Escrow Europe - Latest News

Acquisition of European Escrow provider for up to ?10.5m substantially increases international presence

Tue, 22 Jan 2008 00:00:00 GMT

NCC Group plc (LSE: NCC, "NCC Group" or "the Group"), the international, independent provider of Escrow Solutions, Assurance Testing and Consultancy, has acquired Escrow Europe Holdings B.V. ("Escrow Europe"), a pan-European escrow solutions company, for a maximum consideration of up to ?10.5m in cash.

This earnings enhancing acquisition will increase the Group's share of the European escrow market and substantially develops its international presence.� ��

The Group also reported its interims results for the six months to 30 November 2007.�� Overall Group revenue grew by 42% to �16.4m (�11.5m in 2006) and adjusted operating profits by 41% to �4.7m (�3.3m in 2006).� Adjusted fully diluted earnings per share improved 44% to 9.8p (6.8p in 2006) and the Board has approved the payment of an interim dividend of 2.25p, up by 50%.

Escrow Europe provides independent escrow solutions and escrow verification testing services to approximately 10,000 clients, predominately located in Europe, through 1,000 escrow agreements.�

The initial consideration on completion is ?7.5m, with a further performance related payment of up to ?3.0m. �The latter is expected to be paid in two parts at the end of March and June 2008.�

For the year ended 31 December 2007, Escrow Europe's accounts are expected to show, before application of NCC Group accounting policies including deferred income, revenue of over ?2.3m, earnings before interest and tax of ?0.8m, including in the region of ?1.0m of annual recurring revenues and net assets of not less than ?623,000.

On 31 December 2007, Escrow Europe, with NCC Group's approval, acquired the escrow contracts of Getronics PinkRoccade, a Netherlands IT services provider, providing further annual recurring revenues of approximately ?300,000.

NCCGroup expects that the business should contribute over ?1.0m of profits on revenues of ?2.5m in its first 12 months of NCC Group ownership.

Escrow Europe, which was established in 1989, is based in Amsterdam, Netherlands, with a subsidiary in Munich, Germany, and franchised sales operations in Switzerland, Belgium, Sweden, South Africa and Israel.� It currently employs 10 people and has a client base across all sectors of the market including Delta Lloyd Group, a major financial services provider in the Netherlands and Logica CMG.

The operation will be managed within NCC Group's Escrow Solutions division.� It will provide increased potential for developing existing European accounts and offer clients an improved account management service in their native languages.� The policy of maintaining a neutral stance favouring neither licensees nor suppliers and providing mandatory testing of escrow deposits complements the Group's independent status and position as a 'trusted advisor' to its clients.� The company will trade as "Escrow Europe, an NCC Group Company."

The Escrow Europe operational management team is staying with the business.� The Group expects to benefit from their knowledge and experience of the European escrow market.

Rob Cotton, NCC Group Chief Executive, said:

"This exciting earnings enhancing acquisition is an important step in strengthening our international position as the world's largest escrow provider and increases both the number of businesses and software applications protected by one of our escrow solutions.

"Research shows that, whilst 97% of organisations depend on business-critical software applications, only 18% protect all of these with escrow solutions. NCC Group is well placed to inform and educate clients on the risks and increase their level of IT assurance by protecting more applications with comprehensive escrow solutions."

Enquiries

NCC Group (www.nccgroup.com)
Rob Cotton, Chief Executive
Paul Edwards, Group Finance Director

Today: 020 7457 2020
Thereafter: 0161 209 5432/5200

College Hill
Adrian Duffield/Rozi Morris
020 7457 2815/2803

Third leading security and testing operation acquired

Thu, 27 Nov 2008 00:00:00 GMT

NCC Group plc (LSE: NCC, "NCC Group" or "the Group"), the international, independent provider of Escrow Solutions, Assurance Testing and Consultancy, has acquired Next Generation Security Software Ltd ("NGSS"), a security and testing company, for a maximum consideration of up to �10.0m in cash.

This is the third acquisition by NCC Group in less than two years and as well as complementing its own capabilities in the network, testing and software security market; it will also substantially strengthen the Group's position in this fast growing sector.

NGSS is a leading software security specialist and research consultancy providing security advice and practical assistance to a range of public and private organisations to ensure their systems, networks and web sites are secure. NGSS also provides strategic intelligence services to various government agencies.

NGSS' services include Penetration Testing, Infrastructure and Application Assessment, Cryptography Evaluation, BlackBerry Assessment, Forensics, PCI Testing and Wireless Review. NGSS' research department has developed a number of sophisticated and advanced IP software products and solutions providing organisations with state-of-the-art auditing and protection against both current and emerging security threats.

The initial consideration payable on completion, subject to NGSS' cash balance, is up to �5.2m, with a further performance related payment of up to �4.8m. The latter is expected to be paid in August 2009. The acquisition will be financed from NCC Group's existing debt facilities and internally generated cashflow.

In the year ended 31 May 2008, NGSS generated revenue of �5.2m and profit before tax of �0.5m (see note 1). NCC Group expects that the business should contribute over �0.9m of profit before tax on revenues in excess of �6.0m in its first 12 months of NCC Group ownership, before any investment. As at 31 May 2008, NGSS had gross assets of �2.4m (see note 2). The business is net working capital positive on acquisition.

NGSS, established in 2001, is based in Sutton, Surrey and employs 52 people, including 37 testers some of whom are based in offices in the US, Australia and Scotland. Its clients include a number of blue chip businesses such as Microsoft, Comic Relief, Commerzbank, McAfee and Centennial Software.

Although NGSS will be managed autonomously within the Group's Assurance Testing Division, it will work closely with the rest of NCC Group, particularly the Information Security Consultancy Division. The NGSS management team is staying with the business.

NCC Group expects to publish its interim results on 22 January 2009 and confirms that trading remains in line with both the IMS statement of 16 October 2008 and the Board's expectations.

Rob Cotton, NCC Group Chief Executive, said:

"NGSS is without any doubt one of the most respected security assurance businesses in the market today. This acquisition is an important step in our development of the assurance division and clearly fits with our strategy of being market leader in the area of web security and associated testing, where we are already enjoying considerable success.

"We now have the largest CHECK* accredited team in Europe, a substantially enhanced offering and a wider global reach."

ENDS

Enquiries:

NCC Group 0161 209 5200

Rob Cotton, Chief Executive

Paul Edwards, Group Finance Director

College Hill 020 7457 2020

Adrian Duffield/Belinda Morris

NCC Group will host an analyst conference call today at 8.30am, details are:

UK dial-in
�0870 043 6302
�
International dial-in
�+44 (0)1452 555 566
�
Conference ID
�75867373
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Note 1. Historic profit figures represent normalised, pre-exceptional figures extracted from un-audited management accounts for the year ended 31 May 2008.
Note 2. Historic gross assets figures are extracted from NGSS' filed financial statements for the year ended 31 May 2008.

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*CHECK Certification
CESG, the National Technical Authority for Information Assurance, launched the CHECK (IT Health Check) initiative in partnership with private sector service providers to address an increased demand for security auditing services for government systems. The scheme requires participating commercial organisations to conform to the CHECK standard when conducting CHECK tests. To become CHECK Team Leaders individuals are required to pass an 'Assault course' designed to assess IT security consultants against a baseline skill set of practical penetration testing. The aim of the Assault Course is to ensure that the candidate can perform a complete and thorough technical IT health check as defined by CESG criteria.

To download the press release as a pdf please click here

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Strong organic growth supports 13% increase in profits and dividend up 33%

Thu, 22 Jan 2009 00:00:00 GMT

NCC Group plc (LSE: NCC, "NCC Group" or "the Group"), the independent information security assurance group, has reported its interim results for the six months to 30 November 2008.

Financial Highlights

Group revenue up 27% to �20.8m (�16.4m in 2007) - organic growth 18%
Group adjusted operating profits* increased by 17% to �5.5m (�4.7m in 2007) - organic growth 9%

Escrow Solutions operating profits up 19% to �5.5m
Assurance Testing operating profits up 25% to �1.0m
Consultancy operating profits up 71% to �0.2m

Group adjusted pre tax profits* up by 13% to �5.2m (�4.6m in 2007
Adjusted diluted earnings* per share up by 13% to 11.0p (9.8p in 2007)
Interim dividend up by 33% to 3.00p (2.25p in 2007)
Ratio of cash inflow from operating activities before interest and tax to operating profit up to 119% (118% in 2007)
Net debt of �11.9m following acquisition of NGSS Limited (�0.2m net debt in 2007) and payment of deferred consideration payments

Operational Highlights

Acquisition of NGSS Limited, an Ethical Security Testing business, on 26 November 2008 for total consideration of up to �10.0m, established Group as largest Ethical Security Testing team in Europe
Consultancy and Assurance have seen excellent growth as the public demands security over its information, held in both the public and private sectors
New multi option �15m loan and overdraft facilities agreed in principle until July 2010

* Adjusted earnings measures: A reconciliation of adjusted operating profit, profit before tax and diluted earnings per share measures to reported adopted IFRS measures is set out in the notes. The Directors consider that the adjusted measures better reflect the ongoing performance of the business.

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Rob Cotton, NCC Group Chief Executive commented:

"Despite the current economic conditions; our focus on developing a number of complementary international information and security assurance businesses, by acquisition and organic growth, away from discretionary IT services expenditure continues to show excellent returns.

"A combination of our insulation from the worst features of the economic situation, our strong recurring revenues, cash generation and concentration on the fast growing information security markets gives us considerable confidence in our business, as demonstrated by our 33% increase in dividend. We remain on course to deliver another strong set of figures for this financial year."

To download the Full Interim Results statement please click here the Presentation to Analysts can be found here.

Acquisition of Swiss Escrow Business

Fri, 01 May 2009 00:00:00 GMT

NCC Group plc (LSE: NCC, "NCC Group" or "the Group"), the international, independent provider of Escrow Solutions, Assurance Testing and Consultancy, has acquired the remaining 76% shareholding of Escrow Europe Switzerland, a Zurich based franchise operation of Escrow Europe. The Group acquired the original 24% stake when it purchased Escrow Europe in January 2008.

This earnings enhancing acquisition will increase the Group's share of the European escrow market and further develops its international presence. The consideration will not exceed CHF 0.90m even after completion of a small performance related payment which will be paid on 1 February 2010. Both the initial and final payments have no impact on the Group's net debt position and will be paid for out of Group cash flows.
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NCC Group expects this subsidiary will have recurring revenues of circa CHF 275,000 in its first 12 months of NCC Group ownership.

The operation will increase the potential to develop existing European accounts and offer clients an improved account management service in their local languages. It will be managed by the Group's Escrow Europe division, which is headquartered in Amsterdam. The business will trade as "Escrow Europe Switzerland, an NCC Group Company."

Rob Cotton

, NCC Group Chief Executive, said:

"This earnings enhancing acquisition is another step in strengthening our position as the world's largest escrow provider and further demonstrates our commitment to customer service.

"Research shows that, whilst 97% of organisations depend on business-critical software applications, only 18% protect all of these with escrow solutions which in these financially unstable times represent a significant and unacceptable corporate risk. We are well placed to inform and educate clients on these risks and increase their level of IT assurance by protecting more applications with comprehensive escrow solutions."

Interim profits up 19% and dividend up 17% with forward visibility remaining very strong

Thu, 21 Jan 2010 00:00:00 GMT

NCC Group plc (LSE: NCC, "NCC Group" or "the Group", the international, independent provider of Escrow and Assurance Testing, has reported its interim reults for the six months to 30 November 2009.

Highlights

Financial Highlights��

Group revenue up 22% to �25.4m (�20.8m� in 2008)
Group adjusted operating profits* increased by 16% to �6.3m (�5.5m in 2008)
�� - Group Escrow operating profits up by 9% to �6.0m�
�� - Assurance Testing operating profits up by 33% to �1.6m
Group adjusted pre tax profits* up by 19% to �6.2m (�5.2m in 2008)
Adjusted diluted earnings* per share up by 21% to 13.3p (11.0p in 2008)
Interim dividend up by 17% to 3.5p (3.00p in 2008)
Ratio of cash inflow from operating activities before interest and tax to operating profit up to 127% (119% in 2008)�
Group orders and renewals now totalling �30.9m (�30.4m in October 2009)�

Operational Highlights

Escrow UK has seen continued good growth in new contracts in spite of continued pressure on verification delivery
Assurance Testing Division has seen strong growth as information security issues continue to become increasingly critical to all businesses�
The Group is on track to be debt free by the expiry of the current banking terms.

* Adjusted earnings measures: A reconciliation of adjusted operating profit, profit before tax and diluted earnings per share measures to reported adopted IFRS measures is set out on page 6. The Directors consider that the adjusted measures better reflect the ongoing performance of the business.

Rob Cotton, NCC Group Chief Executive commented:

"A 19% increase in our profitability and 21% increase in earnings is a very credible performance given the overall trading environment. We also continued to generate cash strongly with both divisions showing robust growth.
"Our confidence in the future, reinforced by our strong order book and renewals, has enabled us to increase the interim dividend by 17%. We remain on course to deliver another good year."

To view the Interim Results�in full, please click here�