Cybersecurity provider NCC Group's H1 adjusted EBITDA rises on higher margin

NCC

Today 07:11

Overview
UK cyber security firm's H1 revenue rose 5.0% yr/yr to £151.3 mln
Adjusted EBITDA for H1 climbed 27.7% to £23.5 mln, driven by margin improvement
Company to launch £170 mln tender offer and £15 mln buyback after Escode sale

Outlook
NCC Group expects mid to low single-digit Cyber Security revenue growth for FY26
Company expects FY26 Group adjusted EBITDA to grow faster than revenue, with Cyber adjusted EBITDA margin of c.5.5%-7.5%
NCC Group targets mid-single digit Cyber Security revenue growth in FY27 and FY28 and mid-teens adjusted EBITDA margin by end-FY28

Result Drivers
CYBER SECURITY REVENUE GROWTH - Growth in Cyber Security revenue, especially in the UK and APAC, contributed to overall group performance
MARGIN IMPROVEMENT - Higher gross margins, particularly in Cyber Security, resulted from operational improvements and a shift to higher-margin services
SHIFT TO HIGHER-VALUE ENGAGEMENTS - Company saw increased contribution from larger, multi-capability client contracts and a greater share of Consulting and Managed Services revenue

Company press release: ID:nRSK8464Ha

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
H1 Revenue
 
GBP 151.30 mln
 
H1 Adjusted EBITDA
 
GBP 23.50 mln
 
H1 Pretax Profit
 
GBP 10.70 mln
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the it services & consulting peer group is "buy"
Wall Street's median 12-month price target for NCC Group PLC is GBp175.00, about 23.9% above its June 10 closing price of GBp141.20
The stock recently traded at 24 times the next 12-month earnings vs. a P/E of 22 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)