RM issues pre-results warning

RM issues pre-results warning

But first-half revenues will not reflect the whole of 2008, says chief executive Tim Pearson

Education specialist RM has issued a warning ahead of the results for its first financial half year to 31 March.

As the key supplier of computers to UK schools and colleges, RM works around a seasonal business model, collecting a large proportion of its profits in the second half of the year.

The group has been affected by the increased cost of bids in the government's Building Schools for the Future (BSF) programme, which will largely fall in the first half-year. The forthcoming results should therefore not be taken as an indicator of the following six months, said chief executive Tim Pearson.

"As has happened in other years, the first half of 2008 has had its challenges and there's more left to do in the second half of the year," he said.

"Looking further ahead, the recent Budget reinforced the government's long-term commitment to education and confirmed the spending levels indicated in last year's Spending Review. Our excellent BSF track record, combined with strong progress across the group, means that we're well positioned for the future."

Lower revenue in the first six months will not be a problem if the group makes amends in the second half, said Ovum analyst Peter Clarke.

"RM is doing all the right things in the education market, but it is important for RM that the second-half revenues align with expectations," he said.