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Strictly Education performs well for Bond International

publication date: May 1, 2008
author/source: Ed Tranham

Strictly Education, the provider of outsourced services to state sector schools, has delivered revenues of £2.35m in the 13 months to 31 March 2008 following its £2.67m (a multiple of 1.4 on revenues) acquisition in February 2007 by AIM listed Bond International Software (BIS). Encouragingly for BIS 74% of these revenues are recurring through annual contracts.

The direct-to-school outsourcing market has often been overlooked by larger BPO companies because the cost of sale is too high at individual school level. As a result a number of smaller businesses have developed – sometimes as exits from local authorities, eg Education Personnel Management – to provide more tailored services direct to schools. Most of these businesses are regionally based.

Strictly Education – with its offering of HR outsourcing, payroll, property management and financial services – should be able to spread the cost of sale over a wider range of services, thereby increasing operating margins. With nearly 400 primary and secondary schools using its services, Strictly Education is well placed to expand into a market of about 20,000 schools. Supported by BIS, part of this expansion is likely to be through the acquisition of strong regional players.

For the year ending 31 March 2008, total revenues at BIS were up 29% to £29.46m and profit before tax was up 12% to £5.1m.

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