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KRM22 managing risk in 2020 through focus on organic growth

Snapshot

  • Portfolio of risk management products for capital market firms
  • Applications cover market, regulatory, technology and operations risk
  • Products also cover hedge funds, financial institutions and traders
Risk management

Quick facts: KRM22 PLC

Price: 32.5 GBX

AIM:KRM
Market: AIM
Market Cap: £8.21 m
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What KRM22 does

KRM22 PLC (LON:KRM), which floated in May 2018, is a software and technology firm that provides risk management products to capital markets companies.

The group’s portfolio of applications covers market, regulatory, technology and operations risk.

 

What it owns

The company currently owns:

Irisium – provides analytics and contextual surveillance tools that help capital market firms identify and manage risks of market abuse, fraud and operational issues as well as meet regulatory compliance

ProOpticus – a real-time, multi-asset class, post-trade portfolio risk management system for hedge funds, financial institutions and traders. The system provides analysis from the micro to macro levels of granularity

• Object+ - a risk management and post-trade services firm focused on capital markets

 

How it is doing

Final results for 2019 showed KRM22 booked revenue of £4mln, up from £1.3mln a year ago, with annualised recurring revenue growth of 21% to £4.5mln compared to 10% a year earlier.

Adjusted (EBITDA) losses narrowed to £3.1mln from £3.3mln.

Over the year, six new partnerships were signed, covering client onboarding, enhanced due diligence, online training, individual accountability regime and regulatory reporting.

Post year-end, in May, the company completed a £1.145mln fundraising at a price of 30p each, a 28% premium to its closing price the day before the placing was announced. The funds were to provide additional working capital to support the growth strategy.

 

What the boss says

Executive chairman and chief executive Keith Todd said while risks and uncertainties related to the coronavirus pandemic were continuing to evolve, the firm was confident that it will “deliver on our growth and adjusted EBITDA profit plans”.

“We made significant progress in 2019 launching the KRM22 Global Risk Platform with its range of market risk and regulatory services. 

“In the later part of 2019, we suspended our acquisition activity and focussed on organic growth in which we are continuing with this plan through 2020 and the crisis.”

“I am pleased to say that the business is operating very effectively working from home as a result of the automation and flexible working we established from day one. We are confident of further progress with new and existing customers providing organic growth and remain confident of meeting management expectations.”

 

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