(Alliance News) -Â Kainos Group PLC on Monday reported a surge in full-year profit as both its divisions delivered an "excellent" performance.
Revenue for the financial year ended March 31 rose 31% to GBP234.7 million from GBP178.8 million, the IT provider said. Digital Services revenue grew 32% to GBP161.6 million and Workday Practice revenue grew by 30% to GBP73.1 million.
"We have delivered a very strong business performance, reflecting strong sector demand, the ongoing trust and support of our customers and the dedication of our people," said Kainos.
Bookings rose 6%, and Kainos reported contracted backlog growth of 15%. It had period-end net cash of GBP80.9 million, nearly double the GBP40.8 million a year ago.
Pretax profit for the year more than doubled to GBP50.3 million from GBP23.2 million.
Operating expenses rose 15% to GBP68.2 million from GBP59.3 million - half the rate of the company's revenue growth in the year due to reduced expenditure on costs such as training, recruitment, facilities and travel during the pandemic.
"While we take great satisfaction in our financial results, we also recognise that our trading includes savings that we consider non-recurring in nature - reduced travel, training and marketing expenses. We expect that elements of this expenditure will return to more typical levels in the future," the firm said.
Kainos hiked its total dividend to 28.2 pence from just 3.5p in the 2020 financial year. For the 2019 financial year, Kainos paid out 9.3p.
"As part of the Covid-19 related cost reduction measures, the board elected not to declare a final dividend for the year ended 31 March 2020. In light of the group's performance, during the period, and following the repayment of the monies originally claimed under the furlough schemes, a special dividend of 6.7 pence per share was approved by the board and paid on 4 September 2020," the company explained.
Kainos noted that the digital transformation market has been growing strongly for over a decade, with the pandemic accelerating the need for organisations to invest in their digital capabilities.
"The pandemic has demonstrated that our sector is resilient, but it has also demonstrated that the future is unpredictable. Notwithstanding our confidence, challenges remain. Countries and customers are exiting lockdown at different speeds and with varying degrees of success. The effects of the pandemic will linger for many years and we need to remain vigilant," the company said.
Kainos shares were 4.2% higher at 1,471.00p each in London on Monday morning, one of the best mid-cap performers.
By Lucy Heming;Â lucyheming@alliancenews.com
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Kainos Group (KNOS)