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(Sharecast News) - GB Group reported a statutory full-year loss on Tuesday after booking a large non-cash impairment charge, but said underlying earnings edged higher and revenue momentum was accelerating as its GBG Go identity platform gained traction.
The FTSE 250 identity and location technology group said revenue for the year ended 31 March rose 0.8% to 285.0m from 282.7m.
On a constant-currency basis, revenue increased 3.2% from 276.3m, including a 0.4 percentage-point contribution from the acquisition of DataTools in October 2025.
Adjusted operating profit rose 0.7% to 67.5m from 67.0m, while the adjusted operating margin was flat at 23.7%.
Adjusted diluted earnings per share increased 9.3% to 19.0p from 17.4p, helped by simplification and cost management, lower net interest costs and the benefit of the company's share buyback programme.
On a statutory basis, however, GBG swung to an operating loss of 68.1m from a 22.7m profit a year earlier, while the loss before tax was 74.5m, compared with a 15.7m profit in 2025.
The result was primarily driven by a 73.1m non-cash goodwill impairment charge against its Identity Americas business, as well as a 16.5m write-off linked to the retirement of its legacy Compliance platform.
Basic diluted earnings per share fell to a loss of 30.7p from earnings of 3.4p.
The board proposed a final dividend of 4.4p per share, unchanged year on year.
Chief executive Dev Dhiman said 2026 had been "a year of considerable progress", with the group delivering on strategic initiatives including returning Americas Identity to growth and generating strong demand for GBG Go.
"Our simplified operating model is driving efficiency and platform scalability," he said. "The foundations we have built, a scalable, global platform, and a high-performance culture, are now translating into tangible results with growth accelerating."
GBG said its core Identity and Location businesses delivered combined constant-currency revenue growth of 5.7% in the second half, excluding revenue from the legacy Compliance platform being retired.
Net revenue retention for Identity and Location was 100.0%, compared with 101.4% a year earlier.
The company said Americas Identity returned to growth in the fourth quarter, helped by improved sales execution, stronger customer commitments and a strengthened leadership team.
It said onboarding improvements had reduced time-to-revenue by more than 50%, while renewals containing minimum commitments rose 20% and new business annual contract value was three times higher, with more than 35% pre-committed.
GBG Go, the group's all-in-one adaptive identity platform, secured more than 100 customer contracts since launch and had a pipeline of more than 225 qualified leads.
More than a quarter of those contracts involved multi-solution deployments, while the company has also launched GBG Foresight, an AI-powered analytics layer that provides performance insights, peer benchmarking and real-time alerts.
Dhiman said GBG Go had been "extremely well received by customers" and that the company would accelerate the platform's roadmap to release enhanced capabilities sooner, including broader fraud and identity signals and agentic workflow readiness.
Revenue from subscription and consumption-based activity accounted for 94.8% of group revenue, up from 94.5% a year earlier.
Gross margin slipped to 69.5% from 70.0%, reflecting a higher proportion of Identity consumption revenues, partly offset by pricing discipline and cloud hosting optimisation.
Cash conversion was 87%, down from 91%, while net debt rose to 80.1m from 48.5m, representing leverage of 1.15 times adjusted EBITDA.
GBG said the increase reflected capital deployment including 45m of share buybacks, the DataTools acquisition for 7.2m net of cash acquired, exceptional transformation costs and the payment of the prior-year final dividend.
The company said it had returned about 56m to shareholders during the year through dividends and share buybacks, repurchasing about 8% of its equity.
A further 10m buyback extension began on 1 April, with 3.9m completed by 1 June.
GBG said it expected mid-single-digit revenue growth in the 2027 financial year, supported by continued improvement in the Americas, contributions from new products and market opportunities linked to AI-driven fraud.
It plans a one-off 6m operating cost investment in GBG Go during 2027, which is expected to reduce adjusted operating margins to 21% to 22% for the year.
The company said margins were expected to return to a 23% to 24% range in 2028 and exceed 24% in the medium term as legacy technology retirement delivers efficiency gains.
It said the additional GBG Go investment was expected to add at least one percentage point of incremental revenue growth in 2028, rising to about two percentage points once fully commercialised.
At 0834 BST, shares in GB Group were down 9.33% at 223.5p.
Reporting by Josh White for Sharecast.com.
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