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Shearwater Group encouraged by the progress of recently acquired businesses

Shearwater is building a broad portfolio of select information security and cyber security assets
Cyber-security
The constant evolution of cybercrime and the mainstream awareness of high profile data breaches has helped drive a change in the regulatory environment

SecurEnvoy and Newable Consulting have performed in line with expectations since joining the Shearwater Group plc (LON:SWG) earlier this year.

Trading in both businesses continues to be in line with the board's expectations and since acquisition have generated in aggregate £2.1mln or revenue and contributed £0.9mln of underlying earnings (EBITDA) to the group in the first half of Shearwater’s financial year.

READ: Shearwater reveals second purchase under new management, with the £0.6mln acquisition of Newable Consulting

SecurEnvoy was acquired in May and Newable Consulting – now known as Xcina Consulting – was acquired in May.

In the six months to the end of September, the cyber-security group had revenue of £2.1mln; in the same period of last year it had zero revenues.

The group generated an unchanged underlying EBITDA loss of £0.1mln for the period. Loss before tax ballooned to £1.46mln from £96,000 the previous year.

At the period end, group cash was £3.7mln, up from £0.3mln a year earlier, reflecting strong cash generation at SecurEnvoy and the residual net proceeds from the equity issuances made during the period, which have offset group administrative costs, investments made in portfolio company growth initiatives, and the costs incurred as a result of the creation and development of Xcina.

"Much has been achieved during the period under review, but we have barely scratched the surface. The digital resilience sector offers considerable growth potential and we are fortunate to have an industry leading team in place to capitalise on this potential,” said David Williams, chairman of Shearwater.

READ: Shearwater Group - the former Aurum Mining – reveals reverse takeover of authentication software firm SecurEnvoy

"It is my firm belief that 2018 will be a particularly exciting one for us and that our loyal shareholders will be rewarded as our ambitious plans evolve and further deals in line with our growth strategy are secured," he added.

Shares in Shearwater were off 4% at 3p in early deals.

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