AdVal has been appointed a preferred supplier by the Royal Bank of Scotland for the next three years. The new agreement cements its relationship with the FTSE 100 bank and whilst e-learning will remain a prominent feature, the agreement has been extended to cover AdVal's full range of services, including management consultancy, face-to-face training, and off-the-shelf titles. AdVal recently issued a bullish update in which it said second-half trading had strengthened and preliminary figures to March 2002 would 'at least' meet expectations. Nevertheless, analyst George O'Connor of Old Mutual expects a £900,000 loss on £5.3m of sales when it reports in July. However, next year followers should look for a £200,000 profit on £6.5m of sales. AdVal's recent contract wins have included the Bank of Ireland's first ever e-learning contract, as well as deals with the National Learning Network, Becta Further Education and the Ministry of Defence Royal Military College of Science. It is hoping to cash in on a potentially huge e-learning market, forecast by International Data Corporation to grow from $2.3bn in 2000 to $18bn by 2005. Even for 2003, the shares are trading on a demanding 40 times forecast earnings, but positive news flow is streaming in and AdVal could be an interesting long-term punt. Hold.