Northcoders ends 2023 in line with revised expectations

Technology training firm Northcoders said in a trading update on Tuesday that its performance in 2023 aligned with revised market forecasts.

The AIM-traded company said unaudited revenue for the year rose 27% to £7.1m, up from £5.6m in 2022, primarily driven by growing demand for digital training.

It maintained £1.6m in cash, and had net cash of £0.8m as of 31 December.

Northcoders' said its B2C Bootcamp Division experienced remarkable growth, with 8,535 registrations compared to 4,615 in the prior year, leading to record-breaking graduate placements and a 14% increase in its hiring partner network, which now included 465 companies.

The board said those partners frequently returned to Northcoders to hire new talent.

Despite economic challenges, the B2B division saw improved sales in the second half, securing three new contracts and establishing a promising pipeline for 2024 in both the private and public sectors.

Additionally, Northcoders gained admission to the Cloud Compute 2 government procurement framework, opening up new opportunities in the public sector.

The company's performance in 2024 started strongly, with a 74% increase in registrations within the B2C Bootcamp Division in January, driven by enhanced marketing and conversion strategies.

Furthermore, Northcoders secured its largest-ever Department for Education government funding round on 16 January, resulting in an 18.6% increase in funding per student.

That funding would support the company's profitable growth and help offset inflation-linked costs.

The release of the 'NCore' platform would meanwhile improve efficiency and enable the exploration of new teaching methods.

With revenue and contracted visibility for 2024 at an all-time high of £8.3m, representing a 40% increase compared to January 2023, Northcoders said it was confident about its prospects for the current financial year.

Revenue visibility for 2025 stood at £3.7m, reinforcing market expectations for the year.

“Reflecting on the past year I am genuinely proud of the Northcoders team, who delivered strong growth in revenue despite a challenging macroeconomic backdrop,” said chief executive officer Chris Hill.

“The ambition and entrepreneurial culture across the Group has played a crucial role in navigating these challenging market conditions, particularly as we faced some initial challenges within our newer B2B division.

“Looking ahead, we are moving into 2024 in our strongest ever position.”

Hill said Northcoders remained committed to its mission, building on its growth track record while focusing on increasing profitability.

“I am incredibly excited about the opportunities that lie ahead and the positive impact Northcoders can continue to make in the UK technology industry, and to the lives of the individuals we serve.”

At 1059 GMT, shares in Northcoders Group were up 4.92% at 160p.

Reporting by Josh White for Sharecast.com.