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Shaping up for ‘break-through’ year

The dramatic fall from grace of rock-star fund manager Neil Woodford, has been a classic case of not managing one’s risk correctly – especially surrounding portfolio liquidity, idiosyncratic exposure and x-asset correlations.
Worse still Mr Woodford is far from being alone. Many other experienced investors, broker-dealers, asset managers and even institutions still have to rely on ‘gut feel’ to assess their overall positions. Largely because there is no alternative.
This is where software developer KRM22 fits in. It is currently assembling a ‘1st-of-its-kind’ RiskTech system that seamlessly connects all these risks, allowing holistic real-time assessments and data sharing. This morning the firm said that interest in its new Global Risk Platform (GRP) is “strong” adding that Annualised Recurring Revenues (ARR) had climbed 24% to £4.1m in H1 (vs £3.3m Dec’18), of which £0.3m was organic and the rest M&A (re Object+).
On top it now has 37 active customers (vs 26 in Dec’18), is on track to achieve turnover of £5.8m in 2019, up 350% YoY. Elsewhere, costs continue to be tightly controlled – while discussions remain ongoing with strategic investors relating to a possible industry tie-up. Net debt closed June at £0.7m (vs +£2.2 in Dec’18). In terms of the numbers, we reiterate our projections and 110p/share valuation – with ARR expected to close Dec’19 on a £6.67m run-rate.
Chairman & CEO Keith Todd adding: “Our priority for H2 is to drive recurring revenue growth through our strong sales pipeline of cross-selling opportunities and by attracting new customers. We will continue to bring further applications to the GRP through investments, acquisitions and partnerships. Our discussions with potential strategic industry investors continue which we aim to conclude in H2.”