Software group says stronger second half will lift cash balance
Salford software group K3 Business Technology told the stock market this morning that a strong second half will lift the business’s results when it formally announces in March 2024.
K3, which provides business‐critical software solutions focused on fashion and apparel brands, also claimed cash balances of £8.3m, which is ahead of market expectations, despite the ongoing lower demand and activity in Global Accounts, as previously reported.
The statement this morning (20 December 2023) said: “The Group’s profit and cash generation is traditionally stronger in the second half of the financial year, benefiting from software licence and maintenance and support contract renewals, particularly at NexSys, where renewals were c.98%, which is in line with prior years (2022: 98%). Cash generation also benefited from greater discipline on costs and investing activities, although flows in the second half were reduced by cash restructuring costs.”
In October K3’s chief executive, Marco Vergani, was replaced by non-executive chairman, Tom Crawford, just over two-and-a-half years after he joined the business.
K3 aims to further simplify operations more effectively to address the opportunities within market sectors, and to drive shareholder value.
Figures for the six months ending May 31, 2023, revealed sales of £20.3m from continuing operations, compared with £19.9m the previous year. Pre-tax losses on continuing operations were £2.9m, up from £2.8m a year ago. Adjusted net cash stood at £2.9m, up from £1.4m in 2022.
