Tribal Restarts Dividend After Swings To 2017 Profit On Cost Cutting

22nd Mar 2018 11:28

LONDON (Alliance News) - Tribal Group PLC on Thursday swung to profit in its full-year results for the first time since 2013 on reduced expenses and "positive sales momentum".

The education software and services group reported pretax profit of GBP3.4 million for 2017 compared with a GBP864,000 loss the prior year.

Despite that, revenue came in down to GBP84.9 million from GBP90.3 million year-on-year, as a result of the expiry of the Ofsted Early Years contract in March and the disposal of Synergy in March 2016. Excluding these items, revenue from continuing operations grew 6.5% to GBP81.9 million from GBP76.9 million in 2016.

In March 2016, Tribal sold its synergy business to Servelec Group PLC for GBP20.3 million.

Profit performance was helped by a sharp fall in costs of sales to GBP42.4 million from GBP51.4 million the year prior. Finance costs also dropped to GBP307,000 from GBP993,000. Overall, Tribal explained the improved financial performance was driven by its cost savings programme, which brought a total of GBP3.0 million savings in 2017.

Tribal ended the year with GBP14.1 million in cash, up 59% from GBP8.8 million it had the year before.

The group decided to reinstate its dividend payments given the "good" overall performance of the business in 2017. Tribal proposed a full year dividend of 1.00 pence per share. The company said this would be paid annually going forwards.

The company said that overall market conditions and demand for student information systems remained stable in 2017. This it expects to continue 2018, as it received several software and service contract wins in the early part the new year.

Tribal Chief Executive Officer Ian Bowles said: "I am very pleased with the 2017 results as they clearly demonstrate that the changes driven by management are having the positive impact anticipated. Representing twenty-two months of a three year turn around, it is my view that we are very much on track. Our customers, partners and the broader team at Tribal are seeing the benefit of a clear long-term strategy and commitment to the Education Sector."

The stock was up 4.5% at 81.50 pence per share on Thursday.

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