Education services company RM issues profit warning
spending cuts to education leader to warn of job losses and reduced dividends, and to announce the sale of three subsidiaries
service provider RM Education plans to cut 300 jobs and sell three businesses and spending cuts in education government led the group to announce a profit warning.
The company has appointed former Education Minister Lord Adonis on the board, also said it cut its dividend.
"After a decade of higher education budgets, the current situation provides a stark contrast. Recent reductions in public sector spending in the UK and the completion of the Building Schools for the program's future has been and will continue to affect the group in the coming years, "the company said.
The number of employees was reduced by 13%, meaning RM will have 320 employees. Directors give up their bonuses, as a result of business problems.
The outlook for the company over the next year is grim, RM said. "In the categories of primary and secondary schools about 70% are anticipating a reduction in capital expenditures ... in terms of IT spending by about 40% of primary and secondary schools should reduce over the next year. "
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