K3 reduces pretax losses in H1; sees stronger second half
StockMarketWire.com - Software group K3 reported Monday a narrower half-year loss before tax as its efforts to streamline the business improved performance.
For the six months to 31 May, losses before tax were reduced to £1.0m, from £5.4m the same period a year ago, revenue rose 2.6% to £41.4m of which £18.7m was recurring and adjusted profits from operations swung to a £1.7m profit compared with a loss of £3.1m the same period a year ago.
The company said the 'encouraging' results reflected the benefits of restructuring which led to a more streamlined and integrated business, and refocused growth strategy. Gross profit rose 14.3% to £21.6m from £18.9m amid increased contributions from services, and software licences, and streamlined operations.
Gross margin improved to 52.2% from 46.8%.
'The second half is our stronger earnings period, reflecting the volume of software licence and support renewals in the final quarter of the financial year. It has started very encouragingly, with a healthy pipeline in place, and this, together with expected high renewals, gives us confidence that the Group will make further progress over the remainder of the year,' said Adalsteinn Valdimarsson, Chief Executive Officer of K3.
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