RM results are back in the black

Shares in RM jumped on Thursday following the company's announcement that it had returned to profit for the year ended November 30th 2012.

Shares in RM jumped on Thursday following the company's announcement that it had returned to profit for the year ended November 30th 2012.

Despite a decline in revenue and an increase in sales, the group delivered a profit of £8.75m (2011: loss of £23.38m) after reducing its operating and other expenses.

Subscribe to MoneyWeek

Become a smarter, better informed investor with MoneyWeek.

The adjusted operating profit came in at £13.6m, compared to £14.1m the previous year.

Revenue for the year fell to £288.69m from £350.79m a year earlier, while the cost of sales rose to £217.87m from £260.11m in 2011.

Advertisement - Article continues below

The final dividend payment was increased to 2.25p (2011: 1.53p).

Chairman Martyn Ratcliffe, who announced that he is planning to step down from the board in the summer, said: "The past year has been one of significant change within RM and the Board is pleased with the progress made, particularly in the context of public sector budget constraints.

"Following the restructuring in 2011, the increased focus on working capital resulting in a very strong cash position at the year end and the launch of some exciting new cloud-based products in 2012, RM now has an excellent platform for the future as a leading provider of products, solutions and services into the UK education market.

"Progress against the board's objectives has been very positive. The disposal of loss-making and non-core business activities was completed in the first half of the year, realising cash receipts of £6.3m since the strategic review in September 2011.

"The redundancy programme achieved the necessary streamlining of the group, reducing headcount from 2,699 in September 2011 before the strategic review, to 2,250 in November 2012.

Cash and equivalents at the year end totalled £37.8m, up from £11.3m at the 2011 year-end.

Advertisement - Article continues below

All change at the topAlong with its results, the company announced that David Brooks, the current Chief Operating Officer of the group, has been appointed as the new Chief Executive, effective from March 1st.

Ratcliffe, who was appointed Non-Executive Chairman in June 2011, has announced his intention to leave this summer, and the company said it has started looking for his replacement.

The share price rose 10.64% to 78p by 12:05 Thursday.




Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020
Share tips

Class acts going cheap: buy into Europe’s best bargains

Value investing appears to be making a comeback, while shares on this side of the Atlantic are more appealing on metrics such as price/earnings ratios…
16 Jan 2020

Most Popular


What does the coronavirus crisis mean for UK house prices?

With the whole country in lockdown, the UK property market is closed for business. John Stepek looks at what that means for UK house prices, housebuil…
27 Mar 2020

Coronavirus: what it means for your mortgage or your rent

Ruth Jackson-Kirby looks at all the key questions for owners, renters and landlords affected by the coronavirus crisis.
29 Mar 2020
Small business

Furlough: what does it mean and how does it affect me?

Many companies have “furloughed” employees after they have shut down because of the coronavirus. But what does furlough mean and how does the scheme w…
30 Mar 2020

Buy stocks for the long term, but buy very carefully

After the wild ride of the last couple of weeks, equities are no longer expensive. But if you do decide to buy, be very, very careful indeed, says Mer…
30 Mar 2020