REG - GRC Intnl.Group PLC - Interim Results
08/12/2022 07:01
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RNS Number : 9758I GRC International Group PLC 08 December 2022
8 December 2022
GRC International Group Plc
Strong growth in forward visibility and widening margin underpin outlook
GRC International Group plc (AIM: GRC), an integrated cyber security and
privacy solutions business, announces its unaudited interim results for the
six months ended 30 September 2022.
Financial highlights
· Revenue up 11% to £7.3m (H1 FY22: £6.6m).
· International revenue up 14% to £1.6m (H1 FY22: £1.4m).
· SaaS division revenue up 31% - investment in high-margin and
scalable recurring revenue products paying off.
· Recurring and contracted revenue up 33% to £5.3m (H1 FY22:
£4.0m).
· 73% (FY22: 61%) of revenue generated from recurring and
contracted revenue contracts.
· Gross margin of 60% (H1 FY22: 58%) - continued improvement
reflects operational gearing from subscription services and internal
efficiencies from automation projects.
· EBITDA1 of £0.4m (H1 FY22: £0.4m).
· Loss before tax of £0.5m (H1 FY22: £0.5m loss).
· Net cash at period end of £0.2m (H1 FY22: £0.1m). Borrowings
(excluding lease obligations) £0.8m (FY22 £1.1m).
Operational highlights
· Revenue from existing customers up to 71% of total revenue (H1
FY22: 57%).
· Active SaaS subscriptions up 7% to 5,100 (H1 FY22: 4,700).
· Successful launch of Payment Card Industry (PCI) Qualified
Security Assessor (QSA) services in the US.
· First contracts signed for innovative SWIFT security consultancy
service.
· Web transactions up 22% to 4,400 (H1 FY22: 3,600) and website
visits up by 2% to over 2.1m.
· Group NPS (net promoter score) improved to 54 (H1 FY 22: 33).
Scores over 50 indicate customer service rating of 'Excellent'.
1 EBITDA is defined within the Financial Review of this announcement.
Alan Calder, Chief Executive Officer, said:
"Our revenues, including recurring and contracted revenues, all grew
strongly. Despite inflationary pressures on our operating costs, we continue
to achieve improvement in gross margin.
"In addition to the two certainties of life - death and taxation - there is
now a third: cyber attack, be it of corporates or individuals. The jump in
cyber-crime insurance premiums is testament to the growth of cyber criminals'
capabilities and scale. Despite the current challenging economic
environment, for finance teams and boards to short-sightedly throttle back on
cyber security investments is tantamount to an act of self-harm. It is not a
question of if but when all organisations are attacked by cyber criminals, and
so the services GRCI provides are of critical importance.
"We continued to invest heavily in our higher-margin and faster-growing SaaS
and e-commerce businesses, both in people and systems, which we expect to
underpin our profitable growth in H2 and the following financial years. We
continue to trade in line with market expectations."
Enquiries:
GRC International Group plc +44 (0) 330 999 0222
Alan Calder, Chief Executive Officer
Christopher Hartshorne, Finance Director
Singer Capital Markets (Nominated Adviser and Joint
Broker)
+44 (0)20 7496 3000
Phil Davies, James Fischer
Dowgate Capital Limited (Joint Broker)
+44 (0) 20 3903 7715
James Serjeant, Russell Cook, Nicholas Chambers
Meare Consulting
+44 (0) 7990 858548
Adrian Duffield
About GRC International Group plc ("GRC" or "the Group")
GRC is an international governance, risk management and compliance company
whose main business is cyber defence in depth.
A technology business, its proprietary premier brands including the market
leader, IT Governance, offer 'Our expertise, your peace of mind' for GRC's
wide range of domestic and international corporate customers across all
industrial sectors.
GRC's three operating divisions - Software as a Service (SaaS), E-Commerce and
Services - offer a wide range of products and services encompassing: IT
governance, risk management, compliance with data protection and cyber
security regulations, online and in-person training and staff awareness,
consultancy, online publishing and distribution, as well as software. The
Group's capabilities also include products and services to enable corporates
to address wider governance issues, such as money laundering and bribery.
In addition to its UK business, GRC has operations in the EU, US and
Asia-Pacific regions.
Chief Executive Review
Cyber security market
The dynamics for the cyber security market largely remain unchanged.
The cyber security market is forecast to grow strongly to £353 billion by
2025, at a 14.5% CAGR,(( 1 )) with sophisticated cyber criminals and
nation-state bad actors outperforming their targets. Countries such as Russia,
North Korea and Iran use cyber attacks against their enemies, both to disrupt
critical national infrastructure and to generate hard currency. The attack
surface continues to expand dramatically with millions more insecure and
exploitable network endpoints due to the increasingly widespread use of IoT
(Internet of Things) and remote/hybrid working.
Digital transformation and hybrid working initiatives continue to bring new
and different risks. Combined with customer and supply chain pressure to
improve security and privacy, and proliferating national and international
data protection regulations, cyber and privacy risk is a critical issue for
all organisations.
The global shortage in qualified security and privacy professionals
continues.(( 2 )) There are millions of vacancies. It is increasingly
difficult, therefore, for most organisations to manage day-to-day cyber
security and privacy compliance activity in-house, let alone cope with a
large-scale cyber attack.
Yet, although a catastrophic ransomware or cyber attack is the number one
concern for 47% of companies (double the number in 2021), the reality is that
only 20% of company boards are paying attention. 3 At the same time, cyber
insurance premiums have increased significantly, the pool of available cyber
insurers has shrunk, and the availability of cyber insurance is increasingly
dependent on evidence of adequate cyber defence. These factors will generate
significant opportunities for the Group. However, it will be somewhat
dependent on companies taking more proactive steps to address the issues they
face.
Geopolitical instability and macroeconomic headwinds are encouraging finance
teams and boards to short-sightedly throttle back on cyber security
investments, particularly in the key area of developing internal cyber skills.
This will see many more organisations attempting to remediate cyber attacks at
cost levels 10 to 100 times greater than an appropriate cyber defence-in-depth
investment might have required. And, if they survive the attack, they will
still have to make the cyber defence investment - because cyber attackers are
increasingly re-attacking previously breached organisations that haven't yet
been able to build adequate defences.
This remarkable combination of factors will unquestionably drive longer-term
demand for high-margin recovery services and rapid, high-cost deployment of
post-event cyber defences, albeit in the shorter term there will be challenges
in persuading companies to make this critical investment.
Tightening cyber insurance prerequisites, growing regulatory pressure across
the world, direct personal cyber-compliance exposure for directors, and
proliferating up-stream customer due diligence will, through the next 12
months and beyond, combine to fuel a surge in cyber investment and provide
significant opportunities for the Group.
H1 trading performance
GRC's experience in H1 FY23 very much reflects the global picture. While our
enquiry levels continued to be strong, sales cycles are extended. This was
compounded by the UK government dithering over retained EU regulation,
including UK GDPR, combined with the delayed publication of the revised
ISO/IEC 27001 information security management standard. The latter slowed
sales of our training courses while boosting training deferred income to a
record £0.5m at the end of H1 - which bodes well for H2 training revenues.
Against this backdrop, GRC's H1 results were in line with our expectations.
Revenue was up 11%, recurring and contracted revenue was up 33% and gross
margin improved by 200 basis points to 60%, reflecting the investment in
high-margin and highly scalable recurring revenue products.
Despite investment in our workforce as well as absorbing the inflationary cost
increases that go with providing high-value consultancy services, our H1
EBITDA matched the prior year's H1 result at £0.4m. The investment, funded by
H1 growth, is expected to fuel further future growth in H2 and beyond. Cash
outflow and the working capital cycle was in line with planned investment, and
our debt reduced.
Strategy
Our strategy is to grow internationally, organically and by acquisition. We
have a blue-chip and broad customer base. Our widening portfolio of income
streams enables us to provide an increasing number of value-added and
complementary services to our growing roster of international customers.
The GRC fully integrated and comprehensive 'one-stop' offering is focussed on
people and process. It is uniquely positioned to help organisations of all
sizes deal with the cyber-crime current and future challenges. From emergency
response and data breach services through to integrated cyber defence-in-depth
and regulatory compliance offerings, GRC responds quickly to customer
requirements.
Our continuing investment in building and improving our online subscription
services is driving continual improvements in customer retention and forward
revenue visibility, which will widen our gross margin due to the inherent
operational gearing in the business.
In addition to building our own IP, we have a strategic focus on our SEO
(search engine optimisation). This enables us to dominate search terms, widen
our ecosystem, cross-sell more products and services, and drive new online
sales.
The fragmented market and our strengthening balance sheet will provide us with
opportunities to enhance our capabilities by acquiring products and services
both domestically and internationally.
Current trading and outlook
We expect the current conflict between the caution and general cost management
agenda of company boards and the clear and present danger that is cyber risk
to resolve itself over the medium term in favour of widespread investment in
building cyber defence in depth and cyber resilience. The Board believes that
the Group is extremely well placed to capitalise on this opportunity as it
occurs.
We continue to invest in our E-Commerce and SaaS divisions, and back-office
automation. These are clearly a competitive advantage and the roll out of
these developments, together with extensive improvements in our outbound lead
generation capabilities, will support revenue growth in H2 and particularly in
Q4, which is traditionally our busiest period of the financial year.
We expect that our current sales and billings, marketing and delivery
activities, supported by deployment of SaaS and e-commerce investments, the
October publication of ISO/IEC 27001:2022 and our seasonally strong Q4 will
enable us to achieve our FY23 financial objective. Current trading remains in
line with market expectations.
Alan Calder
Chief Executive Officer
Financial Review
Revenue
Revenue for the six months ended 30 September 2022 was up 11% to £7.3m (H1
FY22: £6.6m) despite the extension in sales cycles.
International revenue was up 14% to £1.6m (H1 FY22: £1.4m), representing 22%
(H1 FY22: 21%) of total Group revenue. Revenue growth in the US was notable at
40% to £0.7m (H1 FY22: £0.5m). The Group services most of its US based
clients through its IT Governance USA business and most of its European
clients through its IT Governance EU business, invoicing in USD and EUR
respectively. The use of local staff and suppliers means costs incurred in
local currency are a natural partial hedge against foreign exchange risk.
Recurring and contracted revenue showed strong growth up 33% to £5.3m (H1
FY22: £4.0). This accounts for 73% of total revenue (H1 FY22: 61%).
The most significant revenue growth was in the SaaS division, up 31%, where
the Group's investment in developing its high-margin and highly scalable
recurring revenue products is beginning to pay off.
The E-Commerce division, which includes sales of public training courses and
documentation toolkits, is subject to seasonality and is more sensitive than
the Group's other divisions to changes in macroeconomic circumstances. The
comparative period benefited from an element of post-pandemic bounce back.
This year saw a more traditional summer holiday season followed by the
unexpected disruption of an additional bank holiday and period of national
mourning due to the Queen's death.
£'m Services Software as a Service (SaaS) E-Commerce Total
H1 FY23 3.6 2.1 1.6 7.3
H1 FY22 3.2 1.6 1.8 6.6
FY FY22 6.6 3.7 3.6 13.9
Period-on-period % Services Software as a Service (SaaS) E-Commerce Total
H1 FY23 vs H1 FY22 13% 31% (11)% 11%
Billings
Billings were up 3% to £7.3m (HY FY22: £7.1m). The shift towards recurring and contracted revenue means billings are more closely aligned with revenue than has been the case historically. Billings equate to the total value (net of VAT) of invoices raised and cash sales through the Group's websites. Billings is considered by the Board to be a key metric for managing the business due to billings' direct relationship with cashflow.
Gross profit
Gross profit was up 16% to £4.4m (H1 FY22: £3.8m) with gross margin also up
by 200 basis points to 60% (H1 FY22: 58%).
The majority of the Group's direct cost base relates to headcount for
consultants and client delivery staff. There have been operational
improvements throughout many parts of the Services division, which have driven
improved consultant utilisation rates and other efficiencies resulting from
the Group's internal automation projects.
This, along with the Group's focus on higher-margin subscription services, has
driven the overall improvement in margin. In particular, the growth in
retainer-type arrangements for some contracts has driven margin improvement in
the Services division and improved forward visibility of revenue.
Notably, the Group's SaaS division had the highest revenue increase at 31% and
the highest gross margin % at 81%:
Segment H1 FY22 Revenue change H1 FY23
Revenue Margin % Revenue Margin
£ £ % £ £ %
Services 3.2 1.2 38% 13% 3.6 1.7 47%
SaaS 1.6 1.5 94% 31% 2.1 1.7 81%
E-Commerce 1.8 1.1 61% (11)% 1.6 1.0 63%
Total 6.6 3.8 58% 11% 7.3 4.4 60%
Administrative expenses
Administrative expenses as planned increased by £0.5m (up 11%) to £4.9m (H1
FY22: £4.4m).
The increase in administrative expenses is primarily an investment in the next
stage of the Group's development, with upfront investment in people, along
with marketing and lead generation initiatives, expected to deliver positive
return in H2 and beyond.
As expected, the Group has seen some inflationary pressure in certain areas of
overhead spend, but management is focused on controlling the impact without
restricting top line growth.
EBITDA
Although EBITDA (earnings before interest, tax, depreciation, and
amortisation) is not a statutory measure, it is considered by the Board to be
an important key performance indicator as a more accurate measure of
underlying business performance, by removing the impact of non-cash accounting
adjustments.
EBITDA was £0.4m (H1 FY22: £0.4m). The revenue growth in H1 FY23 has largely
been invested into the business to fund and support further future growth,
while still delivering a positive return and leaving the Group well positioned
to achieve its full-year objectives.
£'M HY1 FY23 HY2 FY22 HY1 FY22
Revenue 7.3 7.3 6.6
Operating loss (0.4) (0.3) (0.4)
Depreciation 0.1 0.1 0.1
Amortisation 0.7 0.7 0.7
EBITDA 0.4 0.5 0.4
EBITDA as % Revenue 5% 7% 6%
Finance expense
The net finance expense of £0.1m (H1 FY22: £0.1m) relates to interest on the
Group's borrowings and leases accounted for under IFRS 16.
Loss before tax
Loss before tax was £0.5m (H1 FY22: loss £0.5m).
Taxation
No provision for tax has been made in the period (H1 FY22: £Nil). The tax
credit of £21,000 (H1 FY22: £19,000) recognised relates to the unwinding of
deferred tax on the acquisition of DQM.
Earnings per share
Loss per share was 0.48 pence (H1 FY22: loss per share 0.47 pence).
Dividend
The Board is not paying an interim dividend for the period.
It will continue to review its dividend policy periodically.
Cash flow and cash/debt
The Group's closing cash position net of a bank overdraft was £0.2m (30
September 2021: £0.1m).
Borrowings (excluding lease obligations) at period end were £0.8m (31 March
2022: £1.1m, 30 September 2021: £1.3m).
The Group has banking facilities to provide adequate headroom for unforeseen
working capital requirements by way of an invoice discounting facility.
In addition, the unsecured loan facility provided by Andrew Brode for the
amount of £700,000 at an interest rate of 5% above the Bank of England base
rate to provide additional working capital is available to the Company until
at least 31 December 2023 and shall automatically renew for a further 12
months unless terminated by either party. As at the period end and the date of
this report £350,000 remained available to be drawn down.
Statement of financial position
Net assets were £8.1m (31 March 2022: £8.7m, 30 September 2021: £6.4m).
Net current liabilities at period end were up by £1.0m during the six months
to £4.2m (31 March 2022: £3.2m, 30 September 2021: £5.6m).
The funds raised in January 2022 have been used as planned, partly to reduce
HMRC liabilities within trade and other payables in accordance with agreed
payment profiles, and partly invested in projects expected to deliver future
growth.
Intangible assets
The Group's accounting policy is that only directly attributable staff costs
of the technical teams developing the assets are capitalised. No management
time is capitalised, and neither is any proportion of overheads or borrowing
costs.
Additions of £1.0m (H1 FY22: £0.6m), relate to software, website
development, development of courseware and the development of publishing
products.
Capital structure
The issued share capital at 30 September 2022 was 107,826,246 (31 March 2022:
107,826,246, 30 September 2021: 99,931,509) ordinary shares of £0.001 each.
On 27 September 2022 100,000 share options were granted.
Risks and uncertainties
The Board continually assesses and monitors the key risks of the business. The
key risks that could affect the Group's performance, and the factors that
mitigate these risks, have not significantly changed from those set out on
pages 24 to 25 of the Group's Annual Report for 2022 (a copy of which is
available from our website www.grci.group).
Chris Hartshorne
Finance Director
Unaudited Consolidated Income Statement for the six months ended 30 September 2022
Notes 6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2021
unaudited
unaudited
audited
£'000 £'000 £'000
Revenue 3 7,287 13,902 6,633
Cost of sales (2,885) (5,698) (2,813)
Gross profit 4,402 8,204 3,820
Administrative expenses
- Other administrative expenses (4,881) (9,141) (4,369)
- Exceptional administrative costs (36) - -
(4,917) (9,141) (4,369)
Other operating income 48 240 164
Operating loss (467) (697) (385)
Net financing costs (72) (304) (107)
Share of post-tax loss of equity-accounted joint ventures - (2) -
Loss before taxation (539) (1,003) (492)
Taxation 21 6 19
Loss for the financial period (518) (997) (473)
Loss for the financial period attributable to:
The Group's equity shareholders (518) (997) (473)
Basic loss per share (pence) 4 (0.48) (0.98) (0.47)
Diluted loss per share (pence) 4 (0.48) (0.98) (0.47)
All the Group's loss relates to continuing operations
The accompanying accounting policies and notes form an integral part of these
financial statements.
Unaudited Consolidated Statement of Comprehensive Income for the six months ended 30 September 2022
6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2021
Unaudited
unaudited
Audited
£'000 £'000 £'000
Loss for the financial period (518) (997) (473)
Other comprehensive loss - items that may subsequently be reclassified to profit/loss:
Exchange differences on translation of foreign operations (35) (1) (2)
Other comprehensive loss for the financial period, net of tax (35) (1) (2)
Total comprehensive loss for the financial period (553) (998) (475)
Total comprehensive loss attributable to equity shareholders of the parent
(553) (998) (475)
The accompanying accounting policies and notes form an integral part of these
financial statements.
Unaudited Consolidated Statement of Financial Position as at 30 September 2022
Notes 6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2021
Unaudited
unaudited
Audited
£'000 £'000 £'000
Assets
Non-current assets
Goodwill 6,804 6,804 6,804
Intangible assets 5 5,876 5,630 5,699
Property, plant and equipment 293 325 301
Investments accounted for using the equity method 17 17 20
12,990 12,776 12,824
Current assets
Inventories - - 31
Trade and other receivables 1,376 1,612 1,535
Cash at bank 199 2,099 147
1,575 3,711 1,713
Current liabilities
Trade and other payables (4,975) (5,935) (6,188)
Borrowings (526) (722) (879)
Lease obligations (101) (117) (122)
Current tax (127) (127) (129)
(5,729) (6,901) (7,318)
Net current liabilities (4,154) (3,190) (5,605)
Non-current liabilities
Trade and other payables - (73) -
Borrowings (252) (329) (412)
Lease obligations (119) (145) (52)
Deferred tax liability (317) (338) (324)
(688) (885) (788)
Net assets 8,148 8,701 6,431
Equity
Share capital 6 108 108 100
Share premium 16,012 16,012 13,227
Merger reserve 4,276 4,276 4,276
Share-based payment reserve 126 126 126
Translation reserve (44) (9) (10)
Accumulated deficit (12,330) (11,812) (11,288)
Total equity 8,148 8,701 6,431
Unaudited Consolidated Statement of Changes in Equity for the six months ended
30 September 2022
Share capital Share premium Merger reserve Share-based payment reserve Retained earnings Translation reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 April 2021 (audited) 100 13,227 4,276 126 (10,815) (8) 6,906
Loss for the period - - - - (473) - (473)
Foreign exchange difference on consolidation - - - - - (2) (2)
Total comprehensive loss for the period - - - - (473) (2) (475)
At 30 September 2021 (unaudited) 100 13,227 4,276 126 (11,288) (10) 6,431
Share capital Share premium Merger reserve Share-based payment reserve Retained earnings Translation reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 April 2021 (audited) 100 13,227 4,276 126 (10,815) (8) 6,906
Loss for the period - - - - (997) - (997)
Foreign exchange difference on consolidation - - - - - (1) (1)
Total comprehensive loss for the period - - - - (997) (1) (998)
Shares issued 8 2,992 - - - - 3,000
Cost of share issue - (207) - - - - (207)
Transactions with owners 8 2,785 - - - - 2,793
At 31 March 2022 (audited) 108 16,012 4,276 126 (11,812) (9) 8,701
Loss for the period - - - - (518) - (518)
Foreign exchange difference on consolidation - - - - - (35) (35)
Total comprehensive loss for the period - - - - (518) (35) (553)
At 30 September 2022 (unaudited) 108 16,012 4,276 126 (12,330) (44) 8,148
The accompanying accounting policies and notes form an integral part of these
financial statements.
Unaudited Consolidated Statement of Cash Flows for the six months ended 30 September 2022
Notes 6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2021
Unaudited
unaudited
audited
£'000 £'000 £'000
Cash flow from operating activities
Loss before tax (518) (997) (492)
Adjustments for:
Depreciation of plant and equipment 19 91 53
Amortisation of right-of-use assets 47 143 84
Amortisation of intangible fixed assets 5 719 1,367 668
Loss on disposal of fixed assets - 50 -
Foreign exchange (gains)/losses (4) 18 10
Share of post-tax loss of equity-accounted joint ventures - 2 -
Finance expenses 73 304 107
Finance income (1) - -
Income tax expenses (21) (6) -
Operating Cashflows before changes in working capital 314 972 430
Decrease in inventories - 33 2
Decrease in trade and other receivables 252 83 161
(Increase)/decrease in trade and other payables (1,086) 28 191
(520) 1,116 784
Income tax refund - 5 -
Net cash (outflow)/inflow from operating activities (520) 1,121 784
Investing activities
Purchase of intangible assets (963) (1,231) (602)
Purchase of plant and equipment (37) (47) (11)
Acquisition of joint venture investment - (13) (13)
Net cash outflow in operating activities (1,000) (1,291) (626)
Financing activities
Proceeds from issue of shares - 3,000 -
Costs of share issue - (207) -
Proceeds from borrowings - 546 276
Repayment of borrowings (284) (836) (316)
Interest paid (50) (245) (85)
Interest on lease liability on right-of-use asset (13) (69) (13)
Payment of lease liabilities on right-of-use assets (43) (155) (107)
Net cash (outflow)/inflow from financing liabilities (390) 2,034 (245)
Net (decrease)/increase in cash and cash equivalents (1,910) 1,864 (87)
Cash and cash equivalents at beginning of financial period 2,099 233 233
Effects of exchange rate changes 10 2 1
Cash and cash equivalents at end of financial period 199 2,099 147
Comprising
Cash at bank 199 2,099 147
The accompanying accounting policies and notes form an integral part of these
financial statements.
1. Nature of operations and general information
GRC International Group plc ('GRC International Group' or 'the Company') is a
public limited company limited by shares, incorporated and domiciled in
England and Wales. The registered company number is 11036180 and the
registered office is Unit 3 Clive Court, Bartholemew's Walk, Cambridgeshire
Business Park, Ely, Cambridgeshire, CB7 4EA.
The principal activities of GRC International Group and its subsidiary
companies is as a one-stop shop for IT governance including books, tools,
learning and consultancy services.
The interim financial statements have not been audited or reviewed by the
auditors.
2. Basis of preparation of half-year report
The condensed consolidated interim financial report for the half-year
reporting period ended 30 September 2022 has been prepared in accordance with
Accounting Standard IAS 34 Interim Financial Reporting.
The results include the results of GRC International Group plc and its
subsidiaries.
A subsidiary is a company controlled directly by the Group. Control is
achieved where the Group has the power over the investee, rights to
variable returns and the ability to use the power to affect the investee's
returns.
Income and expenses of subsidiaries acquired during the year are included in
the Consolidated Income Statement from the effective date of control. When
necessary, adjustments are made to the financial statements of subsidiaries to
bring their accounting policies into line with those used by the Company.
All intra-Group transactions, balances, income, and expenses are eliminated in
full on consolidation.
The Interim report does not include all the notes of the type normally
included in an annual financial report. Accordingly, this report is to be read
in conjunction with the annual report for the year ended 31 March 2022 and any
public announcements made by GRC International Group plc during the interim
period.
Half-yearly (interim) reports
The comparative financial information for the year ended 31 March 2022 in this
interim report does not constitute statutory accounts for that year.
The statutory accounts for the year ended 31 March 2022 have been delivered to
the Registrar of Companies. The auditors' report on those accounts was
unqualified and did not contain a statement under 498(2) or 498(3) of the
Companies Act 2006.
3. Revenue
Revenue is all derived from continuing operations. The analysis of revenue by
category:
6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2021
Unaudited
unaudited
Audited
£'000 £'000 £'000
Sale of goods 391 824 436
Provision of services 6,896 13,078 6,197
7,287 13,902 6,633
Other income* 48 240 164
Total revenue 7,335 14,142 6,797
*Other income relates to rent received from the sub-let of some of the Group's
office space.
4. Earnings per share
Basic earnings per share is based on the loss after tax for the year and the
weighted average number of shares in issue during each year.
6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2021
Unaudited
Unaudited
Audited
Loss attributable to equity holders of the group £'000 (518) (997) (473)
Weighted average number of shares in issue 107,826,246 101,510,456 99,931,509
Basic loss per share (pence) (0.48) (0.98) (0.47)
Diluted earnings per share is calculated by adjusting the average number of
shares in issue during the year to assume conversion of all dilutive potential
ordinary shares.
Taking the Group's share options into consideration in respect of the Group's
weighted average number of ordinary shares for the purposes of diluted
earnings per share, is as follows:
6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2020
Unaudited
Unaudited
Audited
Number of shares 107,826,246 101,510,456 99,931,509
Dilutive (potential dilutive) effect of share options - -
Weighted average number of ordinary shares for the purposes of diluted earnings per share 107,826,246 101,510,456 99,931,509
Diluted loss per share (pence) (0.48) (0.98) (0.47)
For the purpose of diluted earnings per share in a loss-making situation,
options are not dilutive.
5. Intangible assets
Marketing tools Publishing products Consultancy products and courseware Software and website costs Trademarks Customer relationships Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Cost
At 1 April 2021 (audited) 63 400 1,036 6,177 466 1,843 9,985
Additions 3 51 182 995 - - 1,231
Foreign exchange movement - - - - - - -
At 31 March 2022 66 451 1,218 7,172 466 1,843 11,216
Additions - 37 147 779 - - 963
Foreign exchange movement 1 - 2 - - - 3
At 30 September 2022 67 488 1,367 7,951 466 1,843 12,182
Accumulated depreciation
At 1 April 2021 (audited) 63 266 414 3,057 100 320 4,220
Charge for year - 51 112 1,003 47 153 1,366
Foreign exchange movement - - - - - - -
At 31 March 2022 63 317 526 4,060 147 473 5,586
Charge for period 1 28 61 529 23 77 719
Foreign exchange movement - - 1 - - - 1
At 30 September 2022 64 345 588 4,589 170 550 6,306
Net book value
At 30 September 2022 3 143 779 3,362 296 1,293 5,876
At 31 March 2022 3 134 692 3,112 319 1,370 5,630
Amortisation is included within administrative expenses.
6. Authorised, allotted, issued and fully paid
6 months to 30 September 2022 12 months to 31 March 2022 6 months to 30 September 2021
unaudited
unaudited
audited
Number £'000 Number £'000 Number £'000
Ordinary shares of £0.001 each 107,826,246 108 107,826,246 108 99,931,509 100
107,826,246 108 107,826,246 108 99,931,509 100
7. Events after the reporting period
There have been no events that require disclosure in accordance with IAS10,
'Events after the balance sheet date'.
1 Cybersecurity Market Trends, Size| Industry Growth 2021 to 2026 With COVID
Impact - Mordor Intelligence
(https://www.mordorintelligence.com/industry-reports/cyber-security-market) .
2 Cybersecurity Jobs Report: 3.5 million Openings In 2025 -
cybersecurityventures.com (https://cybersecurityventures.com/jobs/) .
3 Marsh Commercial: New catastrophic risks and insurance market challenges
(March 2022).
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