NCC reports revenue boost despite flat UK figures
Cybersecurity VAR makes recruiting and retaining talent a 'key priority' as part of growth plans
NCC Group's turnover for the first half of its fiscal 2019 rose eight per cent to £126m, despite plateauing revenue in its UK business.
Total operating profit jumped to £9.5m from £6.3m during its H1, which ended on 30 November 2018.
The cybersecurity VAR - which ranked 15th in CRN's Top VARs - attributed its revenue growth to its US Assurance business, which grew 20 per cent.
Its UK arm contributed £43.8m to overall revenue, representing a growth rate of 1.1 per cent.
NCC's UK Escrow division reported a revenue fall of four per cent to £12.9m, which was offset by growth in the US, European and rest of the world markets.
The region also saw "soft demand" in its risk management and governance business as well as a shortage of skilled technical and sales staff.
CEO Adam Palser said he believes the company can revive its UK division by making recruitment and retention of skilled staff a priority.
"We are pleased with the progress we have made, with continued growth in our core Assurance division and a particularly strong performance in the US, the world's largest cyber market," he said.
"While profits from our Escrow division fell slightly, our experience in the US has given us confidence that we can re-energise the growth of this business.
"We have assembled an excellent management team and are now installing the systems and processes that will enable us to operate as a unified global business, helping us to win more major contracts and focus on recurring, higher-margin work.
"The new team is now focused on accessing the resources to enable the group to fully capitalise on its growth potential, with retention and recruitment a key priority.
"We expect to deliver full-year adjusted EBIT of around £34m, while our longer-term growth prospects remain excellent."
Martin Courtney, principal analyst at TechMarketView, said recruiting and retaining staff is of urgent importance for the company to ensure future success, though he cautioned that it may experience weaker than anticipated demand for services in its H2.
He also warned that the VAR needs to accelerate its cloud solutions if it is to keep pace with both the market and its competitors.
"The key to NCC's fortunes will lie in the adaptation of its portfolio to keep pace with enterprise cloud," said Courtney.
"Although it has forayed into delivering cybersecurity solutions for cloud-hosted workloads, NCC's solutions remain predominantly on-premise.
"The development of its cloud security solutions in partnership with providers such as Microsoft, Amazon Web Services et al must now be accelerated if it is to keep pace with market trends."