Education
| |
Six months ended
30 June 2008
£’000 |
|
Pro forma
six months ended
30 June 2007
£’000 |
| Revenue |
50,527 |
|
45,523 |
| Operating profit |
7,483 |
|
7,961 |
| Operating profit margin |
14.8% |
|
17.5% |
| |
|
|
|
Our education business saw an increase in revenue of 11% to £50.5m (2007: £45.5m) during the six month period ended 30 June 2008. Operating profit was £7.5m (2007: £8m) and the operating margin was 14.8% (2007: 17.5%).
The anticipated fall in operating margin was as a result of two principal factors: first, a reduced contribution from higher margin activities, in particular software products, in comparison to the very high levels recorded in the first quarter of last year; second, planned investment in new products and services and increased business development activity. Our expectation is that operating margins in the second half of the year will be broadly similar to those achieved in the first
six months.
Tribal continues to build its reputation as a leading provider of a wide range of services that support the delivery of education and learning in early years, schools, further education (FE), higher education (HE) and workplace settings. Our expertise in key government policy areas places us in a strong position to respond to the drive for cross-department working and we have secured several important contracts with the Department for Children, Schools and Families (DCSF) and the Department for Innovation, Universities and Skills (DIUS) and their supporting agencies.
The Government remains committed to a range of important policy initiatives and we expect to continue playing a significant role in providing support services in areas such as workforce training and development, school improvement, employability and welfare to work.
Learning and publishing
Our learning and publishing business remains a ‘partner of choice’ in respect of the Government’s Skills for Life and Family Learning initiatives, where contract extensions valued at £2.8m have been secured during the period from the Quality Improvement Agency (QIA).
Our work on employee skills training continues to grow with new contracts from the Learning and Skills Council (LSC) to deliver Train to Gain and from McDonald’s to support their innovative pilot apprenticeship programme. Our work with Ford Motor Company has been recognised with a Business in the Community award for excellence and innovation.
We have also been successful in tendering for contracts worth up to £5.8m to deliver employability programmes for the LSC. We have recently signed a major new contract with the QIA to improve the quality of teaching in the FE sector as part of the Science, Technology, Engineering and Mathematics (STEM) programme. This three-year programme is worth over £3m in the first year.
We have seen a flow of opportunities from the Middle East and are developing proposals to support school assessment in Saudi Arabia. We have also been successful in the initial stage of bidding for the Offender Learning and Skills programme.
Software
Our software business is a leading supplier of student and institutional management information systems, with significant market shares in FE, HE and work-based learning. Recent wins include a £3.1m contract with the DCSF to manage an information system for parents and providers, and a £1.2m contract to develop an adult social care placement portal for Skills for Care. We won major contracts in HE with Sheffield Hallam and Kingston universities, and with Coleg Gwent, the largest FE college in Wales. In work-based learning, we secured a contract for an online learning tracking system for Jaguar and Land Rover’s apprenticeship programme. An integrated solution developed jointly by our software and regeneration teams secured our appointment to create a regional
e-procurement portal for One NorthEast regional development agency.
Our children’s services management information systems are helping local authorities to deliver more efficient, integrated services as required by the Government’s Children’s Plan.
Our developers also provide innovative technology solutions for key Tribal contracts and clients, including the National Centre for Excellence in the Teaching of Mathematics and the National Science Learning Centre.
Our pipeline of international work has increased and we are currently exploring opportunities in several different markets.
Services
In services, we continue to provide a high quality service inspecting a third of England’s secondary schools on behalf of Ofsted. We have been invited to participate in the initial stage of the bidding process for the new inspections contracts which will operate from September 2009. In FE, the QIA has awarded us the Improvement Advisory Service contract for a further two years at an annual value of £1.5m.
Raising the quality of provision in schools is at the heart of government policy and we were pleased to be appointed preferred bidder for a contract initially worth £1m to deliver the Greater Manchester Challenge. The programme focuses on improving the performance, quality and achievements of 30 secondary schools across 10 local authorities and there is the potential for us to provide a range of additional services and to support a further 30 schools. This will place Tribal in an ideal position to support the Government’s National Challenge programme, which is designed to raise achievement across the 638 secondary schools which are failing to hit the benchmark for GCSE performance. The Government has committed £420m to this programme over the next three years.
We are the transformation advisers to Catalyst Lend Lease, one of two bidders for the Salford City Council Building Schools for the Future (BSF) programme. We are also advising six local authorities on transformation through innovation in education and Information and Communication Technologies (ICT), including the Royal Borough of Kensington and Chelsea and Kirklees Council.
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