K3C.L Regulatory News (K3C)

12th December 2022

K3 CAPITAL GROUP PLC

("K3", the "Company" and including its subsidiaries the "Group")

Trading Update

K3 Capital Group plc, a multi-disciplinary and complementary group providing specialist advisory services to SMEs, is pleased to provide a trading update for the six-month period ended 30 November 2022.

The Group delivered a good performance during the first six months of FY23 and is expecting to report revenues in the region of £42 million (H1 FY22: £31.2m) delivering profits which are comfortably in line with the Board's expectations.

The Group maintains encouraging activity levels and pipelines across its brands for the second half of the year and management is confident in meeting the Board's expectations for the full year.

John Rigby, K3's CEO, commented,

"The first six months of the year have been positive for K3C especially when taking into account the wide variety of challenges created by global events and the UK macro-economic environment. Our Q1 momentum has been maintained as we continue to deliver our growth strategy. The results are underpinned by diversified revenue streams and illustrate the benefits of our strategy of building a broader SME services group with greater visibility of future revenues.

I am particularly pleased with the performance of the Business Sales Division. Despite the market headwinds, it has continued to grow and deliver strong results which includes some sizeable completions in H1 within our Corporate Finance function.

Our Restructuring Division continues to see an uptick in activity levels and this is clearly a strong indicator of growing demand as the headwinds seen across the restructuring market now turn to tailwinds. As has been widely reported, the slower than expected return of the higher value administration work has resulted in a moderation in growth rates and margins. However, we would hope to see this improve as we look further forward.

Whilst the Chancellor's recent changes to the R&D scheme for SMEs were clearly not welcomed, we continue to drive client numbers within our Tax Division and we are hopeful that the negative impacts of the changes can be potentially offset by our continued organic growth.

The Board continues to look for complementary acquisitions within the professional services space. While cognisant of the negative outlook for the UK economy, we remain confident in the prospects of the Group for the remainder of FY23."

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About K3 

K3 Capital Group plc (AIM:K3C) is a multi-disciplinary and complementary group providing specialist advisory services to SMEs, incorporating Business and Company Sales, Restructuring and Insolvency and Tax Advisory services. The Group floated on the London Stock Exchange's Alternative Investment Market (AIM) in April 2017.

Services provided by the Group fall into three key operating divisions:

Business Sales Division:

· Company sales and business brokerage

· Corporate finance services

· Transaction services

· Debt advisory 

Tax Division:

· Research and development tax credit advisory

· Tax investigations

· Tax planning

· Tax advisory 

Restructuring Division:

· Restructuring advisory

· Financial advisory

· Creditor services

· Forensic accounting and expert witness

· Pensions advisory

· Accelerated M&A