21st Oct 2022 11:55
(Alliance News) - Alpha FX Group PLC on Friday said revenue continues to grow in line with upgraded expectations, as it produced consistent month-on-month growth against last year.
Alpha FX is a London-based provider of FX risk management, accounts and payments solutions, which also launched an alternative banking platform in September.
Meanwhile, it noted that is has been granted a regulatory license in Australia, "with the team now expanding and already generating revenue".
For 2022, the group said it expects profit to be materially ahead of expectations, due to the interest rate environment generating additional income from alternative banking's overnight cash balances.
Additional interest income is expected to contribute GBP6.0 million between the end of August and December. However, Alpha FX said it would only be recognising this figure as 'other operating income', rather than revenue, because it is an uncontrollable, and potentially transitory, income stream.
Alpha FX said it would be continuing with the accelerated investment program it had outlined for the alternative banking division in the first half.
In its interim results statement, the group found alternative banking's success to be encouraging, and decided to accelerate its technology roadmap by making a proportionate increase in product and technology investment in the medium term.
It argued that accelerating the roadmap would help to offset future amortisation by proportionately accelerating the creation of revenue opportunities.
In other news, client default rates remained in line with expectations for the year, despite macroeconomic pressures.
Alpha FX said recent volatility has not brought forward any material revenues and trading has followed a consistent pattern of growth, which it attributed to advising clients to adopt a structured approach to currency risk management, rather than hedging disproportionately and speculatively.
Chief Executive Officer Morgan Tillbrook said: "I am pleased that we have continued to deliver on our upgraded revenue expectations, highlighting our robust business model during a period of macro volatility, with both our divisions continuing to perform strongly into the second half-year."
On Wednesday, the company said it appointed former London Stock Exchange Group PLC Chief Financial Officer Tim Powell as CFO from December 1, replacing Tim Kidd. Outgoing CFO Kidd remains with Alpha FX until March 2023 as part of a transition agreement.
Alpha FX shares were trading 11% higher at 2,069.00 pence each in London on Friday morning.
By Holly Beveridge; [email protected]
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