K3 Business Technology Group Regulatory News (KBT)

AIM: KBT

K3 BUSINESS TECHNOLOGY GROUP PLC

("K3" or "the Group" or "the Company")

Provider of business-critical software solutions focused on fashion and apparel brands.

Trading Update

K3, which provides business?critical software solutions focused on fashion and apparel brands, is pleased to announce an update on trading for the financial year ended 30 November 2023.

Adjusted operating profit* for the year is expected to be at least in line with market expectations, and the Group is expected to have closed the financial year-end with cash balances at £8.3m, which is ahead of market expectations. These results are despite the ongoing lower demand and activity in Global Accounts, as previously reported.

The Group's profit and cash generation is traditionally stronger in the second half of the financial year, benefiting from software licence and maintenance and support contract renewals, particularly at NexSys, where renewals were c.98%, which is in line with prior years (2022: 98%). Cash generation also benefited from greater discipline on costs and investing activities, although flows in the second half were reduced by cash restructuring costs.

The Group's flagship K3 Fashion product set delivered over 25% growth in annualised recurring revenue on a constant currency basis.

The Board remains committed to ongoing operational simplification, and the leadership and operational changes, put in place in the final quarter of the financial year, are enabling greater cost discipline. The delegation of responsibility to the leadership teams will also better capture the growth opportunities within each business unit, which should ultimately lead to greater shareholder returns.

Final results for FY23 are expected to be published towards the end of March 2024. 

Change of Name of Nominated Adviser and Broker

The Company also announces that its Nominated Adviser and Broker has changed its name to Cavendish Capital Markets Limited following the completion of its corporate merger.

*Adjusted operating profit is calculated before amortisation of acquired intangible assets, exceptional reorganisation costs and share based payment charges.

?This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the company's obligations under Article 17 of MAR.

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