Beeks’ Revenue Soars to £23.8 Million, but Where Did the Profit Go?

<p>Beeks
Financial Cloud Group plc (AIM: <a href="https://www.financemagnates.com/tag/beeks-financial-cloud/" target="_blank" rel="follow">BKS</a>), a cloud computing and connectivity
provider for financial markets, has released its annual financial results for
the year ending on 30 June 2023. The company reported significant growth in
various financial metrics, including an increase of 22% in revenue and a rise of 23% in Annualized Committed Monthly Recurring Revenue (ACMRR). However, the company
did not achieve profitability, reporting a operating loss of £331,000.</p><p>Beeks Reports Mixed Results
in FY23</p><p>On the
one hand, Beeks’ revenue increased to £22.36 million, which is up from £18.29 million in
2022. ACMRR saw an increase of 23%, reaching £23.8 million (<a href="https://www.financemagnates.com/institutional-forex/beeks-financial-forecasts-238-million-revenue-in-fy23-secures-jse-deal/" target="_blank" rel="follow">in line with forecasts
from nearly a month ago</a>) and further rising to £25 million by the end of August
2023. Gross profit also rose 15% to £9.12 million. Underlying EBITDA and
profit before tax increased 33% and 13%, respectively, reaching £8.42 million
and £2.33 million.</p><p>“With an
established reputation and a track record of sustained growth, we are
well-positioned to capitalize on the shift of the financial services sector to
cloud computing and continue on our growth trajectory,” commented Gordon
McArthur, the CEO of Beeks. “The deals signed to date and our exit ACMRR mean
the Board is confident in achieving results for FY24 in line with its
expectations.”</p><p>From
another perspective, the company significantly increased its administrative
costs (from £7.6 million to £9.5 million), which turned the operating profit of
£385,000 from the fiscal year 2022 into an operating loss of £331,000. The total
loss before taxation amounted to £650,000. </p><p>We
described a similar situation yesterday (Sunday). The UK-based branch of Hong
Kong-originated Hantec Markets reported an increase in revenue of 7%, but also
<a href="https://www.financemagnates.com/forex/hantec-markets-struggles-to-turn-7-higher-revenue-into-profit-in-2022/" target="_blank" rel="follow">a net loss of £83,968 for 2022</a>.</p><p>Operational and
Technological Updates</p><p>The company signed a multi-year contract with the Johannesburg Stock Exchange (JSE), the
largest <a href="https://www.financemagnates.com/terms/s/stock-exchange/">stock exchange</a> in Africa. This contract went live in September 2023,
with Beeks now providing cloud services to JSE customers. Additionally, the
company has been in advanced discussions with other major global exchanges.</p><p>Beeks has
also been focusing on product innovation. The company launched a major user interface
refresh for its infrastructure automation portal, allowing for a more tailored
user experience. It also re-designed its underlying server <a href="https://www.financemagnates.com/terms/h/hosting/">hosting</a> platform
to improve efficiency and drive long-term cost benefits.</p><p>“We remain
focused on converting our record pipeline of opportunities across our product
offerings, and in particular the recently launched Exchange Cloud offering. The
advanced nature of several of these discussions, including additional proof of
concept implementations, provides confidence in our ability to provide growth
acceleration in FY24,” the CEO added.</p><p>In the meantime,
the company has <a href="https://www.financemagnates.com/forex/news-nuggets-16-may-futu-exits-china-app-stores-beeks-new-contract/" target="_blank" rel="follow">signed a contract with OneChronos</a> to provide a private
computing environment for OneChronos' new Alternative Trading System (ATS).</p>

This article was written by Damian Chmiel at www.financemagnates.com.