Published on: June 18, 2019

Further progress in the first half

K3 has delivered a trading update ahead of its 9 July interims.  The Group continues to progress well and remains on track to meet market expectations for the financial year. Management focus remains firmly on cash generation and the update says that transformation initiatives continue to come through ‘across all key areas of activity’. The RNS notes that results will be more second-half weighted than usual, reflecting the bias towards Q4 of software licence and maintenance contract renewals, but also a degree of Brexit-related disruption. There was some catch up in activity towards the end of the first half, which should feed through into increased service delivery in H2. K3|Fashion enjoyed an encouraging H1 with a combination of new wins and extensions. Significantly, channel partners played a key role in four of these deals, and the pipeline looks ‘very encouraging’. Global Accounts and Managed Services sales continued to grow. K3|Imagine and K3|Cloud, K3’s Infrastructure as a Service offering, were launched during the period. We leave estimates unchanged ahead of the July results.

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