Full year results for the year ended 31 March 2023

GB GROUP PLC

(“GBG”, the “Group” or the “Company”)

Full year results for year ended 31 March 2023

JUNE 15, 2023 – London: GB Group plc (AIM: GBG), the experts in digital location, identity verification and fraud prevention software, announces its audited results for the year ended 31 March 2023.

Chris Clark, CEO, commented:

“GBG continued to make important strategic progress and operational improvements that will have long-term benefits; however, we were impacted by unexpectedly deep post-pandemic corrections in some end markets. These corrections were largely felt in the internet economy, notably by cryptocurrency and fintech customers primarily in our Identity business in the Americas, as flagged in our February trading update.

Looking ahead to FY24, since our update in February, there has been no material change in market conditions. Uncertainty remains; however, we still expect some gradual revenue acceleration in the latter part of the year. The Board is confident that GBG will deliver its FY24 profit expectations assisted by a group-wide focus on efficiency. The business is well-placed to benefit from structural growth, including the increasing proliferation and sophistication of fraud through the advent of generative AI, capitalising on the breadth of its capabilities and global reach to deliver our mid-term growth targets.”

Notes: ¹Defined within note 20 to the Full Year Results. ²Exceptional costs of (£127.2)m include a (£122.2)m non-cash goodwill impairment charge following the Group’s annual impairment review, as explained further within the financial review and note 7 to the Full Year Results. ³ Defined within note 9 to the Full Year Results.

Financial summary

• Statutory revenue growth of 15.0% as a result of prior year acquisitions and despite tough comparators driven by the US stimulus project and exceptional cryptocurrency volumes in the prior year
• Pro forma revenue of £279.8 million up 3.7% on an organic constant currency basis reflects:
• Double-digit growth in both Location and Fraud segments
• Challenging post-pandemic conditions in the internet economy within Identity
• 94% of revenue from subscription and consumption models and strong customer retention demonstrates the attractiveness and repeatability of our cash-generative model
• Adjusted operating profit up 1.7% to £59.8 million, representing an adjusted operating profit margin of 21.5%. Within this, gains on foreign exchange were £3 million
• Reflecting the macro challenges in the last year, the annual impairment review resulted in a non-cash exceptional goodwill impairment charge of £122.2 million against our Identity business in the Americas, which is formed of our IDology and Acuant acquisitions
• Net debt of £105.9 million as at 31 March 2023 (FY22: £107.0 million) despite a negative £8.6 million retranslation impact since FY22; focused on cash generation to further reduce our debt during FY24
• The Board recommends a final dividend per ordinary share of 4.00p, up 5%

Important strategic progress; well-positioned for the future

• Addressing the convergence of identity and fraud, while driving efficiency through simplification:
• Prioritised product and technology investment, and simplified our portfolio to meet the rapidly changing market needs which has enabled GBG to accelerate product innovation
• Mobile Fraud signals in EMEA, Fraud Alerts and Compliance platform in APAC and AI-powered anti-tampering technology
• Entering markets at pace, winning new opportunities and building our pipeline, which includes our expanding Southeast Asia footprint driven by growing demand for identity fraud solutions
• Enhanced capabilities and breadth: Documents and biometrics portfolio now powered by one library with 8,000 documents; expanded Multi Bureau to cover Australia and Canada, and GBG GO, our no-code platform is resonating with customers, who require expertise to manage onboarding at speed
• Continued to enhance our Location intelligence products with customers now benefitting from the release of our latest AI-powered address capture/verify solutions to increase match rates
• Acuant integration complete. IDology is now our primary go-to-market identity brand in the Americas, our differentiated capabilities in biometrics, document and data offer a powerful, combined solution and the combined team have secured over 100 cross-sell/up-sell opportunities
• We are proud recipients of Gallup's 2023 Exceptional Workplace Award, reflecting our commitment to prioritising team engagement and embedding it within our business strategy
• Progress on our ESG strategy; achieved carbon neutral operations this year and set an ambition to become a carbon net zero business by 2045
• Capital Market’s event in January articulated how GBG is uniquely positioned to capitalise on the long-term growth opportunity

Today’s results presentation

Management will be hosting a results presentation webcast this morning at 09:00am for sell-side analysts and institutional investors. The webcast can be accessed via our website www.gbgplc.com/en/investors or directly at https://brrmedia.news/GBG_FY23. Playback will be available along with the presentation materials shortly following the event.

For further information, please contact:

About GBG

We are the experts in digital location, identity and managing fraud risk and compliance. Helping organisations across the globe eliminate customer friction and fraud from their digital experiences. GBG develop and deliver address verification, digital identity, fraud risk and compliance software to businesses globally.

Through the combination of the latest technology, the most accurate data and our unrivalled expertise, GBG helps organisations ranging from start-ups to the largest consumer and technology brands in the world deliver seamless experiences, so their customers can transact online with greater confidence.

To find out more about how we help our customers establish trust with their customers visit www.gbgplc.com and follow us on LinkedIn and Twitter @gbgplc.