H1-2025 Trading Update

Northcoders (AIM:CODE), a UK-based provider of technology training, provides the following trading update for the six months ended 30 June 2025 (the 'Period' or 'H1-2025'). Despite a challenging operating environment, the Group has delivered improved profitability and maintained a resilient balance sheet, reflecting its disciplined focus on cost control, delivery efficiency and revenue diversification.

Revenues for H1-2025 are expected to be £3.7 million (H1-2024: £4.4 million), reflecting the previously announced slower access to Government funding. Nevertheless, gross profit margin is expected to increase to 70% (H1-2024: 67%), driven by enhanced delivery efficiency and cost control. Adjusted EBITDA is anticipated to be approximately £0.4 million (H1-2024: £0.4 million).

The Group retains a solid cash balance of £2.3 million (H1-2024: £1.3 million), which will be £2.7 million as at 31 July 2025, giving flexibility to adapt to market conditions and continue strategic investments selectively.

Training Bootcamps

Performance within Training Bootcamps was mixed due to the change in Government funding structure. Applications were 2,608 (H1-2024: 6,766), with registrations reaching 1,608 (H1-2024: 4,959). Privately funded places, however, increased 30% to 43 (H1-2024:33). Whilst a low base this has been an important step forward for the Group and continues to increase into H2-2025.

Northcoders' leading reputation in the market continues to position the Company strongly for future growth, with graduate placement rates stable and significantly above the national average. Furthermore, the Group was extremely pleased to announce the award of an OUTSTANDING rating in its recent OFSTED inspection. This rating puts Northcoders into the top 6% of UK Further Education providers delivering apprenticeships and skills training across all sectors and highlights the ongoing commitment to quality training and outcomes for students.

The inaugural Data and AI course launched in June 2025 with positive early feedback from students, and we are excited by the opportunity that movement into this area provides. The course teaches both beginners and more advanced students the skills needed to progress in the tech industry during the evolution of AI. It is only available when privately funded, including to students who receive loans through the Group's third-party provider, StepEx.

The part-time coding bootcamp has also gone from strength to strength, with early job offers being made to students prior to course completion. The introductory offer has finished, and this course is now being charged at full price to privately paying customers. This has also been a focus of the Group, as it continues the strategy to diversify revenues away from public funding.

Regional Government funding has been significantly slower than expected, with many councils postponing outcomes and delaying start dates. We are still focused on ongoing engagement with local councils, however, and will continue to bid for funding that suits our business model and courses. Whilst this will likely put a short-term pressure on the Group, the Company is confident that with diversification, cost savings, and continued focus on excellence and agility, Northcoders is well-positioned to emerge stronger and more resilient.

To date the Group has secured 24 seats through Lancashire Council, and decisions by numerous other councils across England are expected in the near-term.

COUNTER®

Growth in our challenger corporate consultancy brand, COUNTER®, forms an important part of the Group's diversification strategy. The division made steady progress in the Period, proving to be an attractive option for our clients in the current hiring market. Seven new contracts were secured in H1-2025, with renewals from Manchester Airports Group and a public sector client, along with new engagements within different functions at Skipton Building Society, proving high-quality customer satisfaction and model effectiveness. The division strengthened its sales function in H1-2025 with three new hires who are now embedded into the team and generating pipeline opportunities/revenue. Delivery quality and retention remain strong, and the division continues to show potential to increase its rate of growth in future periods.

Tom Walton's strategic leadership remains a strength, and the Group will continue investing in COUNTER® to meet demand and identify and capture opportunities.

Current Trading and Outlook

The Group remains cautious due to the uneven regional funding landscape. Critical areas for the Group include revenue diversification, accelerated development activity into areas of AI, cash conservation and cost control.

Northcoders will continue to manage costs tightly, deploy capital selectively, and evaluate new regional delivery opportunities as funding clarity improves, with COUNTER® being well placed for increased speed of growth in H2-2025, 2026 and beyond.

Efficiencies from NCore, our core technology delivery platform, create significant operational leverage within the Group, which will ensure profitability of our Training Bootcamp operations increases as revenues rise.

Chris Hill, Chief Executive Officer of Northcoders, said: "The first half of 2025 has presented a challenging trading environment and although the top-line was impacted by the delays to Government funding structures, our focus on consistently high levels of quality delivery, innovation of AI, efficient delivery and maintaining a lean operating model have resulted in improved profitability and a stronger cash position.

"We remain frustrated by the slow rollout of regionally funded Government training, but our core operations remain robust. COUNTER® continues to develop positively, and we are pleased with the quality of work being delivered.

"We are taking a prudent, focused approach to the remainder of the year, committed to our mission of enabling access to tech careers and new emerging technologies, while maintaining focus on disciplined execution."