This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain. The person responsible for arranging for the release of this announcement on behalf of the company is Neil Martin, Chief Executive Officer.

 

17 October 2022

 

RM plc

Group revenues in line with market expectations

Profitability impacted by operational issues related to ERP implementation

in the Consortium business

 

RM plc (“RM”), a leading supplier of technology and resources to the global education sector today provides an update on current trading with respect to the 12-month period ending 30 November 2022.

 

Group revenues remain positive with both RM Assessment and RM Technology expected to deliver revenue growth in the year. RM Resources, however, has experienced a slower than expected recovery in the Consortium brand resulting from on-going challenges following the IT implementation.

 

Despite improvement through August and into September, continuation of that progress has slowed which has impacted warehouse throughout and system and process optimisation. Shipment volumes are increasing, but these are not yet at the expected level. This has also resulted in a continuation of elevated operating costs and warehouse inefficiencies with some related reduction in customer volumes.

 

Remediation plans are in place that include reducing the order backlog to normalised levels in the short term; however, as a result, operating profit in the current year will be significantly lower than forecast. The IT plans are focused on improving delivery in Consortium, and the wider programme has been substantially slimmed down as we review the most efficient plan to completion in 2024. The impact of the IT implementation on adjusted operating profit has in part been offset by sales of IP addresses brought forward from FY23 in RM Technology.

 

Near-term focus continues to be on managing debt levels and reducing underlying operating costs. Net debt at the end of the year is expected be slightly higher than at the half year which reflects the positive cash generation in the second half of the year offset by the impacts of the IT programme.

 

Neil Martin, Chief Executive Officer, commented: “The challenges associated with the IT implementation have been material and impacted our short-term priorities and financial performance. We remain focused on delivering a plan to put the business back on a solid footing that will deliver longer term value for all our stakeholders.”

 

RM plc
Neil Martin, Chief Executive Officer	Tel: +44 (0)8450 700 300
Emmanuel Walter, Chief Financial Officer (interim)
Cynthia Alers, Investor Relations Director (interim)
Headland Consultancy	Tel:  +44 (0)203 805 4822
Stephen Malthouse
Jemma Savage

 

Notes to Editors:

 

RM provides market-leading products and services to educational institutions, exam

bodies and international governments which improve, simplify and support education and learning.

 

The education sector is transforming, and RM is well positioned to capitalise on this through its three divisions:

 

• RM Resources is the established provider of education resources for early years, primary schools and secondary schools across the UK and to 80 countries internationally.
• RM Assessment (formerly RM Results) is a leading provider of assessment software, supporting exam awarding bodies, universities and governments worldwide to digitise their assessment delivery.

• RM Technology (formerly RM Education) is a market-leading supplier of ICT software, technology and services to UK schools and colleges.