Beeks Financial (AIM: BKS), a cloud computing and connectivity provider for financial markets, reported a 22% increase in revenue for the six months ended December 31, 2024, and announced its first cryptocurrency exchange partnership with Kraken.

Beeks Financial Cloud Reports Strong First Half

The company posted revenues of £15.79 million for the first half of fiscal 2025, up from £12.96 million in the same period last year. Underlying profit before tax rose 37% to £1.89 million, while statutory profit before tax jumped 188% to £0.46 million.

“We have once again successfully delivered double-digit growth and increasing profit margins as we grow and scale with some of the largest financial organizations globally,” said Gordon McArthur, CEO of Beeks Financial Cloud. “Our unique proposition has the potential to transform the future of cloud technology in capital markets.”

Other financial metrics showed robust performance across the board. Gross profit increased 21% to £6.03 million with a gross margin of 38.2%, compared to 38.5% in the prior year period. Underlying EBITDA rose 25% to £5.74 million, representing an improved margin of 36.3% versus 35.6% a year earlier. Cash flow from operations before movement in working capital increased 23% to £5.76 million, underscoring the company's improved operational efficiency.

The recurring revenue profile remained strong at 78% of total revenue, though slightly lower than the 87% recorded in the first half of 2024, as the company increases its higher-quality revenue from Exchange Cloud and Proximity Cloud customers.

Beeks maintained a strong financial position with net cash of £6.57 million as of December 31, 2024, essentially unchanged from £6.58 million at the end of June 2024. The company's Annualized Committed Monthly Recurring Revenue (ACMRR) grew 7% year-over-year to £28.50 million, with a further increase to £29.2 million by the end of February 2025.

Beeks Financial Cloud Group #BKS, Interim Results

- Revenues increased by 22% to £15.79m vs £12.96m
- Underlying profit before tax up 37% to £1.89m vs £1.38m
- Cash flow from operations up 23% to £5.76m vs £4.69m
- Net cash of £6.57m vs £5.44m

Outlook
- First Exchange Cloud win…

— Justin Waite (@SharePickers) March 17, 2025

First Cryptocurrency Exchange Deal with Kraken

The company simultaneously announced a new Exchange Cloud contract with Kraken, a San Francisco-based cryptocurrency exchange, marking Beeks' first entry into the cryptocurrency marketplace. The partnership will allow Kraken to offer low-latency, institutional-grade infrastructure from its European data center.

“This partnership is a significant milestone for us as it marks the first step into the crypto platform space,” McArthur said regarding the Kraken deal.

The Kraken partnership follows a string of Exchange Cloud contract wins in the traditional financial sector, including a multi-year contract with one of the world's largest exchanges and a post-period agreement with Grupo Bolsa Mexicana de Valores, Latin America's second-largest exchange.

“By working with Beeks Exchange Cloud, we're ensuring that clients who need high-speed execution can optimize their trading strategies while benefiting from the security and reliability of Kraken,” Shannon Kurtas, Head of Trading at Kraken, noted.

Market Edge Intelligence

The company also highlighted the development of an AI-based analytics offering called Market Edge Intelligence, which aims to provide latency and client experience insights to enhance trading performance. This new product is expected to launch in the next financial year.

Beeks maintained its headcount at approximately 100 employees, focusing investment on automation to maximize the efficiency of its existing team rather than significant staff expansion.

Looking ahead, McArthur expressed confidence in continued strong performance, noting that several of the world's leading exchanges are in the final stages of conversations with Beeks, with multiple other opportunities in the sales pipeline.

The company is also transitioning to a revenue-sharing model for Exchange Cloud contracts, which it expects will enhance profitability and drive long-term value. Beeks confirmed its outlook for fiscal 2025 remains within the range of market expectations.