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Tribal Group PLC on Thursday said that delays to the implementation and delivery of its Nanyang Technology University contract have continued, resulting in ‘substantially increased’ ongoing costs and lower recognisable revenue for the year than originally anticipated.
Tribal is a Bristol, England-based provider of software and services to the international education market. Sshares plummeted 18% to 45.90 pence each in London on Thursday afternoon.
The company said that trading for the year, excluding the NTU contract, was broadly in line with expectations. However, issues surrounding the scope and delivery of the contract have continued since the first half, and it is now expected to generate a loss of around £12 million.
Tribal said that commercial discussions are ongoing with the university in order to determine the level of additional revenue it is due as a result of these delays, but these are unlikely to be resolved by the end of the financial year.
The board now anticipates a negative impact on earnings before interest, tax, depreciation and amortisation of £9 million.
While a continued positive sales performance means group revenue is expected to be in line with board expectations, Ebitda will be ‘substantially below’, by around £4 million.
In other news, Tribal has continued to sign contracts with new and existing contracts, including a seven year SITS:Vision contract with the University of Plymouth, a five year Cloud contract with the University of East Anglia, and a four year Semestry contract with the University of Birmingham.
Together, these contracts have a total value of £8.3m, adding £1.1m in incremental annual recurring revenue.
The company expects to close the year with a reduced net debt position.
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