Learning Technologies Group PLC Pre Close Update (2987U)

TIDMLTG

RNS Number : 2987U

Learning Technologies Group PLC

17 January 2017

17 January 2017

Learning Technologies Group plc

("LTG" or the "Company")

(AIM: LTG)

Pre Close Update

Strong cash generation and profit ahead of expectations

Learning Technologies Group plc, the leading e-learning company, is pleased to announce a trading update for the year ended 31 December 2016.

Financials

Profit for the year was ahead of market expectations, with EBITDA margins firmly ahead of LTG's strategic ambition of 20 per cent.

The Group has increased its recurring revenues to c27% in 2016 from c10% in 2015. Over the same period, revenues generated outside of the UK have risen from c12% to c36%. These trends underpin the Group's successful development of new learning technology solutions and expansion into new geographical markets.

Cash generation remains strong with gross cash at 31 December of GBP5.3 million and net debt of GBP8.5 million (2015: net cash GBP7.3 million), after significant operational investment.

In January 2016, the Company acquired Rustici Software LLC ("Rustici"), the acknowledged global leader in digital learning interoperability which enables online content and management systems to communicate and work together. The Board is pleased to report that, since acquisition, this business has performed significantly ahead of expectations.

In December 2015, LEO, in a strategic alliance with KPMG UK LLP ("KPMG"), won a formal tender process to provide learning and development services for the entire UK Civil Service ("CSL"). In less than a year, we have redesigned and built the entire core curriculum for 400,000 civil servants, creating a more engaging and 'blended' offering for its learners. Revenues have begun to accrue in 2016 in line with our plans and will grow significantly in 2017 onwards.

Preloaded and Eukleia are engaged in large scale, global learning campaigns in 2017, for a fast food restaurant chain and a global bank respectively. gomo continues to build on its success by adding enterprise customers such as the Foreign and Commonwealth Office, Telefonica, the BBC, Fujitsu and Vodafone.

Acquisitions

LTG continues to pursue acquisition opportunities to diversify and deepen its strategic consultancy, creation, delivery, and analytics offering in the learning technologies market.

Andrew Brode, Chairman said:

'The Group has made excellent progress during 2016. In addition to the acquisition and strong subsequent performance of Rustici in the US, LEO has successfully completed the largest contract that it has ever undertaken. The revenues from this, combined with other strategic wins, will have a transformational impact on profits in 2017 and beyond."

"LTG has made great strides in delivering on its strategic objectives to create an international e-learning business of scale. EBITDA margins are now firmly in the mid twenties, underpinned by strong recurring revenues and expansion of sales outside our core UK market, and we have entered the new financial year with significant momentum. The Board is confident of delivering further strong performances given the Group's industry leading capabilities in a fast growing sector."

It is anticipated that the Group's preliminary results for the year ended 31 December 2016 will be announced at the beginning of April 2017.

Enquiries:

 
 Learning Technologies Group 
  plc 
  Jonathan Satchell, Chief 
  Executive 
  Neil Elton, Group Finance         +44 (0)20 
  Director                          7402 1554 
 
 Numis Securities Limited 
  Stuart Skinner / Michael 
  Wharton (Nominated Adviser)       +44 (0)20 
  Ben Stoop (Corporate Broker)      7260 1000 
 
 Hudson Sandler Limited             +44 (0)20 
  Cat Valentine / Bertie Berger     7796 4133 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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January 17, 2017 02:00 ET (07:00 GMT)