Gb Group Plc · LSE:GBG
Gb — H1 FY22 Earnings Presentation
39 slides from Gb's earnings presentation, Nov 30, 2021
Slide 1: Half year results
GB Group plc Half year results six months ended 30 September 2021 30 November 2021
Slide 2: Disclaimer
2 Disclaimer Restricted distribution Forward-looking statements This presentation is not for release, publication or distribution, in This document contains certain forward-looking statements, including whole or in part, directly or indirectly, in, into or from any jurisdiction statements regarding
Slide 3: Agenda
1. Highlights and Operational review 2. Financial review 3. Strategy overview 4. Acquisition of Acuant 5. Summary & Outlook
Slide 4: Highlights & Operational review
4 Highlights & Operational review Chris Clark, CEO
Slide 5: GBG Vision and Purpose; H1 FY22 Highlights
5 GBG Vision and Purpose H1 FY22 Highlights To build trust in a digital world; ultimately to create Strong growth in revenue to £109.2 million. Up 12.6% in a world where everyone can transact online with organic constant currency terms, despite challenging confidence comparative Organic constant cur
Slide 6: Market & Customer Drivers
6 Market & Customer Drivers Consumers expect simple Continuing growth in Build trust in a digital world. A world where everyone and safe online e-commerce, particularly can transact online with confidence experiences on mobile We help our customers grow faster by adding new customers and managing ex
Slide 7: Excellent progress against our growth strategy
7 Excellent progress against our growth strategy Our long-term structural growth is supported by consumer activity shifting online and an increased need for fraud prevention solutions. In the first half, each business unit grew in both reported and organic constant currency terms. Location • Growth
Slide 8: Financial review
8 Financial review David Ward, CFO
Slide 9: Strong financial performance
9 Strong financial performance Results for the six months ended 30 September 2021 Improvement in each of our financial KPIs. Finished the period with a strong balance sheet and with cash and debt resources to support M&A opportunities £109.2m £109.2m £27.8m 10.9 pence 112.6% +5.4% +12.6% +3.5% +4.8%
Slide 10: Group income statement
10 Group income statement Year to 31 12.6% constant currency organic growth H1 FY22 H1 FY21 March 6 months to 30 September £m £m Change 2021 Higher OPEX due to COVID cash conservation measures taken and Revenue 109.2 103.5 +5.4% 217.7 delaying additional investment spend in the prior year, plus sala
Slide 11: Revenue bridge
11 Revenue bridge H1 FY22 reported revenue growth of 5.4% Organic constant currency growth of 12.6% H1FY21 – H1FY22 Underlying growth of 17.6% Underlying growth 17.6% £4.0 £3.0 (£3.3) £15.2 Exceptional (£3.7) Effect of US crypto- Disposals (£10.0) govt. currency FX stimulus volumes – project – H1 H1
Slide 12: Revenue breakdown
12 Revenue breakdown A business model that delivers excellent cash generation H1 FY22 H1 FY21 Total Growth Organic Subscription / transaction revenue constant accounts for 96% of the total (H1 FY21: currency 95%) and increased 16% growth % of Rev % of Rev £m £m £m % % Term-based subscriptions, which
Slide 13: Markets performance H1 FY22
13 Markets performance H1 FY22 Financial Services 15% Retail Retail and technology sectors continued positive 6% growth momentum Technology Sector 47% 9% Revenue from Gaming customers recovered from diversification Gaming covid-impacted levels in H1 FY21 11% Public Sector Financial services revenue
Slide 14: Group Balance Sheet
Group Balance Sheet Strong cash generation: 2021 2020 As at 31 As at 30 September Variance £m £m March 2021 113% (H1 FY21: 155%) Adjusted EBITDA cash conversion ratio Tangible assets 6.4 8.2 (1.8) 6.9 Undrawn revolving credit facility at 30 September 2021 of £110 Intangible assets & investments 375.
Slide 15: Strategy overview
Strategy overview GBG
Slide 16: GBG's strategy
GBG’s strategy Focused on delivering long-term sustainable growth Geographic expansion People • Europe • Best and most engaged team members • North America • Asia Pacific: ANZ & Southeast Asia Customer growth and diversification Financial profile • Enhance go-to-market: Direct, self-serve & channel
Slide 17: Acquisition of Acuant
GBG GBG + acuanft; aGBG company Acquisition of Acuant “iS
Slide 18: Creating a global leader in the digital identity and fraud prevention markets
Creating a global leader in the digital identity and fraud prevention markets GBG’s acquisition of Acuant brings together two of the leaders in the global digital identity market, with combined revenue of c. £265 million Increases US presence and Attractive financial profile, Accelerated product, da
Slide 19: Acuant at a glance
Acuant at a glance A high-growth provider of digital identity verification solutions Acuant Compliance 71% 209 42% 1999 1,000+ 84% Channel Know Your SaaS revenue Team Know Your Business Founded Customers USA revenue partner Customer (recurring) members revenue Transaction Sanction Screening Monitori
Slide 20: Digital identity markets: large, fast growing and global
Digital identity markets: large, fast growing and global Acquisition of Acuant strengthens our offering in the fast- growing category of identity fraud $15.8bn $13.5bn $11.6bn Identity Verification* $8.7bn $10.0bn $7.6bn $6.2bn $15.8bn 2019 2020 2021 2022 2023 2024 2025 & Identity IdentityFraud Frau
Slide 21: Combination of Acuant and GBG creates growth opportunities in the US and worldwide
Combination of Acuant and GBG creates exciting growth opportunities in the US and worldwide • Acuant acquisition increases GBG’s exposure to the large and fast-growing US market • Acuant products benefit from access to GBG’s global datasets • Combined portfolios prime GBG for further expansion into
Slide 22: Customer base expansion and diversification
Customer base expansion and diversification New customer verticals and complementary customer bases provide multiple sales opportunities FY21 revenue Example shared customers CY20 revenue Financial Services Financial Services Multi-industry Partners Example shared partners Automotive & Transport Ret
Slide 23: Combination accelerates our data, product and technology ambitions by approximately two years
Combination accelerates our data, product and technology ambitions by approximately two years Five key roadmap accelerators: Acuant brings a market-ready SaaS version of GBG’s existing on-premise fraud products. This will focus future investment in GBG fraud products on further product innovation •
Slide 24: Creates a global leader in electronic ID verification
Creates a global leader in electronic ID verification, delivering a differentiated proposition across the customer lifecycle Customer acquisition (on-boarding) Ongoing customer relationship (in-life) Application/ Ongoing AML Document & Biometric Data led identity Transaction fraud In life fraud Orig
Slide 25: Acquisition terms and financing
Acquisition terms and financing Acquisition Terms(1) & Financing Structure Sources and Uses of Funds(1) ~£547m ~£547m • Enterprise value of $736 million (£547 million) • Satisfied by c. £87 million in share consideration to management and PE owners, a £305 million equity placing, Cash from New ~£155
Slide 26: High performing business with an attractive financial profile
High performing business with an attractive financial profile Acuant is a fast-growing, profitable and cash generative business which is strategically aligned with GBG • Acuant generates 84% of its revenue from the high-growth US market Strong growth track • Acuant achieved 22% revenue growth LTM to
Slide 27: Familiarity with Acuant business and management team supports integration
Familiarity with Acuant business and management team supports confidence in integration and delivery of synergies • Detailed plan to be led by highly experienced GBG internal team and in line with GBG’s best practice • 100 and 200 day plans, with clearly identifiable checkpoints and individual respo
Slide 28: Summary & outlook
Summary & outlook GBG
Slide 29: Summary
29 Summary Very pleased with strong constant currency organic revenue growth in H1 of 12.6% to £108.7m despite challenging comparative Organic constant currency growth in each of GBG’s 3 operating segments Continued focus on the safety, welfare and engagement of our People. Talent acquisition is a c
Slide 30: Outlook
30 Outlook Pleased to deliver strong revenue growth across all three operating divisions in H1 The outlook for H2 and the full year is in line with Board expectations Operating margins in H2 will normalise, as GBG invests in future growth - people, product development and marketing & sales GBG conti
Slide 31: Q&A
Q&A GBG
Slide 32: Appendices
Appendices GBG
Slide 33: Cash flow statement
Cash flow statement Year to 31 2021 2020 March Strong cash generation: 6 months ended 30 September £m £m 2021 Adjusted EBITDA 29.4 28.6 61.4 112.6% (H1 FY21: 154.9%) Adjusted EBITDA cash conversion ratio Working capital 3.4 15.9 12.6 Undrawn revolving credit facility at 30 September 2021 of £110 Adj
Slide 34: Historic Revenue by Segment
34 Historic Revenue by Segment Full Year FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Revenue £m Location 14.4 15.3 17.6 22.5 25.2 41.9 47.9 51.5 59.76 Identity 12.4 15.1 19.2 24.8 33.5 43.91 58.22 105.44 128.16 Fraud 6.2 7.2 14.5 17.5 21.3 25.9 29.1 35.5 28.48 Other 3.3 4.2 6.0 8.6 7.5 8.0 8.3 6.7
Slide 35: ESG
35 ESG Establishing trust between businesses and their customers; working and acting responsibly; empowering, prioritising and protecting our people; creating broader societal value and protecting the environment. Equality and diversity Employee engagement Governance and ethics Data privacy and IT s
Slide 36: Acquisitions and Investments
36 Acquisitions and Investments 14 acquisitions and one investment in the last 10 years Proven shareholder value creation model - each acquisition’s strategy and integration is treated differently Financing via cash, debt and equity Equity raised for Acuant, IDology, PCA Predict, IDscan, DecTech and
Slide 37: Acuant - Strong revenue growth in fast-growing market
Acuant - Strong revenue growth in fast-growing market Revenue profile ($m) 40% Subscription/transaction revenue growth 36% Subscription/transaction revenue CAGR(1) 22% Total revenue growth 15% Total revenue CAGR(1) 58.1 49.6 47.6 44.5 37.8 41.4 24.2 32.4 29.5 17.4 20.4 20.3 17.2 18.1 16.6 Dec-18 Dec
Slide 38: Acuant - Strong cashflow generation and well invested business
Acuant - Strong cashflow generation and well invested business Adj. operating profit profile ($m / % of revenue) Cash flow conversion (%) 13% 22% 20% 130% 11.4 10.8 106% 96% 5.8 Dec-19 Dec-20 LTM to Jul-21 Dec-19 Dec-20 LTM to Jul-21 • Acuant’s operating profit margins are similar to GBG’s while con
Slide 39: Contact
Contact David Ward CFO david.ward@gbgplc.com Richard Foster Investor Relations – Senior Manager richard.foster@gbgplc.com