GRC International Group PLC Trading Update (3093X)

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RNS Number : 3093X

GRC International Group PLC

04 May 2021

GRC International Group plc ("GRC" or the "Group")

Trading Update

GRC, a leading supplier of IT governance, cyber security, risk management and compliance products and services, is pleased to announce the following trading update in respect to its trading performance in Q4 FY21.

Significant H2 performance improvements

The Group saw significant improvements in performance across all areas of its business in H2 of FY21 (12 months ended 31 March 2021), culminating with strong Q4 billings* that generated positive EBITDA and positive cash flow for the quarter, following only a small EBITDA loss in Q3.

The performance improvement started at the end of November 2020 and continues through into the new calendar year.

                                                                                   H1 FY21                H2 FY21                Change 

Total billings GBP5.6m GBP6.7m +20%

Total billings per FTE** GBP39k GBP46k +18%

   Cyber security billings                                          GBP3.5m                    GBP4.5m 

+29%

   Recurring & contracted billings                          GBP3.0m                    GBP3.6m +20% 

Website billings GBP1.5m GBP2.5m +67%

Website visits 1.7m 1.9m +12%

(The 'Cyber security', 'Recuring and contracted' and 'Website' categories in the table above are non-exclusive. An invoice or web sale can feature in more than one category.)

The March 2021 total monthly billings figure was the strongest achieved by the Group in the two years since March 2019.

45% of transactions in the quarter were from new customers, with the balance from returning existing customers.

15 months after launching the first Group subscription service, there are now a cumulative 3,600 subscribers to recurring revenue Lines of Business in Vigilant Software, GRC e-Learning, IASME Cyber Essentials, ITGP Toolkits, and GRCI Law, with a combined rolling annual churn rate of only 2.2%.

Q4 performance

The H2 performance improvement was particularly driven by growing demand and activity through February and March.

   --    Billings per business day increased from GBP51k in Q3 to GBP60k in Q4. 

-- Website traffic and transactions in March 2021 increased by 12% and 13% respectively on February 2021.

-- March's web traffic was the best month since July 2018, just after the end of the peak GDPR period.

Q4 Notable contract wins included the Royal Mail, PwC, Open University, NHS, Government Internal Audit Agency, Ely Cathedral, BBC, Rightmove, Mazars, HM Treasury, Langham Hospitality Group, IPG MediaBrands, Unicef, and SipChem.

Cash and available finance facilities

The Group ended the financial year with net cash of GBP0.2m, ahead of expectations, reflecting lower capital expenditure and a deferral of certain HM Revenue & Customs (HMRC) liabilities due for repayment in FY22.

The Group's pre-existing facility headroom available at the half year on 30 September 2020 of circa GBP600k, being the aggregation of two separate facilities, is still undrawn.

The Group will report its Preliminary Results for FY21 later in the summer.

*Billings equate to the total value of invoices raised as cash sales through the Group's websites. The figure does not take account of accrued or deferred income adjustments that are required to comply with accounting standards for revenue recognition.

**FTE stands for Full Time Equivalent employee.

Enquiries:

GRC International Group plc [phone]

Alan Calder, Chief Executive Officer

Christopher Hartshorne, Finance Director

Grant Thornton UK LLP (Nominated Adviser) [phone]

Philip Secrett

Dowgate Capital Limited (Broker) [phone]

James Serjeant / David Poutney

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 which is part of UK law by virtue of the European Union (withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

About GRC International Group plc

GRC International Group plc was admitted to trading on the London Stock Exchange's AIM market in March 2018.

GRC provides a comprehensive suite of products and services to address the IT governance, risk management and compliance requirements of organisations seeking to address a wide range of data protection and cyber security regulation. The Company provides a range of services and products through three divisions: Training, Consultancy, and Publishing and Distribution.

The Group has an international customer base which is expected to grow as GRC expands its geographical footprint. Since admission to AIM, the Group has expanded internationally with operations now established in Ireland, the US and Northern Europe

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May 04, 2021 02:00 ET (06:00 GMT)