REG - FD Technologies PLC - Results for the six months ended 31 August 2022
18/10/2022 07:00
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RNS Number : 1695D FD Technologies PLC 18 October 2022
18 October 2022
FD Technologies plc
("FD Technologies" or the "Group")
Results for the six months ended 31 August 2022
FD Technologies (AIM: FDP.L, Euronext Growth: FDP.I) today announces its
interim results for the six months ended 31 August 2022.
Business highlights
Momentum continues, strong growth in KPIs
- Growing momentum in KX reflected in H1 annual recurring revenue (ARR) growth
of 41% and annual contract value signed of £11.4m, surpassing FY22 (£9.8m)
- Customer expansion strategy delivering results, with net revenue retention
(NRR) increasing to 119% (H1 FY22: 102%), reflecting the value our customers
achieve through increasing their use of KX
- ARR growth in Industry of 120%, led by new customer wins and expansion in
healthcare, manufacturing and energy, while Financial Services delivered ARR
growth of 35% through new customer wins and upsells of existing customers to
KX Insights
- Growth driven by 51 subscription deals signed (H1 FY22: 41), of which 21 were
for KX Insights (H1 FY22: 6), our cloud-first integrated data management and
real-time analytics platform
- Strategic agreement with Microsoft progressing as planned, with joint
marketing initiatives helping to build customer interest and pipeline ahead of
general availability of KX Insights on Azure in H1 2023
- Appointment of Ashok Reddy as KX CEO to deliver product and commercial
strategies that will accelerate growth
- Continued strong growth in First Derivative, ahead of our expectations and
built on our capability to assist clients with their strategic objectives
- Weaker demand environment at MRP, with measures taken to restore adjusted
EBITDA margin in H2 and building pipeline for Prelytix 3.0
- Increasing FY23 Group revenue guidance to at least £300m, while maintaining
adjusted EBITDA guidance to reflect strong KX and First Derivative
performance
Seamus Keating, CEO of FD Technologies, commented: 'The Group has enjoyed a
strong H1, growing revenue and profitability and laying the foundations for
accelerated growth from here. In KX the momentum we have built since the
launch of KX Insights is delivering results, as evidenced by the 41% growth in
annual recurring revenue. The recent appointment of Ashok Reddy is already
benefiting KX through his significant experience in scaling product-led
enterprise technology businesses. Likewise, First Derivative maintained its
strong growth, while we have taken action to enable MRP to improve its
performance in H2 despite the market conditions experienced there.
These results demonstrate that our strategy of investing to accelerate growth
is working. We have added significant value to the Group during H1 as our
investments in product, systems and people are delivering. We are very well
placed to continue to create value, with major growth opportunities ahead.'
Financial summary
Six months to end August 2022 2021 Change
Revenue £147.4m £128.0m 15%
Gross profit £60.2m £51.7m 16%
Profit / (loss) before tax £1.1m (£1.6m) N/A
Reported diluted EPS 2.9p (7.5p) N/A
Net debt* £7.4m £11.7m 37%
Adjusted performance measures
Adjusted EBITDA** £16.0m £14.9m 7%
Adjusted diluted EPS 14.2p 11.7p 21%
Performance against Key Performance Indicators FY23 target H1 performance
KX annual recurring revenue (ARR) growth 35-40% 41%
KX net revenue retention (NRR) 110% 119%
First Derivative revenue growth 15% 22%
MRP revenue growth 10% (8%)
* Excluding lease obligations
** Adjusted for share-based payments and restructure and non-operational costs
Financial highlights
- Revenue up 15% to £147.4m (9% at constant currency), led by performance at KX
and First Derivative both above our full year guidance, balanced by a
reduction in revenue at MRP
- KX returned to growth, with revenue up 19% to £37.8m, with ARR up 41% and now
representing 71% of total KX revenue (H1 FY22: 59%) as we continue to focus on
growing our subscription revenue
- First Derivative revenue £86.2m, up 22%, driven by our investment to deliver
services that map to our customers' strategic goals and our strategy to
achieve greater value from our deep domain expertise
- MRP revenue down 8% to £23.4m, resulting from lower demand for lead
generation activities in the current market conditions
- Adjusted EBITDA £16.0m, up 7%, with stronger growth at KX and First
Derivative tempered by a decline at MRP
- Net debt £7.4m (H1 FY22: £11.7m) after significant investment in
implementation of an Oracle ERP system
Current trading and outlook
The Group is delivering growth in both revenue and profitability. In KX, the
acceleration in ARR in H1 leaves us well placed to deliver growth in this key
metric at the top end of our range of 35-40%. In First Derivative, while H1
was particularly strong, we continue to believe that a growth rate of 15% is
the appropriate medium term target, while in MRP we expect revenue to decline
by approximately 8% for the full year.
For the Group's FY23 performance we increase our revenue guidance and now
expect revenue to be at least £300m, while maintaining our adjusted EBITDA
guidance in the range of £36.5m to £38.5m.
For further information, please contact:
FD Technologies plc +44(0)28 3025 2242
Seamus Keating, Chief Executive Officer www.fdtechnologies.com (http://www.firstderivatives.com)
Ryan Preston, Chief Financial Officer
Ian Mitchell, Head of Investor Relations
Investec Bank plc +44 (0)20 7597 5970
(Nominated Adviser and Broker)
Andrew Pinder
Carlton Nelson
Virginia Bull
Goodbody (Euronext Growth Adviser and Broker) +353 1 667 0420
David Kearney
Don Harrington
Finbarr Griffin
FTI Consulting +44 (0)20 3727 1000
Matt Dixon
Dwight Burden
Elena Kalinskaya
About FD Technologies
FD Technologies is a group of data-driven businesses that unlock the value of
insight, hindsight and foresight to drive organisations forward. The Group
comprises KX, the leading technology for real-time continuous intelligence;
First Derivative, which provides technology-led services in capital markets;
and MRP, the only enterprise-class, predictive Accounts Based Marketing
solution. FD Technologies operates from 14 locations across Europe, North
America and Asia Pacific, and employs more than 3,100 people worldwide.
For further information, please visit www.fdtechnologies.com
(http://www.fdtechnologies.com) and www.kx.com (http://www.kx.com)
Results presentation
FD Technologies will publish a pre-recorded presentation today at 07.05 BST on
its website at https://fdtechnologies.com/investor-relations/presentations/.
The Group will also host a live results Q&A session for analysts at 09.30
BST today.
Business Review
FD Technologies comprises KX, which operates at the frontier of real-time data
analytics; First Derivative, which provides business and software engineering
solutions for capital markets; and MRP, which uses KX to deliver predictive
analytics for enterprise demand generation.
KX - at the frontier of real-time data analytics
As industries increasingly adopt real-time decision making, KX is benefitting
from its leading performance in time series data management and analytics, as
well as the work we have done to make our technology easier to adopt and use.
These capabilities, allied to the investment in our go-to-market strategy, are
cementing KX's place as a core component of a modern data architecture,
resulting in deeper and broader conversations with existing and potential
customers. It is also attracting partners, such as Microsoft, who see
competitive advantage in the ability to deliver real-time and historical
analytics solutions based on KX.
Despite the rapid growth in data generated from machines and sensors,
McKinsey's report 'The Data-driven Enterprise of 2025' asserts that currently
only a fraction of data from connected devices is ingested, processed, queried
and analysed in real-time due to the limits of legacy technology structures
and the high computational demands of real-time processing. Organisations are
increasingly aware of the benefits of real-time analytics, as evidenced by
Forrester and others, and McKinsey forecasts that by 2025 the challenges will
be overcome to enable the creation of vast networks of real-time data and
insights.
KX has the potential to play a central role in the delivery of time series
analytics at scale, particularly as a result of the investments we made in the
past two years to develop and launch KX Insights, our cloud-first real-time
analytics and data management platform. Our technology is currently a mission
critical component in the most demanding use cases, including the real-time
ingestion and analysis of more than seven billion messages per day at an
Exchange customer, and delivering complex queries on disparate data sets at a
fraction of the cost and more than 25x faster than the next best option for a
healthcare customer. These performance advantages are typical of the benefits
our technology delivers and with the added benefits of scalability from our
cloud partnerships and the ease of use and rapid time-to-value delivered by KX
Insights we see enormous potential for growth in recurring revenue in the
years ahead.
Appointment of KX CEO
During the period Ashok Reddy was appointed CEO of KX. He brings a track
record of success driving product revenue growth and commercial strategies at
enterprise technology companies (including IBM, CA Technologies, Broadcom and
Digital.Ai) and his priorities are to use his expertise in driving growth,
particularly through partners, to help KX scale faster.
Microsoft strategic partnership agreement
We are making good progress with our strategic partnership with Microsoft,
signed earlier this year, which positions KX Insights as the premier real-time
analytics technology on Azure. This progress covers both our go-to-market
activities and technical development as we move towards general availability
of KX Insights as a tightly integrated component within Azure, expected in H1
2023. Ahead of this, general availability of KX on the Azure platform as
either a customer managed deployment or as a service managed by KX is expected
in Q4 2022.
The Microsoft and KX sales teams have already started working together to
build pipeline, with Microsoft salespeople fully incentivised to sell KX. A
programme to support the sales effort through joint product marketing and
technical support has commenced and engagement to date has been positive. We
already have a number of customers in private preview of KX Insights on Azure,
across industries including financial services, automotive, healthcare and
industrial IoT. Initial feedback from these clients is extremely positive,
with the rapid time to value and performance they are achieving increasing our
confidence in the potential of KX Insights on Azure.
The progress and engagement with both Microsoft and potential customers is
encouraging and reinforces the significant potential of the partnership to
deliver KX Insights to a broad user base. We also continue our joint
development work with Microsoft ahead of a planned launch next year of
applications and services for the financial services sector that are built on
KX.
More generally we are seeing strong interest from cloud platforms in working
with us, recognising the unique capabilities of our technology. Our customers
who are moving their KX workloads to the cloud are driving us to work with
their preferred cloud vendors and this is leading to stronger collaboration
with the leading vendors.
Operational and commercial progress
We continue to make good progress in areas such as product development and
go-to-market as we seek to deliver on the opportunity for KX. As a result, we
saw momentum that enabled us to deliver more annual contract value in H1 than
we did in the whole of last year, while continuing to increase our pipeline
and investing in our opportunities with partners.
Our focus on rapid time-to-value for our customers is delivering success and
is leading to growth in new opportunities and shorter sales cycles. While more
rapid deployment results in lower implementation services revenue per
customer, it reduces complexity and cost for customers and increases their
return on investment. Our product and go-to-market priorities are to continue
to make KX easier to adopt and use, in order to drive further growth in
recurring software revenue.
Research and development
The launch last year of KX Insights was a major milestone and puts KX at the
heart of the modern data management landscape for time series data. KX
Insights leverages the benefits of cloud architecture to deliver rapid,
scalable insights without the burden of managing infrastructure and is built
on open standards such as Docker and Kubernetes, using a microservices-based
architecture. The ability for SQL and Python developers to use their preferred
programming language rather than learn our proprietary q language is a
particularly attractive feature of KX Insights, opening up opportunities for
existing customers to broaden their use of KX and encouraging adoption by new
customers.
In H1 we continued to focus on prioritising ease of adoption and use,
interoperability with other technologies and integration with partners,
particularly hyperscale cloud providers. In particular, we focused on the
deployment of KX Insights on Azure, working with Microsoft and private preview
customers to ensure the optimal performance of our technology. We also worked
to develop accelerators for our key target markets that will enable customers
to speed up time-to-value by providing common integrations and business
requirements for our customers in those industries.
Go-to-market
We signed 56 new deals during the period, of which 51 (H1 FY22: 41) were
subscription deals including 10 new customers, with the remainder being
upsells to existing customers. Churn remained at low single digits in
percentage terms, and together with expansion from existing customers
attracted by the value they derive from KX, drove NRR of 119%.
Of our new customers, 40% came from Industry, highlighting the progress we are
making in entering new markets. We also saw significant expansion within our
Industry user base, for example with a healthcare manufacturer expanding its
use of KX to more of its facilities in recognition of the return on investment
it has achieved from KX to date.
First Derivative - business and software engineering solutions for capital
markets
H1 revenue growth of 22% in First Derivative was ahead of our expectations,
driven by our strategy to deliver more value from our domain and technology
expertise together with continuing demand for key skills and capabilities from
our capital markets client base. We are well placed to continue to assist our
clients with their strategic goals - delivering value from their investment in
technology, meeting their regulatory and compliance imperatives and digital
transformation.
We continue to refocus our strategy in First Derivative away from hours worked
to delivering outcomes for clients, which is driving deeper engagement and
leading to larger revenue projects. Examples here include transaction
reporting and Know Your Customer where we are now managing ongoing programmes
for a number of major clients.
We invested during the period in equipping more of our consultants with skills
in cloud and real-time data architectures, to enhance our capability to
deliver digital transformation programmes for our clients. We launched an
application development centre in Poland to support this effort on a global
basis, providing us with the potential to scale significantly in response to
demand.
Our clients continue to focus on getting value for their technology investment
and we are able to help them achieve the optimal delivery structure through
our near shore capabilities, particularly in Ireland where we are seeing
continued growth.
Against these growth drivers, the industry is dealing with the twin challenges
of attrition and wage inflation as banks and professional services firms
compete for talent. To manage these challenges we provide highly flexible and
rewarding careers, with interesting roles, good career development
opportunities and a sensible work/life balance. Our recruitment and retention
programmes are industry-leading and during the period we continued to attract
both graduates and experienced consultants to assist our growth ambitions.
MRP - predictive analytics for enterprise demand generation
MRP provides global sales and marketing leaders with an account-based
marketing platform (Prelytix), powered by KX, and supporting products and
services that deliver high response rates and pipeline conversion. Prelytix
tracks more than 1.5 billion intent signals per day, enabling MRP customers to
identify and engage targets earlier and more effectively. Its global presence
is a further differentiator, resulting in Forrester naming it as a leader in
Account Based Marketing (ABM) in its Q2 2022 report on the sector.
MRP's customer budgets are lead indicators of macroeconomic conditions, with
spend on lead generation one of the first areas to be cut since it does not
typically affect the business until more than six months later. Conversely, as
economic conditions recover, customers often rapidly increase their spend on
lead generation to help focus their sales effort. We saw these trends during
the Covid-19 pandemic and again in H1 FY23, with MRP recording an 8% decline
in revenue as customers reduced or suspended their lead generation activities.
In response, MRP implemented cost savings during the period that will reduce
operating expenses by £3.5m on an annualised basis. These measures, combined
with a stabilisation of revenue over the past quarter, provide us with the
confidence that MRP can achieve our full year revenue guidance.
Prelytix 3.0, the latest version of our platform with enhanced self-service
capabilities, has now been rolled out to our existing customer base. In H1 we
signed several new customers for the platform and have a solid pipeline of
opportunities.
While MRP's H1 performance is disappointing, we continue to believe it is a
leader in an important market and that the measures we have taken will enable
it to return to double digit growth when economic conditions normalise.
People
The Group currently employs more than 3,100 people, up from more than 3,000 at
the same time last year. Our employee policies are aimed at making FD
Technologies an employer of choice within technology to support the growth
opportunities across the Group.
During the period we paid particular attention to learning and development,
with a strong focus on leadership, as well as the Group's culture. We
introduced our Aspiring Leadership programme, which offers a structured and
practical path to fast-track high potential individuals into leadership roles,
while we also appointed leaders to run our talent and people initiatives.
We continue to evolve the ways in which our people connect and collaborate,
building on our latest annual engagement survey which shows that 80% of our
employees feel engaged. We encourage employees to use offices as business hubs
to meet colleagues and customers and ensure that those at the early stage of
their FD Technologies career are connected with colleagues across the
organisation. We are also seeing and encouraging a gradual resumption of the
social element of work life, which promotes collaboration and development.
Principal risks and uncertainties
The key principal risks and uncertainties relating to the Group's operations
for the next six months are considered to remain consistent with those
disclosed in the Group's Annual Report and Accounts 2022. Please refer to
pages 29 to 33 thereof which can be found at
www.fdtechnologies.com/investor-relations/news-results/results-centre/
(http://www.fdtechnologies.com/investor-relations/news-results/results-centre/)
.
Summary and outlook
KX and First Derivative both delivered strong growth in H1, ahead of our
guidance and are well placed to deliver on their potential. In KX the growing
importance of time series analytics and our product and commercial strategies
are establishing us as a key component of modern data architecture and driving
rapid growth. First Derivative is well placed to assist customers with their
strategic objectives and delivered growth ahead of our guidance. MRP's
performance was impacted by market conditions, however the initiatives we have
taken are expected to see an improvement in adjusted EBITDA margin in H2 on
revenue similar to H1.
At the Group level we increase our FY23 revenue guidance to at least £300m
while maintaining adjusted EBITDA guidance in the range of £36.5m to £38.5m.
Financial review
Revenue and Margins
The table below shows the breakdown of Group performance by business unit for
each of KX, First Derivative and MRP.
H1 FY23 H1 FY22
Group KX First MRP Group KX First MRP Group change
Derivative Derivative
£m £m £m £m £m £m £m £m
Revenue 147.4 37.8 86.2 23.4 128.0 31.9 70.7 25.3 15%
Cost of sales (87.2) (10.8) (62.7) (13.7) (76.2) (9.8) (51.1) (15.3) 14%
Gross profit 60.2 27.1 23.4 9.7 51.7 22.1 19.6 10.0 16%
Gross margin 41% 72% 27% 42% 40% 69% 28% 40%
R&D expenditure (11.9) (10.2) (0.1) (1.5) (10.7) (9.5) (0.1) (1.1) 11%
R&D capitalised 10.1 8.4 0.1 1.5 9.3 8.1 0.1 1.1 8%
Net R&D (1.8) (1.8) 0.0 0.0 (1.4) (1.4) (0.0) (0.0) 31%
Sales and marketing costs (27.1) (14.4) (7.8) (4.9) (25.0) (12.1) (7.9) (5.0) 7%
Adjusted admin expenses (15.4) (5.4) (6.9) (3.1) (10.4) (4.2) (4.7) (1.5) 47%
Adjusted EBITDA 16.0 5.5 8.8 1.7 14.9 4.5 6.9 3.4 7%
Adj. EBITDA margin 11% 14% 10% 7% 12% 14% 10% 14%
The Group delivered growth in both revenue and adjusted EBITDA driven by
factors including strong growth in recurring revenue at KX, solid growth above
our guidance at First Derivative and market conditions at MRP, added to
investments in systems and people and inflationary cost pressures which
increased admin expenses. We continued to invest in line with our strategic
objectives, while taking steps to ensure MRP returns to growth as quickly as
possible.
Group revenue increased by 15% to £147.4m (H1 FY22: £128.0m) while gross
margin increased by 1% to 41%, led by a 3% increase at KX due to a higher
proportion of software revenue in the mix. Revenue growth was boosted during
the period by the strength of the dollar against sterling, our reporting
currency, with constant currency revenue growth of 9%. Due to the natural
hedge of our operations in the US the impact on profitability was marginal.
KX
KX total Financial services Industry
H1 FY23 H1 FY22 Change H1 FY23 H1 FY22 Change H1 FY23 H1 FY22 Change
£m £m £m £m £m £m
Revenue 37.8 31.9 19% 32.3 27.8 16% 5.6 4.1 36%
Annual recurring 26.8 19.0 41% 23.5 17.5 35% 3.2 1.5 120%
Perpetual 0.8 1.5 (44%) 0.2 0.7 (70%) 0.6 0.8 (19%)
Total software 27.6 20.4 35% 23.8 18.2 30% 3.9 2.2 73%
Services 10.2 11.5 (11%) 8.5 9.6 (11%) 1.7 1.9 (8%)
Gross profit 27.1 22.1 22%
Adjusted EBITDA 5.5 4.5 22%
KX returned to strong growth in H1, with 41% growth in ARR to £26.8m balanced
by an 11% reduction in services to £10.2m to deliver revenue of £37.8m,
representing growth of 19%. The growth in ARR is ahead of our expectations,
while the reduction in services revenue reflects our success in making KX
Insights easier to adopt, speeding up the time to value for our customers and
increasing their return on investment. Perpetual license revenue continued to
fall and now represents just 2% of KX revenue as we complete our planned
transition to a subscription model for our software. Software churn continued
to be minimal, at low single digit percentages.
Financial services revenue grew by 16% to £32.3m, with recurring revenue up
35% as we upsold a number of our existing customers to KX Insights and added
new customers across Europe and in North America. The revenue uplift from KX
Insights upsells is expected to positively impact performance over the next
few years. We also see significant potential for new financial services
customers to subscribe for the KX Insights platform for its performance and
ease of adoption, particularly for users with SQL and Python skills. The
native integration of these important developer languages is also leading to
conversations with existing financial services customers regarding extending
their use of KX within their operations.
Industry revenue grew by 36% to £5.6m with recurring revenue growing by 120%
to £3.2m. Growth was led by subscription contracts across the energy and
manufacturing markets with both new and existing customers, as well as in
pharma.
Alongside the growth in ARR our go-to-market team was also engaged with the
Microsoft team to sign preview customers for KX Insights on Azure and to build
a pipeline of opportunities as we move closer to the general availability of
KX Insights on Azure.
Performance metrics H1 FY23 H1 FY22 Change
Annual recurring revenue (ARR) £m 26.8 19.0 41%
Exit annual recurring revenue £m 60.2 40.3 49%
Net revenue retention (NRR) 119% 102%
Gross margin 72% 69%
R&D expenditure as % of revenue 27% 30%
Sales and marketing spend as % of revenue 38% 38%
Adjusted EBITDA margin 14% 14%
The annual contract value signed in the period was £11.4m, up 207% on the
prior year period (H1 FY22: £3.7m) and driven by the growth in new
subscription deals in the period and our work with partners. This resulted in
ARR increasing by 41% to £26.8m and exit ARR increasing by 49% to £60.2m.
NRR of 119% is ahead of the 102% recorded in H1 FY22 and close to our mid-term
goal of more than 120%. Churn remained minimal during the period while both
upsells to KX Insights from existing customers and expansion across our
customer base boosted this key metric. As we scale, we continue to see
opportunities within our existing customers and have a pipeline of new
customer opportunities.
First Derivative
H1 FY23 H1 FY22 Change
£m £m
Revenue 86.2 70.7 22%
Gross profit 23.4 19.6 20%
Adjusted EBITDA 8.8 6.9 27%
Revenue for the period was £86.2m, with growth of 22% ahead of our target of
15%. This reflected a number of factors, including demand for our services and
a skills shortage within capital markets. We saw the strongest growth in our
near shore operations, which are expanding as our customers pull work from
offshore development centres into centres such as Dublin.
Current attrition and wage inflation rates continue to be challenges across
the industry which we are managing effectively, although they do limit scope
for margin improvement.
We expect demand for our services to continue to be strong, with regulatory
change and digital transformation at the top of our customers' agenda, while
our focus on outcomes and strengthened customer engagement are also driving
growth. However, we remain cautious around the macroeconomic pressures and the
challenges of recruitment and onboarding in current market conditions. While
our pipeline remains strong, we expect H2 to see revenue growth of 15%, in
line with our view of sustainable growth in this business.
Performance metrics H1 FY23 H1 FY22
Gross margin 27% 28%
Adjusted EBITDA margin 10% 10%
Gross margin fell slightly in H1 due to the costs involved in recruiting,
training and deploying new consultants, mitigated by our ability to pass
through wage inflation and the impact of delivering greater value from our
expertise and domain knowledge.
MRP
H1 FY23 H1 FY22
£m £m Change
Revenue 23.4 25.3 (8%)
Platform 12.7 14.0 (9%)
Services 10.7 11.4 (6%)
Gross profit 9.7 10.0 (3%)
Adjusted EBITDA 1.7 3.4 (51%)
MRP derives revenue from its Prelytix platform, powered by KX, and data-driven
engagement between our customers and their prospects, either through Prelytix
or MRP's services. During the period, concerns over market conditions caused
some of our customers to pause or reduce their lead generation activity,
leading to a decline in revenue at MRP. This decline occurred during Q1, with
monthly revenue stabilising in Q2 and into early H2.
As a result of this, adjusted EBITDA during the period decreased by £1.7m
from H1 FY22. In response, during H1 MRP implemented cost savings that will
reduce annualised operating costs by c. £3.5m. We expect this to drive an
improved performance in adjusted EBITDA in H2, despite the assumption in our
forecast of no improvement in customer spending in the period.
Performance metrics H1 FY23 H1 FY22
Platform revenue £m 12.7 14.0
Gross margin 42% 40%
Adjusted EBITDA margin 7% 14%
Gross margin improved to 42% (H1 FY22: 40%) as we achieved efficiencies in
third party costs incurred in our display marketing offering. Admin expenses
increased as we invested in upgrading cyber security protection, improved
legal capability and incurred wage inflation as the business prepares for
future growth.
Adjusted EBITDA
The reconciliation of operating (loss)/ profit to adjusted EBITDA is provided
below:
H1 FY23 H1 FY22
£m £m
Operating (loss) /profit (1.0) 1.5
Restructure and non-operational costs 2.5 1.4
Non-operational IT expenses* 2.6 1.1
Share based payment and related costs 0.9 1.1
Depreciation and amortisation 11.0 9.7
Adjusted EBITDA 16.0 14.9
*Non-operational IT expenses represents ERP implementation costs following the
IFRIC update on accounting for cloud implementation
Profit before tax
Adjusted profit before tax was broadly flat at £5.0m, with the increase in
adjusted EBITDA balanced by higher depreciation and software amortisation
charges. Financing costs fell by £0.3m, reflecting the decrease in our
outstanding loans balanced by the impact of the stronger dollar on our
dollar-denominated interest payments.
The Group reported a profit before tax of £1.1m for the period, compared to a
loss of £1.6m in H1 FY22. The major factors here were the movement in foreign
currency translation reflecting the strength of the dollar in the period and
the cost of implementing the Group's new Oracle ERP system.
The reconciliation of adjusted EBITDA to reported profit before tax is
provided below.
H1 FY23 H1 FY22
£m £m
Adjusted EBITDA 16.0 14.9
Adjustments for:
Depreciation (3.7) (3.3)
Amortisation of software development costs (5.5) (4.9)
Financing costs (1.7) (2.0)
Finance income - 0.2
Adjusted profit before tax 5.0 4.9
Adjustments for:
Amortisation of acquired intangibles (1.7) (1.5)
Share based payment and related costs (0.9) (1.1)
Restructure and non-operational costs (2.5) (1.4)
Non-operational IT expenses (2.6) (1.1)
Profit / (loss) on foreign currency translation 3.7 (1.4)
Gain on disposal of associate 0.1 -
Reported profit / (loss) before tax 1.1 (1.6)
Earnings per share
The Group reported a profit after tax of £0.8m for the period, compared to a
£2.1m loss in H1 FY22. Adjusted profit after tax was £4.0m, a 21% increase
on the prior period and generating a 21% increase in adjusted diluted earnings
per share for the period to 14.2p.
The calculation of adjusted profit after tax is detailed below:
H1 FY23 H1 FY22
£m £m
Reported profit / (loss) before tax 1.1 (1.6)
Tax (0.3) (0.5)
Reported profit / (loss) after tax 0.8 (2.1)
Adjustments from profit / (loss) before tax (as per the table above) 3.9 6.5
Tax effect of adjustments (0.8) (1.1)
Adjusted profit after tax 4.0 3.3
Weighted average number of ordinary shares (diluted) 28.0m 28.1m
Reported EPS (diluted) 2.9p (7.5p)
Adjusted EPS (diluted) 14.2p 11.7p
Cash generation and net debt
The Group generated £12.0m of cash from operating activities before the
exceptional Oracle ERP implementation costs incurred in H1 FY23 of £2.6m,
representing a 75% conversion of adjusted EBITDA. We continued to focus on
cash collection and working capital improvements and the target for the full
year from operating activities cash conversion remains in the range of 80-85%
of adjusted EBITDA.
At the period end, net debt had fallen to £7.4m (H1 FY22: £11.7m). The
factors impacting the movement in net debt are summarised in the table below:
H1 FY23 H1 FY22
£m £m
Opening net cash/(debt) (excluding lease liabilities) 0.3 (9.9)
Cash generated from operating activities before non-operational IT expenses 12.0 13.5
Non-operational IT expenses (2.6) (1.1)
Cash generated from operating activities 9.4 12.4
Taxes paid (0.7) (0.5)
Capital expenditure: property, plant and equipment (2.0) (0.2)
Capital expenditure: intangible assets (10.6) (9.6)
Sale/(Acquisition) of other investments and associates 0.1 (0.1)
Issue of new shares 2.6 0.6
Interest, foreign exchange and other (6.6) (4.4)
Closing net debt (excluding lease liabilities) (7.4) (11.7)
Cash generated from operating activities is lower due to investments in the
new ERP system and restructuring costs. The driver of the movement in capital
expenditure was an increase in property, plant and equipment to more typical
levels. In addition, a higher impact from dollar strength has increased our
predominantly dollar-denominated debt, as seen in the foreign exchange line.
Definition of terms
The Group uses the following definitions for its key metrics:
Annual recurring revenue (ARR): The value of recurring software revenue
recognised in the reporting period.
Exit annual recurring revenue: is the value at the end of the accounting
period of recurring software revenue to be recognised in the next twelve
months.
Net revenue retention rate (NRR): is based on the actual revenues in the
quarter annualised forward to twelve months and compared to the annualised
revenue from the four quarters prior. The customer cohort is comprised of
customers in the quarter that have generated revenue in the prior four
quarters.
Adjusted admin expenses: is a measure used in internal management reporting
which comprises administrative expenses per the statement of comprehensive
income of £31.2m (H1 FY22: £23.5m) adjusted for depreciation and
amortisation of £11.0m (H1 FY22: £9.7m), share based payments and related
costs of £0.9m (H1 FY22: £1.1m) and restructure and non-operational costs of
£2.5m (H1 FY22: £1.4m), IT Systems implementation costs expensed £2.6m (H1
FY22: £1.1m), and other £(1.1)m (H1 FY22: £(0.2)m).
Consolidated income statement (unaudited)
Six months ended 31 August
2022 2021
Note £'000 £'000
Revenue 3 & 4 147,411 127,950
Cost of sales (87,210) (76,209)
Gross profit 60,201 51,741
Operating costs
Research and development costs (11,908) (10,733)
Of which capitalised 10,092 9,347
Sales and marketing costs (27,060) (25,042)
Administrative expenses (31,222) (23,486)
Impairment loss on trade and other receivables (1,162) (345)
Total operating costs 61,260 50,259
Other income 62 46
Operating (loss)/profit (997) 1,528
Finance income 8 248
Finance expense (1,720) (2,011)
Gain/(Loss) on foreign currency translation 3,680 (1,377)
Net finance income/(costs) 1,968 (3,140)
Profit on sale of Investment 100 -
Profit/(Loss) before taxation 1,071 (1,612)
Income tax expense 6 (250) (498)
Profit/(Loss) for the period 821 (2,110)
Pence Pence
Earnings per share 7
Basic 2.9 (7.6)
Diluted 2.9 (7.5)
Consolidated balance sheet (unaudited)
As at 31 August 2022
As at As at As at
31 August
31 August
28 February
2022
2021
2022
Note £'000 £'000 £'000
Assets
Property, plant and equipment 28,734 30,612 28,343
Intangible assets and goodwill 173,636 151,655 155,607
Equity accounted investee - 2,681 -
Other financial assets 18,407 16,673 19,676
Trade and other receivables 4,130 3,751 3,745
Deferred tax assets 20,838 17,774 17,998
Non-current assets 245,745 223,146 225,369
Trade and other receivables 78,270 63,407 74,029
Current tax receivable 5,566 4,443 4,172
Cash and cash equivalents 44,777 50,828 48,564
Current assets 128,613 118,678 126,765
Total assets 374,358 341,824 352,134
Equity
Share capital 8 140 139 139
Share premium 103,359 100,232 100,424
Merger reserve - 8,118 -
Shares option reserve 19,243 17,909 18,404
Fair value reserve 8,393 10,762 9,755
Currency translation adjustment reserve 8,045 (5,014) (3,574)
Retained earnings 68,212 50,586 67,391
Equity attributable to shareholders 207,392 182,732 192,539
Liabilities
Loans and borrowings 9 65,127 79,644 62,504
Trade and other payables 10 3,799 2,976 3,190
Deferred tax liabilities 16,444 14,507 15,307
Non-current liabilities 85,370 97,127 81,001
Loans and borrowings 9 9,866 9,245 9,054
Trade and other payables 10 64,073 43,661 60,596
Current tax payable 197 231 382
Employee benefits 7,460 8,828 8,562
Current liabilities 81,596 61,965 78,594
Total liabilities 166,966 159,092 159,595
Total equity and liabilities 374,358 341,824 352,134
Consolidated statement of changes in equity (unaudited)
Six months ended 31 August 2022
Share Share Share Fair value reserve Currency translation adjustment Retained Total
capital
premium
option
earnings
equity
reserve
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 March 2022 139 100,424 18,404 9,755 (3,574) 67,391 192,539
Total comprehensive income for the period
Profit for the period - - - - - 821 821
Other comprehensive income
Net exchange gain on net investment in foreign subsidiaries - - - - 15,321 - 15,321
Net exchange loss on hedge of net investment in foreign subsidiaries - - - - (3,702) - (3,702)
Net change in fair value of equity investments at FVOCI - - - (1,362) - - (1,362)
Total comprehensive income for the period - - - (1,362) 11,619 821 11,078
Transactions with owners of the Company
Tax relating to share options - - 39 - - - 39
Exercise of share options - - - - - - -
Issue of shares 1 2,935 - - - - 2,936
Share-based payment charge - - 800 - - - 800
Dividends to owners of the Company - - - - - - -
Balance at 31 August 2022 140 103,359 19,243 8,393 8,045 68,212 207,392
Consolidated statement of changes in equity (unaudited)
Six months ended 31 August 2021
Share Share Merger reserve Share Fair value reserve Currency translation adjustment Retained Total
capital
premium
option
earnings
equity
reserve
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 March 2021 139 99,396 8,118 16,790 10,682 (5,628) 53,177 182,674
Total comprehensive income for the period
(Loss) for the period - - - - - - (2,110) (2,110)
Other comprehensive income
Net exchange gain on net investment in foreign subsidiaries - - - - - 964 - 964
Net exchange loss on hedge of net investment in foreign subsidiaries - - - - - (350) - (350)
Net change in fair value of equity investments at FVOCI - - - - (401) - - (401)
Crystalisation of FV loss on disposal of investment - - - - 481 - (481) -
Total comprehensive income for the period - - - - 80 614 (2,591) (1,897)
Transactions with owners of the Company
Tax relating to share options - - - 119 - - - 119
Exercise of share options - - - - - - - -
Issue of shares - 836 - - - - - 836
Share-based payment charge - - - 1,000 - - - 1,000
Dividends to owners of the Company - - - - - - - -
Balance at 31 August 2021 139 100,232 8,118 17,909 10,762 (5,014) 50,586 182,732
Consolidated cash flow statement (unaudited)
Six months ended 31 August
2022 2021
£'000 £'000
Cash flows from operating activities
Profit/(Loss) for the period 821 (2,110)
Adjustments for:
Net finance (income)/costs (1,968) 3,140
Depreciation of property, plant and equipment 3,636 3,202
Amortisation of intangible assets 7,331 6,531
Loss on Disposal of Fixed Assets 3 3
Profit on sale of Investment (100) -
Equity settled share-based payment transactions 800 1,000
Grant income (191) (44)
Tax expense 250 498
10,582 12,220
Changes in:
Trade and other receivables (1,100) 9,182
Trade and other payables (63) (8,975)
Cash generated from operating activities 9,419 12,427
Taxes paid (695) (550)
Net cash from operating activities 8,724 11,877
Cash flows from investing activities
Interest received 8 5
Sale/(Acquisition) of other investments and associates 100 (54)
Acquisition of property, plant and equipment (1,967) (183)
Capitalisation of intangible assets (10,618) (9,625)
Net cash used in investing activities (12,477) (9,857)
Cash flows from financing activities
Proceeds from issue of share capital 2,650 581
Drawdown of loans and borrowings - -
Repayment of borrowings (3,072) (3,377)
Payment of finance lease liabilities (1,928) (1,390)
Interest paid (1,385) (1,733)
Dividends paid - -
Net cash used in financing activities (3,735) (5,919)
Net decrease in cash and cash equivalents (7,488) (3,899)
Cash and cash equivalents at 1 March 48,564 55,198
Effects of exchange rate changes on cash held 3,701 (471)
Cash and cash equivalents at 31 August 44,777 50,828
Notes to the Interim Results
1. General information
FD Technologies plc ("FD Technologies", the "Company" or the "Group") is a
public limited company incorporated and domiciled in Northern Ireland. The
Company's registered office is 3 Canal Quay, Newry BT35 6BP. This condensed
consolidated interim financial information was approved for issue by the Board
of Directors on 17 October 2022.
This condensed consolidated interim financial information does not comprise
statutory financial statements within the meaning of section 434 of the
Companies Act 2006. Statutory financial statements for the year ended 28
February 2022 were approved by the Board of Directors on 9 May 2022 and
delivered to the Registrar of Companies. The auditors reported on those
accounts: their report was unqualified, did not draw attention to any matters
by way of emphasis and did not contain a statement under section 498(2) or (3)
of the Companies Act 2006.
2. Accounting policies
Basis of Preparation
The annual financial statements for the Group will be prepared in accordance
with United Kingdom adopted International Financial Reporting Standards. This
condensed consolidated interim financial information for the half-year ended
31 August 2022 has been prepared in accordance with United Kingdom adopted IAS
34, 'Interim financial reporting'. The interim report does not include all
the notes of the type normally included in an annual financial report.
Accordingly, this report is to be read in conjunction with the annual
financial statements for the year ended 28 February 2022, which have been
prepared in accordance with UK-adopted IFRSs.
This condensed consolidated interim financial information is unaudited and has
not been reviewed by the Company's Auditors. Except as described below they
have been prepared on accounting bases and policies that are consistent with
those used in the preparation of the financial statements of the Company for
the year ended 28 February 2022.
Going concern
The directors are satisfied that the Group has sufficient resources to
continue in operation for the foreseeable future, a period of not less than 12
months from the date of this report. Accordingly, we continue to adopt the
going concern basis in preparing the condensed financial statements.
Changes in accounting policies
The following standards, amendments and interpretations were effective for
accounting periods beginning on or after 1 March 2022 and these have been
adopted in the Group financial statements where relevant:
· Amendments to IAS 1 Presentation of Financial Statements-Classification of
Liabilities as Current or Non-current
· Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice
Statement 2 Making Materiality Judgements-Disclosure of Accounting Policies
· Amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and
Errors-Definition of Accounting Estimates
There are no other standards that are not yet effective and that would be
expected to have a material impact on the entity in the current or future
reporting periods and on foreseeable future transactions.
Critical accounting estimates and judgements
The critical accounting judgements and key sources of estimation uncertainty
are consistent with the Group financial statements for the year to 28 February
2022 and no additional new uncertainties or estimation uncertainty have
arisen.
Information about critical judgements in applying accounting policies that
have the most significant impact on the amounts recognised in the financial
statements are as follows:
· In determining Capitalised Internally Developed Software Costs
management will need to apply judgement and evaluate the technical and
commercial feasibility of each product, and the ability to yield future
economic benefits, and assess likelihood of success, and ability of the Group
to complete each product. Judgements are applied on a product basis in
accordance with IAS 38.
· Management applies judgement in the recognition of revenue,
determining when performance obligations are satisfied, and control
transferred. For software products provided as an annual license, including
the right to regular upgrades, judgement is required when assessing whether
the annual license is a separate performance obligation from the provision of
upgrades to the customer. Management has assessed that the ongoing updates and
upgrades to the software are fundamental to the value of the software and that
without these updates the value of the software will substantially deteriorate
over time. Therefore, the annual license and the updates and upgrades are
combined as one performance obligation and revenue is recognised over the life
of the license as the service is delivered.
Information about assumptions and estimation uncertainties that have a
significant risk of resulting in a material adjustment to the carrying amounts
of assets and liabilities are as follows:
· Under IFRS goodwill on acquisitions is not amortised but is tested
for impairment on an annual basis. Management has assessed goodwill for
impairment based on the projected profitability of the individual
cash-generating unit to which the goodwill relates. No impairments have been
identified. Other intangibles are being amortised and tested for impairment if
an indicator of impairment is identified.
· Management has estimated the fair value of equity investments and
convertible loans. Management has reviewed recent market activity and has
applied a discounted cash flow valuation technique to assess the fair value of
the assets as at year end considering the forecast revenue and EBITDA,
together with forecast exit value applying market multiples, discounted using
a risk-adjusted discount rate.
Management has assessed that there are no other estimates or judgements that
have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities recognised in the financial statements.
Use of non-GAAP measures - Adjusted EBITDA
The Group believes that the consistent presentation of adjusted Earnings
Before Interest, Tax, Depreciation and Amortisation (EBITDA), adjusted
effective tax rate, adjusted basic earnings per share and adjusted diluted
earnings per share provides additional useful information to shareholders on
the underlying trends and comparable performance of the Group over time.
Adjusted EBITDA is defined as results from operating activities before
restructure and non-operational costs, IT Systems implementation costs
expensed, share based payments and related costs, depreciation of property,
plant and equipment and amortisation of intangible assets, and non-recurring
income from investments. Restructure and non-operational costs relate to items
that are considered significant in size and non-operational in nature and
include restructuring costs and costs associated with the management of our
equity investment portfolio. The Group uses adjusted EBITDA as an underlying
measure of its performance. A reconciliation between GAAP and underlying
measures is set out in note 5 (Adjusted EBITDA).
3. Segmental Reporting
Information about reportable segments
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker. The chief operating
decision maker, who is responsible for allocating resources and assessing
performance of the operating segments, has been identified as the Chief
Executive Officer and Chief Financial Officer jointly.
The Group is organised into three operating segments (as identified under IFRS
8 Operating Segments) and generates revenue through the following activities:
· KX, which operates at the frontier of real-time data analytics;
· First Derivative, which provides business and software engineering
solutions for capital markets;
· MRP, which delivers predictive analytics for enterprise demand
generation.
The chief operating decision maker monitors the operating results of segments
separately in order to allocate resources between segments and to assess
performance. Segment performance is predominantly evaluated based on operating
profit before restructure and non-operational costs, IT Systems implementation
costs expensed, share based payment and related costs, depreciation and
amortisation of intangible assets ('adjusted EBITDA'). These costs are managed
on a centralised basis and therefore these items are not allocated between
operating segments for the purpose of presenting information to the chief
operating decision maker and accordingly are not included in the detailed
segmental analysis.
Intersegment revenue is not material and thus not subject to separate
disclosure.
KX First Derivative MRP TOTAL
H1 H1 H1 H1 H1 H1 H1 H1
2023 2022 2023 2022 2023 2022 2023 2022
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Revenue by segment 37,841 31,917 86,150 70,704 23,420 25,330 147,411 127,950
Gross Profit 27,063 22,135 23,410 19,573 9,728 10,034 60,201 51,741
Adjusted EBITDA 5,474 4,486 8,800 6,936 1,691 3,449 15,965 14,871
Restructure and non-operational costs (2,517) (1,354)
IT systems implementation costs expensed (2,557) (1,119)
Share based payment and related costs (921) (1,137)
Depreciation and amortisation (9,261) (8,184)
Amortisation of acquired intangible assets (1,706) (1,549)
Operating (Loss)/Profit (997) 1,528
Net Finance income/(costs) 1,968 (3,140)
Profit on sale of investment 100 -
Profit/(Loss) before taxation 1,071 (1,612)
Geographical location analysis H1 H1
2023 2022
£'000 £'000
UK 46,484 34,948
Rest of Europe 28,243 21,885
North America 59,377 56,247
Asia Pacific 13,307 14,870
Total 147,411 127,950
4. Revenue
Disaggregation of revenue
KX First Derivative MRP Total
H1 H1 H1 H1 H1 H1 H1 H1
2023 2022 2023 2022 2023 2022 2023 2022
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Type of good or service
Sale of goods - perpetual 822 1,464 - - - - 822 1,464
Sale of goods - recurring 26,785 18,975 - - 12,715 13,979 39,500 32,954
Rendering of services 10,234 11,478 86,150 70,704 10,705 11,351 107,089 93,533
37,841 31,917 86,150 70,704 23,420 25,330 147,411 127,950
Timing of revenue recognition
At a point in time 822 1,464 - - - - 822 1,464
Over time 37,019 30,453 86,150 70,704 23,420 25,330 146,589 126,487
37,841 31,917 86,150 70,704 23,420 25,330 147,411 127,950
5. Adjusted EBITDA
H1 H1
2023 2022
£'000 £'000
Operating (loss)/profit (997) 1,528
Restructure and non-operational costs 2,517 1,354
IT Systems implementation costs 2,557 1,119
Share based payment and related costs 921 1,137
Depreciation and amortisation 10,967 9,733
Adjusted EBITDA 15,965 14,871
6. Tax Expense
The total tax charge for the six months ended 31 August 2022, including
discrete items, is £0.3m (H1 FY22: £0.5m). This tax charge equates to an
effective tax rate of 23.4% (H1 FY22: (30.9%)).
Following on from the 2021 UK Budget, the Government enacted several
legislative changes to corporation tax including an increase in the rate of
corporation tax to 25% from 1 April 2023. Deferred tax balances have to be
measured using the tax rates that have been substantively enacted and that are
expected to apply to the period when the asset is realised or the liability is
settled.
7. Earnings per Share
Basic earnings per share for the six months ended 31 August 2022 has been
calculated on the basis of the reported profit after taxation of £0.8m (H1
FY22: loss of £2.1m) and the weighted average number of shares for the period
of 27,858,836 (H1 FY22: 27,738,539). This provides basic earnings per share of
2.9 pence (H1 FY22: (7.6) pence).
Diluted earnings per share for the six months ended 31 August 2022 has been
calculated on the basis of the reported profit after taxation of £0.8m (H1
FY22: loss of £2.1m) and the weighted average number of shares after
adjustment for the effects of all dilutive potential ordinary shares
27,990,830 (H1 FY22: 28,026,499). This provides diluted earnings per share of
2.9 pence (H1 FY22: (7.5) pence).
The Board considers that adjusted earnings is an important measure of the
Group's financial performance. Adjusted earnings in the period were £4.0m (H1
FY22: £3.3m), which excludes the amortisation of acquired intangibles of
£1.7m, (H1 FY22: £1.5m) share-based payments of £0.9m (H1 FY22: £1.1m),
restructure and non-operational costs of £2.5m (H1 FY22: £1.4m), IT systems
implementation costs £2.6m (H1 FY22 £1.1m), gain on foreign currency
translation of £3.7m (H1 FY22: loss £1.4m), and associated taxation impact
of these adjustments of £0.8m (H1 FY22: £1.1m). Using the same weighted
average of shares as above provides adjusted basic earnings per share of 14.3
pence (H1 FY22: 11.8 pence) and adjusted diluted earnings per share of 14.2
pence (H1 FY22: 11.7 pence).
8. Share capital
During the period the Group issued 190,868 shares as part of share-based
compensation for employees and remuneration. These increased the number of
shares in issue from 27,826,486 to 28,017,354.
The holders of ordinary shares are entitled to receive dividends as declared
from time to time and are entitled to one vote per share at meetings of the
Company.
9. Loans and borrowings
31 August 2022 28 February 2022
£'000 £'000
Current liabilities
Secured bank loans 6,131 5,311
Lease liabilities 3,735 3,743
9,866 9,054
Non-current liabilities
Secured bank loans 46,017 42,925
Lease liabilities 19,110 19,579
65,127 62,504
Repayment of secured bank loans in line with previously disclosed repayment
terms amounted to £3.1m.
The group's principal debt facilities totaling £52.1m are provided by a
syndicate of banks and expire in 2024.
10. Trade and other payables
31 August 2022 28 February 2022
£'000 £'000
Current liabilities
Trade payables 11,400 12,833
Other payables 13,655 14,745
Accruals 6,291 5,214
Deferred income 31,908 26,990
Government grants 819 814
64,073 60,596
Non-current liabilities
Government grants 3,799 3,190
3,799 3,190
11. Financial instruments
Fair values
a) Accounting classifications and fair values
Group
The following table shows the carrying amounts and fair values of financial
assets and liabilities. The carrying amount of all financial assets and
liabilities not measured at fair value is considered to be a reasonable
approximation of fair value.
Carrying value
FVPL FVOCI Financial Other Total Fair value
assets at financial
amortised liabilities
cost
31 August 2022 £'000 £'000 £'000 £'000 £'000 £'000 Level
Financial assets measured
at fair value
Equity securities - 18,407 - - 18,407 18,407 3
Convertible loans 283 - - - 283 283 3
283 18,407 - - 18,690 18,690
Financial assets not
measured at fair value
Trade and other receivables - - 72,433 - 72,433 ( 1 )
Cash and cash equivalents - - 44,777 - 44,777 ( 1 )
- - 117,210 - 117,210
Financial liabilities not
measured at fair value
Secured bank loans - - - 52,148 52,148 ( 1 )
Trade and other payables - - - 56,963 56,963 ( 1 )
- - - 109,111 109,111
(1) Fair value not disclosed as the carrying amounts are considered to be a
reasonable approximation of fair value.
Carrying value
FVPL FVOCI Financial Other Total Fair value
assets at financial
amortised liabilities
cost
28 February 2022 £'000 £'000 £'000 £'000 £'000 £'000 Level
Financial assets measured
at fair value
Equity securities - 19,676 - - 19,676 19,676 3
Convertible loans 283 - - - 283 283 3
283 19,676 - - 19,959 19,959
Financial assets not
measured at fair value
Trade and other receivables - - 68,030 - 68,030 ( 1 )
Cash and cash equivalents - - 48,564 - 48,564 ( 1 )
- - 116,594 - 116,594
Financial liabilities not
measured at fair value
Secured bank loans - - - (48,236) (48,236) ( 1 )
Trade and other payables - - - (50,386) (50,386) ( 1 )
- - - (98,622) (98,622)
(1) Fair value not disclosed as the carrying amounts are considered to be a
reasonable approximation of fair value.
b) Measurement of fair values
Group
Outside of external market events that showed a material change to the fair
value of investment valuations, as reflected in the table below, no other
indicators have arisen from the valuation model to indicate a change to the
measurement of fair values of investments.
Reconciliation of Level 3 fair value:
Group
Convertible Unquoted
loans equities
£'000 £'000
Balance at 1 March 2022 283 19,676
Adjustments to fair value - (1,609)
Foreign exchange gain - 340
Balance at 31 August 2022 283 18,407
Convertible Unquoted
loans equities
£'000 £'000
Balance at 1 March 2021 3,122 14,760
Purchases - 5,106
Disposals (2,311) (699)
Adjustments to fair value - (95)
Transfers (521) 521
Foreign exchange gain (7) 83
Balance at 28 February 2022 283 19,676
12. Subsequent Events Note
There were no subsequent events at signing date.
13. Interim Report
Copies can be obtained from the Company's head and registered office: 3 Canal
Quay, Newry, Co. Down, BT35 6BP and are available to download from the
Company's web site www.fdtechnologies.com (http://www.fdtechnologies.com) .
14. Responsibility Statement
The Directors confirm that to the best of their knowledge:
a) the condensed set of financial statements has been prepared in accordance
with UK-adopted IAS 34 'Interim Financial Reporting';
b) the interim management report includes a fair review of the information
required by DTR 4.2.7R (indication of important events and their impact during
the first six months and description of principal risks and uncertainties for
the remaining six months of the year); and
c) the interim management report includes a fair review of the information
required by DTR 4.2.8R (disclosure of related parties' transactions and
changes therein).
The Directors are responsible for the maintenance and integrity of the
Company's website. Legislation in the United Kingdom governing the preparation
and dissemination of financial statements may differ from legislation in other
jurisdictions.
The Directors of FD Technologies plc are listed in the Company's Report and
Accounts for the year ended 28 February 2022. A list of current Directors is
maintained on the FD Technologies plc website: www.fdtechnologies.com
(http://www.fdtechnologies.com) .
15. Forward Looking Statements
The financial information contained in this announcement has not been audited.
Certain statements made in this announcement are forward-looking statements.
Undue reliance should not be placed on such statements, which are based on
current expectations and are subject to a number of risks and uncertainties
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. END IR BRBDGSGBDGDRRecent news on FD Technologies
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