NCC gains sharply from data escrow business

Travails at Torex Retail this year helped NCC, the IT security group, to another year of record profits.

Rob Cotton, chief executive of NCC, said many Torex customers had signed up the group’s data escrow business to allay their fears about their future relationship with the retail software group, whose shares were suspended amid a Serious Fraud Office inquiry while it struggled with massive debts.

The escrow business sees a software seller send a copy of proprietary software to NCC to help back up its customers’ IT systems. It ensures material can be accessed by the user quickly and legally if a supplier’s business fails or if it fails to meet contractual obligations.

Mr Cotton said: “Enlightened software owners are now keen to disassociate themselves from the dubious segments of the software development market and are more aware than ever that a licensee will demand escrow protection.”

The group, which is due to shift from Aim to a full market listing next week, said revenues at its escrow business increased 22 per cent to £15m.

Fastest growth at NCC was at its assurance-testing business, which rose 52 per cent to £5.8m as organised crime continued to focus upon identity theft as well as online banking fraud.

Ethical security testing, in which NCC’s GCHQ-accredited experts hack into corporate IT systems, saw revenue jump 42 per cent to £3.1m.

Revenues for the year to May 31 rose 22 per cent to £25.4m. Pre-tax profit was up from £6.5m to £7.7m and earnings per share rose from 14p to 16.5p.

The company proposed a final dividend of 3.25p, making 4.75p for the year; up 36 per cent. With £19m revenue booked, it was confident about the next financial year. The shares closed up 4½p at 392½p.