First Derivatives manages to significantly reduce net debt
First Derivatives plc (LON:FDP) today issued a trading update for the year to February 28, 2021.
The company announces that it traded in line with market expectations for the period, generating revenue of £238 million and adjusted EBITDA of £40 million.
Net debt at the period end was £10 million, which is better than analyst forecasts and significantly reduced from the Group’s net debt of £49 million a year ago. The improvement in net debt is primarily driven by strong operating cash conversion, supplemented by the partial sale of FD’s investment in Quantile Technologies for cash consideration of £11 million.
Let’s recall that for the six months to end-August 2020 (H1 2021), FD marked a slight rise in revenues and a drop in profits.
Group revenue increased by 3% to £119.6 million in H1 2021 from £116.7 million registered in the equivalent period a year earlier.
Adjusted profit before tax decreased by 19% to £10.7 million (H1 2020: £13.3m) held back by increased financing costs and higher depreciation and software amortisation charges. Reported profit before tax decreased by 12% to £7.4 million (H1 2020: £8.4m).
Reported profit after tax decreased by 8% to £6.1 million (H1 2020: £6.6m) and reported diluted earnings per share decreased by 10% to 21.8p per share (H1 2020: 24.2p).
The adjusted profit after tax for the period of £8.8 million (H1 2020: £10.9m) represented a decrease of 19%.