RM: PC exit not as painful as anticipated

But process of refocusing Education Technology arm on software and services will take time, RM warns

RM is making more money following its decision to exit the PC market, which it said has not been as traumatic as it expected.

Interim pre-tax profit rose 46 per cent to £6.4m at the London-listed education supplier, which announced it was quitting the PC building game in October.

Unsurprisingly, total revenue for the six months to 31 May sank 22 per cent annually to £92.1m but RM's spirits were lifted by a spike in the bottom line, with operating and pre-tax profit both heading north.

Chief executive David Brooks labelled it a "solid" set of results.

"The reshaping of the largest division, Education Technology, continues with the discontinuing of hardware device manufacturing and the end of the standalone sale of personal computer devices progressing well," he said.

"As headlined previously, refocusing this business on software and services will take time, with the trend towards devolved procurement at a school level and the expiry of BSF [Building Schools for the Future] contracts."

As revealed by CRN, RM's PC market exit saw the firm foster a hardware referral partnership with Misco, although the RM One machines Misco is supplying are being built by Zoostorm. In April, RM signed a warranty partnership with Kelway around machines already in the field.

The Education Technology unit is benefitting both from higher revenue and lower costs than planned through the reshaping process, RM said.

This enabled the division to post a slight rise in adjusted operating profit to £3m on sales of £52.7m, down 36 per cent year on year.

RM's total headcount stood at 1,885 on 31 May, down by more than 300 year on year.

"We are pleased to report a solid set of results for the first half," Brooks concluded. "We are particularly encouraged by the double-digit top-line growth in Education Resources for both UK and exports, while maintaining good margins in this business."