K3 boosted by software orders
SALFORD-based K3, which provides and supports software, hosting and managed services to the retail, manufacturing and distribution sectors, says it is pleased with the progress it has made in the six months to December 31, helped by two big software deals.
The company has benefited particularly from its transition to focus on software products with increasing levels of its own intellectual property.
The Group says its strategy is to drive sales through channel partners and K3 signed its first major software order through the global systems integrator (GSI) in September. It has since secured a further major order through another GSI.
Group profitability for the first half is expected to show a significant increase year-on-year in line with management expectations, reflecting a strong performance in retail activities and the benefits of reorganisation.
Revenues for the period were flat, reflecting lower performance in non-core activities as well as a shift toward cloud-based consumption.
K3’s cloud hosting revenues grew significantly during the period, with the contracted run rate at December 31 increasing by about 15% since June 30. K3 expects the cloud-based consumption trend to be an increasing feature of the revenue mix, together with rising channel partner sales and hosting.
Net debt at the period end is anticipated to show a reduction of £1.7m over the first half to £10.4m, also in line with management expectations.
“K3 remains well positioned to attain market forecasts for the financial year, with high levels of recurring revenues as well as a strong pipeline of prospects,” a statement said.
