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Trading statements

NCC Group warns on FY adj. EBITDA

13 December 2016 07:18

NCC Group anticipates year-end adjusted EBITDA to grow by up to 5% and be in the range of £45.5m to £47.5m -- less than earlier expectations.

"We have continued to see strong organic growth across the business, particularly in Assurance, in the first half of the current financial year with adjusted EBITDA up 15%," said CEO Rob Cotton.

"In our trading update of 20 October 2016, we stated that we had seen three large unrelated contract cancellations in quick succession and one deferral in the Assurance division but it was too early to quantify the likely impact.

"Whilst our forward visibility remains strong, we now do not expect to make up this profitability in the current financial year. We therefore anticipate year-end adjusted EBITDA to grow by up to 5% and be in the range of £45.5m to £47.5m -- less than earlier expectations.

"Although disappointing, these contract cancellations do not reflect any structural change in our Assurance business.

"We will continue to exploit our leading worldwide position and are expecting to see solid organic growth in both this and in future years in fast growing markets.

"The long-term outlook for our Assurance business is unchanged and we remain confident in the future prospects for both of our divisions. Overall the Group's forward order books and renewals have increased to £112.8m from the £108.8m level published on 20 October 2016."

HIGHLIGHTS:

- Group revenues increased by 35% (November 2015: 50%) to £125.8m (November 2015: £93.5m). Organic growth of 18% (November 2015: 17%): Assurance Division revenue increased by 42% (November 2015: 57%) to £104.8m (November 2015: £73.8m) - organic growth of 21% (November 2015: 17%); Escrow Division revenue increased by 14% (November 2015: 7%) to £18.7m (November 2015: £16.4m)

- Group adjusted EBITDA increased by 15% to £21.3m (November 2015: £18.5m)

- Adjusted EBITDA for the full year to 31 May 2017 is expected to be in the range of £45.5m to £47.5m - showing growth of up to 5% year on year

- H1:H2 adjusted EBITDA expected split will be approximately 46%:54% based on the midpoint of £46.5m.

Story provided by StockMarketWire.com

Related Company: NCC

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