Tribal Group PLC on Friday reported a fall in annual profit and cut its dividend in half, but it expects good sales momentum in 2023.

Shares were down 6.5% at 35.16 pence each on Friday morning in London.

The Bristol-based educational software and services provider said revenue was £83.6 million for 2022, up from £81.1 million in 2021, following a strong performance across Cloud and Edge offerings and School Inspection Services.

Annual recurring revenue remained flat at £51.2 million, reflecting a ‘10% growth in the group’s strategic products’, Tribal said.

Pretax profit, however, dropped to £387,000 from £8.6 million, as gross profit fell to £31.3 million from £41.8 million a year earlier.

Operating profit fell to £779,000 from £8.9 million in 2021, and adjusted operating profit declined to £17.9 million from £25.8 million

Adjusted earnings before interest, tax, depreciation and amortisation amounted to £7.4 million, down from £16.8 million in 2021. Tribal said the decrease reflected an operating loss relating to the NTU contract and an onerous contract provision of £4.5 million for future losses.

Last week, Tribal said it rejected the right of Singapore’s Nanyang Technological University to terminate a contract between the two and is considering its options regarding the next appropriate steps.

Tribal proposed an annual dividend of 0.65 pence per share, down 50% from 1.3p per share a year prior.

Looking ahead, Tribal said it has entered 2023 with good sales momentum. Despite the lower Ebitda for 2022, the company said its overall prospects remain positive.

Chief Executive Mark Pickett said: ‘We have continued to execute against our growth strategy, transitioning our existing customers to the cloud while securing new customers in our key geographies. Despite the lower Ebitda levels for FY22 due to the substantially increased costs relating to the NTU contract and its subsequent termination, the positive sales performance and successful go live of multiple customer implementations in the year demonstrates the strength of our offerings, effectiveness of our cloud strategy and continued contract and ARR momentum.’

Copyright 2023 Alliance News Ltd. All Rights Reserved.