Viability risk
Risk as applied to viability assessment
Specifics of scenario modelled Potential impact
The impact of this sensitivity has been assessed against the Group’s projected cash flow, available banking facilities, and compliance with financial covenants over the three year viability period. The scenario applied indicates sufficient headroom throughout this period, confirming that no mitigating actions are necessary. The impact of this sensitivity has been assessed against the Group’s projected cash flow, available banking facilities, and compliance with financial covenants over the three year viability period. The scenario applied indicates sufficient headroom throughout this period, confirming that no mitigating actions are necessary.
In order to consider the impact of the risks identified, management has modelled the following scenario: A reduction in future trading performance within Cyber Security, specifically in the Group’s Technical Assurance Services (TAS). This scenario models an annualised reduction of £10.6m in revenue and £3.8m in profitability over the three year viability period.
The ineffective execution of a strategy could have a material negative impact on the Group’s financial performance and value. It would potentially weaken the Group compared to its competitors and risk the Group’s established position in the marketplace. Inability to deliver to clients could result in revenue loss and reputational damage, hindering the Group’s ability to execute its strategy. Loss of key colleagues or significant colleague turnover could result in a lack of necessary expertise or continuity to execute the Group’s strategy. Inability to attract and retain sufficient high calibre colleagues could become a barrier to the continued success and growth of NCC Group. Suboptimal business decision making, and performance as key financial performance data is not available or trusted. These suboptimal decisions could prevent the Group from achieving its strategic goals. Inability to transact, operate and deliver profitable services resulting in loss of revenue and negative impact on share price. Data breach leading to fines from regulators and reputational damage. Lack of availability in systems. Inability to operate services resulting in loss of customer trust, resulting in loss of revenue and negative impact on share price. Impact on national security due to our work with government clients. Each of the above could result in a loss of customers and revenue. Inability to transact, operate and deliver services resulting in loss of customer trust, resulting in loss of revenue and negative impact on share price. Client non-renewal, SLA breaches, or mid-service cancellations could result in revenue loss. Delivery negligence could lead to legal action, reputational damage, and loss of customers and revenue. Failure to maintain internationally recognised quality and security standards could result in client loss, revenue decline, and operational restrictions. Reputational damage from legal action being taken and financial impact of the fines and the impact it may have on key customer accounts.
Inability to execute the Group’s strategy including the diversification of market sector, region, product/service or client Insufficient strategic workforce planning, including technological development and training of colleagues
Insufficient quality, integrity and availability of management information Commercial models (contractual and pricing) do not reflect the flexibility required by clients or drive the optimal commercial
In order to consider the impact of the risks identified, management has modelled the following scenario: A loss in key customers resulting in an annualised reduction of £8.9m in revenue and £2.6m in profitability over the three year viability period.
outcome for NCC Group
Cyber attack
Significant business systems failure
Inability to effectively compete in the market
Criminal and civil corporate legal action
resulting in fines and incarceration
NCC Group plc — Annual report and accounts for the year ended 30 September 2025 39
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