Northcoders – trading has remained strong says Cenkos Securities

Interim results revealed a more than doubling of revenues to £2.37m (+117%), with particularly strong trading in its bootcamp training offering, alongside a growing contribution from Business Services.

Gross profit increased by 110% to £1.66m (gross margin: 70%), with a 62% increase in underlying EBITDA of £0.42m as it continued to benefit from the efficiencies of its hybrid teaching model (with ongoing remote learning).

To capture the growth opportunity, the group has continued to increase its capacity with headcount more than doubling to 84 (H1/21: 41).

Current trading has remained strong, with an additional 1,798 applications since the period end and Q3/22 trading at record levels.

The group looks to be well positioned to benefit from ongoing government support for technology training services, as it addresses the significant digital skills gap in the UK.

The shares trade on 10x FY23E PE (based on Factset consensus).

Source: Cenkos Securities