not sure if it's a question for you or more for Murray, but how do we think about that flowing through to potentially improved margins across the student placement business, please?
Yeah, certainly. I'll talk a little bit about some of the initiatives that underpin the result, and then, then I'll hand over, I'll hand over to Murray for the view looking forward. We were incredibly pleased with the, the results. As we touched on, a 24% increase in counselor productivity, which delivered above expectations. The driver there really was expanding out the use of our centralized application processing hubs, as well as the ongoing work we've spoken around, which includes the use of AI, and lead propensity modeling to really drive conversion through the funnel. Really pleased to see those initiatives in place, and we'll continue to focus on that and scale as we move into FY 2024. Murray, I'll hand over to you to provide a little bit of color on margins.
The student placement EBIT margins, we do expect that we will continue to see strong growth in the student placement business. Obviously, overall margins, EBIT margin, we'll see a little bit of increase with the IELTS business, just softening a little bit with some of our additional costs in the direct cost line. Overall, we should see some margin extension.
Great. Great. Thanks, guys.
Your next question comes from the line of Pete Flanagan from Barrenjoey. Your line is open.
Morning, Tennealle, Murray, and Craig. Can I just ask on IELTS and that rest of world growth at 18% in front of a strong growth second half, can you talk to the drivers behind that and then expectations into FY 2024?
Yeah, certainly. Again, just what we spoke about, is we were really pleased with the strength of the IELTS portfolio more broadly in FY 2023, and we touched on an 18% growth outside of India. I think it's, it's fair to say that the growth was widespread outside of India, but to call out a couple of key highlights there, it was really the strong performance in the key growth markets that we have called out historically, and frankly, where we've been investing over multiple years to build out our student placement network. That is markets like Vietnam, Pakistan, and Nigeria, which all delivered growth above 40%.
I think the key message here that we have been speaking about through, through consecutive results is the disciplined investment in building out our student placement network that we've been undertaking for multiple years, provides the foundation not only for growth in the current year, but in forward-looking years. The growth that you're seeing here reflects the investments we've made on prior periods.
Great. Just on One Skill Retake, can you talk to the current feedback from test takers in, in the U.K. and Australia? Also, is there any update on the potential for Canada to approve One Skill Retake?
Yeah, certainly. We have been undertaking tests across the network in a limited capacity, including in India since May. We have had great feedback so far. Great feedback in terms of, I guess, not only the product itself, but the opportunity it presents to students to, as we've touched on, maximize their, their score opportunity by, by retaking one component without jeopardizing the scoring in their other three. I think it's fair to say that volumes are still small, but we expect this ramp the volumes to ramp up as recognition builds.
We've been really pleased to have secured recognition from both the Australia and, as I announced in the call today, the U.K. government, and that client recognition is progressing strongly. That's something that we're focused on. In relation to Canada, we're currently in discussions with IRCC, but we don't have a definitive timeline for recognition as always are, but that clearly remains a priority for us.
Great. Thanks, all.
Your next question comes from the line of Darren Leung from Macquarie. Your line is open.
Good morning, guys. Congratulations on the result, and thanks for the opportunity. Just two as well from me, please. Maybe the first one on the IELTS volumes piece, you know, extension of this question earlier, but keen to understand how you're thinking about growth in the next sort of one to three years, particularly given the growth by far that I've seen in one of your major competitors, please.
Yes, certainly. I mean, look, what can I say about, l et's start with FY 2024. The recognition changes for the Canada market only came into effect on the 10th of August. It's too early to provide any meaningful comment on the impact of these changes. What I can say for FY 2024 is, and hopefully you've heard this through the call, we remain confident that we're well placed to compete in the testing market for Canada. We have the fundamentals in place and believe that we will continue to be the leading test for the market. I think that comes against the context and two important things to call out. Firstly, is in the Canada situation, highlighting that what has been delivered is quite appropriate score equivalencies, relative score equivalencies between our test and competitors.
What we have to leverage, which is a very strong distribution footprint, and the widest range of test-taking flexibility for our test takers. In FY 2024, we will continue to focus on those levers around the competitive response, which is continuing to leverage what is a ubiquitous, very strong leading brand and brand awareness through investing in both strategic and tactical marketing campaigns with some new brand marketing messages that we can take around the equivalencies coming in at the overall fix for IELTS, which is resonating strongly with our test takers. We'll continue to focus on building that engaged community and partner network for our referral partner network. Now, our referral partner network continues to perform strongly, and this is something that's very embedded and ingrained.
These are test preparation businesses that have built entire ecosystems and businesses around supporting the IELTS test. We'll continue to enhance and amplify the value of those networks. Then lastly, and we've talked through this quite a bit on the call, we're very excited by the opportunities presented through the product differentiation that will come through to One Skill Retake. That's how we're thinking about FY 2024.
I guess if we look further ahead in terms of future growth, what we would say there is that, that the long-dated structural growth drivers for the English language testing play, remain in place, and the industry has strong barriers to entry. So we continue to believe that over that three to five years, IELTS should continue to deliver that single- high-digit volume growth in the medium to long term. As I've touched on, FY 2024 will be more subdued as we navigate these one-off changes associated with the Canada market. We remain very confident in our ability to respond to those changes, reflected in the fact we've been operating in competitive markets for many years.
Got it. In order to achieve that high- single-digit growth, do you think there'll be a level of pricing competition, either from you guys or from the market level?
Yeah. If I was to talk a little bit about pricing in the market, I think that it's fair to say that we, we aren't seeing material price competition in the market, and I think that is probably reasonable to expect. It reflects what is a rational pricing environment in an oligopolistic industry. The other thing that I would say, too, is that our observation would be that demand is relatively inelastic to price, so discounting is rarely used or successful in, in, in this market structure. We haven't seen any change to this dynamic. It's been pretty consistent over, over the historical period, and we wouldn't currently intend to use price as a lever just because of the limited effectiveness that we've observed.
Got it. Thank you.
Your next question comes from the line of Jonathan Higgins from E&P. Your line is open.
Good morning, everyone. Thank you. I just have two. The first one is on the U.S. I think you guys called out for the first time, the 60% of, of your share. I just wanted to check if this is growing from last year, and if it has, what, what's changed in terms of like, has it been the market or IDP, you know, changing strategy to focus more on the U.S? What do you see as opportunity for it going forward?
Yeah, it's a great, it's a great question. Our within student placement, our U.S. volumes were up 33% on last year. To talk a little bit about how we view the U.S. market, we're seeing some favorable dynamics in the U.S. market. There is still that strong demand for the most prestigious, it's considered the most prestigious destination for students from places like India and China. Pleasingly, we're seeing an increase in the adoption of the agent model with rising concerns over domestic student enrollment dynamics. There's some demographic factors at play for the U.S. market. Overall, an attractive and favorable market when we take a look at that. We have been focused on, on the U.S. We've been adding to our client base.
In FY 2023, we added 19 U.S. clients that we identified as priority in the period. What I would say, however, is in addition to this, as part of our model, we are very student-centric and student first, and we will place students with the institution they're looking for, even where we don't have a contract in place. There continues to be a significant number of students that we're placing to U.S. institutions without commission. That is where our near-term focus is, is to reduce these non-commissionable flows by signing contracts with institutions in this category. Favorable overall market and trends. We saw strong growth in the period related to the focus we're putting in this space, and we will continue to focus on that looking at FY 2024.
Great, thank you. Then my second one was just on costs in terms of, you guys mentioned that the monthly cost was AUD 30 million per, per month. I just wanted to check what the exit FY 2023 run rate was, and FY 2024, with all the increases in, you know, offices and staff hires.
Yes, certainly. I'll hand over to Murray to provide a little bit more color on costs, but I just said to start the conversation there, there's a couple of key things I really want to talk to there around managing costs. What I would say that as a management team, we have a long track record of disciplined investment in the business to drive that long-term growth while delivering a rising margin profile. We're not changing that philosophy. We will continue to invest in those strategic growth areas where we see the long-term opportunity. Student placement, investment, and associated growth is a good example there. We are very mindful, however, as we look at FY 2024, we are navigating a period where we have headwinds for IELTS or uncertainty for IELTS as competition for Canada trims the growth profile in the short term.
Our approach to costs in that environment will be to be very disciplined, will be to hold back some of our investment in the first half until we get a better read on the outlook for IELTS revenue, given that uncertainty point I measured, I mentioned. Where revenue is the plan and where we see opportunities, we will look to invest more in the second half, and that investment will be linked to where we're seeing growth in the business, but it primarily in student placement. Then, you know, just to provide a little bit more color on, on the, the, the exit runway, I'll hand over to Murray.
Thanks, Tennealle. I'll talk on a pre-AASB 16 basis so that you can get, include the occupancy costs for those new offices, and you get a view of that. The monthly rate, monthly expense run rate for the full year, AUD 30.6 million on a pre-AASB 16 basis. The second half run rate was only 4.8% above the first half. We actually were very disciplined in our expenses in the second half and deferred non, customer-facing, hires. We did hire, obviously, 1,500 additional heads during the year. There was a couple of items. If we take away the M&A costs. We also had a AUD 10 million FX, AUD 10 million dollar FX loss, which related to translation on the balance sheet.
If you pull those out, the run rate, underlying run rate was AUD 29.3 million. It was right on where we had expected. Thinking about FY 2024, we are expecting to see in the range of 10%-15% growth in our expense base. As Tennealle mentioned, we'll be very disciplined in the first half. We'll be certainly managing our cost base very carefully. As we get a view of revenue, we'll certainly look to release investment in the second half.
Great. Thank you.
The next question comes from the line of John Merron from CLSA. Your line is open.
Hi, good morning. Thanks, guys. Just a quick one on pricing. Sorry if I missed it. Just hoping to get a little color on what you're thinking in terms of pricing on the IELTS side over the next year, particularly in light of increased competition. Then I'll jump in for a second one.
Yes, certainly. When, when we look at pricing for IELTS, we set the price of IELTS in local currency, and it varies across all countries based on local market conditions. Historically, we look to take price increases wherever we can, but we don't have a fixed pricing cycle. I think we have communicated historically that over time, we look to deliver underlying price increases in the range of 3%-5% across the entire profile. This obviously excludes FX. What I would say is, looking forward, our strategy on pricing hasn't changed, and we will look to continue this approach. Our views on the underlying price dynamics for IELTS remains unchanged, which means that we would look to deliver an average of 3%-5% price increases across the network.
Okay. Okay, thank you. Then just another one on FastLane. 17,500 students receiving FastLane offers. Seems like a great result. If I'm not mistaken, it's about double where you were thinking it would be a year ago. Maybe if you could share some more color on this and, and maybe, maybe share how many students actually accepted these offers and, and what drove the outperformance. You know, whether or not we can read this as a measurable evidence of additional students coming into the student placement funnel. Thanks.
Yes, certainly. When we, when we had a look at FastLane, clearly a very strong result. Yes, well above the target we had set for ourselves. The focus for us has been on building out both sides of the marketplace. The, I guess, the uplifting in the velocity of students links directly to the inventory we've been able to bring onto the platform. The work that we did in securing those 4,200 courses was instrumental in delivering the student experience that allowed that number of offers. I think as we touched on the proposition is compelling because it is creating a differentiated experience in student placement. It's driving that better conversion and that better student experience and customer satisfaction. For us, this is something that is, represents a game changer.
It's a game changer because it gives students a unique reason to enroll with IDP, and it gives clients a unique reason to choose IDP as, as their partner, in terms of student placement. We will continue to focus on and the way we think about the- I think I, you know, I shared during the time that the scale and what this looked like is that it was circa, you know, 10%-11% of our total volume went through FastLane for the period.
Thank you. Thank you very much.
Before we continue on to the next participant, I would just like to remind you, if you would like to ask a question, please press star one on your keypad. Your next question is a follow-up from Tim Plumbe from UBS. Your line is open.
Hi, guys. Sorry, actually, most of my questions were answered in the course of that. Apologies.
Your next question comes from the line of Siddharth Singh from BofA Securities. Your line is open.
Hi, congratulations on a good set of results. I've got two questions for you, both on English language testing. Your second half volume stands roughly at 910,000, which was a 10% half on half decline. The first half volume, roughly 1 million IELTS tests. Looking at FY 2024, what should we consider as a normalized run rate? Because considering second half takes us to 1.8 million tests, and obviously there's going to be some end market growth on that, whereas taking first half run rate takes us to 2 million tests. Can you provide us some clarity on that?
Certainly. As we spoke about the color that we provided around the softer than trend volumes for IELTS related solely to India and within India, Canada, volumes to India. The driver of that softer result, as we spoke about, was wholly market-related. What we saw there was both lacking significant growth in prior periods, but in terms of market features, we saw elevated visa processing times, elevated rejection rates, contributing to a softening of market sentiment for Canada. As we touched on at a market level, some of those things have started to unwind in the last couple of months. Visa processing times are looking very favorable.
So some of that is unwinding, and we view it the market conditions as more short term in nature. As we look at what that means for FY 2024, as we have communicated, the recognition changes in Canada only came into effect on the 10th of August. It is quite, it is too early to provide any meaningful comment on the impact of these changes in terms of market share or what that means for volumes in FY 2024.
All I can do is reiterate that we remain confident that we're well placed to compete in the testing market for Canada. I think it is important to call out that what we saw in FY 2023 was a market issue in Canada that is looking, is already unwinding. The uncertainty that comes in FY 2024 simply relates to the changes in recognition that have only come into effect in the 10th of August. It is really too early to provide any comment there.
The second question is, my second question is also on English language testing. On that front, what percent of India volumes relates to Canada? My estimate suggests that, and if you work out the numbers backward, India is roughly 50% of your IELTS testing volume of roughly 1.9 million. Within India, can you provide some clarity about the geographic mix? Is Canada more than 70% of your India testing volumes at the moment?
Yeah. Hey, Siddharth, it's Craig here. I can talk to the market composition. You know, clearly, Canada has become an attractive destination for Indians more broadly. The combination of the, the study opportunities and the migration settings has meant we've had a number of years of really strong demand and growth for that destination. I think as Tennealle mentioned, through 2022, testing for India broadly and, you know, reflected in that in for Canada, we're up sort of 70% on the year.
You know, number of years of compound growth there from India to Canada means that we are, probably in excess of 50% of our testing volumes in that market for the Canadian market, which is clearly higher than what it is for our sort of network more broadly, where there is, you know, more balanced, I suppose, composition for all of the destinations that we offer for. I'd provide those comments. You know, the, the composition is, is changing as we speak. The great thing about India is that there is good interest for a number of destinations, with students and migrants, you know, really committed to that, travel, study and migration opportunity, and they tend to, look at multiple destinations over an extended period of time.
And I think that-
Follow up.
That represents the. Sorry, just to, to build on that, that represents the, the key call-out here, is the strength of this business model around the diversified nature of what we see. I think as we called out in the call, within India, growth to all other destinations, performed strongly and were, and were up for the period. That is just, I guess, a feature of what we see, both that, that diversification across business line, but also geography within business line.
Absolutely. Just a follow-up on that. If India, if more than 50%, you said more than 50% of India's IELTS volume relates to Canada, and any color on what percent of India volumes is concentrated in the states of Punjab and Haryana, which is North India, for Canada, of course? Yeah. That's it. Thanks.
Yeah, look, we've never provided commentary on components and regions within a country. You know, the, the, the beauty of the Indian market, it is, it is many countries within a country, and we've got ubiquitous exposure across all of those regions. Regions have preferences for different destinations within countries. The diversification within India is quite remarkable, and the universities and, and other participants recognize that, and, and our strengthening across that pan-Indian network is, is a feature of the business.
Thank you. Thanks a lot.
As there are no further questions at this time, I would like to thank our speakers for today's presentation and thank you all for joining us today. This now concludes today's conference call. You may now disconnect.