Shearwater Group PLC Trading Update (8590U)
March 31 2023 - 1:00AM
UK Regulatory
TIDMSWG
RNS Number : 8590U
Shearwater Group PLC
31 March 2023
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.
31 March 2023
Shearwater Group PLC
("Shearwater", or the "Group")
Trading Update
Shearwater Group plc, the cybersecurity, advisory and managed
security services group, announces an update on trading for the
financial year ended 31 March 2023(1) ("FY23").
As guided at the half year, trading is traditionally weighted to
the second half. Having started Q3 with stronger momentum,
macroeconomic challenges impacted customers in Q4 more than could
have been anticipated, with customers deferring investment
decisions and in some cases extending spending freezes. As a
result, the Group expects FY23 revenue to be in the region of
GBP27.0m (FY22: GBP35.9m) with Adjusted EBITDA(2) at around
breakeven (FY22: GBP4.4m) significantly behind market expectations.
The key trading drivers impacting the current year reflect delays
in orders being finalised with customers in our Services and
Software businesses, as well as the recent move by some key
customers to one year deals providing more reliable revenue mix in
the future.
As reported at the half year, FY23 has also been impacted by a
one-off FX impact of cGBP0.8m following the significant movement in
the US$ to GBP. The Group now has in place the necessary hedging to
mitigate future exposures.
The Group continues to maintain a strong balance sheet with
unaudited year end net cash expected to be in the region of GBP3.4m
which is c.GBP2.5m higher than the cash position at the half year,
reflecting strong cash generation in the second half largely driven
by a focus on working capital management.
Looking forward the Group retains a strong pipeline on which to
deliver sustainable revenue, with profits moving forward as we
deliver deals to our loyal customer base, including banks and
telecoms businesses. We continue to take steps to address
under-performing areas in the Group and looking forward the Group
has a firm foundation on which to deliver solid, sustainable
revenues and profits.
The Group expects to publish its FY23 full year financial
results in July 2023.
The Company considers current consensus market expectations,
ahead of this trading update, for the year ended 31 March 2023 are
for revenues of GBP37.7m and Adjusted EBITDA of GBP4.4m.
1 All figures are subject to finalisation following the year end
and are unaudited.
2 Adjusted 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, other income, depreciation and
amortisation.
Enquiries:
Shearwater Group plc www.shearwatergroup.com
David Williams c/o Alma PR
Phil Higgins
Cenkos Securities plc - NOMAD and Broker
Adrian Hadden / Ben Jeynes / Max Gould
- Corporate Finance
Alex Pollen / Michael Johnson - Sales +44 (0) 20 7397 8900
Alma PR shearwater@almapr.co.uk
Justine James / Joe Pederzolli +44 (0) 20 3405 0205
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.
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