First Derivatives Reports 20% YoY Increase in H1 2019 Revenue

The company also expects its 2019 financial results will beat consensus forecasts.

First Derivatives (FD) has announced its unaudited financial results for the six months ended August 31, 2018. For the first half of its 2019 fiscal year, FD, a consulting firm and software provider to trading companies, experienced solid results across its key financial areas.

Taking a look first at revenue, FD managed to achieve a revenue of £105.6 million ($138 million). This is an increase of 20 percent when compared to the first half of the firm’s 2018 fiscal year, which had a revenue of £87.8 million.

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Breaking it down into segments, license revenue experienced a growth of 39 percent. According to the statement, this was largely driven by increased demand for Kx technology across its client base.

Fintech revenue was also up by 24 percent, reaching £82.7 million compared to £66.8 million in the same period last year. The uptick was largely thanks to growth in software revenue as well as the expansion of its product offering.

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Gross profit jumped by 21 percent from £36.3 million in the first half of last year to £43.9 million in H1 of 2019. Profit before tax was also up by 20 percent year-on-year, hitting £7.6 million. After tax, profit was still up 15 percent when compared to the same period last year.

FD Expects 2019 Revenue to Beat Forecasts

Seamus Keating, FD, First Derivatives
Seamus Keating
Source: LinkedIn

Commenting on the results, Seamus Keating, Chairman of FD, said: “our confidence in the growth prospects and the long-term potential of FD continues to increase, underpinned by demand for our Kx technology across multiple industries and our domain knowledge and growing reputation in managed services and consulting.

“This confidence drove an acceleration of our investment plans in H1, in response to new opportunities across the business. While the benefits from this investment will be received in future periods, the Group has delivered a strong first half.

“The pace of major contract wins across the business, together with our high levels of repeat and recurring revenue provide confidence and position the group well to continue achieving strong growth. We expect to deliver revenue and adjusted EBITDA slightly ahead of consensus forecasts for the year to 28 February 2019.”

For the year ending February 28, 2019, FD believes consensus revenue will be £213.0 million. The group also expects adjusted EBITDA to come in at £38.5 million.

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