When Graham Ferguson was brought in as FD of First Derivatives Plc (LON:FDP) in August 2008 he took up the financial controls of a business that had big plans to expand around the world. At the time, shares in the AIM listed software and consulting group were trading at around 180p. Today, they are on the cusp of breaking 430p, having surged by more than 60% in 2010 alone. For Ferguson, together with founder and CEO Brian Conlon, a series of acquisitions and constantly evolving service offering have helped to cement those international aspirations. They have also given First Derivatives a niche presence in the market for supplying complex data and trading systems to top tier investment banks and hedge funds.
While the economic downturn caused a great deal of pain for those core clients, Ferguson insists that the drive for efficiency savings that followed actually helped it build stronger ties with them during the bad times. That very fact is reflected in the company’s latest interim figures – sales to August 31 were up 56.2% to £17.7m, Ebitda was up 16% to £3.9m, pre-tax profits were up 5.9% to £3.2m and the half year dividend was raised by 5.2% to 2.9p.
But the numbers not only reflect a growing position in supplying software and consulting services to capital markets clients, they also give a nod to two years of substantial R&D investment in infrastructure. That has allowed the company to embrace a new business model – which now blends the core consultancy offering with traditional licence sales on its technology together with selling software-as-a-service. The first of a new wave of SaaS products – Delta eFX – is now in use by seven of First Derivatives’ clients and processing billions of dollars of transactions per day through its data centres. According to Ferguson, adapting the group’s products to meet client demand has created a platform to grow the group even further.
Graham, the international focus at First Derivatives has grown substantially in recent years so what does a typical day for you involve?
Now that we operate on a global basis, working in Asia, America and Europe, when you arrive first thing in the morning it tends to be pretty intense because you’re catching the end of the Asian day and also finding out…
This is a good jump start to 2014. Bought this on Wednesday @ 1375. Looks like a great company to have in my portfolio. Excellent write up Ben, thank you. Now just two days later I have noticed this article to read more about it. A good solid company to hold onto. Happy new year from a happy holder!
Cheers from Lightningtiger
