Aquis Exchange PLC (LSE:AQX) (Q2 2024) Earnings Call Highlights: Navigating Growth Amidst ...

GuruFocus News
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In This Article:

  • Net Revenue: GBP10 million, a 4% increase period on period.

  • Profit Before Tax: GBP1.1 million, steady compared to the prior period.

  • Cash Balance: GBP14.5 million at the period end.

  • Data Revenue Growth: Up 17% to GBP2.2 million.

  • Operating Costs: Increased from GBP8 million to GBP8.4 million.

  • EPS: 3p per share basic, 2.9p fully diluted.

  • Market Share: Increased to 5.2% following rule changes.

  • Future Contracted Cash: GBP11.8 million.

  • Trading Members: Remain at 42.

  • Investment in OptimX: Increased stake to 10.2%.

  • Value of Trading on Aquis Stock Exchange: 44% increase.

  • Number of Trades on Aquis Stock Exchange: 10% increase.

  • Funds Raised on Aquis Stock Exchange: GBP87 million.

Release Date: September 12, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Aquis Exchange PLC (LSE:AQX) reported a 4% increase in net revenue, reaching GBP10 million.

  • The company saw a 17% growth in data revenues, attributed to price increases and new charges for members.

  • Aquis technologies division has a strong contract pipeline, with more than half of potential customers being national exchanges or central banks.

  • The company has increased its market share to 5.2% following a rule change.

  • Aquis Exchange PLC (LSE:AQX) maintains a strong cash position with GBP14.5 million, supporting strategic investments without needing external funding.

Negative Points

  • Operating costs increased from GBP8 million to GBP8.4 million, reflecting ongoing investments.

  • A historical contract for a startup exchange will not be renewed, impacting future revenue forecasts.

  • The primary market for IPOs remains challenging, affecting the Aquis Stock Exchange division.

  • The company's stock remains illiquid, with limited retail investment and trading volatility concerns.

  • The technology sales division faces competition from established players like Nasdaq and the London Stock Exchange.

Q & A Highlights

Q: Please, can you describe the competitors to your technology sales division? A: Alasdair Haynes, CEO: The main competitors are Nasdaq and the London Stock Exchange with its Millennium product. We've successfully competed against them, which highlights the strength of our product and sales team. Our RIE status allows us to participate at the highest level in RFP processes, broadening our product suite to maximize opportunities.

Q: The technologies contract pipeline has grown significantly with high-quality prospects. What factors do you attribute to this growth, and how confident are you in your ability to convert these pipeline opportunities into long-term profitable contracts? A: Alasdair Haynes, CEO: We are confident due to our track record of beating major competitors. The strategic investment will improve conversion rates, and our ability to win contracts across multiple asset classes is crucial. Richard Fisher, CFO: The investment will enhance our success rate, creating a virtuous cycle of attracting more clients.

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