Shearwater Group PLC Trading Update (9890Q)

TIDMSWG

RNS Number : 9890Q

Shearwater Group PLC

02 November 2021

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 (as amended), which forms part of domestic UK law pursuant to the European Union (Withdrawal) Act 2018. Upon publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

2 November 2021

Shearwater Group PLC

("Shearwater", or the "Group")

Trading Update

Increase in underlying EBITDA in line with expectations

Shearwater Group plc, the organisational resilience group which provides cybersecurity, advisory and managed security services, is pleased to provide an update on trading for the six months ended 30 September 2021(1) , ahead of the publication of the Group's Interim Results in late November.

For the traditionally quieter first half of the year, the Group expects to report encouraging underlying EBITDA(2) growth, up 19% year-on-year to GBP1.3m in H1 FY22 in line with the Board's expectations (H1 FY21: GBP1.1m).

This growth is driven by an improved underlying EBITDA margin of 12% (H1 FY21: 10%), reflecting the increasing proportion of higher margin software and advisory revenue within the revenue mix . Revenue for the first half of the year is expected to be GBP10.6m (H1 FY21: GBP11.2m). In line with the Group's historical trends, c.50% of H2 revenue is either already contracted or anticipated to be generated through renewals.

The Group has a strong balance sheet with unaudited net cash of GBP4.4m as at 30 September 2021 (30 September 2020: GBP3.0m) following the repayment of GBP1.1m of VAT deferrals during the period (GBP0.2m remaining). The Group continues to benefit from a n undrawn revolving credit facility of GBP4.0m.

Demand for Shearwater's offering has remained high across the Group. Particularly pleasing has been the continued rebound in advisory work, with the advisory businesses' pipelines now back to pre-COVID levels.

New customers secured during the first half included a UK university and a number of public sector organisations, with cross-sales between Group businesses also having continued and a number of significant contract renewals concluded.

Phil Higgins, Chief Executive Officer of Shearwater Group PLC, commented:

"Confidence levels are high across Shearwater, reflecting both the level of business won in the first half of the year but also the increased activity levels at our clients. Demand for our cybersecurity, advisory and managed security services remains robust as the marketplace develops."

(1) All figures are unaudited

(2) Underlying EBITDA is defined as profit before tax, before one off exceptional items, share based payment charges, finance charges, impairment of intangible assets, fair value adjustments to deferred consideration, contingent consideration depreciation and amortisation.

Enquiries:

 
 Shearwater Group plc                   www.shearwatergroup.com 
  David Williams                         c/o Alma PR 
  Phil Higgins 
 Cenkos Securities plc - NOMAD and 
  Joint Broker 
  Ben Jeynes / Max Gould - Corporate 
  Finance 
  Julian Morse / Michael Johnson 
  - Sales                               [phone] 
 Berenberg - Joint Broker 
  Matthew Armitt / Mark Whitmore        [phone] 
 Alma PR                                [e-mail] 
  Susie Hudson / Caroline Forde /        [phone] 
  Joe Pederzolli 
 

About Shearwater Group plc

Shearwater Group plc is an award-winning group providing cyber security, managed security and professional advisory solutions to help create a safer online environment for organisations and their end users.

The Group's differentiated full service offering spans identity and access management and data security, cybersecurity solutions and managed security services, and security governance, risk and compliance. Its growth strategy is focused on building a scalable group that caters to the entire spectrum of cyber security and managed security needs, through a focused buy and build approach.

The Group is headquartered in the UK, serving customers across the globe across a broad spectrum of industries.

Shearwater shares are listed on the London Stock Exchange's AIM under the ticker "SWG". For more information, please visit www.shearwatergroup.com.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

TSTFLFIALELLIIL

(END) Dow Jones Newswires

November 02, 2021 03:00 ET (07:00 GMT)