RM plc: Interim Results

15 July 2025

RM plc

Interim Results for the six months ended 31 May 2025

Progress on improving profitability, on course to meet FY25 expectations

RM plc (‘RM’, the ‘Company’), a leading global educational technology (‘EdTech’), digital learning and assessment solution provider, reports its interim results for the six months ended 31 May 2025.

Financial highlights

Highlights

• Adjusted EBITDA excluding share-based payments increased to £3.5m (HY24 restated: £2.4m) and adjusted operating profit improved by £1.2m to £0.9m (HY24 restated: loss of £0.3m).
• Continued progress on margin improvement and cost control, with annualised cost savings of £20m+ delivered to date since the start of the transformation of RM.
• Revenue from continuing operations1 of £73.2m, down 6.5% (HY24 restated: £78.3m), reflecting the impact of ongoing UK schools budget pressures in Technology and TTS as well as that of tariffs on TTS’s US business, which accounts for c.2% of group revenues.
• Significantly, Assessment revenue increased, with core platform revenue up by 19% in HY25
• Statutory loss after tax of £3.3m (HY24: loss £6.8m)
• Adjusted net debt increased to £59.6m (HY24: £52.7m) due to continued investment in the global accreditation platform, now branded RM Ava.
• Signed extended banking agreement for a further 12 months to July 2027 on broadly similar terms demonstrating supportive banking relationship.
• Triennial valuations for closed defined benefits pension schemes showed swing to surplus of £10.5m, meaning no further contributions expected beyond remaining £1.8m as previously agreed.

Assessment platform showing strong growth

• Launch of RM Ava, the adaptive virtual accreditation platform, in June 2025 enabling integration of all assessment tools into a single sign-on system. The platform will support the global transition to digital assessment and be a key driver of future profitable growth.
• Growth in Assessment’s contracted order book,5 including contracts awarded in H1 and signed in H2, from £95.7m to £106.6m.
• This includes new customer, Trinity College, who has chosen RM to provide assessment solutions using its platform.
• 96% of annualised revenue up for renewal in HY25 was successfully renewed, including SEAB in Singapore, and SACE in Australia, demonstrating customer confidence and improved revenue visibility.

Current trading and outlook

• RM remains on course to meet full year management expectations for adjusted operating profit and adjusted EBITDA.
• As with prior years the Company’s seasonal H2 weighting remains and trading in H2 to date has started on an upward trajectory.
• Assessment revenue growth expected to offset the temporary decline in TTS and Technology by the end of the year.
• Further strategic Assessment customer wins are expected to land in H2, building on the H1 momentum.
• Decision to progress with legal and operational separation of the three divisions, to enable strategic flexibility and unlock further cost saving opportunities.

Mark Cook, Chief Executive of RM, said:

“I’m really pleased with the continued progress we’re making in positioning RM for sustainable, long-term growth. Our profitability has improved further, driven by stronger margins and the benefits of our cost-saving initiatives. The recent extension of our banking facility also underlines the confidence our lenders have in the actions we are taking and our strategic direction.

“In our Assessment division, RM Ava provides us with a compelling platform in an expanding global market, and we’re particularly encouraged by the increase in our contracted order book and customer appetite so far. While ongoing investment in the platform has contributed to the expected increase in net debt, we are confident that this is central to the development of our strategy and will drive significant future growth.

“While UK schools market conditions remain challenging, we see opportunities in both TTS and Technology. We are focused on expanding TTS into international markets and unlocking new contract opportunities for our Technology business, both with multi-academy trusts but also across the broader public sector.

“Our plans to legally and operationally separate our three divisions will enhance our strategic optionality, allowing each business to be more agile and execute more effectively.

“We are building real momentum, and I want to thank all of my colleagues for their continued hard work and commitment in delivering another solid set of results.”

Notes

1. Discontinued operations in HY24 restated include the closure of RM Consortium, which occurred during the second half of the year ended 30 November 2024.
2. Throughout this statement, adjusted operating profit/(loss), adjusted EBITDA excluding share-based payments, adjusted loss before tax and adjusted EPS are Alternative Performance Measures, stated after adjusting items (see Note 4 to the financial statements) which are identified by virtue of their size, nature and incidence. The Group reports adjusting items which are used by the Board to monitor and manage the performance of the Group, in order to ensure that decisions taken align with the Group’s long-term interests. The treatment of adjusted items is applied consistently year-on-year.
3. The definition of adjusted EBITDA has been redefined to exclude share-based payment charges and comparatives have been restated. See Note 4.
4. Adjusted net debt is defined as the total of borrowings less capitalised fees, cash and cash equivalents and overdrafts. Lease liabilities of £14.8m (30 November 2024: £15.0m) are excluded from this measure as they are not included in the measurement of adjusted net debt for the purpose of covenant calculations.
5. Contracted order book represents secured revenue, supported by a contract, that is yet to be recognised as revenue in the financial statements.

Presentation details

A presentation by Management for investors and analysts is available on the company website at https://www.rmplc.com/.

Contacts:

RM plc         investorrelations@rm.com

Mark Cook, Chief Executive Officer 

Simon Goodwin, Chief Financial Officer

Daniel Fattal, Company Secretary and Investor Relations 

Headland Consultancy (Financial PR)       +44 203 805 4822

Stephen Malthouse (smalthouse@headlandconsultancy.com)

Chloe Francklin (cfrancklin@headlandconsultancy.com)

Dan Mahoney (dmahoney@headlandconsultancy.com)

Notes to Editors:

About RM

RM was founded in 1973, with a mission to improve the educational outcomes of learners worldwide. More than fifty years on, we are a trusted global EdTech, digital learning and assessment solution provider, transforming learners, educators, and accreditors to be more productive, resilient, and sustainable. Our simple approach enables us to deliver best in class solutions to optimise accreditation outcomes.

RM is focused on delivering a consistently high-quality digital experience, acting as a trusted consultative partner to provide solutions that deliver real impact for learners worldwide. Our three businesses comprise:

• Assessment - a global provider of assessment software, supporting exam awarding bodies, universities, and governments worldwide to digitise their assessment delivery.
• TTS (Technical Teaching Solutions) – an established provider of education resources for early years, primary schools, and secondary schools across the UK and to ministries of education and independent institutions worldwide.
• Technology - a market-leading advisor and enabler of ICT software, technology and bespoke services to UK schools and colleges.

Chief Executive’s statement

Progress on improving profitability

Overview

I am very pleased with the strong operational progress made in the first half of FY25 as we continue to execute our strategy. Adjusted operating profit of £0.9m was £1.2m higher than HY24 (restated) through continued margin improvement and the impact of cost savings taking effect. During a period of economic instability which has impacted Technology and TTS revenues, I was delighted to see our core platform revenue in Assessment grow 19% in HY25. We signed a digital assessment contract with new customer, Trinity College, , shortly after H1 which represents another fantastic win for the business. This sets us up well for the remainder of the year to achieve our strategic goal of growing Assessment through a combination of strategic renewals and new business wins, at higher margins by virtue of the increasing trend towards digital-based exams. To support and capitalise on this trend, we officially launched RM’s adaptive virtual accreditation platform, now branded RM Ava and progress continues to be made in its development, headed by Dr Grainne Watson.

Our banks remain highly supportive of our strategy and agreed an extension of our facility to July 2027 on similar terms. Despite an improvement in our leverage position through higher EBITDA, net debt remains higher than I would like and increased during H1 following continued planned investment in the Ava platform. We remain committed to significantly reduce debt but on terms that are in the best interests of RM and its stakeholders. Divisional separation activities, explained below, will increase our strategic options and in the meantime, all parts of the group remain cash generative.

After several years of being in deficit, I was pleased to see that our legacy defined benefits pension schemes now show a combined technical provisions surplus of £10.5m based on the latest valuation at 31 May 2024. This reflects the trajectory from the macroeconomic environment in recent years but also the contributions made by RM. As a result, no further contributions are expected beyond the remaining £1.8m from the 2023 agreement with the Trustee.

I would like to thank our people for their continued hard work and commitment. FY24 was a year of transformation during which we made fundamental changes to create a sustainable future for RM and FY25 is developing into a year that delivers real progress to our defined growth strategy.

Divisional Performance

Assessment

The strong momentum in our strategic Assessment division has continued into this year with revenue up 4.1% in HY25 versus HY24. Significantly, when one-off non-core projects are stripped out, platform revenue grew 19% on the back of further customer renewals and wins including SEAB in Singapore and SACE in Australia. Last year we reported that we successfully renewed 99% of core Assessment contracts up for renewal in FY24, demonstrating our stickiness with customers. In HY25 we have secured 96% of the annualised revenue that was up for renewal which is further testament to our world class assessment offering, decades of building customer relationships, and our team working tirelessly to deliver these fantastic outcomes. Our newly launched RM Ava platform is set to strengthen our position further and be a key driver of profitable growth in the future, unlocking digital assessments and delivering higher margins.

Our contracted order book, plus contracts awarded in H1 and signed in H2, has grown from £95.7m at the end of FY24 to £106.6m. This includes winning the Trinity College tender which we are delighted to have secured under contract shortly after H1. The three-year contract will see Trinity College move its c.600,000 mostly digital tests, provided in more than 60 countries, onto our platform and serves as another example of our ability to land strategic opportunities in our core Assessment business. The pipeline into H2 is strong and we expect to land further wins to build on our H1 success, highlighting Assessment’s position as the growth engine of RM.

With recent Assessment wins being predominantly digital in nature rather than paper-based, the division’s adjusted operating margin has increased from 11.6% to 17.6%. We expect this trend to continue as our customers pivot further towards fully digital exams, enabled by RM Ava deployment.

At the time of writing, we are in the middle of our summer peak exam season, the busiest period for Assessment. Approximately 15 million exams will be marked during this time on our platform and up to 500,000 per day, putting us on track to reach 21 million marked exams for the full year.

Technology

Technology revenue is down by 12.4% due to the continuation of the tough UK schools market highlighted last year leading to a slow start for HY25. Government funded projects, such as Connect the Classroom, generated revenue in HY24 but its relaunch was delayed and only announced in March. We expect the initiative to generate revenue from Q3 and into FY26.

Technology’s slow start to the year was exacerbated by the start of managed services contracts won last year being delayed. More positively, the division won the First Federation Managed Service, Connectivity and Filtering contract and ended the period strongly by winning four consecutive managed services tenders, including Hayles Valley Trust schools. We therefore believe that the current decline will be temporary.

TTS

TTS revenue is down by 8.6% primarily due to the tough UK schools’ market with a continuation of budget constraints and exacerbated by US sales which were impacted by the implementation of trade tariffs in April. US sales in TTS account for less than 2% of group revenues so this impact is minimal and we are excited about the significant international opportunities in Europe and the Middle East, underpinned by our decision to open an office in Dubai which is now up and running. Even allowing for the drop in US sales, we continue to see further overseas opportunities for H2 which we expect to partly offset the decline in UK sales.

Operationally, the division continues to strengthen following the consolidation from two warehouses into one in FY24 with 84% of orders delivered on time and in full, compared to 49% in HY24, and average Trustpilot scores consistently above 4. TTS launched 104 products in H1, helping us to stand out and evolve our product range.

Launch of RM Ava

A proud milestone in our innovation journey

At the start of June, we announced the official launch of RM Ava, our adaptive virtual accreditation platform (formerly known as the Global Accreditation Platform), in a major step forward for RM’s digital assessment-focused growth strategy. RM Ava brings together our world-class tools onto a single, end-to-end solution, with a clear, new identity. The platform is our engine for profitable growth and will cover everything from assessment creation to AI-enhanced marking, with the opportunity to develop new features in the future. Early adoption has been positive, and the platform has also been a key differentiator in unlocking new contract wins.  While platform revenue from customers is already helping to fund RM Ava, its development will result in a cash outflow of £6.5m in FY25 (£4.2m in FY24). This cashflow trend will reverse in the coming years as digitisation of assessments ramps up and will continue that way for the foreseeable future.

I mentioned the successful AI marking proof-of-concept (“PoC”) project in last year’s annual report and we continue to work with customers to explore how AI can be tailored to support their assessment process. We are currently productionising this system to go live in 2026 and are doing further exciting PoCs introducing the ability to mark computational assessments.

RM Ava will allow us to capitalise on the significant growth opportunities and the global shift towards digital assessment, enabling revenue growth, improved profitability and cash generation. This, in turn, will support our continued focus on reducing net debt in the near to medium term.

Separation activities

Unlocking the opportunity

We have formed a plan to operationally separate our three divisions which have been historically linked through shared services, IT systems and the current legal structure.

Separation will create simpler structures, provide greater strategic flexibility, and help to unlock further cost saving opportunities for the group. We are commencing the detailed evaluation on how to maximise cost savings in H2 and I will provide a further update on progress in due course.

Financial Review

Group financial performance