BPP rises despite Linguarama woes: Language training is hit by companies' spending cuts

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The Independent Online
CUTS in non-essential expenditure by European companies suffering from the recession has hit Linguarama, the English language training company owned by BPP Holdings.

Results from language training showed a steep dive from profits of pounds 620,000 to losses of pounds 40,000 in the six months to 30 June.

Charles Prior, chief executive, said Linguarama was a 'black spot' and would continue to find the going very tough.

Despite that, however, BPP's overall profit rose from pounds 2.97m to pounds 3.34m and the company hinted that its unblemished growth record would remain intact at the year-end.

Half-year turnover rose from pounds 23.3m to pounds 24m.

Richard Price, chairman, said student demand for academic and professional qualifications continues to increase.

However, he said: 'Our interim statement contains a note of caution. Many of BPP's businesses rely heavily on demand at the start of the new academic year and it is hard to forecast how its fortunes will go in the key months of September and October.' BPP traditionally earns about 60 per cent of its profits in the second half.

The chairman added: 'In professional publishing we face new competition. And the number of places in sponsored chartered accountancy training is significantly lower than three years ago when some of our current cohorts started their training.'

Against that, he said there were encouraging signs in other markets in the UK.

He also hoped that the collapsing exchange rate mechanism would lead to lower interest rates in Europe and a consequential 'early end to economic difficulties'.

Overall, investors reacted favourably to the results and BPP shares finished the day 9p higher at 303p.

The interim dividend has been increased by 11 per cent to 3p, covered more than twice by earnings per share ahead from 7.2p to 7.6p.