2nd Jul 2014 12:16
LONDON (Alliance News) - GB Group PLC Wednesday raised its total dividend for the year to end-March, and said it was confident in its long-term growth prospects, as it saw pretax profit rise in the year to end-March.
The identity solutions company raised its total dividend by 6.7% to 1.60 pence from 1.50 pence the year before.
GB Group posted a pretax profit of GBP4.0 million, up from GBP3.5 million in the previous year, as revenue rose to GBP41.8 million from GBP39.4 million and margins improved. Cost of sales dropped to GBP14.5 million from GBP16.7 million.
The company saw a strong performance in its Identity Proofing business, driven by the launch of its ID3global identity verification software.
In its Identity Solutions business, the company saw revenues rise 11%, driven by the launch of new versions of its software products.
The company restructured its commercial agreements with BT Group PLC last year, and whilst under the new terms it no longer receives royalty payments from BT, it no longer pays a proportion of revenue for clients served through its ID3global platform. As a result of this, revenue from the agreement has reduced, but margins have increased.
The company said shortly after the year-end that it had acquired Australia-based DecTech Solutions Pty Ltd, which had helped provide it with better better scale, capabilities and geographic reach. The acquisition is being integrated into the company's Identity Proofing business.
"[The integration is] going really well, I've been down there for the last two weeks and I met with customers, sales partners and all of the teams down there. In particular I met with GE Capital and HSBC which are very big customers and they raved about [DecTech's] products and services," Chief Executive Richard Law told Alliance News.
Law explained that as a result of the acquisition it would be able to use its infrastructure to help drive sales in DecTech's operations across Asia, and additionally be able to bring DecTech's products and services into the UK.
"We're in the process of doing that and we've got quite a nice pipeline building for those product and services," Law said.
"We are looking at opportunities," Law said. "The market we operate in is very fragmented, and there are opportunities to consolidate, but it would have to be the right fit. It must bring along complimentary capability, and it needs to be in a high growth sector of the market, have very good products and services, and be capable in a relatively short time, if not in year, of being earnings enhancing."
"Its a pretty choosy pick list really, if we find the right one we have GBP11.8 million in the bank, debt facilities we can exploit, and we have supportive shareholders," Law said.
As part of its business model, the company sources data from external datasets via partnerships. Law wouldn't rule out the possibility of acquiring a company which collects or holds that data itself if the data was very unique, but Law said that it was probably more cost effective to buy the data than to own it and maintain it.
In the coming year GB Group said it will continue to focus on internationalising its product portfolio, continuing its investments and improving margins.
Law said that one of the company's goals is to be able to verify anyone in the world, anywhere, at any time. The company said it's about half way to this objective in the thirty countries within which it operates.
"When we're all the way there, when you think about all the businesses, social networks, financial services, that have aspirations to access the globe on-line then the potential of a service like that is huge," Law explained. "So we're going to continue to build out those international services and we have international aspirations for all of our products and services."
"We're the biggest checker of criminal records in the UK, [...] so why on earth can't we do that in France and Germany etc? It's the same software, its the same methodology," Law said.
"I think as the world gets smaller we have a real opportunity for further internationalisation, our revenue last year from international was less than 10%, with the DecTech acquisition this year it will be over 20.%" Law said.
Shares in GB Group were trading up 3.7% at 162.24 pence Wednesday afternoon.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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