Cloud computing and connectivity infrastructure-as-a-service company Beeks Financial Cloud (LON: BKS) reported figures in line with expectations and profit growth is set to accelerate this year. The AIM-quoted company’s share price improved 7.48% to 273p.
In the year to June 2024, revenues were 27% higher at £28.4m and annualised recurring revenues were 18% ahead at £28m. Underlying pre-tax profit improved from £2.3m to £3.9m. Net cash is £6.6m.
During the summer, Beeks Financial Cloud signed a contract extension with the Johannesburg Stock Exchange, which will use its Exchange Cloud technology in a second data centre. This is a multi-year contract.
Nasdaq is another client. There are other opportunities with global stock exchanges. That provides a potential addressable market of hundreds of millions of pounds.
Recurring revenues cover more than two-thirds of the 2024-25 forecast revenues. Canaccord Genuity has edged up its pre-tax profit forecast from £6m to £6.1m on revenues of £39.6m. The 2025-26 pre-tax profit forecast has been raised from £7.2m to £7.7m, assuming a further 15% increase in revenues. The forecasts are based on increasing revenues and rising margins.
The shares are trading on 36 times prospective earnings. Net cash could rise to £9m by the end of June 2024. Canaccord Genuity has raised its target share price from 260p to 335p.