Published on: September 17, 2013

Positive outlook reiterated, numbers in line and prospects healthy

K3 has reported preliminary results for FY13 which are in line with the guidance given in its June pre-close trading update. Revenues are a touch (1%) lower than our estimates with adjusted EBITDA ahead of our number by 7%. Adjusted diluted EPS of 13.9p was some 52% ahead of our expectation thanks to an overall tax credit for the year. The group has maintained the dividend payment at 1.0p. While investment spend and the retail market backdrop influenced the FY13 outturn, the upturn in UK Retail order wins in the final quarter of FY13 and the prospects for Gemstone bode well for future performance. A positive outlook statement reiterates this and emphasises the opportunities across a Group which retains a robust financial position. Our FY14 estimates remain substantially unchanged and we introduce FY15 numbers.