Half Year Trading Update

LTG, the provider of services and technologies for digital learning and talent management, announces the following trading update for the six months to 30 June 2020. 

LTG has delivered a robust performance in the first half of the year, in line with management expectations.  The Board expects Group revenues to increase c.2% to not less than £64.0 million (H1 2019: £62.6 million) reflecting a small decline in the underlying business due to the challenging COVID-19 trading environment, which was more than offset by the contribution from the acquired Open LMS business in the second quarter.1

Adjusted EBIT of not less than £18.3 million (c.29% margin) includes, as expected, an increase in amortised R&D and share based payments of £1.6 million.  Underlying adjusted EBIT of c.£19.9 million, excluding these non-cash items, is ahead of prior year (H1 2019: £19.5 million).  

Approximately 75% of LTG’s revenues are derived from recurring multi-year contracts (H1 2019: 67%) and whilst, as expected, some enterprise software procurement processes have been postponed, we are seeing retention rates in PeopleFluent and our other software businesses hold up well. In Rustici and our newly acquired Open LMS business we are seeing sales and revenues increase as the adoption of digital-learning solutions accelerates.  After an initial downturn in the market for Breezy HR’s recruitment software in mid-March we have seen a marked uptick in new sales since mid-May.  

In our Content & Services division, as expected, revenues have been subdued in the second quarter as some client projects were curtailed as a result of COVID-19.  However, we have also won some prestigious projects including a $1 million virtual-reality healthcare project for PRELOADED and the conversion of a number of classroom training programs to online and blended learning for LEO, to be delivered in the second half of the year.

Given the current dynamic nature of the market we have redeployed staff across the Group to match demand, particularly in Open LMS where sales have increased substantially to meet the needs of universities to deliver digital curricula and examinations online, rapidly, securely and at scale.

Strong operating cash flows are ahead of management’s expectations.  Net cash of £77.9 million (31 December 2019: £3.8 million) includes net Placing proceeds of £79.6 million received in June.  The Group has gross cash of £98.1 million (31 December 2019: £42.0 million) and undrawn debt facilities of c.£39.0 million.  

This robust capital position will enable the Group to take advantage of value-enhancing acquisition opportunities as they emerge, as well as capturing the benefits of the acceleration of structural trends towards digital learning and talent management.  The Board continues to pursue a number of acquisition opportunities and looks forward to updating the market on developments during the year.

With the ongoing macro-economic disruption caused by COVID-19, the Board continues to take proactive measures to protect the safety of colleagues, customers and partners and to prioritise the strong liquidity and cash position of the Group.  LTG has repaid all furlough payments received from the UK government and the Company will not make any claims under the job retention bonus scheme for furloughed staff.  

LTG will publish its half-year results on 22nd September 2020.

Jonathan Satchell, Chief Executive, said:

“The resilience of our people and our business has enabled the Group to deliver strong results in the first half of the year, in the context of unprecedented challenges as a result of the COVID-19 pandemic. During this time we continued to serve our customers in the rapidly evolving environment for corporate learning and talent management and prioritise the safety and wellbeing of our customers and staff.  

“With several major project wins to celebrate across our Content & Services business and resilience in our Software & Platforms division, LTG enters the second half of the year in a robust position, with demand in line with management expectations and a cash position to enable us to expand our business with strategic value-enhancing acquisitions.”


  1. Based on the fair value of acquired deferred revenue under IFRS3 representing the full value recognised under IFRS15 (subject to audit).