Northcoders Group (CODE) Trading update summary

Government funding outlook

• Skills Bootcamp funding has shifted to a regional model; multiple bids remain pending, and some authorities have yet to issue tenders or confirm allocations, with delays indicated rather than cancellations.

• Timing of Government-backed contract income remains unclear; revenue and profitability are expected to be unpredictable for the rest of 2025, and current market expectations cannot be supported with confidence.

• Long-term confidence is supported by OFSTED Outstanding accreditation and Skills England trends: shorter modular training, rising AI and digital skills demand, and SME preference for fast-track upskilling.

Trading and financial position

• Annualised fixed costs reduced by ~£3.25m, a 40% decrease on the 2024 reported cost base, while retaining investment in core growth areas and seeking to protect gross margins.

• Cash balance £2.25m; positive cash position expected to be maintained.

• Existing £10m DfE contract concludes later in 2025 and is generating cash for many months ahead, offsetting some near-term headwinds.

Growth and strategic priorities

• B2B Counter consultancy division continues to make positive progress; an update is expected in the next trading update.

• Investment continues in AI, data engineering, corporate training solutions and adaptable learning models; focus also remains on scaling Counter and serving areas of strong demand.

• Diversified delivery, employer relationships, operational capabilities and quality assurance are positioned to support recovery as the funding environment stabilises.