UPDATE 2-NCC Group profit rises; eyes more acquisitions

* Sees more than 35 mln stg of orders, renewals in new yr

* FY adjusted pretax profit 14.5 mln stg vs 12.3 mln stg

* Ups final dividend by 16 pct to 10.75p

* Shares up nearly 7 pct to two-year high

(Adds CEO comments, analyst reaction, shares)

By Paul Sandle and Aditi Samajpat

LONDON, July 5 (BestGrowthStock) – British computer-security firm
NCC Group (NCCG.L: ) posted 18 percent growth in full-year pretax
profit, helped by higher margins and acquisitions, and said it
was eyeing further deals in the United States and Britain.

Revenue at the company, which tests IT security and holds
copies of software source code in escrow, rose 15 percent to
53.7 million pounds ($83.1 million), after it bought two
companies to bolster its security division.

Chief Executive Rob Cotton said further deals could be on
the cards, and the group had 27 million pounds of funding
available.

“The U.S. tax changes have meant a number of the U.S.
businesses we have looked at are looking more affordable,” he
said in an interview on Monday.

“There are things going off in the U.S. that we are
optimistic about, as in the UK. I am optimistic something will
happen in the next 12 months.”

Shares in the group rose nearly 7 percent to a two-year high
of 442 pence by 1019 GMT, as analysts welcomed the results.

Jon Fletcher at Altium said: “The outlook is very positive,
reflected in the increased order book levels and the opportunity
for further margin progression.”

Cotton said the group had increased its adjusted margin —
by one percentage point to 28 percent — despite freezing prices
in its escrow business last year when sentiment amongst its
customers was poor.

“We do expect to put prices up — we expect to get RPI plus
at least,” he said. “We have got difficult times ahead but
people are accepting that price increases are not unreasonable.”

He was also confident on the outlook for the group. “With
high revenue visibility and over 35 million pounds of orders and
renewals forecast for the current financial year, we are
confident that our prospects continue to be very bright.”

NCC, which serves 94 of the companies in the FTSE 100
including Vodafone Group (VOD.L: ) and BAE Systems (BAES.L: ), sees
renewals at Escrow Solutions rising 4.8 percent to 15.2 million
pounds and order book at the Assurance Testing unit up 49
percent to 14 million pounds.

For the year to end-May, the company reported an adjusted
pretax profit of 14.5 million pounds, compared with 12.3 million
pounds in the year ago.

The group said it would pay a final dividend of 7.25 pence,
raising its total payout by 16 percent to 10.75 pence.
(Editing by Maju Samuel and Michael Shields)

UPDATE 2-NCC Group profit rises; eyes more acquisitions