Published on: September 15, 2014

Full year results reflext Ax|is product growth

K3’s July trading update flagged an in-line performance for the year to June 2014. That is reflected in the FY14 results within which revenues and adjusted EBITDA were a touch better than we expected. The dividend increase of 25% to 1.25p is ahead of our estimate. The results show positive numbers for adjusted profits in both the Microsoft UK and Managed Services Divisions after losses last year. Slightly lower profits from the other two divisions reflect slow markets, investment and a small disposal – but both finished the year in encouraging fashion. Looking ahead, management expects to make further investment in growth opportunities and produce good results from its Microsoft AX Dynamics proposition. On the back of this strength, we upgrade our FY15 estimates (c.5% at the Adjusted PBT level) and introduce our FY16 numbers.

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