NCC Group PLC on Thursday gave no update on plans for its Escode and cyber security businesses as it reported improved profitability but lower sales.
The Manchester, England-based cyber security and software escrow business, swung to a pretax profit of £20.6 million in the financial year to September against a £17.8 million loss the year prior.
This mainly reflected a one-off profit of £11.4 million from the sale of Fox Crypto in March and a reduction in other ‘individually significant items’ of £29.5 million, NCC explained.
The latter included re-organisation charges and costs relating to the strategic review of its Escode and Cyber business businesses.
Revenue declined 7.2%, or 6.2% at constant currency, to £305.4 million from £329.2 million the year before.
NCC said the sale of Fox Crypto helped transform the balance sheet to eliminate group borrowings.
Net cash, excluding lease liabilities, amounted to £13.1 million compared to net debt, excluding lease liabilities, of £45.3 million the year prior.
In October, NCC said it was considering offers to buy the whole company, after stating it was considering options for its Escode and cyber security businesses earlier in the year.
On Thursday, Chief Executive Mike Maddison said if a sale of Escode is concluded, ‘this would allow NCC Group to become solely a pure-play cyber security service company and consider a significant return of capital to shareholders.’
Looking ahead, NCC anticipates that revenue, including recent non-core disposals, for the financial year ended September 2026 is expected to grow marginally, with Escode and Cyber Security experiencing low single-digit growth as pipeline continues to build.
Full-year group adjusted earnings before interest, tax, depreciation and amortisation is expected to be in line with expectations - growing faster than revenue.
In the financial year just ended, NCC reported adjusted Ebitda of £43.7 million, down 12% from £49.7 million in the prior 12-month period.
‘While the macro environment remains challenging, demand for cyber security, resilience and regulatory assurance continues to grow. We are confident in our strategy to deliver sustainable growth and long-term success,’ CEO Maddison said.
NCC said it is proposing an unchanged final dividend of 3.15p per share, ‘marking 20 consecutive years of dividend payments for shareholders.’
Shares in NCC fell 3.0% to 135.60 pence each in London on Thursday.
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