Preliminary Results

RM PLC
20 November 2000


           Results for the Twelve Months Ended 30 September 2000

RM plc ('RM'), the leading supplier of IT software, services and systems to
UK education, announces results for the twelve months ended 30 September
2000.

Financial Highlights
*    Turnover up 28% to £207.6 million (1999: £162.2 million)
*    Profit before tax (before goodwill amortisation and exceptional
     provision*) increased 26% to £15.5 million (1999: £12.3 million)
*    Diluted earnings per share (before goodwill amortisation and
     exceptional
     provision*) up 33% to 13.0p (1999: 9.8p)
     
*    Final dividend for year of 2.7 p per share (1999: 2.2p). Total
     dividend for year up 22% at 3.5p (1999: 2.86p)
     
*    As announced in September 2000, an exceptional provision finalised at
     £5.4 million was incurred against pre-contract expenditure for
     Northern Ireland Classroom 2000 project
     

Operating Highlights
100,000 teachers signed up for RM's joint venture Learning Schools Programme

Growth in managed services and learning software

£5.5 million acquisition of 3T Productions in March 2000 and strategic
alliance with Riverdeep signed in June 2000

Launch of new Group organisational structure with individual operating
businesses for specific customer groups and online content

Commenting today, Richard Girling, Chief Executive, said:

'The year 2000 has seen excellent growth for RM.  The innovative technology
products that we supply are now seen as a fundamental part of the fabric of
education establishments and RM is well placed to benefit from further market
growth.'

'The next stage of RM's development will see further growth in the UK
education market and significant expansion of our content activities.  The
new Group organisation will facilitate this growth by creating separate
operating businesses each with much sharper customer focus.'

'Against such a positive backdrop, it is disappointing that acceptable
commercial terms have still not been agreed for the Classroom 2000 project.
No contribution from the project is built into the plan for the current
year.'

'As usual, it is too early in the year to comment on the likely outcome for
2001, particularly given the seasonal nature of our business.  Nonetheless,
the Board is confident that RM will continue to be the ICT partner of choice
for the UK's educational establishments and, as a consequence, results for
the full year will show good progress.'

Enquiries to:

Richard Girling, Chief Executive   RM plc    020 7404 5959 on 20/11/00
Mike Greig, Finance Director       and thereafter on 01235 826 000

Andrew Fenwick Brunswick 020 7404 5959
Deborah Done

RM plc
Results for the twelve months ended 30th September 2000

Results

RM's results for the year ended 30 September 2000 were in line with market
expectations.  Turnover increased by 28% to £207.6 million (1999: £162.2
million).  Order intake grew more rapidly than turnover and the value of the
Group's order book (in the form of deferred income and order backlog at the
close of the period) was £111 million (1999: £79 million), with approximately
£75 million of this representing contracted services to be delivered in
future years.  As reported at the half-year, increased funding for the
National Grid for Learning became available in the government year starting
April 2000.  This had a significant impact on RM's second half, which saw
turnover growth of 42%.

The Group announced in September 2000 that it expected to establish a
provision against expenditure incurred during the year in connection with
Classroom 2000 (a ten-year project to provide managed ICT services to all
schools in Northern Ireland).  This provision has now been finalised as an
exceptional cost of sales of £5.4 million.  Negotiations over Classroom 2000
have been more difficult than expected and Trilith (the RM - ICL joint
venture company that has been sole bidder for the project since June 1999)
has still not been appointed preferred bidder, despite the investment of
considerable time and resources.

Profit before tax (before goodwill amortisation and before the exceptional
provision) was £15.5 million (1999: £12.3 million) and diluted earnings per
share (stated on the same basis) were 13.0p (1999: 9.8p).  After goodwill
amortisation of £0.6 million (relating to the acquisition of 3T Productions)
and the exceptional provision, profit-before-tax was £9.5 million and diluted
earnings-per-share were 7.9p.

At year-end the Group's cash balance was £19.2 million (1999: £17.8 million).
Loan notes to the value of £2.3 million were issued as part of the £5.5
million acquisition of 3T Productions.

The normal seasonal nature of RM's business leads to a peak in working
capital requirement over the summer and results in minimum cash balances
being significantly less than at year end.  This year the seasonal pattern
was more marked than usual resulting in the working capital peak being larger
and continuing for longer, leading to unusually high levels of working
capital at the year end.

Gross margin - excluding the exceptional cost of sales - was 25.1% (1999:
27.0%).  This reflects lower margins from the Group's PC operations and an
increased contribution from the Learning Schools Programme (RM's joint
venture with the Open University to provide training for teachers.)  PC
margins were affected by unusual cost increases, including adverse currency
fluctuations, over the summer.  In addition, the Group took an aggressive
pricing stance on certain key products in order to enhance its competitive
position.  Operating profit margin - excluding the exceptional cost of sales
and amortisation of goodwill - was 7.2% (1999: 7.2%).

The Board is recommending a final dividend of 2.7p per share (1999: 2.2p)
payable on 31 January 2001 to shareholders on the register at 8 January 2001.
This makes a full year dividend of 3.5p (1999: 2.86p).

Markets

Demand for ICT amongst educationalists continues to grow and ICT is now seen
as a fundamental part of the fabric of schools and colleges.

The Summer 2000 Comprehensive Spending Review indicated that further funding
for education would be made available in the three government years from 2001
to 2004.  In September the DfEE (Department for Education and Employment)
confirmed that £245 million would be available in 2001/2002 and announced a
further £710 million across the two years 2002/2003 and 2003/2004.  The £710
million in government years 2002/2003 represents a 58% increase over the two
years 2000/2002.  The DfEE has also reinforced its view that schools should
have autonomous control over their spending and has increased its target for
delegation of funds from 85% to 90%.

This year has seen the focus of the DfEE's National Grid for Learning (NGfL)
investment move to secondary schools.  This has driven growth in the
secondary school market and had a particularly significant impact in the
second half.  The introduction of RM Community Connect - an enhancement of
the Group's whole-school network solution - further differentiated RM from
the competition and allowed it to take advantage of this market growth.  The
Group has maintained its share of this sector and turnover grew by 20%.

Turnover from the primary school market increased by 18%.  The increased
competitiveness of the Group's products, combined with significant revenues
resulting from the Group's participation in the Tesco Computers for Schools
scheme, allowed the Group to retain its position in an enlarged market.
Improved Internet support and software enhancements to address changes in UK
curricula have made RM Window Box(R) more popular than ever.

Learning Schools Programme

The government's £230 million, lottery funded initiative to provide ICT
training for teachers is progressing well.  This initiative is enormously
important to RM's marketplace.  It will significantly enhance teachers'
familiarity with and understanding of ICT allowing them to become more
confident users and purchasers of technology.  It also represents a
significant business opportunity both in terms of revenue and by offering a
chance to build strong relationships with individual teachers.

The Learning Schools Programme - the Group's joint venture with the Open
University in response to the lottery funded initiative - is making a
significant contribution to the initiative.  100,000 teachers have already
signed up for the Learning Schools Programme, which represents approximately
one third of all teachers who have registered for training so far.  50,000 of
these had commenced training by the end of the year.

Managed Services

RM is the leading provider of managed services to UK education
establishments.  The Group now manages 20,000 desktops (an increase of 67%
over last year) in over 300 establishments ranging from single primary
schools, through large colleges, to whole LEAs.  The majority of this growth
has come from individual education establishments, reflecting the continuing
trend of delegation of decision making responsibility to individual schools.
Significant managed service contracts won during the year include Scottish
Borders Council and Rotherham LEA (a managed broadband learning network).

The Group has always seen its customers as partners, offering the potential
of long-term, mutually beneficial relationships.  Managed service contracts
formalise these relationships and offer predictable multi-year revenue
streams.  The majority of the Group's managed service business is in the form
of multi-year contracts.

Managed services are seen by education establishments as a highly effective
mechanism for procuring ICT services because they simplify initial decision
making and guarantee a high quality of service.  The managed service approach
has also been strongly endorsed by government through the introduction of the
NGfL Managed Services accreditation scheme - RM is an accredited supplier
under this scheme.

Learning Software and Online Content

Improving standards of literacy and numeracy are key objectives for education
and the Group's portfolio of learning software products makes a significant
contribution in this area.  Turnover from these products increased by over
50% on the previous year.

The installed base for SuccessMaker(R)continues to grow and the long-term
distribution agreement RM entered into with its owners - Computer Curriculum
Corporation - has proved to be very beneficial.  RM Maths Learning System is
now becoming established as an important numeracy tool for primary schools
with the number of schools using the product increasing by approximately one
half during the year.

RM's learning software portfolio has been enhanced with the launch of CCC
Destinations (TM) (a numeracy product aimed at post-16 learners), the launch
of Easiteach(TM) Maths (an online whole-class teaching tool) and through a
strategic alliance with Riverdeep (which brings a Key Stage 4 mathematics
product.)  RM now has a complete range of maths learning software covering
all ages.

RM's strategic alliance with Riverdeep, which was signed in June, gives RM
exclusive UK distribution rights to Riverdeep's highly regarded maths
learning product and provides a non-exclusive channel to market for RM's
Living Library Internet content service in the USA.  The Riverdeep maths
software is being localised for the UK market and is expected to launch at
BETT 2001 in January 2001.  In turn, Living Library is being localised for
the US market and will be delivered through the riverdeep.net learning
portal.

3T Productions, which the Group acquired in March, is a web design company
that specialises in producing educational content.  3T Productions has an
excellent reputation and a client base including the DfEE and the Teacher
Training Agency.  RM had already worked successfully in partnership with 3T
Productions to produce the Explore Parliament web site.  The addition of 3T's
web and design expertise positions the Group well to compete for large and
significant educational contracts.  This has already proved successful with
the award of a contract from the DfEE to pilot a Key Stage 3 mathematics
learning service in English schools.

RM's online content range has developed significantly during the year.  RM
Living Library - the UK's leading premium educational content service -
continually evolves and now includes a range of archive film footage sourced
from the BBC and British Pathe archive.  Also during the year the Window Box
Online (WBOL) service - which provides an unrivalled range of online lesson
plans and teaching resources - was launched.  WBOL adds significant value to
the RM Window Box franchise by extending the core brand benefits of
integration and ease-of-use online.

In time, it is the Group's intention to build on its position as the UK's
leading education Application Service Provider (ASP) by bringing all of its
content activities together and presenting them through a unified online
distribution channel.  This channel is a natural extension of RM's position
as the leading distributor of software and content to the education market in
the UK.

Internet Connections

RM continues to lead the way in providing Internet service connections to
education establishments.  Internet for Learning (IfL) is now Internet
Service Provider (ISP) to 11,500  (1999: 10,000) establishments, of whom
8,000 (1999: 6,000) take network connectivity using ISDN, or higher
bandwidth, telecommunications.  IfL also hosts web sites for over 8,000
schools.

The Group's value-added Internet services have also progressed well.
EasyMail, a chargeable web email service aimed at schools, now has 700,000
users and delivers 4.5 million page impressions per month.  SecureNet, a
secure communications system designed to allow schools to exchange public
examination information with examining boards, now has 410 secondary schools
users (approximately 10% of its target market).

Looking Ahead

The next stage of RM's development will see further growth in the UK
education market and significant expansion of the Group's content activities.
To facilitate this development the Board has decided to create separate
businesses each headed by a managing director reporting to the Group
Executive Board.  RM Schools will focus on delivering managed services to UK
schools, whilst RM Learning will focus on the development of innovative,
online learning content.  In addition, there will also be a Further and
Higher Education business tasked with taking forward RM's leading position in
these market sectors, which currently account for 15% of Group turnover.

This new organisational structure will allow RM's senior operational managers
both the focus and freedom they need to drive their businesses forward.  It
will also provide increased opportunities for the Board to focus on the
Group's strategic development.

Prospects

Technology has become a key modernising force in education, with education
establishments now routinely using extremely sophisticated ICT systems.
Throughout RM's marketplace there is increasing acceptance that the most
effective way of exploiting these systems is to work in partnership with an
ICT specialist.  The Group's expertise in managed service delivery positions
it well to benefit from this growing market need.

The market for educational ICT continues to grow.  This year has seen the
confirmation of three more years of government funding for the NGfL.  In
addition, the boundaries between technology spend and general education
budgets are breaking down, which creates the opportunity for ICT solutions to
address a much higher proportion of an establishment's budget.  With the
growing breadth and capabilities of its online content products, the Group is
well placed to benefit from this.

Acceptable commercial terms have still not been agreed for the Classroom 2000
project.  The Board believes that terms that would currently be acceptable to
the customer do not represent an acceptable balance of risk and reward for
the Group.  As a consequence, the level of spend on the project has been
reduced to be accommodated within the normal level of sales and marketing
expenditure and no revenue or contribution from Classroom 2000 has been built
into the plan for the current year.

It is too early in RM's annual business cycle to give an indication of the
likely outcome for 2001, particularly given the seasonal nature of the
Group's business.  Nonetheless, the Board is confident that RM will continue
to be the ICT partner of choice for the UK's educational establishments and,
as a consequence, results for the full year will show good progress.

CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the year ended 30th September 2000

                                                       2000       1999
                                                       £000       £000
TURNOVER                                                              
Existing Operations                                206,309   162,210
Acquisitions                                          1,251         -
----------------------------------------------------------------------
Total Turnover                                       207,560   162,210

                                                                      
Cost of sales before exceptional items (155,364)            (118,367)
Exceptional cost of sales                (5,359)                    -
---------------------------------------------------------------------
Total cost of sales                              (160,723)  (118,367)
                                                                     
---------------------------------------------------------------------
GROSS PROFIT                                        46,837     43,843
---------------------------------------------------------------------
Operating                                                            
expenses
Selling and                                       
distribution                                      (23,377)   (18,777)
Research and                                      
development                                        (7,365)    (6,651)
Administration                                     (7,018)    (6,685)
---------------------------------------------------------------------
                                                  (37,760)   (32,113)
---------------------------------------------------------------------
OPERATING PROFIT                                     9,077     11,730
                                                                     
---------------------------------------------------------------------
Operating profit analysed                                            
between:
Existing operations before                
exceptional cost of sales                 14,780               11,730
Exceptional cost of sales                (5,359)                    -
                                       ----------           ----------
Operating profit for existing                     
operations                                           9,421     11,730
                                                                     
Acquisitions                                 266                    -
Amortisation of goodwill                   (610)                    -
                                       ----------                     
                                                     (344)          -
                                                 ---------- ----------
Total Operating profit                               9,077     11,730
---------------------------------------------------------------------
                                                                     
Net interest receivable                                451        532
---------------------------------------------------------------------
PROFIT ON ORDINARY ACTIVITIES BEFORE                
TAXATION                                             9,528     12,262
                                                                     
---------------------------------------------------------------------
Profit on ordinary activities                                        
before taxation analysed
between:
Profit on ordinary activities                                        
before taxation, amortisation of
goodwill and exceptional cost of                    
sales                                               15,497     12,262
Exceptional cost of sales                          (5,359)          -
Amortisation of goodwill                             (610)          -
                                                 ---------- ----------
                                                     9,528     12,262
---------------------------------------------------------------------
                                                                     
Tax charge on profit on ordinary                  
activities                                         (2,019)    (3,065)
---------------------------------------------------------------------
PROFIT ON ORDINARY ACTIVITIES                       
AFTER TAXATION                                       7,509      9,197
                                                                     
Dividends paid and                                 
proposed                                           (3,273)    (2,633)
                                                                     
---------------------------------------------------------------------
RETAINED PROFIT FOR THE YEAR                         4,236      6,564
---------------------------------------------------------------------
Earnings per                                                         
ordinary share
Basic                                                 8.1p      10.0p
Diluted                                               7.9p       9.8p
                                                                     
Diluted - before amortisation of                     13.0p       9.8p
goodwill and exceptional cost of
sales

CONSOLIDATED BALANCE SHEET
As at 30th September 2000

                                                 2000        1999
                                                 £000        £000
                                                                 
FIXED                                                            
ASSETS
                                                                 
Intangible fixed assets                       11,465       7,837
Tangible fixed assets                         26,093      23,032
---------------------------------------------------------------
                                              37,558      30,869
                                                                
CURRENT ASSETS                                                 
                                                                
Stocks                                        20,817      10,171
Debtors                                       67,754      35,948
Cash at bank and short                        
term deposits                                 19,182      17,794
---------------------------------------------------------------
                                                                
                                             107,753      63,913
                                                                
CREDITORS                                                       
                                                                
Amounts falling due                          
within one year                              (93,203)    (53,578)
                                                                
---------------------------------------------------------------
NET CURRENT ASSETS                           14,550      10,335
---------------------------------------------------------------
                                                                
                                                                
TOTAL ASSETS LESS CURRENT                    
LIABILITIES                                  52,108      41,204
                                                                
                                                                
CREDITORS                                                       
                                                                
Amounts falling due                          
after more than one
year                                         (5,375)     (3,531)
                                                                
PROVISION FOR LIABILITIES AND                                                 
CHARGES                                      (1,601)     (1,130)

                                                                
---------------------------------------------------------------
NET ASSETS                                    45,132      36,543
---------------------------------------------------------------
                                                                
CAPITAL AND RESERVES                                           
                                                                
Called-up share capital                       1,873       1,842
Share premium account                        16,368       6,029
Other reserve                                   500           -
Profit and loss account                      26,391      28,672

                                                                
---------------------------------------------------------------
EQUITY SHAREHOLDERS' FUNDS                   45,132      36,543

---------------------------------------------------------------

CONSOLIDATED CASH FLOW STATEMENT
For the year ended 30th September 2000

                                                              2000        1999
                                                              £000        £000
                                                                              

NET CASH INFLOW FROM OPERATING ACTIVITIES                  13,778       22,116
                                                                              

Returns on investments and servicing of finance              451          532
Taxation                                                  (1,742)     (3,569)
Capital expenditure and                                                       
financial investment                                       (9,591)   (16,693)
Acquisition of subsidiary                                   (296)           -
Equity dividends paid                                     (2,770)      (2,243)
------------------------------------------------------------------------------
                                                                            
NET CASH (OUTFLOW)/INFLOW BEFORE USE OF                                       
LIQUID RESOURCES AND FINANCING                              (170)          143
------------------------------------------------------------------------------
            
Management of liquid resources                            (3,364)        1,314
                                                                              
Financing                                                   1,558          687
                                                                              

------------------------------------------------------------------------------
(DECREASE)/INCREASE IN CASH                               
IN THE YEAR                                                (1,976)       2,144
------------------------------------------------------------------------------

RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
For the year ended 30th September 2000

                                                         2000         1999
                                                         £000         £000
                                                                          
(DECREASE)/INCREASE IN CASH IN THE YEAR               (1,976)        2,144

                                                                          
Cash outflow from decrease in                     
lease financing                                            6             -
Cash inflow/(outflow) from change                     
in liquid resources                                    3,364        (1,314)
------------------------------------------------------------------------
Change in net cash resulting from cash flows           1,394           830
New finance leases                                       (58)            -
Issue of loan notes                                   (2,278)            -
------------------------------------------------------------------------
MOVEMENT IN NET FUNDS IN THE YEAR                       (942)          830
                                                                         
Net cash brought forward                              17,794        16,964
                                                                         
------------------------------------------------------------------------
NET FUNDS CARRIED FORWARD                             16,852        17,794
------------------------------------------------------------------------

 NOTES TO THE ACCOUNTS

1.   Report and Accounts 2000

    The financial information set out in this preliminary results
    announcement does not constitute the Company's statutory accounts for
    the years ended 30th September 2000 or 30th September 1999 but is
    derived from those accounts.  Statutory accounts for 1998/1999 contained
    an unqualified audit report and have been delivered to the Registrar of
    Companies.  The statutory accounts for 1999/2000 will be posted shortly
    and delivered to the Registrar of Companies following the Company's
    Annual General Meeting to be held on 24th January 2001.

2.  Tax charge on profit on ordinary activities
    The tax charge for the year represents a rate of 20% of profit before
    amortisation of goodwill (1999: 25%).

3.  Earnings per share

    Earnings per share figures for 2000 and 1999 have been calculated using
    FRS14 Earnings per Share.  Basic earnings per ordinary share for the
    year ended 30th September 2000 is based on 92,941,901 ordinary shares,
    being the weighted average number of ordinary shares in issue during the
    year.  The diluted earnings per ordinary share for the year ended 30th
    September 2000 takes account of share options in issue and is based on a
    weighted average number of 95,684,362 ordinary shares issued and
    issuable. An adjusted earnings per share figure, which excludes the
    exceptional cost of sales and amortisation of goodwill has been
    included.

4.  Dividends per share

    The Directors have recommended the payment of a final dividend of 2.7p
    (net) bringing the total dividend for the year to 3.5p (net) per share.
    The final dividend is payable on 31st January 2001 to shareholders on
    the register on 8th January 2001.

5.  Net cash flow from operating activities


                                                    2000       1999
                                                    £000       £000
                                                                   
    Operating profit                               9,077     11,730
    Depreciation charge                            6,788      3,889
    Amortisation of intangible fixed assets        1,600        951
    Profit on sale of fixed assets                 (156)       (91)
    Increase in stocks                          (10,646)    (1,644)
    Increase in debtors                         (31,381)    (1,574)
    Increase in creditors                         38,496      8,855
                                               ---------   --------
                                                                   
    Net cash inflow from operating activities     13,778     22,116

    Copies of the Annual Report and Accounts may be obtained after the
    posting date of 15th December 2000 from the registered office of the
    Company at: New Mill House, 183 Milton Park, Abingdon, Oxfordshire OX14
    4SE

    A copy of this announcement is available at RM's internet site:
    http://www.rm.com and a copy of the Annual Report and Accounts will be
    available at the same site from 15th December 2000.