Tribal Group plc, a leading provider of systems and solutions to the education, learning and training markets in the UK and internationally, releases the following update on trading, covering the period from 1 January 2013 to 16 May 2013.
Tribal’s trading since its year end has been in line with expectations for 2013. As anticipated at the start of the year, profits are likely to be weighted towards the second half of the year. The order book shows strength; at the end of April it was £158 million, compared to £168m at the end of 31 December 2012.
The Group’s Systems business continues to make good progress. Domestically, the overall pipeline for new business remains resilient. Internationally, Tribal’s pipeline reflects an increasingly geographic spread of potential new customers for its student management systems, in line with its strategic plan.
Tribal’s Solutions business has performed satisfactorily domestically as the market remains relatively quiet but the Group’s range of software-based education improvement services are gaining momentum in Asia Pacific, and are beginning to make progress in the United States and Middle East.
Cash generation from Tribal’s operations has been good, and its net debt levels remain in line with expectations for the full year.
Even though Tribal are seeing the effects of budget constraints on its UK university customers' capacity to purchase enhancements to its SITS student management system, the flow of new opportunities in the Group’s student management systems business in its existing markets is good. In addition to previously announced key new customers secured towards the end of 2012, Tribal have recently been appointed as preferred bidder on two further systems projects for important universities in Asia Pacific.
Elsewhere, geographic expansion within the Group is proceeding well. As identified in the preliminary results announcement in March 2013, North America and the Middle East are currently being explored as potential new markets for Tribal’s university student management system. The Group is now in advanced discussions with two important universities in North America, together with a higher education institution in the Middle East, to deploy its SITS system. Further details are to come.
The integration of i-graduate, which was acquired in January 2013, with the Company’s operational benchmarking activities is proceeding well and Tribal are pleased with the early benefits of collaboration across its combined businesses.
Tribal’s overall activity levels in the UK Vocational Learning market are steady. During 2012, Tribal launched its refreshed Maytas 5 work-based learning student management system, and were pleased with good upgrade demand from our installed customer base in the early part of 2013.
The Group’s work in Asia Pacific is continuing to make good headway. Tribal have successfully met key milestones for delivery of its systems into acceptance testing on the New South Wales Student Administration and Learning Management (SALM) project, prior to anticipated initial implementation in colleges later this year. Also in Australia, Tribal have secured a further analytics contract in Technical and Further Education Colleges (TAFEs) in the state of Queensland, under which it will provide financial and operational benchmarking services to a group of TAFEs. This second such contract represents important progress for the Company’s Solutions activities in Australia, as it broadens its capabilities in the Asia Pacific region.
Tribal’s schools and Early Years quality review and evaluation work continues to progress well, with positive trends in overall inspection volumes. Its quality review programmes in the United States and the Middle East are also extending, and the Company is starting to see good opportunities for its analytics and benchmarking solutions in these markets.
As with its colleges solution, Tribal have successfully met key milestones for delivery of its schools-focused student management system for the SALM project. The Group’s software has moved into acceptance testing, prior to anticipated implementation in an initial selection of schools across New South Wales later in the year. Tribal are also making good progress on its contract with the New Zealand Ministry of Education to provide its own k2 asset management system across all state schools in New Zealand.
Activity levels in the domestic Children's Services market remain good. In addition to its existing local authority management systems, Tribal are now exploring a number of opportunities in the UK to complement its Children's Services management system ‘Synergy’ with schools-based student management system functionality derived from work carried out in Australia.
Keith Evans, Chief Executive, commented;
"Trading in the early months has been as expected, with good progress in particular across our international operations. We look forward to the balance of the year with confidence."
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