Half-year trading update – October 2024

GB GROUP PLC

("GBG", "Group" or the "Company")

Strong 1H25 results: FY25 outlook reiterated

17 October 2024, London, UK: Today, GBG, (AIM: GBG) the expert in global identity fraud and location software, provides an update on its performance for the six months to 30 September 2024.

The Board is pleased with the strategic progress and financial performance that GBG has delivered in the period. This performance is in line with our expectations and underpins the Board’s confidence in reiterating its FY25 outlook.

Business performance and outlook

First half revenue was approximately £137 million (1H24: £132.4 million), up 4.5% on a constant currency basis, with our two largest segments, Identity and Location, together up 6.8% on a constant currency basis.

Identity built on the momentum generated in the final quarter of FY24, led by the year-on-year improvement in EMEA and Americas as a result of improving net revenue retention. We maintained solid growth in Location through new logos, partner activity and strong retention, despite the subdued consumer backdrop. The growth of these segments more than offset the anticipated high-single-digit decline in Fraud which, as previously noted, relates to year-on-year timing differences in our customer renewal cycles.

As a result of our revenue growth in the last six months and the continued benefit of our group-wide cost and simplification initiatives executed in the prior year, the first half adjusted operating profit¹ grew by approximately 21% to £29 million, representing a margin of 21.2%.

Our balance sheet remains strong with good progress in lowering net debt, which as at 30 September had reduced to around £72 million (31 March 2024: £80.9 million). This includes the FY24 final dividend payment of £10.6 million and a £5.0 million retranslation benefit given the relative strength of pound sterling since our FY24 results.

With the strong progress achieved by the business in the last six months and positive momentum moving into the second half of the year, the Board reiterates its FY25 outlook. We expect to deliver mid-single-digit revenue growth on a constant currency basis, leading to high single-digit growth in adjusted operating profit.

Commenting on the results, Dev Dhiman, CEO, said:

“On becoming CEO, I outlined four initial focus areas – removing complexity; being globally aligned; driving a performance culture; and accelerating the pace of innovation to ensure the business capitalises on its potential as well as the significant market opportunity.

We have made encouraging progress in each of these areas, and this is translating into our performance – with strong pipeline execution, ramp-up with a number of important customers, and some significant customer win-backs reinforcing our market leadership position in identity fraud and location software.

The positive operating momentum we carry into the second half underpins both the Board’s ongoing confidence in delivering the FY25 outlook, and our ability to fulfil the longer-term potential of the business. I look forward to sharing more on this progress at our November results.”

Notes

¹ Adjusted operating profit excludes amortisation or impairment of intangible assets, share-based payments and exceptional items

Notice of results

GBG intends to release its half-year results on Tuesday, 19 November 2024. On the morning of the announcement, a management presentation with Q&A will be hosted virtually for investors and sell-side analysts at 09:30am GMT. Sign-up details can be found on our investor relations website.