GRC.L Regulatory News (GRC)

5 June 2024

GRC International Group PLC

("GRC" or the "Group")

Year-end trading update

GRC International Group PLC (AIM: GRC), an integrated cyber security and privacy solutions business, announces a trading update for the for 12 months ended 31 March 2024 ('FY24').

Highlights[1]

· Revenue expected to be up 4% to £15.3m (FY23: £14.7m).

o  Contracted and recurring revenue expected to be up 3% to £11.0m (FY23: £10.7m).

o  Annualised Recurring Revenue ('ARR') expected to be £11.0m (FY23: £10.9m).

· Gross Margin expected to increase to 62% (FY23: 61%).

o  Continued Gross Margin improvement from 52% in FY21 to 62% in FY24

· Underlying EBITDA[2] expected to be not less than £1.0m (FY23: £0.3m) up 330%.

· Year-end cash of £0.2m (FY23: £0.1m).

o  Total borrowings at 31 March 2024 (excluding capitalised lease obligations) of £1.7m (FY23: £1.3).

· Quality and customer satisfaction improved further: NPS score now 59 (FY23:53). Note: 50+ is 'excellent', 70+ is 'world class'.

The Group has made progress against the short-term objectives set out for investors in September 2023:

- Completed phase 1 of the restructure - merged Vigilant Software and GRC e-Learning into IT Governance Ltd.

o  FY24 Consultancy, training revenue both increased 3% on prior year.

o  EBITDA improvements.

o  Annualised cost savings now running at £1.6m+.

- Completed first phase of investment into CyberComply development.

o  FY24 Software revenue up 20% notwithstanding the 6-month redevelopment pause.

o  To improve customer acquisition and retention the website improvements are expected to go live from Q1 in FY25.

- Launched Digital Operational Resilience Act ('DORA') and EuroPrivacy product suites.

o  Sales of DORA products and services have improved as we ended FY24 and commenced FY25.

- Developed and deployed initial AI tools into marketing and operations.

The Board are pleased with the Group's significant growth and improvement in performance over the last 4 years.

Alan Calder, Chief Executive Officer, commented:

"Encouragingly, FY24 was a third year of progress in improving revenue, margins and productivity. This progress, combined with the early benefits of the Q4 streamlining and re-structure, led to a significant improvement in underlying EBITDA in FY24 and generated ongoing cost savings.

CyberComply, our cyber security and compliance platform, is key to the Group's strategy for growth and in the current financial market conditions, our primary focus remains on organic growth and, in particular, in positioning our Cyber Comply platform at the heart of our service offering. Our continued investment in CyberComply and in our technology infrastructure should enable us to accelerate customer acquisition while improving retention and customer lifetime value ('CLV').

While we anticipate the UK General Election will affect short term sales, trading in April was in line with expectations."

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014, which is part of UK law by virtue of the European Union (withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

Enquiries:

GRC International Group PLC +44 (0)330 999 0222

Alan Calder, Chief Executive Officer

Christopher Hartshorne, Finance Director

Singer Capital Markets (Nominated Adviser and Joint Broker) +44 (0)20 7496 3000

Phil Davies, James Fischer

Dowgate Capital Limited (Joint Broker) +44 (0)20 3903 7715

James Serjeant, Russell Cook, Nicholas Chambers

About GRC International Group PLC

GRC is an international governance, risk management and compliance company whose main business is cyber defence in depth.

A technology business, its proprietary premier brands, including IT Governance, offer 'Our expertise, your peace of mind' for GRC's wide range of domestic and international corporate customers across many industrial sectors.

GRC's three operating divisions - Software as a Service (SaaS), E-Commerce and Services - offer a wide range of products and services encompassing: IT governance, risk management, compliance with data protection and cyber security regulations, online and in-person training and staff awareness, consultancy, online publishing and distribution, as well as software. The Group's capabilities also include products and services to enable corporates to address wider governance issues, such as money laundering and bribery.

In addition to its UK business, GRC has operations in the EU, US and Asia-Pacific regions.