FreeAgent narrows losses as investment sees client numbers rise

Edinburgh-based accountancy software solutions firm FreeAgent has reported a net loss of £1 million for the six months ended September 30.

The listed company said the reverse came amid investment aimed at boosting customer numbers and developing new products.

The firm narrowed its first-half losses on the evident success of these measures as revenue jumped by nearly a third.

While posting a net loss of £1 million for the six months to 30 September, “reflecting planned growth in further customer acquisition and support costs and increased investment in product development”, the company said this compared to a £1.3m loss 12 months previously, while revenue leapt by 28 per cent to £4.6m,

FreeAgent, which floated on the stock market around one-year ago, said practice clients climbed to 37,600 from 29,485, with direct clients rising to 18,247 from 16,724.

The company, based in Edinburgh’s and targeted at UK microbusinesses,

Ed Molyneux, chief executive of the Fountainbridge firm, said: “The first half has seen Freeagent report continued strong revenue growth with an evolving channel mix.”

He continued: “Growth has continued in both our direct sales and practice sale channels and, whilst the rate of growth in our practice sales has been tempered by changes to IR35 ‘off-payroll’ legislation, which has affected public sector contractors, the underlying market drivers remain intact as accounting professionals transition towards digital accounting to cater for all their business requirements.”

He also flagged “considerable” progress made in developing the fintech firm’s strategic partnership with Royal Bank of Scotland.

Mr Molyneux added: “We look forward to reporting further progress with the rollout in the second half.”