The UK fintech company Fintel plc (AIM: FNTL) published its trading update for the fiscal year of 2023 (FY23) today (Tuesday). The company reported resilient financial performance in line with board expectations and announced the acquisition of two companies: Owen James Events and Synaptic Software.

Fintel Announces 2023 Financial Results

Fintel's adjusted EBITDA grew 6% to £20.5 million compared to £19.4 million last year. The company maintained a strong balance sheet with £12.7 million in cash reserves and £69 million in available credit through its £80 million revolving credit facility. Fintel had a net cash position of £1.7 million at year-end, having invested significantly in four acquisitions throughout 2023.

The company's core revenue, which excludes mortgage brokerage and surveying services, increased 0.3% to £56.6 million. Core software-as-a-service and subscription revenue was up 2% to £37.6 million, or 8% higher on a like-for-like basis excluding the impact of changed accounting treatment for some software reseller agreements and the acquisitions.

The fintech's non-core revenue, mainly from mortgage brokerage and surveying services, declined to £8.4 million in FY23 from £10.1 million last year due to the weak UK housing market. Overall statutory revenue was £64.9 million compared to £66.5 million last year.

Matt Timmins, the CEO of Fintel, said the company made significant strategic progress in 2023 by increasing scale and reach through four acquisitions.

“In line with our strategy, we are completely focused on consolidating a fragmented market to enhance our scale, proposition, and IP, as we continue to inspire better outcomes for UK retail financial services,” Timmins added.

Two New Acquisitions

Earlier in January, Fintel completed two acquisitions: Owen James Events and Synaptic Software. Owen James is the leading provider of strategic engagement events for the UK financial services industry.

“Today, we welcome yet another market leader in Owen James Events, a business with huge potential, and our sixth acquisition in twelve months,” Timmins commented.

Synaptic Software provides fintech solutions to financial intermediaries. The two acquisitions align with Fintel's strategy of expanding into adjacent markets and enhancing its service platform for customers.

Fintel's Future Outlook

For 2023, Fintel expects full-year results to be in line with board expectations, with resilient earnings from the core business offsetting pressures from the mortgage market.

The company remains well-positioned to benefit from a recovery in the UK housing market and adjusting interest rates in 2024. Fintel also gains from increasing regulatory requirements and its ability to support financial intermediaries in demonstrating product suitability.

“We are confident of delivering further progress in the year ahead as we continue to scale our proposition, realize our very active M&A pipeline and invest in our service and technology platform, with our growth underpinned by recurring incomes and positive structural market drivers,” the company’s CEO concluded.

Fintel plans to announce its 2023 full-year financial results on 19 March 2024. The company's share price on the London Stock Exchange AIM market decreased almost 5% in early trading following the trading update.

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