TIDMCODE
RNS Number : 0125H
Northcoders Group PLC
25 July 2023
For immediate release 25 July 2023
Northcoders Group PLC
('Northcoders', the 'Group' or the 'Company')
Government contract win
H1-2023 Trading Update
Northcoders (AIM:CODE), the independent provider of training
programmes for software coding, is pleased to announce that the
Group has been successful in securing further funding from the
Department for Education Skills Bootcamps Wave 4 bid. In addition,
the Group provides a trading update for the six months to 30 June
2023 ('H1-2023' or the 'Period').
Contract win
The Group is pleased to announce that it has successfully
secured further funding from the Department for Education Skills
Bootcamps Wave 4 bid. This new round of funding provides
Northcoders with a further GBP4.5 million to train individuals on
the Northcoders market-leading bootcamp and provides the Company
with strong revenue visibility for H2-2023 and FY-2024. In
addition, it also provides the Group with a 12.5% increase in
funding per student which is expected to increase the gross profit
margins of the Group's training products and assist in covering
recent inflation-linked cost increases.
Trading update
H1-2023 Highlights:
-- Increase in H1-2023 revenue of over 50% in comparison with H1-2022
-- Good FY-2023 revenue visibility with further confirmation of
Skills Bootcamp funding and multiple corporate contracts in
place
-- Strong balance sheet position with GBP2.9 million of cash and
net cash of GBP2.0 million as at 24 July 2023
-- Significant investment into sales, marketing and partnership
functions to ensure success against current economic backdrop
-- Tech Returners, which was acquired in February 2023, has now
been fully integrated into the Business Services division and is
performing well.
The Group is trading comfortably in line with management
expectations. Revenue for the period increased by 52% to GBP3.5
million (H1-2022: GBP2.3 million). As at 30 June 2023, revenue
visibility for FY-2023 was GBP6.75 million, being 70% of the market
expectations for the full year. As forecasted before the start of
the current financial year, it remains the Board's expectation that
FY-2023 revenues will be second half weighted. Substantial business
development progress has been made by Northcoders towards the
visibility of H2-2023's revenue forecast.
In H1-2023 Northcoders' Business Solutions division secured a
number of significant new contracts with large corporate clients
including Deutsche Bank and BAE Systems. The Group also has
confirmation of a repeat programme from KPMG to begin during
Q4-2023 and a healthy business development pipeline which the Board
is confident will further boost full-year revenue visibility during
the coming months. In addition, to strengthening corporate
business, the Business Solutions division has also secured its
first public sector consultancy contract with a major government
department.
The Training Bootcamps division grew its graduate hiring network
by a further 9% by engaging with 76 new organisations for the first
time this year. Northcoders now has a network of over 450 partner
companies to sustain its graduate hiring from training bootcamps.
The Group has also seen increased demand from individuals wanting
to enrol on its core coding bootcamps and Returner Programmes.
Application numbers in the six months to June 2023 stood at 3,494,
which compares favourably with the 3,662 applications in the 12
months to December 2022.
Despite the positive momentum made by the Group in H1-2023, the
current financial year does present a number of market challenges
that demand the Board's full attention. The Group acknowledges the
prevailing headwinds encountered by the technology market,
including budget constraints, workforce reductions and recruitment
freezes that is affecting many of the Group's partner companies,
which potentially might affect the vacancies available to
Northcoders Training Bootcamp graduates. The Board remains resolute
in its approach and continues to inject significant investment into
the Group's corporate sales and partnerships teams across all
Northcoders' divisions. This proactive measure signifies the
Group's total commitment to ensuring exceptional outcomes for the
individuals engaged in its Training Bootcamps and positions the
Group favourably for continued growth within its consultancy
division, Business Services.
Outside of business development activity, the Group is making
significant progress with its investment into its Technology
platform, Ncore, which remains on track for roll-out across all its
Training Bootcamps in early 2024. Ncore is expected to grow our
capacity, increase gross profit margins in the Group's Training
Bootcamps division and bring multiple new ways of taking its
Training Bootcamp products to market, such as the
part-time/distance learning delivery of its courses.
The development of new training courses is going according to
plan. Northcoders' Cloud Engineering training course has been
developed and launched and the Group is pleased to see an increase
in enrolment and employer interest. Northcoders looks forward to
providing more updates about training course development and other
strategic initiatives in the second half of the year.
Northcoders' cash flow continues to benefit from the Department
for Education-funded scholarships being made available to those who
previously utilised the Group's finance provider, which had
absorbed working capital. The Group feels comfortable with current
and forecasted cash positions and has the cash available to
continue with planned investments. Focus will be applied to
cashflow forecasting to ensure that the Group remains this way
during uncertain economic times. The Group has a strong cash
position with GBP2.9 million of cash and GBP2.0 million of net cash
as at 24 July 2023.
Chris Hill, CEO of Northcoders, said: "In spite of challenging
market conditions, the Board is confident of achieving further
growth for the full year. During the period Northcoders won a
number of contracts with large corporates as well as securing
further funding from the Department for Education, providing the
Group with good forward visibility of revenues. The Company is
financially strong and we are well placed to further invest in the
business for growth."
This announcement contains inside information for the purposes
of Article 7 of the UK version of Regulation (EU) No 596/2014 which
is part of UK law by virtue of the European Union (Withdrawal) Act
2018, as amended ("MAR"). Upon the publication of this announcement
via a Regulatory Information Service, this inside information is
now considered to be in the public domain.
- Ends -
For further enquiries: Northcoders Group plc Via Buchanan
Chris Hill, CEO Tel: +44 (0) 20 7466 5000
Charlotte Prior, CFO investors.northcodersgroup.com
WH Ireland Limited (Nominated Adviser & Joint Tel: +44 (0)20 7220 1666
Broker)
Mike Coe / Darshan Patel / Sarah Mather (Corporate
Finance)
Peterhouse Capital Limited (Joint Broker) Tel: +44 (0) 20 7496 0930
Martin Lampshire www.peterhousecap.com
Lucy Williams
Duncan Vasey
Buchanan Communications Tel: +44 (0) 20 7466 5000
Henry Harrison-Topham northcoders@buchanan.uk.com
Jamie Hooper
Notes to Editors
Northcoders is a market leading provider of technology training
for businesses and individuals with courses in, Software
Engineering, Data Engineering and Platform Engineering. Founded in
2015, the Group's business model operates a hybrid structure with a
flagship site in Manchester and other sites in Leeds, Birmingham
and Newcastle supported by a proven digital offering to support its
students across the UK.
Powered by IP rich technology, Northcoders offers boot camp
courses to individuals from a range of backgrounds, delivered
through virtual and physical learning. The Group also works with
blue chip corporates across multiple sectors to help them to
achieve their digital requirements, with teams as a service and to
supply innovative solutions for the upskilling and reskilling of
employees. With a keen focus of inclusivity, diversity and quality
at its core, Northcoders aims to address the digital skills gap in
the UK to meet the increasing demand for digital specialists at all
levels, from businesses and public agencies.
Northcoders was admitted to trading on AIM in July 2021 with the
ticker CODE.L. For additional information please visit
investors.northcodersgroup.com .
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END
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