Beeks Financial Cloud Group plc (LON:BKS) was discussed by Miton UK MicroCap Trust plc (LON:MINI) Co-Fund Manager Gervais Williams in a wide-ranging exclusive interview about the Trust and some of its portfolio holdings.
DirectorsTalk asked:
Now we’ve seen a lot of renewed investor interest in some of your holdings in your portfolio, which I’d really like to get your thoughts on. The first one, Beeks Financial Cloud Group plc (LON:BKS) provide cloud computing and connectivity services and just delivered another set of record annual results. Companies have been migrating their data storage to the cloud for a while, is that trend driving the share price improvement?
Gerais Williams commented:
What’s interesting about Beeks Financial Cloud Group is it’s quite a small company, but it’s got a global market leadership, particularly in its exchange cloud offerings. Proximity cloud has also been big, private cloud too, but particularly exchange cloud and that’s been very much rolled out in the Johannesburg Stock Exchange.
What’s been interesting about that isn’t so much how successful it has been in terms of improving the efficiency of the market, but actually that they needed to roll out an additional contract extension very quickly afterwards. It led to extra volumes, it led to extra turnover, it led to better transaction prices, and that’s been a feature.
Of course, importantly, from our point of view, they’ve started winning out contracts, and they’ve announced a very large exchange contract. We don’t know quite which organisation it is, it’s going to be very big, it’s probably something like NASDAQ, we don’t know.
Most particularly, this is a company where its service level offerings are going to be adopted, we think, considerably going forward. It has net cash, clearly the share price has come up with the contract announcements but it’s the nature of many of these small micro-cap companies. They start overlooked and then as they succeed, their share prices can appreciate quite significantly, and particularly because they’re in the UK, which is an area where a lot of share prices have been fairly depressed over recent years, we’re going to see, these kinds of companies if they succeed, hopefully generating not just attractive returns, but much better returns than you get in most other global markets.
Beeks Financial Cloud is a leading cloud computing and connectivity provider for financial markets, offering low-latency Infrastructure-as-a-Service (IaaS) to retail and institutional traders in foreign exchange, financial futures, equities, fixed income and cryptocurrency asset classes.
