REG - Northcoders Group - Trading Update

NorthcodersAnnouncement

28/01/2025 07:00

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RNS Number : 8495U  Northcoders Group PLC  28 January 2025

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ('MAR'). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

 

 For immediate release  28 January 2025

 

 

Northcoders Group PLC

('Northcoders', the 'Group' or the 'Company')

 

Trading Update

 

'FY-2024 in line with expectations; well positioned for medium term growth'

 

Northcoders (AIM:CODE), a market leader in technology training in the UK, is
pleased to provide the following trading update for the year ended 31 December
2024 (the 'period' or 'FY-2024').

 

The Group reports that underlying FY-2024 trading is in line with market
expectations.  Unaudited revenue for the period increased by 24% to £8.8
million (FY-2023: £7.1 million), driven by increasing demand for digital
training. As anticipated, efficiencies provided by the Group's NCore
technology platform and product maturity have enabled a large year-on-year
profitability increase in line with expectations.  The Group maintains a
robust financial position with £1.2 million of cash as at 31 December 2024
(31 December 2023: £1.6 million) and net cash of £0.75 million (31 December
2023: £0.8 million).

 

Despite the wider macro-economic uncertainty, the Group's Training Bootcamp
division has delivered a resilient performance with enrolments up by 15% to
1,339 (FY-2023: 1,167). Registrations grew by 24% to 10,575 (FY-2023: 8,535)
and the hiring partner network increased to 510 companies (FY-2023: 465
companies). The premium reputation for quality enjoyed by Northcoders training
programmes across software development, data engineering and cloud engineering
(DevOps) programmes fuelled further expansion across the UK, helping address
the ongoing national digital skills shortage.

 

Training for students outside of the core delivery in England continues to be
a priority, with Northcoders receiving 474 registrations from outside of
England (FY-2023: 320 registrations).  The Group has continued its strategy
to focus on virtual training, given its more scalable and profitable model.

 

There has been further momentum in Counter®, the Group's consultancy brand,
with the initial pilot contracts progressing well, and discussions regarding
the commercial terms of renewals now underway.  Furthermore, Counter® has
secured a full contract with a large airport group, which has commenced, and
the pipeline for future sales opportunities is growing.  In November 2024,
the Group announced that it had been successfully accepted onto the G-Cloud 14
government framework, positioning Northcoders strongly for additional
investment into the public sector, including the NHS.

 

Current Trading and Outlook

 

FY-2025 has started promisingly across the business, further supported by the
successful office move in Manchester that provides lower costs and more
flexibility to the business. While the change in Government that took place in
July 2024 has introduced some changes to the timing and structure of public
funding for digital training, including a potential shift to regional
contracts.

 

The Group's current Department of Education contract provides visibility until
July 2025 and there is confidence, although not certainty, that decisions
about future structures will have been made by then, with national extension
conversations underway.  Alongside this, there are a number of local
frameworks with open regional bids which offer funding opportunities for
Northcoders and the Group has begun these bidding processes.

 

The Government's commitment to enhancing digital skills, particularly through
AI utilisation for economic growth, presents significant opportunities.

 

The Company has considered the changes to Employer's National Insurance
announced in the 2024 Autumn Budget which will take effect from April 2025.
 As a result, it estimates it will have approximately £0.15 million of
additional costs in FY-2025 and has taken actions to streamline the business
in Q4 FY-2024 and Q1 FY-2025 which will to some extent protect Group
profitability in the year ahead.

 

The Company is highly cognisant of the challenging corporate hiring market,
and whilst this is extending decision making for potential clients,
Northcoders is confident that the Counter® model, which provides corporates
with a long-term talent solution, at a lower cost, positions the Company
strongly in the medium term.

 

Chris Hill, CEO and Founder of Northcoders, said: "We are pleased to report
another year of significant progress for Northcoders, with our strategic
investment into our products and infrastructure leading to a material increase
in profitability in the period.

 

"Whilst conscious of the hiring challenges felt in the wider UK recruitment
market, there continues to be a fundamental gap in digital skills which acts
as a barrier to economic growth and, as such, we remain confident in the
underlying demand for our services. We believe the steps taken to diversify
our revenue streams, through the launch of the Counter® consultancy business,
combined with the ongoing expansion of the Northcoders brand in the UK,
position us strongly as we start the new financial year."

 

- Ends -

 

 For further enquiries:

Northcoders Group plc                          Via Burson Buchanan
 Chris Hill, CEO                                Tel: +44 (0) 20 7466 5000
 Charlotte Prior, CFO                           investors.northcodersgroup.com (https://investors.northcodersgroup.com)

 Zeus (Nominated Adviser & Joint Broker)        Tel: +44 (0) 20 3829 5000
 Mike Coe / Darshan Patel (Investment Banking)

 Fraser Marshall / George Krokos (Sales)

 

Peterhouse Capital Limited (Joint Broker)  Tel: +44 (0) 20 7496 0930
 Martin Lampshire                           www.peterhousecap.com (http://www.peterhousecap.com/)
 Lucy Williams

Duncan Vasey

 Burson Buchanan                            Tel: +44 (0) 20 7466 5000
 Henry Harrison-Topham                      northcoders@buchanan.uk.com (mailto:northcoders@buchanan.uk.com)
 Steph Whitmore                             www.bursonbuchanan.com (http://www.bursonbuchanan.com/)

 Jesse McNab

 

 Peterhouse Capital Limited (Joint Broker)  Tel: +44 (0) 20 7496 0930
 Martin Lampshire                           www.peterhousecap.com (http://www.peterhousecap.com/)
 Lucy Williams

Duncan Vasey

 Burson Buchanan                            Tel: +44 (0) 20 7466 5000
 Henry Harrison-Topham                      northcoders@buchanan.uk.com (mailto:northcoders@buchanan.uk.com)
 Steph Whitmore                             www.bursonbuchanan.com (http://www.bursonbuchanan.com/)

 Jesse McNab

 

 

Notes to Editors

 

Northcoders is a market leading provider of technology training for businesses
and individuals with courses in, Software Engineering, Data Engineering and
Platform Engineering.  Founded in 2015, the Group's business model operates a
hybrid structure with a flagship site in Manchester and other sites in Leeds,
Birmingham and Newcastle supported by a proven digital offering to support
its students across the UK.

 

Powered by IP rich technology, Northcoders offers boot camp courses to
individuals from a range of backgrounds, delivered through virtual and
physical learning.  The Group also works with blue chip corporates across
multiple sectors to help them to achieve their digital requirements, with
teams as a service and to supply innovative solutions for the upskilling and
reskilling of employees. With a keen focus of inclusivity, diversity and
quality at its core, Northcoders aims to address the digital skills gap in the
UK to meet the increasing demand for digital specialists at all levels, from
businesses and public agencies.

 

Northcoders was admitted to trading on AIM in July 2021 with the ticker
CODE.L.  For additional information please visit
investors.northcodersgroup.com (https://investors.northcodersgroup.com) .

 

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