GB Group Reports Solid FY25 Results with 9.5% Profit Growth Amid Economic Uncertainty
Why we think this is good
The financial results show a mixed but generally positive picture. While revenue growth was modest at 3.0% on a constant currency basis, profitability improved significantly with adjusted operating profit up 9.5% and margin expanding by 160bps. The company demonstrated strong cash generation and substantially reduced its net debt. However, mentions of 'economic uncertainty' and 'challenging market conditions' in the outlook temper the overall positive sentiment. The dividend increase of 4.8% signals management's confidence in future performance, but caution is warranted given the uncertain economic environment.
Key Points
- Revenue up 3.0% on constant currency basis to £282.7 million
- Adjusted operating profit increased 9.5% to £67.0 million
- Adjusted operating margin expanded 160bps to 23.7%
- Adjusted diluted EPS up 14.9% to 17.4p
- Net debt reduced from £80.9 million to £48.5 million
- Final dividend increased 4.8% to 4.40p per share
- Cash conversion improved to 91.3% from 90.6%
- Identity and Location segments showed growth, Fraud segment declined
- Company acknowledges economic uncertainties and challenging market conditions
- Strategic focus on GBG Go platform and operational improvements in Americas business
Summary
GB Group plc reported its FY25 results, showing resilience in a challenging economic environment. Revenue grew 3.0% on a constant currency basis to £282.7 million, while adjusted operating profit increased 9.5% to £67.0 million. The company demonstrated strong profitability improvements with adjusted operating margin expanding by 160bps to 23.7%. Cash conversion remained robust at 91.3%, enabling a significant reduction in net debt from £80.9 million to £48.5 million. The board's confidence is reflected in a 4.8% increase in the final dividend to 4.40p. However, the company acknowledges economic uncertainties and challenging market conditions, which could impact future performance. Strategic focus areas for FY26 include continued investment in the GBG Go platform and operational improvements in the Americas business.