GB Group sees interim profits slip, reaffirms outlook

(Sharecast News) - Shares in GB Group came under pressure on Tuesday, after the identity verification specialist saw first-half profits dip and flagged a jump in one-off costs.

Updating on trading, the British company - which also specialises in protecting against digital crime - said revenues in the six months to 30 September rose 1.4% to £139.5m on a constant currency basis. But adjusted operating profits fell to £27m from £29.5m, following additional investment in its GBG Go platform.

GB also flagged around £4.5m of exceptional costs incurred during the period, which primarily related to "cost efficiency actions" taken to help mitigate weak trading in its Americas Identity business. GB also expects to report non-cash goodwill impairment charges related to the division.

The company warned in August that it had seen higher-than-expected volume attrition at several key customers in Americas Identity, causing it to cut guidance for full-year group revenues to between 1% and 3% from mid-single-digit growth.

The group reiterated the revised guidance on Tuesday and said it remained on track to meet profit forecasts.

However, that did not stop the stock - which tanked 30% in the aftermath of the August revision - falling, and by 0945 BST it had shed 4% at 152p.

Dev Dhiman, chief executive, said: "Our resilient performance, led by strong growth in location, EMEA Identity and the momentum behind GBG Go, demonstrates that the business fundamentals are strong."

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