Responding to customer need We continued to refine our services based on customer need, contributing to a successful year in our Assurance division – particularly in North America and the UK, with total Assurance revenue growth of +12.1% at constant currency 1 (+10.5% at actual rates). Our decision to create a global professional services function, with investment in our systems to enable collaboration, has meant customers can access our expertise more readily, utilising our global talent base over and above just the team in their market. Global cross charged days increased 47%. This has been transformational, both in terms of customer experience and our capacity to handle increased customer demand rapidly. It is a prime example of our growing capability to truly operate as one global firm – to the benefit of our customers. In managed services, our newest offering using Microsoft Extended Detection and Response (XDR) has shown significant promise. We have the ability to quickly and simply offer 24/7 managed detection and response (MDR) to businesses with a Microsoft infrastructure – no matter where they are in the world. This has, in a sense, democratised MDR and made it a more natural purchasing decision. With so much of the market still untapped there is opportunity to scale further. In addition, NCC’s Microsoft Cloud Business has shown growth over the last twelve months, resulting in significant Azure Consumed Revenue (ACR) being driven back to Microsoft. This ongoing partnership goes from strength to strength, with NCC also embedded in the Microsoft Intelligent Security Association, and with a nomination for the Microsoft MSSP Program. NCC is now recognised as one of Microsoft UK’s fastest growing Cloud Security Partners and we are looking forward to extending that into Europe, North America & Asia-Pacific. In our Software Resilience division, the acquisition of IPM at the start of the financial year led to increased scale. The integration is substantially complete, and our new colleagues have added to the brilliant talent already present in the team. We have seen appetite from the IPM client base for our Escrow-as-a-Service (EaaS) cloud escrow proposition, with a healthy pipeline moving into FY23. Financial performance summary Group revenues increased by 17.9% on a constant currency basis 1 and at 16.4% (2021: 2.6%) at actual rates. Group revenues excluding the recent IPM acquisition 1 increased by 10.3% on a constancy currency basis 1 , 8.9% at actual rates. In our Assurance business, the North American and UK and APAC Assurance businesses grew on a constant currency basis 1 by 14.6% and 11.8% respectively (13.8% and 11.6% at actual rates) and our EU region 2 increased 8.0% on a constant currency basis 1 (2.7% at actual rates). Global Professional Services grew by 11.0% to £189.0m on a constant currency basis 1 (9.8% at actual rates) with delivered day rates increasing by 2.1% (H2 delivered day rates increased by 3.5%). Global Managed Services (GMS) grew by 6.7% to £58.6m on a constant currency basis 1 (4.3% at actual rates).
Within GMS, our new XDR service global sales orders for the forthcoming years increased twelvefold to £11.6m. The Group has received continued strong sales orders since the year end providing confidence in our future growth strategy. Remediation services are generating market traction, with 2022 revenues of £4.5m compared to £2.1m in 2021. In our Software Resilience division, we completed in June 2021 the acquisition of IPM, which contributed £20.2m to revenue, delivering an overall growth in the division of 55.1% on a constant currency 1 basis (53.8% at actual rates). Our overall Software Resilience division results excluding IPM showed a decline in revenues for the first half of 3.3% on a constant currency 1 basis (4.9% at actual rates); however, as expected our second half revenue increased by 2.2% on a constant currency 1 basis (2.2% at actual rates) resulting in an overall decline of 1.4% for the year. Our Escrow-as-a-Service (EaaS), our cloud escrow proposition, generated sale orders of £3.4m, an increase of 64% compared to the same period last year. Gross profit increased by 19.9% to £132.6m (2021: £110.6m) with gross margin percentage increasing to 42.1% (2021: 40.9%). The margin increase was due to the impact of the IPM acquisition, offset by overall Assurance margins declining by 0.4% pts as we focused on sales growth and a decline in our existing Software Resilience business by 3.2% pts following recent investment to return it to sustainable growth. Turning to our statutory operating profit and taking into account all adjusting items (£13.4m), the Group has recognised an overall operating profit of £34.7m. However, as the Group manages its performance internally at an Adjusted operating profit 1 level, Adjusted operating profit 1 increased by 22.7% to £48.1m (2021: £39.2m). Profit before taxation increased 109.5% to £31.0m (2021: £14.8m) and profit for the year increased 130.0% to £23.0m giving rise to a basic EPS of 7.4p (2021: 3.6p); Adjusted basic EPS amounts to 10.8p (2021: 9.5p). At 31 May 2022, our cash conversion 1 was 101.9% (2021: 88.2%). Net debt 1 amounts to £85.0m (2021: net cash of £48.9m). Net debt excluding lease liabilities 1 amounts to £52.4m (2021: net cash £83.3m). Total borrowings (including lease liabilities) offset by cash and cash equivalents amounts to £85.0m (2021: net cash £48.9m).
NCC Group plc — Annual report and accounts for the year ended 31 May 2022
9
Made with FlippingBook Online newsletter maker