Slide 1: Full Year Results 2023
Full Year Results 2023 Thursday, 14 March 2024 Mark Cook Chief Executive Officer Simon Goodwin Chief Financial Officer
Slide 2: Agenda
Agenda FY23 Financial Looking Q&A Overview Review Forward Mark Cook Simon Goodwin Mark Cook Chief Executive CFO Chief Executive 2 RM plc Full Year Results 2023
Slide 3: FY23 Overview
FY23 Overview Mark Cook, CEO 3 RM plc Full Year Results 2023
Slide 4: FY23 Overview: Financial results impacted by Consortium under performance
FY23 Overview FY23 Overview Financial results impacted by Consortium under performance, business stabilised • EVO IT system & Consortium business permanently ceased, distribution centres consolidated, TTS unleashed • FY23 delivered in line with guidance at operating profit £0.3m and EBITDA £7.0m • R
Slide 5: FY23 Overview: New strategic, operational and management change
FY23 Overview FY23 Overview New strategic, operational and management change enabled to unlock value in RM • Strategic plan unveiled to become leading EdTech company serving global customers - New long term customer contracts to support Global Accreditation Platform • New highly skilled leadership i
Slide 6: Financial Review
Financial Review Simon Goodwin, CFO 6 RM plc Full Year Results 2023
Slide 7: FY23 financial summary
Financial review FY23 financial summary • £7.0m EBITDA, down 45.7% £195.2m • £10m of annualised cost savings initiated in year Revenue (8.9%) • £46.9m of exceptional costs, offset by £24.21m of gains from £175.9m excluding sale of assets consortium (2.3%) – £43.2m of costs relating to closure of Con
Slide 8: Summary Income Statement
Financial review Summary Income Statement FY 2023 FY 2022 Variance £m Continuing1 Discontinued2 Total Continuing1 Discontinued2 Total Total Revenue 195.2 2.4 198.0 214.2 4.9 219.1 (21.1) Adjusted* operating Profit 0.3 0.8 1.1 7.5 1.6 9.1 (8.0) Adjusted* operating Margin 0.2% 33% 1% 4% 33% 4% 37% Net
Slide 9: Revenue
Financial review Revenue £m Revenue down 8.9% £(18.9)m 3.4 -6 1.3 -3.2 214.2 -14.4 195.2 FY 22 Assessment TTS TTS - International Technology Consortium FY 23 • Assessment up 9% on prior year benefitting from further volume growth with existing customers and additional contract wins • TTS down 10% on
Slide 10: Adjusted operating profit
Financial review Adjusted* operating profit £m Adjusted* operating profit down £7.2m £(7.2)m -1.8 2.9 -1.5 7.5 -2.1 -4.7 0.3 FY 22 Assessment TTS Technology Corporate RM Consortium FY 23 • Assessment profits were up £2.9m to £10.3m driven by 9% revenue growth and improved operational efficiency • TT
Slide 11: Cashflow
Financial review Cashflow Elevated net debt underpinned by new banking facility to July 2026 £m 46.8 3.4 0.5 £[x]m 45.6 5.7 (21.9) 4.5 1.0 11.5 (5.9) Significant negative movement is one-off and will not repeat Adjusted* Proceeds from Operating Working Capex Pension Interest Paid Lease Other Adjuste
Slide 12: Financial outlook & guidance
Financial review Financial outlook & guidance • FY24 revenue from the ongoing business expected to grow with high single digit % • Significant changes to ongoing cost base: – £6m benefit to FY24 from annualisation of £10m of cost saving initiatives initiated in FY23 – Partial in year benefit from £1
Slide 13: Looking forward
Looking forward Mark Cook, CEO 13 RM plc Full Year Results 2023
Slide 14: New RM
Looking Forward New RM Vision To enable the improvement of educational outcomes around the world RM plc original pioneers of Purpose To enrich the lives of learners EdTech Oxford, England Values Trust, Innovation, Responsibility, since 1973 Enjoyment, Customer focus Our purpose is still valid – EdTe
Slide 15: RM vision and drivers
Looking Forward RM vision and drivers Vision What we’re going to do Where we’re going to be One company, one clear Investment in the digital A company that has 3-4x go-to-market approach transformation of education the value today Products and solutions from Focus on RM USPs and digital A de-leverag
Slide 16: Education landscape and EdTech opportunities
Looking Forward Education landscape and EdTech opportunities EdTech Market Education Education Challenges Opportunities 01 02 The Challenges The Opportunities • Access to quality Education • Online learning • Funding • Immersive learning • Teacher shortages • Gamification • Educational disparities •
Slide 17: RM strategic pillars
Looking Forward RM strategic pillars Global Lifetime of Opportunity Learners Curriculum focused Products and solutions from across the world, $222bn early life to professional EdTech market. Accreditors Global Owned, Educators, Accreditation designed IP Learners, Platform Majority of revenue Custome
Slide 18: Our global customer reach
Looking Forward 1 ar Our global customer reach ill P RM products & Sweden solutions support UK Lithuania Canada Ireland >10m students Poland China Globally Slovenia USA 28,000 Schools, Pakistan EMEA Nurseries and Trusts Caribbean world-wide Nigeria Singapore 115 countries South America Network of 13
Slide 19: RM global customer base
Looking Forward 1 ar RM global customer base ill P 28,000 schools, trusts & educators Blue Chip long-term customer credentials built on trust, partnership, & deliverables 19 RM plc Full Year Results 2023
Slide 20: New customer centric solutions
Looking Forward 3 New customer centric solutions ar ill P Assessment Accreditors Global platform delivery of exam making and Full end-to-end Digital Accreditation Platform end-to-end assessment process. with SaaS offering • 20m online & marked tests p.a. in 180 countries BUT Solutions for formative
Slide 21: Education is on a digital transformation
Looking Forward 4 ar Education is on a digital transformation ill P We innovate approaches to digital assessments across practice, progress, evidence collection and exams, and we work with customers throughout the lifelong learning journey. RM Digital Assessment Journey Enhancing Going Embedding Tra
Slide 22: RM Portfolio Roadmap
Looking Forward 5 RM Portfolio Roadmap ar ill P FY24 FY25 FY26 Platform Full end-to-end global digital accreditation platform Accreditors Solutions Adaptive Learning Educator Solutions Managed Services Educational Resources Global ‘Tech in a Box’ solution Digital curriculum teaching aids Educators N
Slide 23: Summary
Summary Mark Cook, CEO 23 RM plc Full Year Results 2023
Slide 24: Summary
Summary Summary New strategic and operational change enabled to unlock value in RM • New highly skilled leadership in place with focus on delivery, culture and business capability • Complex projects delivered on time and to plan • New long term customer contracts to support Global Accreditation Plat
Slide 25: Appendix
Appendix 25 RM plc Full Year Results 2023
Slide 26: Global EdTech Market
Appendices Global EdTech Market UK Investment Investment in EdTech in UK, with a covid peak of $609m in 2021 Value Drivers of Growth Global market worth New Tech available for Online US$222bn* in 2023 The EdTech & Distance Learning Market CAGR c.12% globally from Key segments 2024-32 Hardware, softw
Slide 27: Global E-learning Market
Appendices Global E-learning Market 2019 vs 2026 • The E-learning market is growing more than any other segment in the market buoyed both by new technologies and changing consumer behaviour. • Adaptive learning is a goal for many companies • Providing platforms where content can be delivered is also
Slide 28: Income Statement
Appendices Income Statement FY 2023 FY 2022 £m Adjusted Adjustments Total Adjusted Adjustments Total Revenue 195.2 - 195.2 214.2 - 214.2 Cost of sales (129.1) - (129.1) (145.7) - (145.7) Gross profit 66.1 - 66.1 68.5 - 68.5 Gross profit % 33.9% 33.9% 32.0% 32.0% Operating expenses (65.8) (46.9) (112
Slide 29: Balance Sheet
Appendices Balance Sheet 30 30 November November £m 2023 2022 Goodwill 38.5 49.4 Intangible assets 5.2 25.5 Property, plant & equipment 8.3 15.9 Defined benefit pension surplus 12.8 24.0 Other receivables 0.2 0.2 Right-of-use assets 14.3 16.4 Contract fulfilment assets 2.0 1.7 Deferred tax assets 0.
Slide 30: Cashflow
Appendices Cashflow £m FY 2023 FY 2022 (Loss)/profit from operations, including discontinued operations (41.2) (20.0) Depreciation, amortisation and impairments 47.1 9.5 Increase in provisions 3.8 1.5 Utilisation of contract fulfilment asset 2.5 2.3 Other adjustments (4.6) (0.2) Operating cash flows
Slide 31: Consortium closure
Appendices Consortium closure The decision to close the Consortium business ends a Significant actions had already been taken to reduce the prolonged period of declining performance and significant Consortium losses; however, its closure should still deliver investment which has damaged the RM busin
Slide 32: Pension
Appendices Pension IAS19 Surplus/(deficit) (£m) • IAS19 pension surplus reduced by 6% 40 £10.2m to a £12.4m surplus. 30 • Reduction in the surplus has been driven by a decrease in the value of 5% 20 Scheme assets more than offsetting the positive impact of higher discount rates. 10 4% • Deficit reco
Slide 33: Disclaimer
Disclaimer Forward-looking statements speak only as at the date of this Presentation. Except as required by applicable law or regulation (including to meet the requirements of the London Stock Exchange Rules, the Market Abuse Regulation as it forms part of domestic law in the United Kingdom by virtu