FD Technologies PLC on Tuesday reported a drop in profit for its recently ended financial year, on higher R&D and marketing costs, in spite of revenue growth through strong demand.

Shares in FD Technologies were 8.5% higher at 2,435.00 pence on Tuesday morning in London.

For the year ended February 28, the Belfast, Northern Ireland-based consulting services provider posted a pretax profit of £9.0 million, down 19% from £11.1 million the year before.

FD’s profit performance was hurt by a 32% rise in research & development costs to £21.1 million, while sales and marketing costs rose 21% to £47.4 million.

Revenue, however, increased 11% to £263.5 million from £237.9 million the prior year. The result was slightly ahead of management’s guided range of £255 million to £260 million, as a result of a stronger performance from the First Derivative and MRP.

‘Across the group, our investment in systems and people positions us to scale our operations to meet our growth ambitions. The opportunities across the markets in which we operate are significant,’ said Chief Executive Seamus Keating.

First Derivatives benefited from strong market demand to post strongest growth rate since 2016, with revenue rising 24% to £148.0 million.

Meanwhile, MRP’s revenue grew 16% to £51.1 million, through new contract wins and the launch of Prelytix 3.0.

Looking ahead, FD Technologies said it has a positive outlook across its business units, and has guided for adjusted earnings before interest, tax, depreciation and amortisation to come between £36.5 million and £28.5 million.

Revenue meanwhile is expected to grow to between £290 million and £300 million, compared to the £237.9 million seen the year prior.

‘We have delivered a year of transformation across the group, with each business unit achieving the key performance indicators we set out in our strategy one year ago to accelerate our growth. KX, which was the principal focus of our investment in the year, delivered our target ARR growth, and enters the new financial year with increased momentum from our partnership with Microsoft enabled by the launch of our cloud native KX Insights platform,’ Keating continued.

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