Interim Management Statement

RM PLC 06 February 2008 6 February 2008 RM - Interim Management Statement RM is today issuing its first Interim Management Statement, which covers the period from 1 October 2007 to 5 February 2008. Performance at this point in the year is not a good indicator of outturn - either for the first half, or for the year as a whole. RM is a seasonal business, with the majority of revenue and an even greater proportion of profit occurring in the second half of the financial year. The first three months of the Group's year is the smallest quarter, both for revenue and order intake. Operational update Since the start of the financial year, RM has been selected as ICT provider for two out of the three BSF programmes that were awarded. The previously indicated increase in BSF bid costs will fall largely in the first half of FY2008, whilst BSF revenues, reflecting the timing of new school openings, will be predominantly in the second half. This will increase seasonality and, in line with management's expectations, profit in the first half of FY2008 will be less than in the equivalent period of FY2007. BETT, which is the world's largest educational ICT exhibition, took place in London on 9 - 12 January and provided a good opportunity for judging the state of the market. The high level of attendance at this event, combined with the announcement of additional central government funding, confirms that educational ICT remains a high priority for both policy makers and educational practitioners. A significant trend at BETT this year was the growing emphasis on learning platforms. These products will increasingly be used by schools to facilitate the government's aim of providing parents with real time school reports. RM's Kaleidos product is well positioned to meet this need and is attracting significant market interest, with encouraging order intake levels. Kaleidos has a software as a service (SAAS) delivery model, so revenues from FY2008 orders will be spread over future years. Recent acquisitions, DACTA, SERAP and SpaceKraft, are all performing in line with management's expectations. Customer satisfaction (RM's most important non-financial measure) for the year so far is 7.65, ahead of where it was at this time year last year. Tim Pearson, CEO of RM, said: 'BSF, where we are the clear market leader, continues to be our major area of investment. We've had further success in the first four months of the year, winning two out of three bids awarded and achieving the highest score for ICT in all three. However, the consortium nature of some BSF programmes does mean that the best ICT isn't always selected and some schools can end up with second-best solutions. 'Learning platform sales, which we see as the foundation of long-term strategic relationships with many customers, are also progressing well. We have recently signed a multi-year agreement with Staffordshire, one of a number of contracts we now have in place. We have also been selected by the South West Grid for Learning, an existing broadband Internet customer, as preferred bidder to provide a range of innovative learning platform services.' Material events and transactions during the period On 1 October 2007, RM acquired SpaceKraft, a supplier of special educational needs and early years products, for a net cost of £4.4m. SpaceKraft brings further scale to the Group's Educational Resources business and significantly increases the Group's existing SEN business. On 5 October 2007, RM announced that it had been appointed, as part of the mpb education consortium, preferred bidder to provide ICT services to the London Borough of Hackney's BSF programme. Hackney's BSF programme covers six secondary schools and three special schools in total, and will be delivered in three phases. The initial phase covers three schools and 3,350 pupils. On 17 January 2008, RM announced that it had been appointed selected bidder to provide ICT services to Sunderland City Council. Sunderland's BSF programme covers five secondary schools and three academies, serving a total of 8,000 pupils. On 6 February 2008, RM announced that it had been appointed preferred bidder for a £2.75m contract to deliver innovative network and learning platform services to the South West Grid for Learning (SWGfL). On 20 December 2007, RM appointed Jo Connell as an Independent Non-Executive Director. For further information, please contact: Mike Greig/Phil Hemmings, RM plc 08450 700300 Mark Antelme, Brunswick 020 7404 5959 Notes: Founded in 1973, the RM Group is a leading provider of educational products and services to schools, colleges and universities, local government and central government education departments and agencies. RM works closely with educationalists to create new products, processes and technology which improve teaching and learning. RM is listed on the main market of the London Stock Exchange under the symbol RM.L RM's business reflects buying patterns in the schools market place, with many schools purchasing equipment ready for installation during the summer vacation. In 2007, first half profit before tax (before exceptional pension credit and amortisation of acquisition related intangibles) was 14% of that for the year as a whole; first half revenue was 42% of that for the year as a whole. In line with its normal programme of communications with shareholders, RM will release a pre-close update prior to the end of the first half of its financial year on 31 March 2008. This information is provided by RNS The company news service from the London Stock Exchange

Companies

RM (RM.)
UK 100

Latest directors dealings