GB Group plc (GBG) Earnings Call Transcript & Summary

Good morning, everyone, and a very warm welcome to the GBG results announcement for FY '25. Thank you to everyone who has joined us either via webcast or here in person in the room in London. David will shortly take us through our FY '25 financial performance, but this slide shows how Team GBG have delivered much more than revenue growth and strong operating profit in the past year. We've enabled safe and rewarding digital lives for genuine people everywhere. The statistics on the screen support the fact this isn't just a marketing tagline. It's a reflection of the impact we're making right across the globe supporting over 20,000 customers and processing billions of transactions every year. FY '25 marks the end of my first year as CEO. And when I come back later, I'll walk you through the operational progress we've made in the past 12 months and how we will make GBG an even stronger business in the coming years. But first, I'll hand over to David.

Thank you, Dev, and good morning, everyone. Thank you for joining us. I am very pleased to take you through our financial performance for FY '25, which I should start by confirming is in line with the trading statement that we put out in respect to the year-end in April. In headline terms, we delivered revenue of GBP 282.7 million, up 3% on a constant currency basis. While this was a little lower than our expectations at the start of the year, this does represent an acceleration over the previous year, which is encouraging given the context of a still relatively challenging macroeconomic backdrop for some of our end market sectors. The expected revenue recognition headwinds that we knew we would face for our Fraud business and the ongoing turnaround for our Americas Identity business. Consistent with the prior year, 95% of our revenue came from repeatable revenue streams. The combined Location and Identity segment NRR returned to being a driver of absolute growth increasing to 101.1% for the full year. We continue to focus on operational strategies to drive NRR even higher. These include our strong customer relationships where we continue to find ways to add value and increase satisfaction, therefore, improving retention, upselling customers to our higher-value solutions and cross-selling customers to a broader suite of GBG products, and, of course, managing customer pricing, which we've talked about previously. In the Fraud segment, which we no longer include in NRR as it isn't the most appropriate measure for that business, annual recurring revenue or ARR increased by 5%. Adjusted operating profit increased by 9.5% to GBP 67 million, with the margin expanding to 23.7%, up 160 basis points year-on-year. This improvement in operating leverage came primarily from the cost savings that we delivered in the prior year, but also from our ongoing focus on simplification and efficiency. Adjusted diluted EPS increased 14.9% from the prior year to 17.4p, driven by the increase in adjusted operating profit plus lower net finance costs as the level of our debt on our balance sheet continues to reduce. And finally, cash conversion remained strong at 91.3%, enabling us to reduce net debt by over GBP 32 million year-on-year to GBP 48.5 million and bringing our net debt-to-EBITDA ratio down to 0.7x. I'll talk more about how we're thinking about capital allocation later in the presentation. But here, the headline is that in addition to the GBP 10 million of share buyback that we've just completed at the end of last week, we are recommending an increase in our final dividend in respect of FY '25 of 4.8% to 4.4p per share. Now let's take a look at the income statement, although I have already covered most of the headlines. Revenue for the year was GBP 282.7 million, up 1.9% on a reported basis but 3% on a constant currency basis. This reflects our continued growth in our Identity and Location segments, which more than offset the decline in Fraud. Gross margin held steady at 70%, broadly in line with last year, and this stability reflects our success in managing customer pricing and optimizing cloud and infrastructure data costs. Net finance costs reduced to GBP 6.9 million, down from GBP 9 million the previous year. This was due to lower average debt levels and some easing of interest rates during the second half. Reflecting both the growth in adjusted operating profit and the reduced interest costs, adjusted profit before tax increased 15.2% to GBP 60.1 million and adjusted diluted EPS was up 14.9% to 17.4p. Our adjusted effective tax rate was 26.3%, slightly higher than last year, primarily due to the derecognition of a small deferred tax asset. Excluding that one-off, the underlying tax rate remains around 25%, which is where we expect it to stay moving forward. Moving on to the segments. Identity remains our largest segment, contributing 56% to group revenue in FY '25, and revenue grew 3.1% on a constant currency basis to GBP 159 million. This growth was driven by strong performance in EMEA and APAC, where we saw improved net revenue retention through successful upsells of capabilities like international data and our multi bureau solution. At the half year, we talked about our success in growing the relationship with Remitly and also how pleased we were to win back MoneyGram from a competitor. We also saw increasing demand for our document and biometric capabilities with notable wins, including Santander in the U.K. and Star Entertainment Group in Australia. In the Americas, which accounts for the single -- largest single part of Identity, performance was broadly flat, but we've made good progress operationally in stabilizing the business. Just like any turnaround, there is a lot to improve but among our achievements in FY '25, we rebuilt the account management team, standardized our sales incentive schemes and have a number of programs running to reduce the time to revenue for new customers. Then in Q4, we transitioned to new local leadership, relocated more of our GBG group leadership team into the U.S. and are now particularly focused on accelerating new business. Early signs are encouraging as we have improved NRR quite meaningfully, secured a multiyear win with Indra SIA Group to support 7 airports and we won back a leading sports betting customer from a competitor due to our superior pass rate on our platform. But there remains a lot to do, and Dev will talk more about our FY '26 focus areas in his section later. In Identity, 31% of our revenue is from subscriptions, but you should expect this to gradually increase across the medium term as we focus particularly on -- particularly in the U.S. on converting more customers from the consumption model to subscription agreements, which we hope ultimately will improve and keep attrition low. After another strong year, Location comprises 30% of total group revenue, with revenue up 6.2% on a constant currency basis to GBP 85.6 million and contributing now a margin comfortably holding above 40%. This segment continues to demonstrate consistent growth and high customer retention, reinforcing our leadership in location intelligence and our success in diversifying into new sectors. That growth was despite a macroeconomic environment that remains challenging, particularly for the almost 1/4 of this business that sells into the retail and e-commerce sector. Growth was driven by strong net revenue retention and our ability to upsell platform capabilities to customers like Microsoft, Wise and LEGO. We also saw continued momentum through our partner channel with enterprise partners like IBM, Oracle and SAS helping to expand our reach and which drove total revenue from such partners to now account for 20% of the Location total. In Asia, we built on our success with cross-border e-commerce players like SHEIN and secured a landmark win with Temu now supporting them in 21 markets. We are particularly excited about our opportunity as a key partner to FedEx, which we feel represents a much more -- much broader strategic opportunity than just the revenue contracts that we closed in Q4. Revenue in our Fraud segment, which is our smallest segment at just 14% of total group revenue, declined 4% on a constant currency basis to GBP 38.1 million. This was primarily due to timing differences on revenue recognition in software license renewals, particularly in Southeast Asia and in EMEA. However, customer retention remains strong. Recurring revenue for the Fraud segment is 77% of the total. And against this, we secured a 5% increase in ARR during FY '25. The contribution margin increased above 40% in FY '25 as the cost efficiency drive of the prior year delivered lasting benefits into the cost base. As you know, our Fraud segment comprises two businesses. Following a strategic review undertaken of our mostly APAC-focused fraud prevention solutions, which make up 8% of group revenue, we have now repositioned this business operationally as a stand-alone unit, Global Fraud Solutions and we feel that this will better leverage our expertise and unlock new growth opportunities and TAM expansion. As we have referenced before, this business -- the business model of this unit does mean that revenue recognition can be lumpy, but we were pleased that the business delivered ARR growth of close to 8% in FY '25. Our U.K.-focused Identity Investigation solutions, which make up 6% of total group revenue and which have previously been reported as part of the Fraud segment, will now be reported within the Identity segment from FY '26. Turning now to operating expenses. The income statement that I presented a few minutes ago was on an adjusted basis. And you can see at the bottom of this table that through our continued focus on efficiency and cost discipline, we managed to keep annual adjusted operating expenses to 1.9% lower than the prior year. That was despite some reasonably significant inflationary pressure. But we have also made some targeted investments into key innovation and operational initiatives, which Dev will talk more about in his section soon. Having had no exceptional costs in the first half of FY '25, we did invest GBP 4.5 million in the second half as we continue to transform GBG into a simpler, more globally aligned business that is focused on delivering strong shareholder value. We invested GBP 2.5 million in restructuring that ultimately is providing us with more capacity to invest in the innovation and team that will drive growth in future years. We also invested GBP 1.9 million into the strategic review of our fraud prevention business. This review was very broad in nature and considered multiple opportunities for maximizing value. Ultimately, we landed on a refreshed strategy. And as I mentioned earlier, that business has now been completely separated into a distinct organization structure that we feel is best way for us to opportunity for that business. Amortization of acquired intangibles reduced to GBP 34.8 million as some assets became fully amortized during the year. Share-based payments increased to GBP 5.1 million, reflecting a higher share price and a full year impact of awards granted in FY '24. Our focus on cost control, simplification and global alliance going to continue. And Dev and I feel that there is a lot more opportunity for us, which ultimately will release the flexibility we need to invest in our core growth accelerators. Dev is going to talk more about those priorities in his section of the presentation. While it is early for us to be specific or precise, you should expect a broadly similar level of exceptional items in FY '26 as we continue to execute those transformation initiatives with a particular focus on business systems that will improve productivity and consistency, particularly for our sales teams. Cash generation remains a core strength of the business. And in FY '25, we converted 91.3% of adjusted EBITDA into cash, enabling us to generate GBP 48 million of adjusted free cash flow. It is worth reminding that within that cash flow generation, there is significant investment into the future of the business, including GBP 47 million invested into technology development, all of which is expensed as incurred, there is no capitalization. In FY '25, we used the majority of that free cash flow to pay our dividend of GBP 10.6 million and reduced our net debt by GBP 32 million. We did also utilize a little for the investments we made via the exceptional items that I just mentioned and a small amount for share purchases for our EBT that will be utilized to satisfy employee share options rather than needing newly issued shares. The table below here shows the good progress we have made in paying down our debt, and by the year-end, net debt stood at GBP 48.5 million, which represents a net debt-to-EBITDA ratio of 0.7x. We feel that now for the first time in a while, GBG has some optionality in capital allocation. As we think about that optionality for FY '26, firstly, we expect free cash flow generation to be a bit stronger than in FY '25, given some moderate increase in adjusted profit. We have also announced today we will pay a dividend with total cash cost of approximately GBP 11 million. We've just completed a share buyback and cancellation of just over 3.7 million GBG shares at a total capital outlay of GBP 10 million. And we do expect a similar level of exceptional costs in FY '26 as the business continues to transform. The remainder of the expected free cash flow plus our relatively comfortable current level of debt-to-EBITDA ratio is where we feel we have retained some optionality, which could cover us for further potential share buyback programs if that was deemed optimum, bolt-on M&A if we are able to find the right opportunity or, of course, for further debt repayments. So before I hand over to Dev, I just wanted to cover the outlook statement for FY '26. The new financial year has begun as expected, and our outlook for the full year is consistent with current market expectations. Given the relative strength of the first half of FY '25, our FY '26 growth in constant currency terms will naturally be second half weighted. And based on current spot rates, we do expect FX translation to be a headwind to reported growth with the majority of this impact already reflected in current market expectations. I should also highlight that within the announcement this morning, we declared our intention to commence the work required for GBG to move from AIM to the Main Market which we feel ultimately will increase GBG's access to broader pools of capital. We will provide further updates on the timing and process for the move in due course. So just before I hand over to Dev, I mentioned earlier how one of our investment priorities for FY '25 was into GBG Go. So we wanted to share with you a short video, intro video that we have used primarily for customers. [Presentation]

Thank you, David, and that is GBG Go. We launched Go on the 1st of April and encouragingly, we have already signed customers in each of our three key regions and built a strong pipeline, including those organizations who participated in the early adopter program. Go is a huge achievement for GBG and it's a big change in terms of how we deliver product and will continue to be a key focus area in FY '26 and beyond but a bit more on that later. FY '25 was much more than just Go. This past year has been one of heavy lifting both for the team at GBG and for me personally. Every initiative we launched, every promotion that was earned and every mile we traveled has been to build a stronger, more focused GBG. Whilst we've delivered growth in revenue and profit, we've also maintained strong employee engagement scores, offering nearly 10% of our team their next career opportunity and kept a focus on customer satisfaction, recording our highest ever NPS score, Net Promoter Score. I've really enjoyed leaning in and spending time with our teams and our customers, and those interactions have helped inform where we take the business next. But first, let's talk about the initial focus areas that I introduced in this very room last year and the progress we've delivered against each of those. Just a quick recap first on what they were, global alignment, embracing the power of GBG and becoming one team, driving a performance culture by creating an environment that drives and rewards performance, removing complexity, making GBG an easier business to work with, work in and to understand from the outside, and lastly, differentiating through innovation, making focused investments to regain our competitive edge. Let me start by talking about what we've done to drive global alignment. One of GBG's key differentiators is our global proposition. At the end of FY '25, we retired our legacy brands, and we now go to market with a single identity that can finally speak to that global size and scale without the need for an explanation. Within each of the three segments that David described, we've created a more global operating model. We've also restructured our technology function, placing our engineers within the business unit they support to bring them closer to the customers that they serve. As we've operated more as one team than ever before, I'm also really pleased with how that's translated to the way that we're prioritizing our investments on a more collective basis for the biggest long-term impact. And lastly, something I'm really proud of is that we now have a purpose statement, one that unites us for today and inspires us for tomorrow. And that purpose is enabling safe and rewarding digital lives for genuine people everywhere. Earlier, you saw proof points about how we help keep people safe, running more than 800 million identity checks and blocking 24 million bad transactions every year. You saw proof points about how our technology delivers rewarding experiences, validating 6,000 addresses every second or 64 billion per year. And we do this everywhere. Identity data in 50 countries, 8,500 document types, address data available in 78 languages. I'm really excited to see how we will grow into this purpose as we innovate, developing new ways to enable safe, deliver rewarding and doing both of those across more and more of the world as we grow. Next, let's talk about dialing up the performance culture at GBG. In the second half of last year, we launched Project Perform, a program with the goal of overhauling our performance frameworks to set clear objectives and minimum standards for our people whilst meaningfully rewarding high performance. Our new performance system also went live on the 1st of April and has been well received by the team. For the first time ever, 100% of our team members have documented objectives, which is a huge shift from where we've been. As big of a shift, we will also, for the first time, be rewarding outcomes based on -- resetting reward outcomes based on individual performance, launching a new quarterly bonus scheme for all team members. In Q4, we evolved and strengthened our global leadership team, appointing James Gothard as Chief Strategy Officer; and Tom Schutz as Chief Revenue Officer for the Americas. Both James and Tom have deep industry knowledge, global experience and are already making a difference to the way we operate. And since we've mentioned Tom, let's talk about where we're at with our Americas turnaround. A year ago, our Americas business had a fractured culture, limited leadership visibility and was not customer-centric in the way it was structured. As David described, we spent a lot of FY '25 addressing those issues. Today, our underlying business in Americas is in a stronger place because of those actions. When we look ahead to what's next, we know there is more work to be done and time to pass before that underlying improvement shows through in our numbers given our SaaS revenue model. In FY '26, we will continue to build the platform and track the leading indicators which matter. Those indicators include how we're leveraging the leadership transition to reset minimum standards, embedding a performance culture with a metrics-based operating system that holds people to account. With Tom now in place as CRO, Gus Tomlinson, our MD of our Identity business now relocated to Atlanta and other senior appointments made in the second half, we are seeing the Americas region work more closely together as we pursue more strategic and larger opportunities. We continue to execute against the turnaround playbook that we've obviously refined under new leadership. Our particular focus is on playing where we win, to drive the pace and increase our probability of success. A key part of that playbook, as David described, is how we evolve our commercial model, transitioning away from a legacy approach that was consumption-based or pay-as-you-go to a multiyear agreement structure with volume commitments and that shift will only be accelerated as we lead with the GBG Go proposition. Having officially retired the legacy brands that came through acquisition, we're focused on differentiating ourselves from locally-focused competitors through the strength of our global offering. That's not just about how we launch new global products like Go and KYB, but also, for example, how we've created a single global gaming team to better support our growth ambitions in that fast-growing vertical in the U.S. The Americas continues to be a strong long-term opportunity, and therefore, we are applying a long-term lens to our decision-making, whether that be sunsetting legacy products, recontracting key customers on longer-term commitments, or developing a talent pool that will enhance our future success. Thirdly, let's talk about how we're becoming a simpler business to work with, work in and understand. David has already covered how we started the journey to modernize our business systems, such as CRM, how we've been smarter in our deployment of cloud and how we've generated efficiencies by simplifying our product and technology. But in addition to those areas, we've also focused on making our product easier to consume. I've spoken to you previously about how we've enjoyed benefits from simplifying the contracting process for customers. Today, I want to focus on how we've been doing this from a technology perspective in our Locate business, where the team have enabled our address verification product to be distributed through e-commerce marketplace integrations. As I'm sure you know, platforms such as Shopify are an increasingly popular way for small to mid-sized businesses to build out their digital storefront. And so it's very important that Locate has a presence within those marketplaces. In addition, the types of businesses that leverage those marketplaces do not have the time or the development resource to accommodate a complex integration. Historically, our Locate product would take around 60 days to configure, test and integrate. That's something that wouldn't work for the types of business that operate in the marketplace. They need products they can discover, try and buy in minutes, not in months. And this is where our Locate engineering teams reimagined what was possible and delivered a product that was 1,000x faster for customers to deploy in just 1 year. What used to take 60 days has been brought down to less than 60 minutes. And as a result, Locate is now available in 20 marketplaces with 10 more planned and is an attractive proposition to a massive number of potential customers who need best-in-class address capability to ensure their goods are delivered first time. We are now focused on creating the right go-to-market model in terms of executing our digital marketing playbook, tuning our product messaging and placement in the marketplace and developing an attractive channel pricing strategy before we can accelerate investment behind this initiative. I highlight this example because I really think it shows that what's possible when we challenge ourselves. It also shows the strength of our tech talent and also how they're critical in unlocking revenue growth opportunities for GBG. Our fourth and final focus area in FY '25 was around innovation. You've heard me talk before about GBG Trust, our identity network, which continues to grow in size, now standing at 135 million records, which we generate from almost 1,000 contributors. Outside of trust, we're leveraging AI to create address data in emerging markets where generally available postal files are poor in quality. Outside of product and tech, we're adopting an AI-first approach to the way we work. Whether that's how we drive sales productivity, enable our customer support teams or create efficiency in our central functions, there is more we can do as AI evolves, but I'm pleased to see how this has become a standard part of our toolkit in the past year. Today, though, I want to spend my time under this pillar talking about GBG Go, our global identity platform, enabling customers to easily enjoy the entire breadth of our capabilities. Go is the platform that will spearhead our business in the coming years. It leverages modern software techniques and accelerates the pace with which we can integrate new capabilities. That same modern architecture enables collaboration across our global engineering teams so that we can have the best minds on the biggest customers' problems wherever our people are in the world. And because it's from GBG, customers can be sure it's compliant with data privacy regulations. Its launch on April 1 was a key moment. There is much more to come as we align all our efforts behind it but our initial focus is to lead with the platform for new business opportunities. While we talk about Go under our innovation pillar, it also encompasses our other three focus areas. It's about leveraging our global size and scale, turning up the dial on performance, whilst removing complexity for the customer, making us simpler to do business with. So what can Go do for customers? Go helps them grow while being resilient to fast-evolving fraud challenges through its global coverage, comprehensive capabilities and user-friendly configuration. Customers can connect to any of their consumers through a combination of identity, fraud and risk modules and users can create journeys with billions of possible configurations and they can optimize that performance with insightful analytics and granular data. When carrying out an investigation into potential fraud, Go enables them to do so with a complete audit trail. Go is built to be user-friendly and intuitive. Let me demonstrate that now by showing you just how easy it is for customers to build a journey. By using our journey builder, customers can choose an out-of-the-box template based on GBG's knowledge of their industry, geography or user case whilst more sophisticated users can start with a blank journey canvas. By placing GBG Trust at the start of every journey, we can help organizations funnel their customers to the appropriate workflow based on risk from the word go. Customers can then proceed to build out the rest of the journey so that good customers receive a great experience and are moved through the process quickly. Potential fraud can be identified and prevented at source and medium-risk customers can be asked to provide more authentication by incorporating additional modules, which are obviously available in the platform. GBG Go allows customers to test and verify their configuration in a non-production environment before going live and that is how you create an adaptive journey for a great customer experience and optimal ROI. At the half year, I spoke about our ambition to unlock more insights from our platforms. We built Go to do exactly that through an intuitive set of analytics dashboards, allowing customers to optimize journeys to better deliver on their business objectives. Customers can dive deeper with insights and features such as journey drop-off and journey insights. These tools expose points in the journey that either have long completion times or cause consumers to abandon journeys, both of which point to a poor customer experience. Once these pain points have been identified, customers can use A/B testing tools that are built into Go to pick new journey configurations against existing ones before rolling out changes into production. You can see in the demonstration on the screen shortly how Go has recommended that the addition of an e-mail verification solution would uplift the acceptance rate from 65% to 81%. And ultimately, by adopting that recommendation, our customer sees a measurable uplift in value as they can onboard more consumers to their business with a much better experience. So what's next for Go as we continue to invest behind its road map? Coming next, customers can expect more exciting features and functionalities such as the incorporation of digital identities. We're also releasing a no-code version that's even simpler to integrate and we're building the very exciting recommendation engines that will prompt users on additional capabilities that will help improve journeys that they have built. Looking further out, customers can expect more AI-led intelligence and the integration of new solutions like Know Your Business or KYB. It's early days, but I'm encouraged and excited by what Go is bringing to customers now and even more by what it can deliver to GBG's future. It feels now like an appropriate time to move on to talk about how David and I are thinking about that future. During my first 12 months as CEO, our focus has been on an initial set of priorities that would help guide the new team as it came together. Through the progress I've already described, I'm pleased to see these focus areas will now become our foundation. As we grow, we will ensure that GBG encourages and retain simplicity to enable our scale, not just in how we look but also doubling down on single global platforms such as Go. And our culture is one that values collaboration and performance. Team GBG is powerful when it acts as one. With those foundations built and the benefits coming through, our focus is now firmly on accelerating the top line. We have identified three key priorities that will improve -- that will drive improved performance and build further on our innovation agenda. Firstly, we'll continue the work we've started around initiatives to transform our business. This includes the turnaround of the Americas, but more speaks to how we can and will unlock synergies and scale within GBG in order to operate with increased pace and agility. Secondly, we will evolve the core. So what does that mean? In Identity, it means accelerating the development of Go, using it as a platform to modernize our business and integrate our teams more closely than ever before. In Location, that means accelerating the expansion of the business through new distribution channels, such as the partners that David talked about and the e-commerce market places that I highlighted. And in Fraud, we will scale our business profitably using its Tier 1 customer base as a key enabler. And the third key priority is how we will fuel growth by creating a more formal system of innovation through a dedicated team. Our focus here will be on exploring new capabilities that can bring our identity and location businesses closer together to benefit both existing and new customers and developing adjacent and new capabilities, which we can then distribute through our global platforms to target a larger addressable market. As we execute against these priorities, opportunities to accelerate our growth and expand our business more rapidly are available, specifically through a more joined up go-to-market approach across our portfolio for our largest customers to really drive upsell and cross-sell, unlocking strategic partnerships, leveraging our platform to distribute new capabilities, continuing to grow an already global proposition by continuing to broaden our coverage and extending our competitive advantage, accessing new geographies and targeting attractive vertical markets where we don't have a significant presence today and inorganic growth through disciplined M&A. I look forward to updating you through this framework as we engage moving forward. To wrap up, before we go to Q&A, I want to leave you with four key messages. As I said a year ago, GBG is a high-quality business and the scale we enjoy uniquely positions us to serve a global customer base. Our focus in FY '25 means we have built strong foundations for what's to come. It's been a year of heavy lifting, but one that was necessary to commence the build with where we're going next. Our balance sheet continues to strengthen, which means we are returning to a place of optionality in how we deploy our capital. And we have a clear strategic direction for our future, one that is about driving accelerated growth as we transform towards a unified global platform. With that, we now invite your questions.

Okay. Nick, your hand shot up quite quickly. We'll come to you first.

Yes, it's Nick Dempsey from Barclays. I hope that's working. So the first one, just in relation to the strategic review of Global Fraud Solutions. Can you give us a bit more color on the options that you considered there and how you came to the decision that you've made on that? The second question, you've given us a lot of useful color on how you're improving the organization and culture of the business in the U.S. Can you give us a bit more color on the competitive landscape and how that might be changing in the U.S.? So for example, is there more competition from cheaper, lower-quality offerings? Or any more color on changes there? And just the third one, can you talk about pricing dynamics across your products but particularly in the Americas, how that's been in FY '25?

I'll take the first two, David, and you go for the last one. So I think in terms of the strategic review of global fraud, as David described, Nick, we evaluated a range of options as you would expect any new CEO coming in is making sure that the portfolio is match fit. In the end, we've resulted -- we've landed on structuring a single global business around that proposition. And the output of the review concluded that there was significant growth opportunities still for us to harness. Those relate to geographic expansion into places like the Middle East, those relate to how we can drive more solutions into our existing Tier 1 customer base around compliance and FRAML. And that's really our focus now with that business is to take that really high-quality customer base and continue to sell into it. In terms of the U.S., I think one of the shifts that I think we've made under Tom's leadership is focusing much more about our own execution and not worrying too much more about the competition. We know they're out there. It hasn't significantly changed since the last time I was here or the last time we spoke. Our focus really is on playing where we win, and that's really been how we've ensured that we've got strong product market fit by targeting the places we know we've got a right to win and removing distractions by not trying to be all things to all people.

Yes. I'll just comment actually, just to add on Americas before I take your third question. I think the key -- a key proof point, but I think it's quite indicative of where we find ourselves versus the competition is when we are really organized, which I think is something that we've been really driving to improve -- when we're really organized, we can be very successful. And I think I mentioned a win back that we've had in the gaming sector. That's a pretty significant customer. So there's no reason that we can't win more customers back. We just need to -- the whole team to be organized and driving towards that, which is a much improved situation. You asked -- your third question was on pricing. We've talked probably for the last 12 months about how we've been much more proactive on pricing, having probably between 12 and 18 months ago, taken on a specialist team of pricing experts that we now deploy across sales really. That's the way they're doing it. So they're now getting much more involved in the more significant customer negotiations and renewals but they're also driving much more discipline and process around some of the smaller customers where actually sometimes we don't really need to have too many conversations. We do just need to be more disciplined in pushing through price increases. So there was a good opportunity for us to continue to manage pricing, and I reference that as one of the reasons we've been able to maintain our gross margin. And I think going forward, the other thing that I think we need to think about is what does GBG Go do for pricing. Dev talked about this year, really, at least for the start of the year, our focus is on GBG Go being used for new customers. But I think you've seen the power of the tool from the quick demonstration Dev has given today, but that as a platform will be particularly valuable for customers, and we need to make sure we get appropriate pricing for that. Tintin, next.

In terms of the U.S., could you just refresh our minds in terms of what you think are the right to win sectors for you now? And then in terms of moving the U.S. more to a subscription basis, what pushbacks are you getting from customers? And from a competitive standpoint, is that far removed from what they're used to in terms of pay-as-you-go. And then finally, on the GPG Go pricing, how is that currently being priced at the moment? Is that per module? Is that pay-as-you-go? And if an existing customer wants to move to Go, what is the current response?

Okay. I'll have a go at the U.S.A. ones and then maybe, David, you can cover Go pricing and I'll chip in with some color. But in terms of the right to win. So David talked about the gaming customer that we won back. Alongside that, we've looked at all of the customers that have left us over the past 3 years, and we have a pursuit list around which ones we think we can win back. That was the first. There are more on that list. The right to win sectors are people who value a global coverage offering. So businesses that interact, trade globally. Most of our competitors in the U.S.A. have a local focus. Other right-to-win sectors are where we can join up brands across the world. So I talked about gaming in my section around how we've created a global vertical. That's because a lot of those gaming operators don't just play in the U.S.A., they play elsewhere, so customers like Entain and others. So that's really that. Happy to go into more detail, but focused on where we've had the right to win and then enabling our team with training and all of the product marketing type materials that will then support that and actively not playing where we don't have the right to win. In terms of this -- the move away from pay-as-you-go to commitment, actually, very little pushback. We have had to seed pricing in some cases to enable that, but it's a much stronger proposition for us to build off in the long term. So most of our competitors will price on commits. So we are really just catching up to where the rest of the market was.

Yes. And I think just picking up on that, I mean, the third question, we have much higher levels of subscription, as you're probably aware, in the Identity businesses in EMEA and APAC. So the markets are really not that dissimilar that it might work in Americas as well. On Go pricing, obviously, there's a good reason why we're launching with new customers initially. It means that it's a much more manageable number so that we can see how that lands. But so far, so good, Dev has talked about wins in each region already. I guess the key difference is that there will be a platform fee, which we do charge to some customers today, even if they're not on Go but we're going to have much more rigor around how that platform fee is going to be charged to customers. I think the key difference, though, is that there is a lot more value in the platform, which you can see from the analytics and the recommendations, which is something that customers today haven't had. So that's only fair that we charge for that. My eyes are this way. I'm sorry. So Charlie, and then I'll promise I'll turn my head the other way.

It's Charlie Brennan from Jefferies. I'll go with three questions as well, if I can. Firstly, that was a very thorough overview of the year-on-year trends in the business, but I think a lot of us are perhaps concerned about the slowdown in momentum in the second half of the year. I know that the NRR deteriorated sequentially from H1 to the full year. Can you just shine some light on that deceleration? Where there any customer losses behind it? And what's going to give you the confidence it's going to recover? Secondly, I think I've lost count of the number of times I've heard that GBG is going to accelerate in the future. It always seems to be in the future. Can you just refresh our memory of what you think market growth is and what growth should look like for GB? And how long are you giving yourself to achieve that so you know that the current strategy is working? And then thirdly, just on a very minor accounting detail, as you go from pay-as-you-go to multiyear commits, is there anything for us to be aware of there? In the phasing of revenue recognition, does a multiyear commit imply a pull forwards of revenue recognition?

Very good questions. Charlie, thank you. I think they're probably all for me, aren't they? So I'm sure Dev will add some color if he feels necessary. So H2 momentum, you're right that H2 growth was lower than the first half. I think when we reported to you at the first half, I think we were rightly proud of the growth acceleration we've seen in the first half, which we said at the time, underpinned our view for the full year. And that's exactly as it proved. We did also say at the time that particularly in Identity where we were helped by some customer project volumes, you might remember us talking about Santander, so there was some warning that identity might be a bit slower in the second half. And obviously, in the second half, you might remember, we were then lapping a relatively strong Q4. So first thing to say, I guess, cutting through all of that is we're confident in the underlying momentum is there for underpinning our outlook for FY '26. But as we said in the announcement today, we do expect it to be second half weighted just because it won't surprise you based on the fact that the first half of last year was stronger than the second half. So that's H2 momentum. Looking further out, yes, I think we've talked a lot today about the hard work that the whole team have put in, in building GBG as a platform for growth. I think the best thing we can say at the moment is we feel we're putting all of the right foundations in place. And actually, we feel that the acceleration in growth that's built into most of the analysts' expectations for the next few years feels about right. So everyone has growth accelerating in each of the next few years, that feels like what we can see as well at the moment. But obviously, we're looking to do everything we can to build more growth levers into the business. And then I'd be disappointed if there wasn't an accounting detail question, Charlie. So thank you for not disappointing me. No, I think if anything, actually, it would improve working capital because if we get upfront commitments at the moment versus some of our arrangements with customers on a pay-as-you-go or consumption model, they're typically paying monthly in arrears. If we do get multiyear commitments in Identity, revenue will still be recognized monthly. It's just that the cash will probably come a bit sooner. Julian?

Just a couple from me. Firstly, lots of good strategic initiatives in terms of what you're doing regarding sort of product and encouraging customers to move to, I guess, sort of more strategic products for yourself. Does that not take customers to procurement? If you're sunsetting products, if you're trying to shift customers to subscription maybe at a slight price cost cut and GBG Go, great initiative, but again as a decision that customers need to make, how are you managing that to make sure you don't see churn and encourage customers to go to sort of full procurement? Or is that already sort of factored in, in terms of a bit of risk there? And secondly, a little bit related actually is sort of churn. Obviously, that's improved massively over the last couple of years because your NRR has gone up and your new logos remain the same. So churn is obviously a big benefit as well as upsells. Is there more to go on that? I guess the two questions are a bit interrelated. Where does NRR go to? What's your aspirations for NRR? What can we sort of see there on the both sides of the NRR equation?

I'll jump in. Yes. So I'll perhaps start to take them in a reverse order actually because as you say, they are closely linked. So I think on churn, you're right, significantly improved, particularly, I would say, on net churn. I think, however, across our three regions, in Identity particularly, I think there's more to -- a bit more to do. And we're a lot more focused on making sure that those are very, very well joined up. And as you can see, through some of the initiatives we're bringing through in GPG Go, constant feedback as to how the Identity journeys are progressing is going to be very valuable to make sure customers are still getting the best possible value from the platform. So I think there is more to do. And as we look to increase NRR even further, it's definitely one of the levers, not the only one, but it's one of the levers that we would expect to continue to contribute to that. On the Go point around procurement, I think obviously, Go wasn't just built in isolation. It's been based off a lot of feedback we've had from customers and prospects around what they're looking for. And that's how we built Go around that and then try to get ahead of that as well. So we don't anticipate significant churn risk. In fact, I think we would see that there's uplift potential because you've got more value in the platform that you can then enable for customers. And they can obviously grow with the platform as well, which then drives to the earlier point around NRR kind of locked into their growth with our growth.

Do you go in at a low -- at a sort of a competitive price point and then the price increases as more modules are added? I mean, how are you testing the pricing?

So the way we've built the pricing for the customers that we've won so far is it's a platform fee and then there's an element that relates to specific customization of modules that customers want. So -- but it's not a low -- we're not coming in by habit and then work out what you do with it. It's much more of a productive conversation with the customer around what are your needs, what do you need to build. We obviously consult around what's the best configuration of the solution for them. And then that drives the relevant platform fee with how much they're going to use it and how big and complex their business is. It's not activate it and figure out for yourself.

Yes. And in terms of the sun setting point on -- obviously, a lot of products that GBG had, if you could just talk very quickly about how you're managing that? Or is it not the risk?

Well, so I think in my section, I did talk about how we, in the Americas, in particular, have taken a decision to sunset a product that was probably causing too much distraction for the team. So I think it's a good sort of point to make, a broader point that actually our focus in the Americas is really just to get ahead. We're not trying to catch up. We're trying to go to what the end state is. It would have been very easy for us to entertain continuing to tinker with that product and putting engineering resource on it. We took the bold decision, I would say, to sunset. And that was a very specific product case in the U.S., and I think we'll see now how the reaction is to that from customers and that could be a good way for us to test and learn as we see opportunity in the future to do more of that as we integrate all of our efforts behind Go.

Okay, that makes sense. A quick follow-up on tariffs. You sort of mentioned that in the pre-close, nothing in the statement here or presentation. I assume no change. What's your thinking on that in general?

Yes. Good spot and good question, Julian. Thank you. So I think the outlook statement references particularly that we're comfortable with where expectations are for FY '26. Clearly, those expectations have already factored in our comments from April where we did say it's quite possible we might see, in some of our sectors at least, some impact from macro uncertainty, certainly not directly related to tariffs, but I think it's sort of second order potential impacts. And I think the areas where we are probably most aware of those risks are probably for the -- some of the sectors for Locate, which in truth, we did see some degree of softness in Q4, you saw the slowdown in -- slight slowdown in Location versus the first half. And some of that's continued for the first couple of months. But it's all within the bounds of what we thought was quite possible. Andrew?

I've got a couple. So just sticking with the theme of Go. Just can you give us a sense of what the sort of the magnitude of wins to date has been and/or the pipeline build and where you expect that to go over the next sort of 12 to 24 months, how much resource are you putting behind it? And just on this sort of thinking in terms of go-to-market, do you go after new or do you go after existing? If Go is a platform that makes it easier for customers to access more stuff and improves the UX, why wouldn't you just hit all of your existing customers as well as going after new where presumably the pitch to new takes longer? And I've got a second question after that.

Right, I'll deal with that one first. So I think in terms of the magnitude, so we're at full and counting. If you remember, I think I said previously, we had an early adopter program running, which we had about 20 customers in that too who were existing and new. In terms of -- I think you asked a few questions in there, Andrew, so if I try and unpick them, resource behind it. So I think as we look forward -- so today, we have engineering teams on the legacy kind of local platforms. The direction of travel is clearly to have a single engineering team that powers Go that everybody gets the benefit of. So we think there's significant efficiencies in that, that David sort to talked to in how we transform the business that will unlock other investment into other acceleration areas. We're leading with it with new to build confidence but inevitably, we're having some conversations with existing customers, particularly large ones that would get the most benefit to test and learn. I think your point is valid that at some point there will come a time when we can consider how we take it to market more broadly. That's just not yet. Bear in mind, we launched it 2 months ago, positive feedback so far, but we need to do a bit more learning, I think, before we do something more broad.

And just in terms of sort of -- so we don't get too carried away in terms of materiality, can you give us a sense of pipeline or how meaningful it could be on a sort of 2-, 3-year view?

Yes. I think the area you should look at is the level of growth that we get from new logos. As we said, we're launching, particularly for new customers in this initial phase. For the last few years, growth from new customers for Identity and Location combined has been about 3% of total growth benefit for us. So that's the number that I'd expect to be able to improve based on what we did in our strategy for this year.

I think, Andrew, just to clarify, wherever we can, we're leading with Go now, we're not giving customers the choice. So in some ways, it just dovetails into what's our new business pipeline because it is kind of becoming one and the same.

Understood. It's the modus operandi for the business, yes, understood. And then second question I have was just on Fraud in terms of the strat review process. Did you consider disposals? And if so, why didn't you go down that route as opposed to continuing to build the business. Obviously, there's some big players out there in the Fraud space that, I don't know, you could argue maybe find it easier to broaden the business into other regions?

Yes. I think as we said, we considered all sorts of options for fraud, as you'd expect us to do. It felt like the right time for a strategic review. As we said, we're actually pretty excited about the strategy we've landed on where we think based on that review, we think there is opportunity with the customers that we've got. It is a fantastic list of customers. You'll have seen some of the logos in previous presentations. So to be able to take more capability to them, but also to broaden out the product suite that we think is the best opportunity, and we'll be able to expand the TAM. It's a nice sweet spot of opportunity out there in Southeast Asia, particularly, and we want to make the most of that. Kai?

I might also slip in three. The first one is just to try and put it all together in terms of the acceleration in growth that was being talked about, obviously, the launch of Go. It feels like it's not a market where there's a huge amount of greenfield opportunity on a global level, right? You talked about competitive re-wins. I'm just wondering sort of if we were to see 5%, 6% growth, perhaps 7% at some point, what will be the composition of that? I think, as you said last year, was 1% existing, 2% new logos. Should it be roughly similar or should be a bit more balanced or could, in fact, existing customers drive most of the growth going forward? That was the first one. The second one was just around the move from AIM to the Main Market, I think looking at your register, it looks like there's a fair amount of IHT, perhaps 20-plus percent of investors. Is there anything that you aim to do to potentially deal with that overhang as you kind of execute that move? Or you're just sort of letting it wash through? And then the third one was just around R&D. Is there a chance that at some point, once all the features modules for Go have been built out that sort of stays flat or perhaps even declines as you then also get the benefit of sunsetting existing platforms?

Maybe I'll take the R&D and then David, you can cover the other two. So I think that's exactly what I was just saying to -- in Andrew's question. I think as we look forward, we -- a single engineering team by design will be more efficient than three and we've started that move towards that now. And the time frame of that, I won't talk about today, but definitely, that's something that's available. And we've only talking about -- we've only spoken about that from an identity standpoint. There may be other ways that we could leverage Go for other parts of our business.

Yes, two good questions. So on Identity growth, I'm trying to unpick that a little bit for you. I think the first thing I would say is the biggest opportunity we've got in the near term, which is why we're so focused on it, is unlocking the potential of the Americas business. As we said, flat in the year just finished, likely to be something similar for FY '26. But for FY '27, we have to have a focus on driving growth in that business. The split between existing and new, we've said this before that actually, I think the biggest opportunity is with existing. So the ultimate growth rate, whatever that might be, and I'm not going to say now, the ultimate growth rate, I think, will still be have more coming from NRR than it would from new business. But clearly, we're excited about the opportunities that GPG Go will bring to be able to drive more from new business. AIM to Main, yes, we've announced this morning that it's our intention, and we are now obviously building out the work streams that are required to execute that process. We'd expect that to be at least within the next 12 months. Although clearly, today, we haven't set out a clear time line for that. And one of the things -- getting to the crux of your question, one of the things we certainly need to think about is how do we make that as seamless as possible. There are a number of things we can do. And clearly, we're not the first people to have made this. So there are lessons that we can learn from what others have done. And quite specifically, as I said, we have got capital optionality. So that gives us something to think about if that's an optimum use of that. And last but certainly not least.

Alex Short from Berenberg. Perhaps one for Dev on competition again. There's very -- particularly with respect to the U.S. identity fraud space, there are very wide ranging growth rates among players. You've got some which are shrinking by 20% per year, some growing north of 50% per year. Can you help me understand what the underlying drivers are there? Is it product quality? Is it go-to-market, use of the partner channel, level of investment or other?

Just one, well, that's refreshing. So clearly, within each of those businesses, there are things that they kind of have in their control which will determine whether they execute well or not. The point I would make is I think one of the things that we have spent some time as part of the kind of broader strategic review, we've talked about it being a fraud review, but we've done a bit of a broader review within that. I think one of the things that we've looked at is where do we play today and how fast is that market growing. So an example is that today, we do a lot of regulated KYC checks. Is that market growing as fast as other markets around potentially KYB or age verification or other markets which have less regulated use cases that may be growing faster? As we think about the focus we're now going to have on innovation, one of the things I want us to do is to think about where else can we play that may be growing faster than the market we're in. We put Identity and Fraud in this amorphous mass and we say it's growing at whatever. We don't play in all of that and we don't play in all of those countries. So there's a lot more sophistication to it. What I would say to you is we can play in places that are growing faster than the places we play today, and that's one of the ways that we can accelerate growth in the future.

Okay. Thank you, everyone, for your questions. I think that concludes the presentation. Thank you for joining us.