Find replace regex captures not working?

Running OmniGraffle Pro 7.4 on Mac

I tried this regex find/replace:

Source text: 12
Find (regex): ^(\d\d)$
Replace: \1.0
Expected: 12.0
Got: 1.0

So the capture isn’t filling as I would expect \1 should insert the matched group, right?
I tried numerous variations and the \1 \2 syntax in the replace just isn’t working.

Is it broken or am I doing it wrong?