Computer company RM is confident that the market for linking schools to the Internet will continue to grow, with its order book topping 100m, writes Maggie Hartford.

Half-year profits were 1.5m, compared with 2.5m for the same period last year. But the figures include 2.1m set aside to cover the costs of Classroom 2000, a 300m project to manage the computers of all the schools in Northern Ireland, which RM hopes to win. RM, based at Milton Park, near Abingdon, has set up a joint venture with ICL to bid for the project.

Staff numbers have grown by 108 to 1,300 and turnover was up ten per cent to 78.1m.

Chief executive Richard Girling said the group expected to take on another few hundred staff in the second half of the financial year. "We are delighted with the progress made in the year to date," he said.

"The performance of our software and services business has been strong. These businesses now contribute over 50 per cent of the group's turnover.

"Looking ahead, we remain convinced that the use of ICT in education will continue to increase dramatically. "Our investment in developing Internet-related businesses and in our Learning Schools programme and learning software activities positions us well to capitalise on the next phase of this growth.

"We expect continued strong financial performance in the second half and are confident of further good progress for the group."

The company is to double the capacity of its Internet services to schools at no extra cost. The Internet for Learning service which is currently taken by 11,000 schools - nearly a third of those in Britain. Three years ago less than 1,000 schools had networked access.

The deal will help the group secure its dominant position in the schools market, which it believes is set to boom under the Labour government.

Chairman John Leighfield told shareholders he believed the provision of Internet education services to schools was set to increase "dramatically".