Gb Group Plc · LSE:GBG
Gb — GBG — H1 FY23 Earnings Presentation
31 slides from Gb's earnings presentation, November 2022
Slide 1: Results presentation
Results presentation For the six months ended 30 September 2022 Chris Clark David Ward CEO CFO
Slide 2: Disclaimer
Disclaimer Restricted distribution Forward-looking statements This presentation is not for release, publication or distribution, in whole or in part, This document contains certain forward-looking statements, including statements directly or indirectly, in, into or from any jurisdiction where to do
Slide 3: Introduction to GBG
Introduction to GBG November / December’22 investor roadshow
Slide 4: Who is GBG
Who is GBG We are one of the largest pure-play identity software solution providers In a fast-evolving industry, we have 30+ years of experience in location intelligence, identity verification and fraud & compliance management. Our business is focused around 3 complementary solutions: Location, Iden
Slide 5: GBG's purpose: Build trust in a digital world
GBG’s purpose: Build trust in a digital world Our vision: To create a world where everyone can transact online with confidence Investing in the future of identity underpinned by trust to deliver long-term sustainable growth Build Markets Build Differentiation Build Once Growth by regions, sectors an
Slide 6: Differentiating through world-class data, technology and trust experts
Differentiating through world-class data, technology and trust experts Our competitive strength We can provide trust at every step of Onboarding the customer journey • Enhances customer experience, reducing friction with real-time verification • Improves customer onboarding speed, verifying more gen
Slide 7: Industry leaders choose GBG
Industry leaders choose GBG Internet Retail & Banking Finance Lending & Insurance Gaming economy ecommerce payments | Investor Presentation – November 2022 7
Slide 8: Strategic & operational review
Strategic & operational review Chris Clark - CEO
Slide 9: H1 FY23 at a glance
H1 FY23 at a glance Strategic & operational summary Financial summary • Overall, excellent strategic and operational progress • Increase in reported revenue of 22.6% to £133.8m, against long term growth strategy helped by M&A in prior year • Volume impact from two specific end-market • Pro forma rev
Slide 10: Location
Location Validating accurate and reliable address data with minimum friction 1H FY23 underlying constant currency growth of 10.4% • Successfully pursued cross-sell/up-sell initiatives • Price increases and new business wins New customer wins • A resilient business model demonstrated by new customer
Slide 11: Identity
Identity Building trust across all points of the identity verification and identity fraud customer journey 1H FY23 pro forma constant currency decline of 1.4% (Growth of 7.0% incl. FX) • Tough comparatives from US stimulus and exceptional cryptocurrency activity • Volume decline from cryptocurrency
Slide 12: Fraud
Fraud Offering protection against modern-day financial crimes such as identity, application and transaction fraud 1H FY23 underlying constant currency growth of 14.4% • Strong organic growth driven by new customers and important renewals with existing financial services customers in both APAC and EM
Slide 13: Financial review
Financial review David Ward, CFO
Slide 14: Financial performance
Financial performance GBG grew reported revenue and adjusted operating profit. Our cash generative model supporting ongoing investment in the business and the repayment of the debt £133.8m £134.9m £28.1m A track record in reported revenue growth Reported group revenue Pro forma revenue1 Adjusted • D
Slide 15: Group income statement
Group income statement 31 March 1H FY23 1H FY22 Growth 2022 Six months to 30 Sept £m £m £m • 10.4% pro forma underlying growth; 3.4% on a pro forma constant currency basis Reported revenue 133.8 109.2 +22.6% 242.5 • Change in sales mix has increased the Gross profit % Cost of sales (38.7) (32.3) (70
Slide 16: Group Balance Sheet
Group Balance Sheet 1H FY23 FY22 As at As at 30 Sept 31 March Strong cash generation 2022 2022 Variance £m £m vs. FY22 Debt leverage & borrowing: Tangible assets 6.7 7.3 (0.6) Intangible assets 1,096.5 971.9 124.6 Net cash / debt 30 Sept 22 31 Mar 22 30 Sept 21 analysis £m £m £m Deferred tax assets
Slide 17: A business model delivering sustainable revenue and excellent cash generation
A business model delivering sustainable revenue and excellent cash generation GBG’s revenue breakdown Subscription-based revenue 54.9% 19.5% £58.2m Transaction/consumption revenue of 1H FY23 pro forma Deferred Other revenue £141.7m2 £134.9m3 revenue is growth in revenue £122.0m2 14.5 9.0 subscriptio
Slide 18: Group revenue bridge for 1H FY22 – 1H FY23
Group revenue bridge for 1H FY22 – 1H FY23 • Reported revenue growth of 22.6% • Pro forma underlying revenue growth of 10.4% • Pro forma underlying revenue growth ex. FX of 3.4% Pro forma underlying growth 10.4% Current year deferred Acuant crypto revenue haircut 1H FY22 - Revenue (£m) FX Effect of
Slide 19: A diversified revenue mix
A diversified revenue mix We deliver our services across an ever-increasing number of sectors and regions Sector split Geographic spread 45% 1H FY23 45% 1H FY23 FY22 41% FY22 40% 40% 39% 40% 38% 35% 35% 30% 30% 30% 30% 25% 25% 20% 20% 17% 16% 15% 15% 15% 14% 12% 11% 11% 11% 10% 9% 8% 8% 10% 7% 6% 5%
Slide 20: Cryptocurrency volumes declined due to broader macroeconomic and market volatility
Cryptocurrency volumes declined due to broader macroeconomic and market volatility GBG’s FY18-22 cryptocurrency revenues • First half cryptocurrency volumes declined due to (excl. Acuant revenues) broader macroeconomic slowdown and market volatility £16 Revenue from cryptocurrency (£m) ~5.8% Our rev
Slide 21: Summary & outlook
21 Summary & outlook Chris Clark, CEO
Slide 22: Summary
Summary First half performance Excellent strategic progress • Identity volumes impacted by the challenges in • Drives a sustainable runway of growth over time cryptocurrency and internet-economy customers, • We have a relentless focus to deliver against our long- particularly the Americas term strat
Slide 23: Outlook
Outlook GBG is a diverse business to navigate the near-term macro uncertainties Public Sector / Examples Cryptocurrency Internet economy Retail / eCommerce FS & Payments Gaming Healthcare • Start to the second half has • Expect mid-single digit pro • Expect a stronger second half • The Board remains
Slide 24: Differentiating through world-class data, technology and our trust experts
Differentiating through world- class data, technology and our trust experts Our capital market’s event on 19 January 2023 creates an exciting opportunity to discuss the long-term growth opportunities and how GBG is uniquely positioned to capture them: • What customers need today and in the future •
Slide 25: Q&A
Q&A
Slide 26: Appendices
Appendices GBG
Slide 27: Cash flow
Cash flow 31 March Remain focused on cash generation: 1H FY23 1H FY22 2022 Six months to 30 Sept £m £m Variance £m • 70% (FY22: 96%) Adjusted EBITDA cash conversion ratio on 12m rolling basis with the decline related to specific non-recurring factors: Adjusted EBITDA 29.7 29.4 0.3 62.2 Working capit
Slide 28: Modelling considerations for FY23 – Foreign Exchange
Modelling considerations for FY23 – Foreign Exchange Currency % of group revenue Trading update – 20 Oct Impact of FX move (vs. GBP) 1H FY23 FX assumption A 3 cent move in the average exchange rate for H2 will impact the: 1.16 US Dollar 38% (vs. spot 1.14) • Second half growth rate by approx. 1% • F
Slide 29: Our purpose-led approach makes a difference
Our purpose-led approach makes a difference Making progress towards our ambitions Our people Environment Data privacy & Ethics & IT security governance We contribute to the following UN SDGs: • 95% of our team • Focused on reducing our • Employing best-practice • A Board with robust “recommend GBG a
Slide 30: Acquisitions and investments
Acquisitions and investments • 15 acquisitions and one investment since 2011 to accelerate our organic growth strategy • Reputation as a credible, high integrity acquirer - each acquisition’s strategy and integration is treated differently • US market penetration enabled through several acquisitions
Slide 31: Contact
Contact David Ward CFO david.ward@gbgplc.com Richard Foster Senior Manager, Investor Relations richard.foster@gbgplc.com | Investor Presentation – November 2022