These are the three technology shares that I currently hold. My holding in BDI was small to start with, and has declined about 65%, so it's currently only 1.4% of my portfolio. MXM is down 22% to make 6.8% of the portfolio; QDG is down 26% to 6.6%.
All of these are reliant to some extent on investment spending by UK corporations, and are therefore vulnerable to a recession. But their business models leave them exposed to very different extents.
Looking at their Cash Flow statements is educational. I've picked out the cash flow of the companies below, calculating this as (pre-tax profit + amortization - tax - development). Of course Maxima pursues growth by acquisition, while other companies do more development in-house, so you would expect Maxima to have stronger cash flow. Nonetheless, in a recession Maxima can simply put its acquisition strategy on-hold; it's harder for Bond to sack a bunch of developers.
Maxima
Pre-tax profit: £5208k
Amortization: £3410k
Tax: -£1861k
Development: -£432k
Total: £6325k
Market cap: £27m (at 110p)
Revenue: £46m
Bond
Pre-tax profit: £5250k
Amortization: £1883k
Tax: -£953k
Development: -£2849k
Total: £3331k
Market cap: £15m (at 48p)
Revenue: £30m
Quadnetics
Pre-tax profit: £4394k
Amortization: £160k
Tax: -£1037k
Development: -£1132k
Total: £2385k
Market cap: £19m (at 111p)
Revenue: £79m
Conclusion
Judging by these numbers, Maxima is better-placed to continue generating cash in adverse conditions. It converts about 14% of its revenue into cash, vs 11% for Bond and a mere 3% for Quadnetics. However, Bond came out of this stronger than I had expected. I'm not surprised at Quadnetics' superficially weak numbers, since its business model is fundamentally different.
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