Newry IT firm looking for overseas acquisition

NEWRY-based financial services IT support company, First Derivatives is actively pursuing acquisition opportunities in the Australasia region, in the coming months, as it seeks to significantly expand its international presence.

The company — which specialises in software support services for hedge fund administrators and investment banks — yesterday reported a record set of interim results for the six months to the end of August. First half pre-tax profits were up by 21%, on a year-on-year basis, to £2.24 million (€2.83m), with turnover up by a similar level at £6.83m.

A first-half operating profit of £2.42m was up from a figure of just over £2m for the same period last year and earnings per share showed a year-on-year jump of 4% to 10.8p.

The AIM and IEX-listed company also declared an interim dividend of 2.35p per share, up by 2% on last year’s level.

“The current turbulence in the financial markets is characterised by increased trading volumes, a move towards consolidation and probable increased oversight and regulation. We consider that our expertise and product base is well placed to take advantage of opportunities emerging from this shifting landscape.

“We continue to experience increased demand for our consulting services, from both existing and new customers and are achieving high utilisation levels,” commented chief executive, Brian Conlon, before adding that the company is expecting to see further progress made for the full financial year.

For the year to the end of next February, the company is expecting to report EBITDA (earnings before interest, tax, depreciation and amortisation) of around £5.5m and pre-tax profits broadly in line with last year’s level of £4.7m.

While growth in Europe will likely to be of the organic nature, the company is favouring growth through acquisition further afield. Just last month, First Derivatives made its first major acquisition, taking US company Marketing Resource Partners (MRP) over for $20m (€14m).

First Derivatives shares fell 5 pence, or 2.9%, to 165 pence in London. The stock has fallen 41.7% this year, giving the company a market value of £21.9 million pounds.