Latest news with #FirstDerivatives
Belfast Telegraph
3 hours ago
- Business
- Belfast Telegraph
FD Technologies: the story of a Newry tech giant
The journey of FD Technologies, from a bedroom in Conlon's family home to become one of Northern Ireland's biggest technology companies – via an old converted corn warehouse next to the canal in Newry – is remarkable. The software specialist business – which provided products and consulting services to large global financial, technology and energy institutions – evolved from that bedroom to the stock markets of London and Amsterdam. Now another chapter in FD's 30-year journey has been written. In May, 2025, the company, which is headed by Seamus Keating, accepted a takeover bid from a private equity investor from Boston which valued the business at £550m. Donna Troy, chairwoman of FD, said the board unanimously thought the deal, based on an offer for £24.50 per share, 'delivers appropriate value to shareholders'. Over the last 30 years, FD (one of a handful of listed companies from Northern Ireland), grew from its Newry home across the Americas, Europe and Asia. And it has come a long way to get here. Brian Conlon was born in 1966 in Newry. He studied accountancy in Queen's University while playing gaelic football for his native Down. In 1987 he sustained a knee injury during a match for Queen's, forcing early retirement from the sport. He then turned his attention to the capital markets sector where he trained with a major accountancy firm. 'I spent the first year counting concrete and pick-up trucks and wanted something more challenging,' he told the Sunday Independent in an interview in 2008. Like many of his generation, Conlon migrated to London where he joined the risk management team in Morgan Stanley. From there he worked as a capital markets consultant in SunGard, a global derivatives software house. Rather than settle in England, he opted to return home and bring his experience with him. There was a gap in the market, he realised, for software consultancy. 'Most of the software firms were focused on selling the licences and not on services. There was an opening to help banks write financial models and help them with quantitative analysis,' Conlon said in 2008. He established First Derivatives in 1996 in the spare bedroom of his mother's home in Newry, using a £5,000 loan from the Newry Credit Union to help him get started. Years of organic growth followed. In the autumn of 1998, a few months after the signing of the Good Friday Agreement, Brian Conlon took his fledgling team on a trade mission to California's Silicon Valley alongside a handful of other local software companies, including Kainos. California was receptive. The following year Kx Systems, a software company from Paolo Alto which specialsed in financial modelling and data analyses, sold its marketing rights to FD and the two businesses would prove a perfect couple over the following decades. By 2002, First Derivatives had just 26 employees and a £2m turnover, but Conlon decided to float his business on the Alternative Investment Market (AIM) in the London Stock Exchange (LSE), initially offering four million shares at a price of 50p per share. 'FD at the start was small of scale but the vision attracted investors,' Ryan Preston, the company's chief financial officer, told Ulster Business in 2022. 'You have to follow up and deliver the vision. When we first floated on the LSE we attracted an investor base that was primarily driven by revenue growth and dividends. We delivered on that very successfully over many years.' Annual reports over the next decade reported consistent profit growth. The company steadily increased its stake in Kx Systems and added more strings to its bow, including the acquisition in 2008 of Market Resource Partners (MRP), a Philadelphia-based business which employed data analytics for software and technology firms. By now Conlon's operations spanned the globe – from Singapore to Sydney, Vienna to Vancouver, London to Los Angeles. The company even purchased residential for its staff. 'We have up to 60 people working in London and 25 in New York so we decided that rather than pay rents we would buy apartments,' Conlon said in 2008. 'It worked because we only bought in nice places like Mayfair and Kensington in London and around Chelsea or the Village in New York.' The world was its stage but Newry remained home for First Derivatives. 'Brian spotted global opportunity where no one else did,' said Justin McNulty, an SDLP MLA who worked at the business. 'But on top of that he combined pride in his home town of Newry with his knowledge that the people of the North have the education and drive to excel.' The business leader was keen to spread some of his knowledge and in 2012 established The First Derivatives Trading Room, NI's first financial trading facility, at Queen's. In June 2019, First Derivatives announced it had taken entire ownership of Kx Systems for $53.8m (£39.9m) in cash. This was an important milestone, Conlon said at the time: 'Since we acquired a controlling stake in Kx in October 2014 we have invested heavily to deliver the performance advantages of our combined solutions, branded as Kx technology, to a range of end-markets.' Sadly, this was his final deal. The following month, July 2019, Brian Conlon died in Newry not long after being diagnosed with cancer. But his baby First Derivatives – which changed its name in 2021 to FD Technologies (to incorporate its three operations, First Derivative, Kx and MRP) – had grown wings of its own. The company was by now a technology powerhouse, providing software and services to major banks and servicing marketing technology and the automotive industry. In 2020 the company 'recognised there was a huge opportunity in Kx, our software business, and we came back to market with an accelerated growth strategy,' said Ryan Preston. FD ultimately decided to restructure the business to focus on Kx, which uses an approach to data analysis that helps companies predict and respond to market conditions in real time. In early 2024, it merged MRP, its marketing technology division, with Contentgine, a US firm. FD retained 49% of this merged entity. Late in 2024 it sold its consulting wing First Derivative to EPAM Systems, a US software company for a reported £205m. Since then, the company has focused on growing subscription sales of Kx products. Following its sale to TA Associates, an investment firm with reported assets under management of over $60bn, will FD have to part ways with Newry? Not necessarily. TA Associates said it intends to keep headquarters in Newry. Some jobs could be subject to 'reorganisation, reduction or redeployment but the deal will 'create greater employment opportunities for existing and future employees over the long term'. FD has come a long way to get here – and it looks as though the journey is not over yet.
Irish Times
3 days ago
- Business
- Irish Times
FD Technologies revenue rises amid strategy shift
FD Technologies said revenue rose in the year to the end of February as the company saw significant strategic progress. The company said revenue for the year was £80.7 million (€95.6 million), a 2 per cent rise year on year. However, the company reported an operating loss of £23.4 million, widening from £15.6 million a year earlier, with an adjusted Earnings before interest, tax, depreciation and amortisation of £6.5 million. In October last year, the company agreed to sell its First Derivatives division to US software company EPAM for £230 million and divesting MRP, leaving leave FD Technologies to focus on KX, another arm of the group, as its sole continuing operation. READ MORE During the second half of the financial year, KX continued to perform well, delivering bookings growth for the fiscal year at the top end of it guidance range with £18 million annual contract value. That was a 33 per cent rise on the same period last year, when the figure was £13.5 million. Annual recurring revenue rose 13 per cent to £81.8 million during the year, a strategic milestone 'As these results demonstrate, momentum is accelerating in KX bookings and ARR growth, and the business is on course to deliver sustainable operating leverage over the long term, with cash EBITDA reaching breakeven in FY27,' chief executive Seamus Keating said. 'Following the completion of the disposal of First Derivative for an enterprise value of £230 million in December 2024, we returned £120 million to shareholders via a tender offer in January 2025, reflecting our commitment to maintaining an efficient balance sheet and maximising shareholder value.' The company has also agreed a takeover deal that will see US private equity fund TA pay £24.50 a share for FD Technologies, valuing the company at £570 million. 'TA has significant experience supporting in high-growth global software businesses, and we believe it is a suitable and appropriate partner for our employees, customers, and other stakeholders,' Mr Keating said. The company has a 'robust pipeline' for the coming financial year, and plans to invest in expanding its customer reach in core sectors, including the financial services sector, boosting innovation, and exploring new markets. 'With accelerating ARR growth and better-than-expected operating leverage, KX delivered a strong performance based on good ongoing execution,' Mr Keating said. 'Our focus for FY26 is to deliver efficient growth and demonstrate progress in delivering the significant operating leverage that is a feature of our business over the long term. We will prioritise our investments to accelerate deployment, time to value and ease of use, further simplifying our product model and enhancing sales productivity.' The company said it expects ARR growth of at least 20 per cent in the coming financial year.
