Learning Technologies Group (LTG) has seen its share price climb at the open, as the e-learning business posted an impressive increase in revenues.
The group's revenues rose 68 per cent in the first half of the year compared to a year prior, to £21.5m. Organic revenue hit £17.6m, up 33 per cent, while recurring revenues increased by a massive 153 per cent to make up more than a third of the total.
Adjusted earnings before interest and tax were up 41 per cent to £4.1m, although the margin was down slightly due to the acquisition and integration of NetDimensions. This also knocked adjusted earnings per share, which were down seven per cent at 0.523p.
However, the proposed interim dividend was up 29 per cent at 0.09p.
Why it's interesting
The interim results exceeded analysts' and management's expectations, with Numis raising its target price from 60p to 63p.
Berenberg increased its earnings estimates for LTG, noting that the business had a “very strong order book”. Part of this is the Civil Service Learning programme, which has been renewed for another year.
After acquiring NetDimensions for £54m earlier this year, LTG said its integration was completed “on time and to plan” in the second quarter of the year.
Speaking to City A.M., LTG's chief executive Jonathan Satchell said the deal had gone so well that the business was already looking for more merger and acquisition opportunities, and was in early to mid-stage discussions.
Although Satchell was expecting a boost in revenues from the NetDimensions deal, he said he was "delighted" with the business's organic growth.
NetDimensions will also be involved in a novel project at the Tate Modern this November, using virtual reality headsets to take the audience to early 1900s Paris as part of a Modigliani exhibition.
What LTG said
“LTG has demonstrated strong organic revenue growth across all businesses and has continued to expand its client base and international reach whilst at the same time increasing its recurring revenue base,” said Andrew Brode, chairman of LTG.
“The acquisition of NetDimensions completes the final key technical capability that will allow the group to offer its corporate and government clients a truly comprehensive service. The ambitious integration of NetDimensions has been completed on time and the Board is confident that this will result in a strong margin performance in the second half of the year.
The board continues to look at acquisition opportunities where the group will be able to leverage its established technical capabilities and working practices in domain specific market sectors, supported by its industry leading employees.