Manchester headquartered Northcoders, the independent provider of training programmes for software coding, is pleased to provide the following trading update for the six months to 30 June 2022 (‘the Period’).
- At 30 June 2022 revenue visibility for the financial year to December 2022 was already at 83% of market expectations
- Continued growth in demand with 3,494 applications in the six-month period compared to 3,662 applications in the full year to December 2021
- Strong reputation of Northcoders training facilitating successful launch and strong pipeline for the Group’s new Hire, Train, Deploy product, ‘Developer Incubator’.
- Significant expansion of Corporate Solutions division, with multiple well-known UK companies turning to Northcoders for digital skills training
With demand achieving record highs, the Group is trading comfortably in line with management expectations as to revenue and ahead of management expectations with respect to underlying profitability for H1 2022. Revenue for the six months to 30 June 2022 was £2.3m (H1 2021: £1.0m). On 30 June, revenue visibility for the financial year to December 2022 was £5.4m, being 83% of the market expectations for the year.
The strong performance of the Group in the year to date gives the Board confidence to invest additional funds in the second half of the year to support the anticipated growth in FY 2023, which is expected to result in the overall profitability for FY 2022 being in line with market expectations.
During the Period, the Group has secured multiple new contracts in its Corporate Solutions division, with Rolls Royce and EMAC Ltd, among others, and the Group received confirmation that its NHS Digital academy programme will commence in September 2022. Well-known companies such as On the Beach, Evri, HESA and Sky Bet have also now started their digital training programmes with Northcoders during the first half of 2022. The Group grew its graduate hiring network by a further 10% by engaging with 32 new companies for the first time this year. Northcoders now has a network of almost 350 hiring partner companies to sustain its graduate hiring from coding bootcamps. The Group has also continued to see an increase in demand from individuals wanting to enrol on its core coding bootcamps and apprenticeships. Application numbers for the first six months of the current year stood at 3,494, which compares favourably with the 3,662 applications in the 12 months to December 2021.
In the Period, Northcoders’ Corporate Solutions division successfully launched “Developer Incubator”. Developer Incubator is a fully managed “Teams-as-a-Service” model for businesses to hire teams of junior developers, managed by Northcoders’ internal consultancy team. Developer Incubator offers the support required by organisations who need to future-proof their talent pipeline but do not have the internal resources to hire junior-level developers. Training is bespoke to the client and delivered up front. Developer Incubator utilises a “Hire, Train, Deploy” model, whereby consultants are hired on Northcoders’ payroll and billed out to clients for a monthly fee.
Following on from our first hire, train and deploy consultancy contract with theidol.com (a subsidiary of Legal & General), Northcoders Solutions division has signed Developer Incubator contracts with R2 Data Labs; Rolls-Royce’s Data Science division; and the customer service software provider, EMaC.
The Developer Incubator product, part of the Group’s Corporate Solutions division, is already growing strongly, with positive market reception and demand providing confidence in the significant growth potential of the division. Staff utilisation rates are expected to remain constantly high as all consultants can be used either to teach on the Northcoders’ bootcamp or work on internal development projects when not utilised on a client contract.
Northcoders’ cash flow has benefited from the Department for Education-funded scholarships being made available to those who previously utilised the Company’s finance provider, which had absorbed working capital. Therefore, the Company has used this as an opportunity to accelerate investment plans in its learn-to-code platform, which will automate learner enrolment in its courses and lead to a substantial saving in staff costs in the learner admissions team. Even while the learn-to-code platform is in its infancy, the Company is already yielding staff-saving benefits.
