GB Group: Good Start To The Year
Edison | Jul 29, 2021 10:44
In today’s AGM trading update, management confirmed that it had seen a good start to FY22. All divisions are benefiting from the consumer shift to transacting online. Cryptocurrency trading has boosted Identity volumes in the quarter, while Location continues to see good demand and recent licence extensions point to a recovery in the Fraud business. The strong trading in Q122 provides management with confidence for the year ahead; we maintain our forecasts.
GB Group (LON:GBGP) provided an update on trading for today’s AGM. The company last updated the market on 15 June when FY21 results were reported. Management reported that the company has made a good start to the year. In Identity, active cryptocurrency trading in April and May helped maintain consumption volumes in Q122, despite challenging comparatives due to the US financial stimulus programme in Q121. The Location business has seen good demand across a range of sectors, as more consumers shift to transacting online. Since the company last reported, the Fraud business has signed two term licence extensions with large multinational financial services companies, indicating the start of a recovery after a weaker year in FY21. The group closed Q122 with a net cash position of £37.7m, up from £21.1m at the end of FY21 but before the payment of the final dividend (c £6.7m). The group also has access to a £110m revolving credit facility (currently unutilised). We maintain our forecasts. The company expects to provide a H122 trading update in October.
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