NCC’s revenues surge despite ‘stagnating’ economy
IT assurance and Escrow specialist NCC Group said in a trading update that it had defied a “stagnating” economy in the UK to record good growth.
The acquisitive Manchester company said trading between December 1 and the end of March had been in line wiith expectations, and revealed that in the first 10 months of the current financial year revenues are 53% up on the same period last year at £57.6m.
The company said: “NCC Group’s trading performance remains in line with the board’s expectations and is on course to deliver the anticipated levels of growth and profitability.
“Whilst the group remains concerned about the underlying UK economy, which is currently stagnating, good solid and consistent growth has been seen in both divisions.”
Sales in the Escrow division are up 8% in the tradign period, with revenues for the year to the end of May forecast to be £15.5m, up from £14.6m last time.
Escrow UK, described as “the cornerstone of the NCC Group” saw 6% revenue growth (March 2010: 9%) with a continued good performance from the Verification Testing business.
The European and North American Escrow businesses continue to perform well, seeing revenue growth of 10% and 14% respectively.
In late March NCC bought US-based Escrow Associates for a cash consideration of up to $9.5m.
It said its IT Assurance division had continued to perform strongly with a 97% growth in revenue in the period, of which 15% was organic growth.
NGS Secure and iSEC, the ethical security testing brands, have grown their combined order book to £12.5m (March 2010: £7.2m) as market demand continued to increase.
NCC said it was being hampered by difficulties recruiting the best testers, which meant the delivery of orders is being “constrained”.
It said more staff were being poached by competitors and that staff turnover was now 8%, up from 7% at the half-year. NCC empoys 136 testers.
The overall order book in the Assurance Division currently stands at £19.1m, more than twice that seen in March 2010 of £7.2m.
Net debt after recent acquisitions is now £26.7m.
The company said it had appointed Atul Patel as finance director. He has been in the role on an interim basis since February.
It added: “NCC Group remains on course to deliver another strong year, in line with market expectations and is well positioned for continued long term, sustained growth.”
Full-year results are expected on July 7.
