March 31, 2023

NCC warns on cyber revenue

Macro & Overnight

There is emerging evidence that China’s re-opening recovery is coming through, with China’s services growth recording the sharpest increase in over a decade. However, manufacturing output remains sluggish, which is not what the commodity bulls had hoped for.

European inflation is recording sharp falls, particularly in Spain, as energy cost declines feed through, and the base effect comes through.

The UK has joined the eleven-nation trans-pacific trade partnership.


UK Company News

Cerillion, the telco software provider, has announced a major new £10m contract with an existing customer over ten years. 

Dignity, the UK’s leading funeral and crematorium operator, released FY results with revenue down 13%, profit down 68% and cash down £86%. Operationally it held its market share steady while restructuring to more decentralised management. The trend towards lower price funerals and various cost pressures are ongoing features. The company continues to support the 550p cash offer from the JV between Phoenix Asset Management and Sir Peter Wood. However, it continues to review all options, including the possible need to raise equity finance to reduce its debt and improve its capital structure. 

Dignity investors might feel more encouraged to accept the offer given the challenging trading conditions and geared balance sheet. 

United Heath’s offer to acquire EMIS has run into further CMA difficulties. 

IT security provider NCC has updated and warned about increased market volatility, significantly impacting near-term cyber security revenue and profitability, particularly in the North American technology sector. It now expects FY23 operating profit to be £28m-£32m versus previous guidance of £47m. 

Cybersecurity spending might be more discretionary than investors might have hoped as the migration of software and data to the cloud shifts spending patterns.



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