Interactive education technology vendor Promethean has announced a net loss for the 2011 year of £3.8m – and it is banking heavily on a refreshed software strategy to promote recovery.
The vendor has admitted its turnover shrank 30 per cent to £157.0m in the year ending 31 December 2012 – down from £222.9m in the previous year.
That worked out to a pro forma net loss of £3.8m for the year, a turnaround from 2011, when the company made a net income of £16.4m for the year. That is despite an overall operating cost reduction of 18.5 per cent, to £52.5m.
Jim Marshall, chief executive of Promethean, said in a Stock Exchange announcement that market conditions in the US and Europe "were tough throughout 2012 and continue to be so".
Revenue in Promethean's International division, including the UK, was affected by austerity measures in Europe and a reduced number of large tenders, and was down 20.4 per cent from 2011 to £74.2m. Also, the average selling prices of interactive display systems, whose sales declined 20 per cent in the year by value, continued to fall.
Learner response system sales in the division did better than the displays segment, sliding only 10.3 per cent in value terms from 2011 to £3.6m.
Education budgets remain under pressure, and there is more competition in the interactive hardware market, such as from tablet purchases, he said, so the vendor was looking at its software strength to counter ongoing market weakness. However, Marshall hastened to underline that cash management and cost reduction programmes were working well.
"This programme was delivered within time and beyond expectations. Full-year operating costs were down 18.5 per cent and, in the second half, they were down 37.5 per cent. The full benefits of these cost reductions will be felt in 2013," Marshall said.
"Promethean is responding to a rapidly changing market with multiple initiatives to build on our presence as an education solutions provider with a strong position in both hardware and in the applications and infrastructure software arenas."
Marshall said that 2013 will be a transitional year, with its software initiatives starting to pay off over time, although funding for interactive education technology is continuing to be squeezed in many countries. "Over time, we believe that governments and school districts will increase the priority they give to learning productivity," he said.
The vendor expects to announce a string of equipment and software launches through 2013. Promethean since year-end has also teamed up with Microsoft to develop a new suite of collaborative technologies for the classroom on the Windows 8 and Windows RT platforms.
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