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Cyber security
FTF Martin Currie UK Smaller Companies ’ Dan Green highlights three digitally enabled companies that should prove resilient regardless of what is happening in the wider economy
Our process involves bottom-up analysis as we seek companies with strong market positions , structurally growing addressable markets , high returns on capital and solid balance sheets . We are seeing many of these characteristics in companies related to the digital economy . These businesses are growing through the digitalisation and automation of trends in their sectors . They also have capital-light business models and don ’ t need major investment to continue growing . While the outlook for the UK economy is gloomy , we think the following three businesses can beat expectations .
Alpha Group is a financial technology business specialising in forex risk management , global accounts and payments . It has increased revenues and profits every year since inception in 2009 and has a long growth runway , considering it currently has less than 1 % market share . One of its two divisions , Alternative Banking Solutions , has increased its revenue from zero to £ 29m in four years , with operating margins of 40 %. This division charges an annual fee for its accounts , providing visibility and resilience . Alpha Group also earns interest on overnight balances , which has become a significant contributor to earnings .
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