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GB Group — Back to investing for growth

GB Group (AIM: GBG)

Last close As at 05/08/2026

GBP2.22

▲ 1.00 (0.45%)

Market capitalisation

GBP508m

More on this equity

Research: TMT

GB Group — Back to investing for growth

GB Group’s (GBG’s) H121 results were in line with its recent trading update, confirming revenue growth of 10% y-o-y and normalised EPS growth of 25% y-o-y. COVID-19-related cost reduction and cash preservation measures helped reduce net debt by £32m h-o-h. FY21 revenue guidance is unchanged and the company expects to return to more normal levels of investment (both opex and capex) in H221. We have made small upgrades to our forecasts.

Written by

Katherine Thompson

Director

TMT

GB Group

Back to investing for growth

H121 results

Software & comp services

8 December 2020

Price

900p

Market cap

£1,759m

Net debt (£m) at end-H121

2.7*

*Gross of unamortised loan arrangement fees.

Shares in issue

195.5m

Free float

98%

Code

GBG

Primary exchange

AIM

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

1.7

25.2

26.2

Rel (local)

(8.5)

12.7

37.4

52-week high/low

900p

474p

Business description

GB Group is a specialist in identity data intelligence. Its products and services enable its customers to better understand and verify their customers and employees and are used across a range of fraud, risk management, compliance and customer on-boarding services. With headquarters in the UK, GB operates across 16 countries, has customers in more than 70 countries and generates more than 56% of revenues internationally.

Next events

FY21 trading update

April 2021

Analyst

Katherine Thompson

+44 (0)20 3077 5730

GB Group is a research client of Edison Investment Research Limited

GB Group’s (GBG’s) H121 results were in line with its recent trading update, confirming revenue growth of 10% y-o-y and normalised EPS growth of 25% y-o-y. COVID-19-related cost reduction and cash preservation measures helped reduce net debt by £32m h-o-h. FY21 revenue guidance is unchanged and the company expects to return to more normal levels of investment (both opex and capex) in H221. We have made small upgrades to our forecasts.

Year end

Revenue (£m)

EBITA*
(£m)

PBT*
(p)

Diluted EPS*
(p)

DPS
(p)

P/E
(x)

03/19

143.5

32.0

31.3

15.4

3.0

58.5

03/20

199.1

47.9

45.7

17.9

0.0

50.3

03/21e

199.2

44.3

42.7

16.5

6.0

54.7

03/22e

215.0

47.5

46.4

17.8

3.3

50.6

03/23e

237.4

53.0

52.1

19.8

3.6

45.4

Note: *EBITA, PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.

Strong cash generation in H121

GBG reported results in line with October’s trading update, with constant currency organic revenue growth of 10.4% y-o-y for H121. The company saw accelerated growth from some existing customers as they extended their use of digital services while customer contract renewal rates were in line with prior years. New contracts were more difficult to sign in some sectors and geographies, but GBG won new business against competitors. The strong growth in revenue translated to a 24.5% increase in adjusted operating profit and a 25.2% increase in normalised diluted EPS. Net debt reduced by £32m over H121 to close the period at £2.5m. The company confirmed it will pay an interim dividend of 3.0p per share.

Outlook maintained; investment reinstated

While there are still uncertainties in the outlook due to ongoing COVID-19 restrictions, GBG is maintaining its FY21 guidance for marginal growth in revenue. The acceleration in digital transformation during the pandemic highlights the long-term structural growth opportunity for GBG. Having conserved cash and maintained profitability during H1, the company is ready to resume investment in priority areas and has an active acquisition pipeline. Reflecting H121 results we have made small upgrades to our forecasts: FY21 normalised diluted EPS +1.1%, FY22 +2.7% and FY23 +4.0%.

Valuation: Premium rating reflects growth potential

GBG trades at a premium to the UK software and IT services sectors and at the upper end of its ID management peer group on a P/E basis, reflecting its strong growth outlook (post COVID-19), high recurring revenues and strong balance sheet. Our reverse DCF analysis estimates the current share price is factoring in operating margins of 25.8% and revenue growth of c 16% per year from FY24, at the upper end of the group’s revenue and margin targets. Outside of faster than expected COVID-19 recovery, triggers for upside could include successful cross-selling from recent acquisitions, adoption of GBG’s combined identity/location solution and in the medium term, accretive acquisitions.

Review of H121 results

Exhibit 1: H121 results highlights

£m

H121

H120

y-o-y

Revenues

103.5

94.3

9.8%

Gross profit

72.6

68.3

6.4%

Gross margin

70.2%

72.4%

-2.2%

Adjusted operating profit

26.8

21.6

24.5%

Adjusted operating margin

25.9%

22.8%

3.1%

Reported operating profit

15.7

9.7

61.7%

Reported operating margin

15.1%

10.3%

4.9%

Normalised diluted EPS (p)

10.0

8.0

25.2%

Adjusted basic EPS (p)**

11.8

9.0

30.5%

Reported basic EPS (p)

6.1

2.9

110.3%

Net debt*

2.5

53.8

-95.4%

Source: GB Group. Note: EBITA = operating profit before exceptional items, amortisation of acquired intangibles and share-based payments. *Net of capitalised financing costs. **Company adjusted measure uses reported tax charge.

H121 results were substantially in line with the October trading update. H121 revenue was 9.8% higher year-on-year, or 10.4% higher on a constant currency basis. Exhibits 2 and 3 show the split of revenue by sector and by geography. Around 14% of revenue was generated from COVID-19 challenged sectors, down from 18% in FY20. The US saw substantial growth in revenue (73% yoy, benefiting from a one-off contract in Identity), while the UK declined 16% y-o-y, reflecting the UK exposure to more challenged sectors such as gaming, travel and leisure.

Exhibit 2: H121 revenue split by sector

Exhibit 3: Revenue split by geography

Source: GB Group

Source: GB Group

Exhibit 2: H121 revenue split by sector

Source: GB Group

Exhibit 3: Revenue split by geography

Source: GB Group

The company took action at the beginning of the COVID-19 pandemic to reduce costs to preserve cash. Combined with the benefit of a one-off contract in the US Identity business, this resulted in strong growth in profitability. Adjusted operating profit was 24.5% higher year-on-year, which resulted in a 3.1pp margin increase. Net finance costs reduced from £1.2m in H120 to £0.8m in H121 reflecting the reduction in debt over the period. The reported tax rate was 20.8% in H121 compared to 34.0% in H120 (when profit was weighted towards higher rate countries).

Net debt reduced from £34.6m at the end of FY20 to £2.5m at the end of H121 through higher operating cash flow and a reduction in capex as well as no final dividend for FY20. Adjusted EBITDA cash conversion of 155% in H121 compares to 103% in H120. The company paid down £27.5m of its revolving credit facility during H1 and since the end of H1 has repaid a further £15m.

The company acquired an 11% stake in a Singapore-based business called CredoLab for £2.3m via the issue of 322k shares.

As previously announced, the company will pay a 3.0p interim dividend. GBG does not usually pay an interim dividend – this is in effect to compensate for not paying a final dividend for FY20 – and we expect a final dividend to be announced for FY21 before reverting to paying one dividend a year.

Divisional performance

Exhibits 4 and 5 summarise performance by division. The contractual arrangements for each service differ, with the vast majority of fraud revenues coming from licences, whereas the majority of Identity revenues come from volume-based contracts.

Exhibit 4: Divisional performance

£m

H121

H120

y-o-y

Revenues

Fraud

12.28

16.82

(27.0%)

Identity

64.53

51.19

26.1%

Location

25.20

23.26

8.4%

Unallocated (Engage)

1.53

3.07

(50.0%)

Total revenues

103.55

94.34

9.8%

Adjusted operating profit (AOP)

Fraud

2.22

5.40

(58.9%)

Identity

23.32

15.78

47.8%

Location

7.78

6.63

17.4%

Unallocated (Engage)

(6.49)

(6.26)

3.7%

Total AOP

26.84

21.56

24.5%

Adjusted operating margin

Fraud

18.1%

32.1%

(14.0%)

Identity

36.1%

30.8%

5.3%

Location

30.9%

28.5%

2.4%

Unallocated (Engage)

-422.9%

-203.9%

(219.0%)

Total adjusted operating margin

25.9%

22.8%

3.1%

Source: GB Group

Exhibit 5: Revenue by type per division

Group

FY19

FY20

H121

Licence

52%

36%

28%

Transaction

39%

56%

67%

Services

9%

8%

5%

Fraud

Licence

95%

95%

92%

Transaction

0%

0%

0%

Services

5%

5%

8%

Identity

Licence

21%

7%

5%

Transaction

78%

91%

94%

Services

1%

3%

1%

Location

Licence

76%

60%

56%

Transaction

23%

32%

35%

Services

1%

8%

9%

Unallocated

Licence

0%

0%

0%

Transaction

0%

0%

0%

Services

100%

100%

100%

Source: GB Group

Identity – benefit from one-off contract in the US

The Identity business saw revenue growth of 26.1% y-o-y (27% constant currency), as one of its customers in the US provided identity verification services for a one-off project that is not expected to continue into H221. Transaction-based revenues increased to 94% of total divisional revenues, up from 91% in FY20 and 78% in FY19. This means that GBG is more directly exposed to the levels of activity seen by customers, so in some cases revenue will have declined as certain sectors eg travel and leisure were in lockdown, whereas other areas that benefited from increased customer activity such as the one-off contract referred to above contributed directly to revenue growth. The strong revenue growth translated to a 47.8% increase in adjusted operating profit and margin expansion from 30.8% in H120 to 36.1% in H121.

Location – boosted by shift to online retail

Location revenue increased 8.4% y-o-y (9% constant currency) helped by the accelerated shift to online commerce. The division saw growth across all regions. This dropped through to a 17.4% increase in adjusted operating profit and margin expansion from 28.5% in H120 to 30.9% in H121.

Fraud – tough comparison and harder to sign new business

GBG reported several multi-year licences in H120, creating a tough comparison for H121. In addition, there were fewer new contracts in the market as potential customers were focused on business continuity, and it was more difficult to undertake installation projects. This resulted in a 27.0% y-o-y revenue decline for the division (-26% constant currency), a 58.9% decline in adjusted operating profit and a reduction in the margin from 32.1% to 18.1%.

Unallocated – H120 restatement

In H121, the company decided to report the Datacare business within the Location division rather than as unallocated revenue and restated historical data accordingly. This removed £1.0m from H120 unallocated revenue and £0.1m from H120 adjusted operating profit. The remaining business generated revenue of £1.5m, down 50% y-o-y. Central costs of £6.0m were included within this division in H121 compared to £5.6m in H120. As the total unallocated adjusted operating loss increased only £0.2m y-o-y, this implies the remaining Engage business that is included here also managed to reduce its cost base.

Business update

During the course of H121, the group continued to invest in strategic projects:

■

Investment in CredoLab – GBG was already partnered with them. The business uses AI to help institutions make lending decisions without depending on traditional credit bureau data. This should enhance the capabilities of the Fraud business and allow GBG to serve new fintech and neobank market segments.

■

Extended machine learning capabilities across Fraud’s solutions. This enables greater accuracy in determining fraud probability and should improve fraud detection for customers.

■

Integrated global identity verification solutions to increase international reach for customers. IDology customers now have access to more data outside of the US, and customers in Australia and New Zealand now have better access to document and biometric capabilities.

■

Added new datasets in Argentina and Brazil as well as UK mobile.

■

Selectively added new hires and skills across the business.

Outlook and changes to forecasts

GBG reiterated guidance for FY21, expecting revenue to be marginally ahead of FY20 on an underlying basis. As there is not likely to be a repeat of the one-off project in Identity in H2, this implies revenues drop from £103.5m in H121 to more like £95.6m (-8.7% y-o-y). At the same time, the company is planning to deepen investment in initiatives required for future growth by reinvesting H221 operational leverage. Consequently, we do not expect a repeat of the 25% operating margin achieved in H1. We have revised our forecasts to reflect H121 results, with a small upgrade to FY21 normalised EPS (+1.1%) due to lower financing costs. For FY22 and FY23, we upgrade revenue and operating profit as increases in our Identity and Location forecasts outweigh lower Fraud forecasts. This results in normalised EPS forecasts 2.7% higher in FY22 and 4.0% higher in FY23. We forecast a shift to a net cash position in FY22. The company continues to consider M&A and currently has c £105m additional borrowing capacity (£75m available immediately and a £30m accordion facility).

Exhibit 6: Changes to forecasts

£m

FY21e

FY21e

 

 

FY22e

FY22e

 

 

FY23e

FY23e

 

 

old

new

change

y-o-y

old

new

change

y-o-y

old

new

change

y-o-y

Revenues

199.2

199.2

0.0%

0.0%

213.2

215.0

0.8%

7.9%

234.7

237.4

1.1%

10.4%

Gross profit

144.8

143.4

(1.0%)

(0.5%)

153.5

154.8

0.8%

7.9%

169.0

170.9

1.1%

10.4%

Gross margin

72.7%

72.0%

(0.7%)

(0.4%)

72.0%

72.0%

0.0%

0.0%

72.0%

72.0%

0.0%

0.0%

EBITDA

48.4

48.3

(0.1%)

(6.6%)

51.1

51.7

1.1%

7.0%

56.1

57.3

2.2%

10.9%

EBITDA margin

24.3%

24.3%

(0.0%)

(1.7%)

24.0%

24.1%

0.1%

(0.2%)

23.9%

24.2%

0.2%

0.1%

EBITA

44.4

44.3

(0.1%)

(7.5%)

46.9

47.5

1.3%

7.2%

51.7

53.0

2.4%

11.4%

EBITA margin

22.3%

22.3%

(0.0%)

(1.8%)

22.0%

22.1%

0.1%

(0.1%)

22.0%

22.3%

0.3%

0.2%

PBT

42.2

42.7

1.1%

(6.6%)

45.2

46.4

2.7%

8.8%

50.1

52.1

4.0%

12.2%

EPS - normalised, diluted (p)

16.3

16.5

1.1%

(8.0%)

17.3

17.8

2.7%

8.1%

19.1

19.8

4.0%

11.5%

EPS - reported (p)

7.1

7.3

2.0%

(17.3%)

8.1

8.5

5.9%

17.1%

10.1

10.8

7.7%

27.0%

DPS (p)

6.0

6.0

0.0%

N/A

3.3

3.3

0.0%

(45.0%)

3.6

3.6

0.0%

9.1%

Net debt/(cash)

12.0

15.5

28.6%

(55.3%)

(16.6)

(14.0)

(15.6%)

(191%)

(48.6)

(47.3)

(2.6%)

237%

Divisional forecasts

Revenue

Identity

113.3

115.8

2.2%

9.8%

122.3

125.8

2.9%

8.7%

135.5

139.4

2.9%

10.8%

Location

45.8

50.2

9.6%

-2.5%

49.5

54.2

9.6%

8.0%

55.4

60.7

9.6%

12.0%

Fraud

33.8

30.1

(10.8%)

-15.1%

36.5

32.5

(11.0%)

7.7%

39.8

35.3

(11.3%)

8.8%

Group

199.2

199.2

0.0%

0.0%

213.2

215.0

0.8%

7.9%

234.7

237.4

1.1%

10.4%

Adjusted operating profit

Identity

35.9

37.2

3.6%

10.5%

37.0

38.1

2.9%

2.6%

41.0

42.2

2.9%

10.8%

Location

11.2

14.3

27.5%

-4.5%

13.9

15.2

9.6%

6.3%

15.5

17.0

9.6%

12.0%

Fraud

8.9

6.9

(23.2%)

-48.9%

10.2

9.1

(11.0%)

32.3%

11.1

9.9

(11.3%)

8.8%

Group

44.4

44.3

(0.1%)

-7.5%

46.9

47.5

1.3%

7.2%

51.7

53.0

2.4%

11.4%

Adjusted operating margin

Identity

31.7%

32.1%

30.3%

30.3%

30.3%

30.3%

Location

24.5%

28.4%

28.0%

28.0%

28.0%

28.0%

Fraud

26.5%

22.8%

28.0%

28.0%

28.0%

28.0%

Group

22.3%

22.3%

22.0%

22.1%

22.0%

22.3%

Source: Edison Investment Research

Valuation

GBG trades at a premium to the UK software and IT services sectors and at the upper end of its ID management peer group on a P/E basis, reflecting its growth prospects (after COVID-19 disruption recedes) and high recurring revenues. The company also has a solid balance sheet and is cash generative, positioning it well to weather this period of uncertainty.

Our reverse DCF analysis, which uses a WACC of 7.5%, long-term growth of 3% and our forecasts to FY23, estimates the current share price is factoring in operating margins of 25.8% and revenue growth of c 16% per year from FY24, at the upper end of the group’s revenue and margin targets. Triggers for upside from the current level, apart from faster than expected recovery as COVID-19 restrictions are reduced, could include accretive acquisitions, successful cross-selling from recent acquisitions and adoption of GBG’s combined identity/location solution.

Exhibit 7: Valuation metrics

Rev growth (%)

EBIT margin (%)

EV/sales (x)

EV/EBIT (x)

P/E

Div yield (%)

CY

NY

CY

NY

CY

NY

CY

NY

CY

NY

CY

NY

GBG

0.0

7.9

22.3

22.1

9.0

8.3

40.4

37.7

54.7

50.6

0.7

0.4

Ave ID Management

4.9

7.7

28.2

28.9

6.4

6.4

24.3

22.0

31.8

27.0

0.9

1.1

Median ID Management

3.7

7.3

28.3

28.8

5.8

6.1

25.5

23.1

31.7

27.3

0.6

1.0

Ave UK Software

13.9

13.6

-2.4

6.3

5.5

4.8

14.4

16.7

19.9

22.6

0.9

1.1

Median UK Software

7.1

7.8

12.4

14.1

3.7

3.4

20.8

19.5

25.2

24.4

0.1

0.4

Ave UK IT Services

10.3

11.7

10.7

13.0

3.3

3.1

51.1

19.8

32.2

37.3

1.1

1.3

Median UK IT Services

4.2

9.8

12.9

13.6

3.4

3.0

27.6

21.7

34.0

28.8

0.5

1.1

Source: Edison Investment Research, Refinitiv (as at 7 December 2020)

Exhibit 8: Financial summary

£'000s

2017

2018

2019

2020

2021e

2022e

2023e

Year end 31 March

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

Revenue

 

 

87,468

119,702

143,504

199,101

199,184

214,957

237,385

Cost of Sales

(20,302)

(27,092)

(36,060)

(54,914)

(55,771)

(60,188)

(66,468)

Gross Profit

67,166

92,610

107,444

144,187

143,412

154,769

170,917

EBITDA

 

 

18,734

28,741

34,080

51,739

48,318

51,704

57,337

Operating Profit (before amort. and except.)

17,006

26,311

32,031

47,945

44,350

47,549

52,987

Acquired intangible amortisation

(4,022)

(7,885)

(10,316)

(19,008)

(18,900)

(18,900)

(17,900)

Exceptionals

(1,410)

(2,143)

(4,003)

(1,552)

(93)

0

0

Share of associate

0

0

0

0

0

0

0

Share based payments

(994)

(2,375)

(2,287)

(4,541)

(4,995)

(5,495)

(6,044)

Operating Profit

10,580

13,908

15,425

22,844

20,362

23,155

29,043

Net Interest

(498)

(508)

(689)

(2,218)

(1,655)

(1,105)

(855)

Profit Before Tax (norm)

 

 

16,508

25,803

31,342

45,727

42,695

46,444

52,132

Profit Before Tax (FRS 3)

 

 

10,082

13,400

14,736

20,626

18,707

22,050

28,188

Tax

668

(2,746)

(2,583)

(3,562)

(4,490)

(5,292)

(6,765)

Profit After Tax (norm)

13,206

20,642

24,760

35,210

32,448

35,298

39,621

Profit After Tax (FRS 3)

10,750

10,654

12,153

17,064

14,217

16,758

21,423

Ave. Number of Shares Outstanding (m)

131.6

150.6

158.1

193.6

195.1

196.4

197.7

EPS - normalised (p)

 

 

10.0

13.7

15.7

18.2

16.6

18.0

20.0

EPS - normalised and fully diluted (p)

 

9.9

13.5

15.4

17.9

16.5

17.8

19.8

EPS - (IFRS) (p)

 

 

8.2

7.1

7.7

8.8

7.3

8.5

10.8

Dividend per share (p)

2.4

2.7

3.0

0.0

6.0

3.3

3.6

Gross Margin (%)

76.8

77.4

74.9

72.4

72.0

72.0

72.0

EBITDA Margin (%)

21.4

24.0

23.7

26.0

24.3

24.1

24.2

Operating Margin (before GW and except.) (%)

19.4

22.0

22.3

24.1

22.3

22.1

22.3

BALANCE SHEET

Fixed Assets

 

 

105,653

170,284

438,683

430,219

407,061

389,006

371,857

Intangible Assets

98,753

161,372

425,646

414,505

387,040

367,990

349,940

Tangible Assets

2,856

4,700

4,815

9,420

10,502

11,497

12,398

Other fixed assets

4,044

4,212

8,222

6,294

9,519

9,519

9,519

Current Assets

 

 

48,914

61,121

76,522

95,984

81,538

112,922

150,268

Debtors

30,569

37,969

54,992

66,554

71,706

77,385

85,459

Cash

17,618

22,753

21,189

27,499

4,332

30,039

59,311

Other

727

399

341

1,931

5,499

5,499

5,499

Current Liabilities

 

 

(44,444)

(56,942)

(77,030)

(86,459)

(86,892)

(93,520)

(102,505)

Creditors

(36,436)

(56,100)

(70,302)

(80,280)

(82,689)

(89,317)

(98,302)

Contingent consideration

(7,122)

(45)

(5,287)

(6,179)

(4,203)

(4,203)

(4,203)

Short term borrowings

(886)

(797)

(1,441)

0

0

0

0

Long Term Liabilities

 

 

(15,940)

(16,711)

(116,707)

(94,810)

(46,413)

(36,727)

(26,981)

Long term borrowings

(11,499)

(8,451)

(85,447)

(62,139)

(19,833)

(16,002)

(12,002)

Contingent consideration

0

0

0

0

(458)

(458)

(458)

Other long term liabilities

(4,441)

(8,260)

(31,260)

(32,671)

(26,122)

(20,267)

(14,521)

Net Assets

 

 

94,183

157,752

321,468

344,934

355,293

371,682

392,640

CASH FLOW

Operating Cash Flow

 

 

16,305

31,620

27,779

48,498

42,600

52,653

58,248

Net Interest

(498)

(545)

(689)

(1,768)

(1,454)

(936)

(855)

Tax

(2,193)

(3,247)

(2,930)

(6,386)

(10,247)

(11,147)

(12,512)

Capex

(2,227)

(2,018)

(1,625)

(1,339)

(2,900)

(3,000)

(3,100)

Acquisitions/disposals

(36,840)

(70,363)

(255,101)

(81)

(2,089)

0

0

Financing

24,755

56,668

157,339

(1,553)

(1,037)

(2,000)

(2,000)

Dividends

(2,775)

(3,582)

(4,049)

(5,761)

(5,855)

(5,864)

(6,509)

Net Cash Flow

(3,473)

8,533

(79,276)

31,610

19,018

29,706

33,272

Opening net debt/(cash)

 

 

(8,673)

(5,233)

(13,505)

65,699

34,640

15,501

(14,037)

HP finance leases initiated

0

0

0

0

0

0

0

Other

33

(261)

72

(551)

121

(169)

0

Closing net debt/(cash)

 

 

(5,233)

(13,505)

65,699

34,640

15,501

(14,037)

(47,309)

Source: GB Group, Edison Investment Research


General disclaimer and copyright

This report has been commissioned by GB Group and prepared and issued by Edison, in consideration of a fee payable by GB Group. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by GB Group and prepared and issued by Edison, in consideration of a fee payable by GB Group. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

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