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Learning Tech surges as solid results prompt divi hike

Trading was strong across the board in 2016, with recent acquisition Rustici making a solid contribution
two men discussing something on a laptop
Organisations are paying more attention on how to best train their staff for the benefit of the business

Shares in Learning Technologies Group PLC (LON:LTG) zipped higher in early deals as the e-learning specialist posted a solid set of full-years.

The firm said performance last year was strong across the board, including in the US with its Rustici software division which it acquired last January for US$26mln.

As a result, revenues for the 12 months to 31 December 2016 jumped 42% to £28.3mln (2015: £19.9mln), while recurring revenues – which are important for a company’s visibility – almost tripled to 27% (2015: 10%).

Learning Tech also diversified its revenue streams away from the UK, with international sales now accounting for 36% of the business (2015: 12%).

WATCH: Learning Tech boss "very pleased" with progress ...

Margins also improved last year to 27% (2015: 22%), which helped to push up adjusted underlying earnings (EBITDA) to £7.7mln (2015: £4.3mln).

The AIM-listed group did post a loss before tax of £1.2mln (2015: £1.2mln profit), although this was down to costs related to the acquisitions of Rustici and US$3mln investment in learning analytics firm Watershed Systems.

As a result of the strong trading performance, Learning Tech hiked its dividend by 40% to 0.21p per share.

“2016 was another fantastic year for LTG during which we delivered strong revenue and profit growth as well as completing the acquisition of Rustici Software and investment in Watershed Systems,” said chief executive Jonathan Satchell.

“LTG is very well placed in its digital learning segment of the global corporate training market and it is pleasing to see that recurring revenues increased to 27% and revenues outside of the UK to 36%.”

Pleasingly for investors, the fine form has continued into 2017, with the company stating that trading so far has been “significantly ahead of last year”, boosted by a “healthy” order book.

LTG is expecting sales to continue on their upward trajectory, and margins to strengthen again.

Back in February, the company agreed to buy managements software group NetDimensions (Holdings) Limited (LON:NETD) in £54mln cash deal and it said today it is “excited by the opportunities already identified” from the acquisition.

Non-executive director Peter Gordon is stepping down from his position, with effect from today, to take on the role of managing director at NetDimensions.

Shares were up 5.5% in early deals to 46.4p.

View full LTG profile View Profile

Learning Technologies Group plc Timeline

CN Research
December 07 2016

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