TIDMKINO
RNS Number : 5635S
Kinovo PLC
07 November 2023
7 November 2023
Kinovo plc
("Kinovo", the "Group" or the "Company")
First Half Trading Update
Notice of Results
Strong H1 Performance and Ongoing Execution of Strategic
Initiatives
Kinovo Plc (AIM: KINO), the specialist property services Group
that delivers compliance and sustainability solutions, is pleased
to provide a trading update for the six months ending 30 September
2023 (the "Period") ahead of its interim results which are expected
to be released on Tuesday 28 November 2023. All figures are
unaudited.
Continuing Operations
The continuing operations of the Group have performed strongly
in the first half of the year, further benefiting from the
strategic repositioning to focus on its three key pillars of
Regulation, Regeneration and Renewables.
Legislative drivers including the Building Safety Act, Fire
Safety Act and changes to the Electrical Wiring Legislation have
increased the proportion of Electrical workstreams in the first
half, delivering a higher margin, with an uplift in gross margins
to 27.7% (H1 2023: 25.9%). With a number of planned works being
delayed due to clients' administrative bottlenecks and only
commencing in the latter part of the first half, the Board expects
to report a revenue increase of 2% to GBP30.34 million (H1 2023:
GBP29.76 million) with a 9% increase in gross profit to GBP8.40
million (H1 2023: GBP7.71 million). As the planned works progress
and new contract wins are fully mobilised, revenues are expected to
pick up further in the second half of the year, albeit at more
normalised margins, as part of the Group's traditional second half
weighting.
The Board expects to report adjusted EBITDA growth of 21% to
GBP2.91 million (H1 2023: GBP2.40 million) and Operating Profit
growth of 46% to GBP2.75 million (H1 2023: GBP1.87 million) driven
by a favourable work mix, enhanced by the Group's operational
efficiencies and lower non-underlying costs.
The Company ended the six months ending 30 September 2023 with a
cash balance of GBP1.16 million and a net cash position of GBP1.04
million (30 September 2023: gross cash of GBP1.72million and net
debt of GBP0.06 million).
During the Period, the Group secured several important contracts
with both new and existing clients including the introduction of
additional workstreams. These successes have continued post-period
with further contract wins and extensions, including:
-- a direct award by the London and Quadrant Housing Trust for
legal disrepair and void works with a total value of GBP1.0 million
across a two-year period;
-- a Home Upgrade Grant funded retrofit insulation works for
Broadland District Council for GBP0.5 million over two years with
the option of five additional one-year extensions; and
-- a two-year extension until September 2025 to its contract
with Haringey Council for gas maintenance works, with a historical
value of approximately GBP3.0 million per annum.
This positive momentum of contract wins and renewals represent
key organic growth drivers and facilitated further strategic
investments within the Business Development Team, including hiring
an additional Bid Manager and an Estimator which will further
benefit the Group.
Under the Renewables pillar, Sustainability continues to be a
key component of Kinovo's strategy, and the Company is beginning to
see the combined benefits of its robust accreditation profile and
high-ranking framework placings, with several direct awards being
granted during the Period and post-Period end. Additional
investment has been made to strengthen the Group's position,
including the provision of carbon literacy training to the
management teams, the recruitment of a Retrofit Team comprising of
a Lead Assessor, Technical Coordinator and Resident Liaison
Officer, whilst also releasing a year two Net Zero report in
October 2023 and a maiden ESG Impact report, which we expect will
be ready for release in November 2023.
Discontinued Operations
The Company is progressing the legacy construction projects
associated with DCB Kent ("DCB"), Kinovo's former construction
division, and continues to expect seven of the nine projects to be
completed during the current financial year, with five of these
expected to complete by early December 2023. Further developments
have also been made and negotiations continue with the remaining
two projects.
The current overall pre-tax cost to complete estimate for the
projects within DCB are estimated to increase by GBP0.46 million
from GBP5.26 million, as reported at 31 March 2023, to GBP5.72
million. The cost estimate will be updated in conjunction with
Kinovo's final account reconciliations and additional detail on all
related matters will be provided in the forthcoming interim
results.
David Bullen, Chief Executive Officer of Kinovo plc,
commented:
"The first half was another important period of progress and
growth for Kinovo, underpinned by the clear benefits associated
with our strategic repositioning, the ongoing effects of
legislative drivers and our selective investments.
We have also made significant progress regarding DCB. We remain
on target to complete seven of the nine projects this financial
year and I look forward to updating our shareholders with further
detail in the interim results.
Looking ahead, I am confident that our strategic investments
will generate further value for the Group, creating opportunities
to continue our momentum, including additional contract wins and
renewals across our divisions. At this stage of the Group's
financial year, the Board is confident of achieving full year
results in line with its expectations."
Enquiries
Kinovo plc
Sangita Shah, Chairman +44 (0)20 7796 4133
David Bullen, Chief Executive Officer (via Hudson Sandler)
Canaccord Genuity Limited (Nominated Adviser
and Broker) +44 (0)20 7523 8000
Adam James
Andrew Potts
Harry Rees
Hudson Sandler (Financial PR) +44 (0)20 7796 4133
Dan de Belder
Harry Griffiths
This announcement contains inside information for the purposes
of article 7 of the Market Abuse Regulation (EU) 596/2014 as
amended by regulation 11 of the Market Abuse (Amendment) (EU Exit)
Regulations 2019/310. With the publication of this announcement,
this information is now considered to be in the public domain.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTLQLLBXFLBFBD
(END) Dow Jones Newswires
November 07, 2023 02:00 ET (07:00 GMT)
Kinovo (LSE:KINO)
Historical Stock Chart
From Mar 2024 to Apr 2024
Kinovo (LSE:KINO)
Historical Stock Chart
From Apr 2023 to Apr 2024
