Mounting pressure on schools and universities to provide relevant skills and value for money has prompted educators to fork out for Tribal's (TRB) student management systems, which let them pinpoint struggling students. But expansion costs, contract delays and the group's ongoing shift from offering support services to software meant adjusted operating profit fell in three of its four divisions. Group trading profit was down 8 per cent to £14.5m.
The professional division suffered from the phasing out of less profitable activities such as careers advice. But international turnover rose 13 per cent as Tribal inked deals abroad. For example, the group is rolling out systems to 200 technical and further education campuses across the Australian states of Tasmania, Queensland and New South Wales. The recent acquisition of Callista, whose software is used by around a quarter of Australian universities, should support further growth.
Over the next three years, management wants to grow Tribal's software, analytics and international revenues, widen its operating margin and increase adjusted EPS by a half to 17p. Beyond that, management has set its sights on the Middle East, Europe and the US; India and Brazil present a greater challenge because "people are cheaper than software" there.
Broker Canaccord Genuity expects pre-tax profit of £17.1m, giving EPS of 14.3p (from £13.4m and 11.3p in 2014).
| TRIBAL (TRB) | ||||
|---|---|---|---|---|
| ORD PRICE: | 177p | MARKET VALUE: | £168m | |
| TOUCH: | 177-179p | 12-MONTH HIGH: | 204p | LOW: 144p |
| DIVIDEND YIELD: | 1% | PE RATIO: | na | |
| NET ASSET VALUE: | 58p* | NET DEBT: | 21% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 104 | -0.4 | -0.5 | 2.50 |
| 2011 | 108 | 3.7 | 3.5 | 1.00 |
| 2012 | 115 | 10.0 | 8.5 | 1.25 |
| 2013 | 125 | 13.5 | 11.5 | 1.60 |
| 2014 | 124 | -6.3 | -8.4 | 1.80 |
| % change | -1 | - | - | +13 |
Ex-div: 11 Jun Payment: 10 Jul *Includes intangible assets of £101m, or 107p a share | ||||
