TIDMTRB
RNS Number : 1343N
Tribal Group PLC
28 January 2021
28 January 2021
Tribal Group plc
("Tribal" or "the Group")
Trading Update
Strong sales performance builds platform for growth
Tribal (AIM: TRB), a leading provider of software and services
to the international education market, today announces the
following trading update in respect of its financial year ended 31
December 2020. The Group expects to announce its audited full year
results on 17 March 2021.
Resilient trading performance
The Board is pleased to report that a strong sales performance
in the year has resulted in Annual Recurring Revenue (ARR)
committed at the period end increasing 12% to GBP47.5m (2019:
GBP42.4m), demonstrating the successful ongoing execution of the
Group's SaaS transition strategy. The Group has shown great
resilience in the year and anticipates reporting results in line
with current market expectations upgraded in October 2020(1) ,
delivering revenue in the region of GBP73.0m (2019: GBP78.2m),
adjusted EBITDA(2) of approximately GBP14.9m (2019: GBP15.4m) and
adjusted EBIT(2) of approximately GBP11.8m (2019: GBP11.7m).
Strong cash balances have been maintained and the Group ended
the year with a net cash position of GBP9.5m (2019: GBP16.5m), with
no debt drawn; all furlough benefits received and all temporary tax
deferrals were repaid in the year. The net cash position is after
paying an interim dividend of GBP2.2m, the one-off payment of
GBP8.1m to settle the platform dispute, as well as continued
investment in Tribal Edge of GBP6.6m (2019: GBP5.9m). Cash
generation excluding these items was GBP10.0m.
Strong sales execution
The Group had a positive end to the year, closing a number of
significant sales to new and existing customers, and expanding into
new territories in South East Asia.
Across the year Tribal won four new SITS:Vision Student
Information Systems customers being Kaplan Business School
Australia, Chartered Accountants Australia and New Zealand (CAANZ),
Arden University in the UK, and Nanyang Technological University in
Singapore.
Our success with Nanyang Technological University validates
Tribal's strategy to provide complete, integrated Student
Information Systems managed in the public cloud, covering the
complete student journey, from pre-admission through to graduation.
The GBP16.9m, eight year contract encompasses SITS in the
Tribal:Cloud and Tribal Edge products, together with Tribal Student
Marketing & Recruitment and Tribal Student Support &
Welfare.
Ongoing Innovation
The Group's cloud offering was enhanced in the year through the
launch of Tribal :Cloud, enabling all existing products to be
hosted and managed by Tribal in the public cloud, resulting in cost
efficiencies for our customers whilst significantly increasing
Tribal's share of wallet. There were two significant Tribal:Cloud
sales in the second half of the year to existing customers: the
University of Sydney in Australia and King's College London in the
UK, and a growing pipeline across the existing customer base.
We continued to deliver on our Tribal Edge strategy, which
provides a compelling vision to new and existing customers to
embrace our next-generation, best-of-breed, cloud native Student
Information System (SIS) solutions. As a cloud native SIS, Tribal
Edge provides a competitive differentiator in targeting and
acquiring new customers. In addition, it protects Tribal's customer
base into the future by providing the most efficient, lowest cost
route to achieve a comprehensive, integrated, open-standards SIS
which maximises the student experience and reduces the technical
complexity and IT cost for our customers.
Tribal Edge Submissions, the first Tribal Edge product, was
launched on schedule during the year, and successfully sold to all
12 of our current Australian University customers, as well as to
TAFE New South Wales. Our continued investment in Tribal Edge has
seen the first version of Tribal Edge Admissions completed in
December; it will be released to early adopters in the first half
of 2021.
In Education Services our team proved their adaptability in the
face of Covid-19, with the key assurance, training and inspections
contracts in the UK, US and New Zealand continuing largely
remotely. The inspections contract with ADEK in the Middle East was
paused due to Covid-19 school closures but is expected to resume
upon relaxation of Covid-19 restrictions. The benchmarking and
student surveys work continued; however, the larger Student
Barometer survey for the southern Hemisphere had to be delayed to
2021.
Outlook
Tribal enters the current financial year with increased levels
of revenue visibility due to the strong sales performance in 2020,
a strengthened position in South East Asia through the addition of
Nanyang Technological University to the customer base and a
considerably expanded addressable market through the launch of
Tribal:Cloud and imminent launch of Tribal Edge Admissions.
The safety and well-being of the Group's employees and customers
remains a priority, as we continue to monitor the impact of
Covid-19 both on Tribal and Education as a whole. The financial
impact of Covid-19 and the changing expectations of students, means
that never has the need for cloud-based solutions for the Education
market been more pressing. The investments the Group continue to
make position Tribal at the forefront of this evolution in the
industry, providing for an exciting future for the Group.
Overall, the Board looks forward to the year ahead with
confidence.
Mark Pickett, Chief Executive Officer of Tribal, commented:
"I am very proud of how the Tribal team performed in 2020 adding
a number of significant new customers against the challenging
backdrop of Covid-19 while delivering on our product expansion
strategy.
"The addition of Nanyang Technological University has
strengthened our presence in South East Asia and validated our
strategy of providing complete, integrated Student Information
Systems managed in the public cloud to our customers.
"Our Tribal:Cloud and Tribal Edge products provide significant
opportunities with our existing and new customers as they focus
increasingly on standardisation and efficiency. We expect to see
further sales across 2021. The growth of our Annual Recurring
Revenue provides us with a strong platform as we enter 2021 and the
Board is confident in the outlook for the year ahead ."
(1) In so far as the Board is aware, prior to this announcement,
market expectations for the year ending 31 December 2020 were for
revenue of GBP72.6m, adjusted EBITDA of GBP14.8m and adjusted EBIT
of GBP11.5m.
(2) Adjusted EBITDA and Adjusted EBIT is in respect of
continuing operations excluding restructuring costs, share based
payments and provision for the platform dispute settlement.
END
Tribal Group plc Tel: +44 (0) 117 311 5293
Mark Pickett, Chief Executive Officer
Paul Simpson, Acting Chief Financial
Officer
Ken Lewis, Company Secretary
Investec Bank plc (NOMAD & Joint Tel: +44 (0) 20 7597 5970
Broker)
Sara Hale, Virginia Bull, Will Godfrey
N+1 Singer Capital Markets Limited Tel: +44 (0) 20 7496 3000
(Joint Broker)
Shaun Dobson, Tom Salvesen, Alex
Bond
Alma PR Tel: +44 (0) 203 405 0205
Caroline Forde, Robyn Fisher, Josh
Royston, Molly Gretton
About Tribal Group plc
Tribal Group plc is a pioneering world-leader of education
software and services. Its portfolio includes Student Information
Systems; a broad range of education services covering quality
assurance, peer review, benchmarking and improvement; and student
surveys that provide the leading global benchmarks for student
experience. Working with Higher Education, Further and Tertiary
Education, schools, Government and State bodies, training providers
and employers, in over 55 countries; Tribal Group's mission is to
empower the world of education with products and services that
underpin student success.
This Statement has been prepared for and is addressed only to
our shareholders as a whole and should not be relied on by any
other party or for any other purpose. Tribal, its directors,
employees, agents or advisers do not accept or assume
responsibility to any other person to whom this Statement is shown
or into whose hands it may come and any such responsibility or
liability is expressly disclaimed. This Statement may contain
forward-looking statements. Any forward-looking statement has been
made by the directors in good faith based on the information
available to them up to the time of approval of this Statement and
should be treated with caution due to the inherent uncertainties,
including both economic and business risk factors, underlying such
forward-looking information. To the extent that this Statement
contains any statement dealing with any time after the date of its
preparation, such statement is merely predictive and speculative as
it relates to events and circumstances which are yet to occur and
therefore the facts stated and views expressed may change. Tribal
undertakes no obligation to update these forward-looking
statements.
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END
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