Shares in IT services management company Beeks Financial Cloud (BKS:AIM) traded sharply higher up 10.6% at 188.6p after the firm posted strong annual results.

Revenue for the year to June increased 24% to £11.6 million from £9.4 million the previous year, while pretax profits jumped to £1.3 million from £678,000.

RAISING FORECASTS

In a separate trading update, the company said it sees revenues for the year to June 2022 beating market expectations, after it posted record sales of more than $5 million in total contract value during July, August and September.

Started in 2010 by chief executive Gordon McArthur, who still owns a 54% stake, the Glasgow-based business provides low latency access for traders to futures, forex and other financial markets. Latency is the time lag you sometimes get when trying to connect to something using the internet.

Reflecting the strong growth outlook, over the past year the company has increased its headcount from 65 to 80. Today’s trading statement indicates major contract wins in what is normally a quiet trading period for the firm.

Beeks uses a cloud infrastructure platform operating from 11 data centres located close to financial exchanges in cities such as London, Frankfurt, New York, Tokyo and Hong Kong, with a twelfth data centre in pipeline in Brazil.

Clients access the platform through a configurable portal that means they get exactly want they want with Beeks doing the behind-the-scenes work.

A key growth driver moving forward is the firm's 'Proximity Cloud' initiative which enables its top-tier clients to have a private cloud hosted suite of Beeks offerings managed at their site, downloaded via a Beeks portal.

ANALYST UPGRADES 

Responding to the strong results and bullish trading update, analyst Steve Robertson at Canaccord Genuity has raised his price target for the shares by 27% from 150p to 190p.

'Looking to the full year 2022 and cognisant of the July/August trading update issued alongside the FY21 release, we upgrade our sales forecast by 8% and adjusted EBITDA by 4%', said Robertson.

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Issue Date: 27 Sep 2021