GB Group finishes year ahead of market expectations
Identity data technology company GB Group reported a 9% improvement in total revenue and organic constant currency revenue for the 2021 financial year on Thursday, to £217m, ahead of updated market consensus expectations.
The AIM-traded firm said it would disclose organic revenue reflecting the impact of the two small businesses it disposed of in the last quarter in its full-year results.
It said it had a “strong” 12 months ended 31 March in challenging conditions, and benefited from a shift to digital models among its customers.
Growth was the strongest in its identity operations, helped by United States stimulus and good growth in financial technology.
The board said the location division also grew well, supported by increased transactions in the online retail sector.
That growth “more than compensated” for a decline in the sectors affected by Covid-19, the firm reported, as well as lower sales of fraud products, which were traditionally deployed onsite where pandemic restrictions impacted new sales and implementations.
GB Group said it expected to report adjusted operating profit of about £58m, which would be a 21% increase year-on-year, and would also be ahead of updated market consensus forecasts.
The growth rate in adjusted operating profit was underpinned by a combination of factors including business mix, with the one-off impact of deferring expenditure as a “prudent step” in the early stages of the pandemic, as well as lower people costs flowing from those decisions, and cost savings as a direct result of the coronavirus crisis.
Net cash balances at year-end totalled £21m, swinging from net debt of £35m at the end of the 2020 financial year.
Strong cash generation enabled the full repayment of the company's bank loans by 31 March, compared to leverage of 0.8x at the end of the prior financial year.
“I am very pleased with the performance of the business in the 2021 financial year,” said chief executive officer Chris Clark.
“Although Covid-related uncertainties remain front of mind, we are encouraged by the global easing of lockdowns and the pace of vaccinations in some of our key geographies.”
Clark said one legacy of the pandemic would be accelerated digitalisation.
“GB Group will play a major role in this transition and over the next year we will continue to make important strategic investments in the business, its technology and in our people to fully leverage the opportunity this presents.”
GB Group said it would release its final results for the year ended 31 March in June.
At 1525 BST, shares in GB Group were up 5.14% at 920.51p.
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