FD Technologies Reports Pretax Loss and Lower Full-Year Earnings
FD Technologies reports a pretax loss and lower full-year earnings attributed to higher operating costs and investment in KX software development. CEO remains optimistic about the company's progress.
Troy D. Hanson
October 24, 2023
Shares in FD Technologies dropped by 35% in early trading following the company's announcement of a swing to pretax loss in the first half of the year. The financial-software and consulting company cited higher operating costs and investment in its KX software product development as the reasons for the decline in earnings.
During the six months ended August 31, FD Technologies reported a pretax loss of £4.5 million, compared to a profit of £1.1 million during the same period last year. Revenue also decreased from £147.4 million to £142.5 million, attributed to decreased customer spending.
Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to £14 million, a slight decrease from £16 million the previous year.
Looking ahead, the company expects revenue for fiscal year 2024 to range between £285 million and £295 million, with adjusted EBITDA projected to be between £24 million and £26 million. Investments totaling £9 million to £10 million are anticipated for the second half of the year in the KX product. This outlook compares to revenue of £296 million and adjusted EBITDA of £34.8 million for the year ending February 28.
CEO Seamus Keating remains optimistic about the company's progress, stating, "We have continued to drive strategic progress across the group in the first half, with KX highlights including the launch of KDB.AI and strong progress with our global partners. We delivered a resilient performance in first derivative and MRP despite weaker customer demand in their respective markets."