Digital learning services provider Learning Technologies (LTG:AIM) has reinstated guidance and dividends, and forecast annual performance to meet expectations in the 12 months to 31 December 2020.
The company also unveiled the A$5.5 million acquisition of eCreators, the Australian firm behind the Moodle, open-source learning management system. The deal comes with additional earn-outs of up to A$6.5 million over the next three years.
Learning Technologies reported a fall in profit on lower margins although some may view the relatively modest decline of the adjusted earnings before interest and tax (EBIT) margin from 31.1% to 28.7% evidence of the company’s ability to flex its costs (mainly with freelancers) when times are tougher.
Shares in the company fell 6% to 129.5p on Tuesday.
For the six months to 30 June 2020 the company posted a pre-tax profit decline from £6.8 million to £4.1 million, while revenue increased 2% to £64.1 million.
The company reconfirmed its run-rate target of about £230 million revenue and £66 million EBIT by end 2022.
Another firm sign of improving confidence from the business came from its decision to reinstate the 2019 final dividend of 0.50p alongside a proposed interim dividend 2020 payout of 0.25p.
PRESSURE LETS UP
‘These results paint signs of increasing confidence at Learning Technologies with Covid-19 headwinds easing towards the end of the first half and into the second half for both the Software & Platforms and Content & Services sides of the business,’ said Megabuyte analyst Lee Prout.
The also sees the company staying on the acquisition trail after the ‘relatively low risk’ eCreators deal ‘given the funds in the bank’.