Last checked at 12 Jun 2020 07:00
12 June 2020
Half-year End Trading Update
RM plc ("RM"), a leading supplier of technology and resources to the education sector, today issues a trading update for the six months ended 31 May 2020.
Overview
Trading in the first six months of the financial year has been impacted by the COVID-19 outbreak, following the closure of UK and international schools and the cancellation of exams. RM has remained profitable in the first half and as schools and early years settings re-open, trading will improve.
Operating in COVID-19
The health and well-being of our employees and customers is the primary concern for RM. Where possible all RM employees in the UK, India and Australia are working from home. For employees who are not able to work from home, for instance those working in distribution centres and technical engineers on school sites, the Group has put in place a range of safeguarding measures to ensure the working environments are safe and to enable our sites and services to remain operational.
The Board thank all our employees for the commitment and flexibility they have shown through this difficult period.
Actions taken to mitigate the impact
RM entered the COVID-19 crisis in a strong financial position and took action to balance the conservation of cash with the long-term needs of the business. These actions include:
· The Board and Executive team reducing their salaries by 25% and 20% respectively
· Pausing our two major capital programmes, with the expectation they will start again later this year
· Halting recruitment of permanent staff and reducing levels of temporary staffing
· The cancellation of the final dividend declared for FY19
· A significant reduction in discretionary spend
As at 31 May 2020 RM had net debt of £14m (30 May 2019: £21m) against a revolving credit facility of £70m, which has also had its net debt leverage covenant increased from 2.5x to 3.5x for 2020.
Outlook
The situation continues to be too fluid to provide financial guidance for the remainder of the financial year. The Board remains confident that the resilience of the business and the actions taken to conserve cash, alongside our credit facilities, provide RM with a platform to successfully manage through the current uncertainty.
David Brooks, Chief Executive of RM, said:
"In the short term, RM's focus is on continuing to provide our products and services safely to our customers. Looking further ahead, as schools re-open and exam boards restart assessments, RM will play a key role in helping to get education systems back on track and adapt to the new environment."
Contacts:
RM plc
David Brooks, Chief Executive Officer
Neil Martin, Chief Financial Officer
08450 700 300
Headland Consultancy (PR adviser to RM)
Stephen Malthouse (smalthouse@headlandconsultancy.com) 07734 956201
Abena Affum (aaffum@headlandconsultancy.com) 07799 088801
Notes to Editors:
RM plc is a leader in the education sector, providing support throughout the stages of education with its three focused divisions:
· RM Resources is the established provider of education resources for early learning centres, primary schools and secondary schools across the UK and internationally. Our trusted brands, TTS and Consortium, develop and supply resources to help bring the curriculum to life for teachers and students across over 80 different countries.
· RM Results a market-leading provider of e-Assessment services, enabling e-marking, e-testing and the management and analysis of educational data. Every year RM Results provides the technology to help our customer deliver c. 15 million exams, working with world renowned exam providers, professional bodies, education establishments and governments.
· RM Education is a market-leading supplier of ICT software, technology and services in the UK. It helps schools save time and money and enables them to enhance the impact of technology on teaching and learning.