KRM22 plc

("KRM22", the "Group" or the "Company")

UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2025

KRM22 plc (AIM: KRM.L), the technology and software investment company, with a particular focus on risk management in capital markets, is pleased to announce its unaudited interim results for the six months ended 30 June 2025 ("H1 2025" or the "Period").

Highlights

Financial

·    Annualised Recurring Revenue* ("ARR") of £7.2m at 30 June 2025 (H1 2024: £6.0m) - growth of 20%

o  New contracted ARR in the period of £1.0m (H1 2024: £1.1m)

o  Total ARR attributable to the relationship with Trading Technologies International, Inc. ("TT") of £0.9m (H1 2024: £0.8m)

·    Total revenue recognised of £3.6m (H1 2024: £3.3m) - growth of 10.6%

o  Recurring revenue recognised of £3.4m (H1 2025: £2.9m) - growth of 15.4%

·    Adjusted EBITDA profit** of £0.4m (H1 2024: profit of £0.3m)

·    Loss before tax of £1.6m (H1 2024: loss before tax of £1.3m)

·    Gross cash and cash equivalents at 30 June 2025 of £1.4m (FY 2024: £1.0m)

Operational

·    New contractual ARR in H1 2025 generated from four cross sales opportunities to existing customers for the Limits Manager, Risk Manager and Market Surveillance applications

·    First sales of combined surveillance product offering via the TT relationship

·    KRM22 applications and Services team successfully handled increased market volatility following changes to US economic policy announced in April 2025

·    Amendments to the TT convertible loan to defer all interest payments until June 2026

Post-Period Events

·    Growth in ARR to £7.4 as at the date of this report at current FX rates

* Annualised Recurring Revenue ("ARR") is the value of contracted Software-as-a-Service (SaaS) revenue normalised to a one year period and excludes one time fees.

** Adjusted EBITDA is the reported loss for the period, adjusted for recurring non-monetary costs including depreciation, amortisation, unrealised foreign exchange loss and share-based payment charges/(credit) and non-recurring costs, both monetary and non-monetary, including Company reorganisation costs.

Commenting on the results, CEO of KRM22, Dan Carter, said:

"Another strong set of results for KRM22, with continued ARR growth and positive adjusted EBITDA.  This momentum is being driven by sustained demand for Risk Manager and Limits Manager, with the majority of new ARR coming from cross-selling, highlighting both the strength of our applications and the quality of our service.  Looking ahead, our pipeline remains robust as we work towards a strong close to 2025."

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

For further information please contact:

KRM22 plc                                                                                                                                    [email protected]

Dan Carter, CEO

Kim Suter, CFO

Cavendish Capital Markets Limited (Nominated Adviser and Broker)                                      +44 (0)20 7220 0500

Stephen Keys / Isaac Hooper

Sunila de Silva (ECM)

About KRM22 plc

KRM22 is a closed-ended investment company which listed on AIM on 30 April 2018.  The Company has been established with the objective of creating value for its investors through the investment in, and subsequent growth and development of, target companies in the technology and software sector, with a focus on risk management in capital markets.

Through its investments and the Global Risk Platform, KRM22 helps capital market companies reduce the cost and complexity of risk management.  The Global Risk Platform provides applications to help address firms' trading and corporate risk challenges and to manage their entire enterprise risk profile.

Capital markets companies' partner with KRM22 to optimise risk management systems and processes, improving profitability and expanding opportunities to increase portfolio returns by leveraging risk as alpha.

KRM22 plc is listed on AIM and the Group is headquartered in London, with offices in several of the world's major financial centres.

See more about KRM22 at www.krm22.com

CEO'S REPORT

KRM22 has maintained strong momentum into 2025, building on our record performance last year with continued growth in Annual Recurring Revenue ("ARR").  ARR reached £7.2m as of 30 June 2025 and, at the time of writing, has since increased further to £7.4m.  The first half of 2025 delivered £1.0m in new ARR, representing one of our strongest starts to a year and underlining the continued momentum in the business.  Encouragingly, 86% of this new ARR came from existing clients expanding into additional applications beyond their initial services with us - clear evidence that our integrated application strategy is gaining traction.  Client churn continues to be managed to an acceptable level, with £0.1m of churn in in H1 2025 and, as at the date of this report, the total churn for the year-to-date has further increased to £0.3m, primarily due to industry consolidation.  We continue to exercise disciplined cost control, positioning the business firmly on the path towards cash flow positivity and sustainable profitability.

Revenue growth

KRM22 has continued the progress made in 2024 into H1 2025 with £1.0m in new ARR, made up of £0.9m on new contracts and £0.1m of extensions to existing contracts.  The growth in ARR was primarily driven by sales of Risk Manager (45%) and Limits Manager (32%), with the majority of these (86%) being sales of new applications to existing clients as an extension to what they currently have with KRM22.  This growth validates our strategic vision to enable integration of the Risk Manager and Limits Manager applications, which together cover our Trading Risk offering.  This enables firms to gain complete control of their risk management processes technologically by syncing live risk data with limits set on ISV trading applications and exchanges.  Clients that have seen the benefits of using our Limits Manager application are now supplementing the audit trail workflows in Limits Manager with real-time data via the Risk Manager application.  Similarly, our Risk Manager clients are now looking towards Limits Manager for the efficiency and audit gains that can be realised.  

Our Trading Risk applications are used primarily by Futures Commissions Merchants ("FCMs") and, at the date of this report, we now have 19 FCMs contracted with KRM22 Trading Risk applications.  Limits Manager remains the market leader and, with the integration to Risk Manager, we hope to see continued demand in this area. 

The delivery of the highest standards of service is critical to a SaaS software firm such as ours.  The changes in US economic policy announced in April 2025 created immediate volatility in global capital markets.  Our applications and the services team proactively responded to the increased activity from our customers with high service levels being maintained.  Proactive account management and high service levels ensure that customer churn levels are managed to an acceptable level.  We continue to monitor this closely as we look to close out 2025 and beyond.

KRM22 Applications

In 2025, our focus has remained on strengthening core functionality in our applications, advancing integration of the Limits Manager and Risk Manager, and driving wider client adoption.  Building on this foundation, we are now looking at how our applications can be adopted by additional asset classes, reflecting the significant opportunity in becoming a truly multi-asset platform.  As our application suite continues to mature, we are well positioned to extend market coverage and deliver enhanced value to clients across a wider spectrum of their risk management needs.

Risk Manager

Following the successful creation of Risk Manager over the past couple of years, with initial sales of the enhanced application in 2024, the first half of 2025 has focused on scaling client usage and strengthening the performance of the application.  There have been further client deployments that have successfully gone live, supported by continued investment in core functionality and data processing.  In addition, we have delivered significant user interface improvements, ensuring a seamless transition for firms previously relying on our legacy At-Trade and Post-Trade Stress applications.  With a client-led roadmap in place, we are delivering features that align closely with the day-to-day needs of risk managers across the industry.

Limits Manager

As Limits Manager advances further through its growth phase, development has remained focused on extending functionality and usability for risk teams and execution services.  We have introduced more powerful client portal features, giving firms greater flexibility in how they grant access to their own end clients. Enhancements to API connectivity and external data enrichment have further strengthened audit trail capabilities, while automation features have continued to evolve.  We have also expanded integrations with additional ISVs and exchanges via both APIs and file-based transfers, ensuring the application continues to deliver greater efficiency and control at scale.

Integration of Limits Manager and Risk Manager

Support and momentum have strengthened behind the integration of Limits Manager and Risk Manager, with more firms recognising the benefits of a consolidated risk framework.  In 2025 we enhanced the combined workflows, enabling risk teams to assess key metrics from Risk Manager directly alongside client-raised limit changes in Limits Manager.  These changes, once approved, are automatically recorded in the audit trail with full context which provides a powerful real-time view into both the decision process and underlying account standing.  This level of transparency and control is proving increasingly valuable to our clients.

Market Surveillance

Our Market Surveillance application has continued to evolve, both in breadth and in strategic positioning.  The alert library has grown further, now surpassing 80 alert types.  The development of the API, enabling clients to consume surveillance results outside the KRM22 GUI, has unlocked even greater value through our integration with Trading Technologies International, Inc. ("TT") own surveillance product offering.  This combined solution, pairing TT's AI/ML-driven model with KRM22's calibrated alerting, was released by TT in late 2024 and has gained commercial traction in H1 2025.  TT's integrated surveillance product is already generating recurring and non-recurring revenues for KRM22, and with TT actively marketing the application, we expect this revenue stream to grow meaningfully through our revenue share model.

Outlook

We have continued to deliver strong progress in 2025 with £1.0m of new ARR added in the first half of the year and, at the date of this report, ARR now standing at £7.4m.  The significant share of new ARR generated in H1 2025 from existing clients expanding into additional applications underpins our belief of the cross selling opportunity at KRM22 and the increasing value clients place on our integrated application suite.  Limits Manager and Risk Manager continue to grow in stature as market-leading applications, while our partnership with TT is extending the reach of our joint best-in-class Market Surveillance offering.  With a significant market opportunity ahead, especially across different asset classes, a growing footprint across both new and existing clients, and disciplined execution, we remain confident in our ability to build on this momentum to become a cash generative and profitable business.

Dan Carter

CEO

16 September 2025

FINANCIAL REVIEW

Income statement

Total revenue

Total revenue reported in the period was £3.6m (H1 2024: £3.3m), an increase of 9.1% compared with the prior period, with 93.1% (H1 2024: 89.1%) generated from recurring customer contracts.  Non-recurring revenue for the period was £0.3m (H1 2024: £0.4m) and related principally to customer implementations, proof of concept work and development services.

Recurring revenue

As at 30 June 2025, the Group had contracted Annualised Recurring Revenue ("ARR") of £7.2m (H1 2024: £6.0m), with new contracted ARR in the period of £1.0m (H1 2024: £1.1m) and churn of £0.1m (H1 2024: £0.4m).  As at the date of this report, contracted ARR has further increased to £7.4m.

Gross profit

Gross profit for the period was £2.8m (H1 2024: £2.7m) with gross profit margin for the period of 77.5% (H1 2024: 81.8%).  The decrease in gross profit margin was driven by additional external sales commission on new ARR contracts in the period, and increased direct costs associated with the Risk Manager application.

Adjusted EBITDA

Adjusted EBITDA is a key metric to consider in order to understand the cash-profitability of the business due in particular to the non-cash items that impact the Income Statement under IFRS accounting, such as non-cash share-based costs.

Adjusted EBITDA for the period was a profit of £0.4m (H1 2024: profit of £0.3m) and a reconciliation of adjusted EBITDA profit to operating loss is detailed below. 

Loss for the period

Reported operating loss for the period was £1.3m (H1 2024: loss of £1.0m) and included £1.1m of unrealised foreign exchange losses driven by a 9% movement in GBP:USD FX rates in the period.

Finance charges

The net finance expense for the period was £0.3m (H1 2024: £0.3m) and related to accrued loan interest on the TT convertible loan.

Financial position

Assets

The cash balance at 30 June 2025 was £1.4m (31 December 2024: £1.0m). 

Current assets at 30 June 2025 include trade and other receivables of £0.8m (31 December 2024: £1.2m).

Liabilities

As at 30 June 2025, our principal liabilities were:

·    £4.5m convertible loan owed to TT plus accrued interest of £1.0m.  

·    £0.4m (US$0.5m) deferred consideration for earn out payments for the acquisition of Object+.  The liability can be satisfied in either cash or Company ordinary shares at the Company's discretion.

·    £3.4m of deferred revenue; contracted and paid services that will be released within one year.

Principal risks and uncertainties

The principal risks and uncertainties facing the Group remain broadly consistent with the Principal Risks and Uncertainties reported in the Group's 31 December 2024 Annual Report and continue to be carefully monitored by the Board.

Kim Suter

CFO

16 September 2025