Kinovo Plc (AIM: KINO), the specialist property services Group that delivers compliance and sustainability solutions, provides the following half-year update for the six months ending 30 September 2021.
Trading and Financial Position
In the six month period to 30 September 2021, Kinovo has continued to demonstrate resilient progress, delivering strong growth in revenues as COVID restrictions eased, earnings and cash generation from its continuing operations, despite the market challenges of supply chain inflation and material and labour availability.
Comparative revenues for continuing operations during the period grew 64% to £23.8 million (2020: £14.5 million), Adjusted EBITDA (after the effect of a charge for lease payments) increased by 75% to £1.8 million (2020: £1.0 million), with operating profit from continuing operations delivering £1.2 million (2020: loss £0.2 million). Total profit after tax was £0.6 million (2020: loss £0.2 million).
Net debt fell further from £2.7 million at 31 March 2021 (£4.9 million at 30 September 2020) to £1.7 million at 30 September 2021, including cash balances that rose from £1.3 million at 31 March 2021 to £2.2 million at 30 September 2021.
During the six month period, the Company reinstated its final dividend and paid £0.3 million, as well as deferred VAT payments totalling £0.6 million, strengthening its financial position further following the effects of the pandemic. Outstanding deferred VAT was £0.4 million at 30 September 2021 and will be fully repaid by January 2022.
The Company has also won a number of new contracts during the period, most of which will be initiated during the second half of the year, with a total potential value of £43.6 million over the life of the contracts.
Planned Sale of Construction Division
Following its rebranding and strategic review, Kinovo announces that it is currently in advanced discussions regarding the planned sale of DCB Kent Limited (DCB), the Company's non-core construction business. The disposal of DCB will allow the Company to harmonise its operations and increase the focus on its three strategic workflow pillars; Regulation, Regeneration and Renewables. These pillars are centred on compliance driven, regulatory led specialist services that offer long-term contracts, recurring revenue streams and strong cash generation. There can be no certainty that the sale will proceed, however further announcements will be made as appropriate.
The Company expects to release its interim results for the period ended 30 September 2021 on Tuesday 7th December 2021.
David Bullen, Chief Executive Officer of Kinovo plc, commented:
"We are pleased with how the Company has managed to deal with the significant issues posed by the pandemic, emerging in a strong position for growth. The commitment of the team has allowed the business to combat a very challenging year and I re-iterate my thanks and gratitude for all their hard work.
The potential sale of DCB will serve to strengthen our strategic footing and allow us to focus and build on our core business, centred around the non-discretionary arenas of compliance and regulatory work.
We look forward to providing more detail at our Half-Year Results in December."