City round-up: GB Group; Altitude Group; N Brown Group

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29th November 2022

GB Group, the Chester-based identity verification specialist, reported a 22.6% increase in half year revenues today, but zero profit, compared with a £14m pre-tax profit this time last year.

The results for the six months to September 30, showed turnover of £133.8m, up from £109.2m a year ago. An adjusted operating profit, before exceptional items and normalised items, of £28.1m, a one per cent improvement on the previous year, despite tough first half comparators driven by the US Stimulus project and exceptional cryptocurrency volumes last year.

Net debt of £132.6m was compared with a surplus of £39.5m a year ago, primarily driven by a US Dollar retranslation impact.

The group said it expects margin improvement for the full year due to second half weighted revenues, supported by its strong pipeline of opportunities and disciplined cost control. It is focused on maintaining a strong balance sheet, using cash generation to pay down debt.

And the integration of Acuant has been completed. GBG says it is well positioned to drive growth and on track to deliver £5m synergies through cost and cross-sell/up-sell revenue initiatives.

Chief executive, Chris Clark, said: “Excellent strategic progress has been made across the group over the past six months as we maintain our relentless focus to deliver against our long term growth strategy, bringing our market leading Location, Identity and Fraud solutions together to address the ever-growing needs of customers in the digital world.

“Our fantastic people around the world are key to this success, and I would like to thank them for their efforts. Their continued hard work and dedication has underpinned GBG as it has evolved into one of the world’s leading pure play identity software providers.

“The macro uncertainties have been well publicised, but with world class technology, a diversified blue chip customer base and our strong cash generative business model, the board remains confident in the long term prospects of the business.”

Alasdair Young, of investment bank Panmure Gordon, reiterated his Buy call on GBG’s stock after today’s announcement, but said: “GBG’s interims are in line with the disappointing figures from the October trading update.

“Underlying constant currency revenue growth was only 3.4%, though we estimate that this figure improves to high single digits if we strip out all crypto and ‘internet economy’ revenue.

“We understand that customer retention rates remain unchanged in the high 90s, and win rates have, if anything, improved. Crucially, we think this points to weak end markets as opposed to concerns about losing market share.”

Altitude Group, the Manchester-based operator of a leading marketplace for the global promotional products industry, has improved turnover and reduced losses in the six months to September 30, 2022, it revealed today.

Revenues of £7.7m were a 29.3% increase on figures a year ago, and the pre-tax loss was cut from £414,000 last year to £133,000 this year.

The business said it achieved a strong underlying performance during the reporting period, with its platform geared for scalability and attracting high value, high quality users.

Altitude said it benefits from an advantageous exchange rate and has not experienced any negative impact, to date, from the current macro-economic turbulence.

It added that the board remains cognisant of the macro-economic uncertainty and the potential impact on the business, although remains cautiously optimistic.

Continued robust growth is anticipated into second half of the year with new partner agreements signed across all key programmes and a growing new business pipeline.

Chief executive, Nichole Stella, said: “In the first six-months of the current financial year, the group experienced a robust performance across key Services and Merchanting programmes showing significant growth on the same period last year.

“The continued strong, consistent, and upward momentum in the performance of the business in both revenue and profit growth demonstrates the group’s ability to execute on its strategy.

“Based on the performance in the year to date, the board was pleased to announce on 22 November 2022 that the group is on track to achieve record year-end results. With continued focus on scaling the business and a healthy new business pipeline, the group is well placed for accelerated future growth, and the board is confident in the long term success of the business and its positive outlook for the future.”

N Brown Group, the Manchester-based inclusive fashion and homeware digital retailer, has announced that Rachel Izzard has today notified the board of her intention to step down as group chief financial officer.

She will be leaving the group to take up a career opportunity outside of the online fashion and consumer credit industry.

The process to identify her successor is under way.

The group said Rachel has agreed to work her 12 month notice period while a successor is identified.

Original article here: https://www.thebusinessdesk.com/northwest/news/2106760-city-round-up-gb-group-altitude-n-brown-group

Author: Neil Hodgson

Alasdair Young

Director, Research Analyst, Technology

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