TIDMK3C
RNS Number : 8629B
K3 Capital Group PLC
15 June 2021
K3 CAPITAL GROUP PLC
("K3", the "Company" and including its subsidiaries the
"Group")
Pre- Close Trading Update
K3 Capital Group plc, a multi-disciplinary professional services
firm providing advisory services to SMEs, is pleased to provide a
pre-close trading update for the financial year ended 31 May 2021
("FY21 Financial Year").
The Group delivered an exceptionally strong performance, having
successfully grown revenues and profits across all divisions. As a
result, the Group expects to report revenues for the full year to
31 May 2021 of approximately GBP46.0 million and adjusted EBITDA*
of not less than GBP14.25 million. These results exceed the full
year guidance provided by the Company in the trading updates
released on 14 April 2021 and 4 March 2021, with adjusted EBITDA*
significantly ahead of current consensus market expectations**. The
M&A division had a strong year with material organic growth
delivering revenue and adjusted EBITDA* significantly ahead of
expectations and delivering a high profit margin contribution.
Alongside the transformational acquisitions of Quantuma and
randd and in line with the Group's stated strategy, three
complementary bolt-on acquisitions were also completed during the
period and have all contributed to growth and provided further
diversification of revenues. These new revenue lines together with
the new tax advisory and debt advisory offerings and the newly
established Market Mapping joint venture all provide additional
layers of diversification and will financially contribute to the
Group in FY22 and beyond.
The Group's balance sheet is strong with an unaudited cash
balance of approximately GBP14 million as at 31 May 2021. In
addition, shortly before the end of the financial year, the Group
announced that it had agreed maiden debt facilities of GBP15
million, which remain undrawn and give the Company greater
flexibility in funding future bolt-on acquisitions.
* Adjusted EBITDA is earnings before interest, tax, depreciation
and amortisation, stated before acquisition related costs and share
based payment charges.
** Current consensus analyst forecasts for revenue of GBP45.02
million and adjusted EBITDA of GBP13.27 million.
John Rigby, K3's CEO, commented,
"In a year of challenging conditions, particularly in the
context of the suppressed insolvency market, we are extremely proud
that we have delivered results for the FY21 Financial Year that are
significantly ahead of initial market expectations; beating
multiple upgrades made to market expectations across the year. The
FY21 Financial Year has been a transformational and very important
year for the Group, notably being our first period of reporting
post the acquisitions of Quantuma and randd. It represents a year
of significant growth in the scale, diversity and quality or our
business which sees a significant increase across revenue and
profits as well as progression in our strategy to build a wider
group of growing and complementary professional services
businesses.
All of our business divisions have performed well and
integration projects have proceeded in line with expectations. We
believe that these results are testament to the Group's ability to
identify, acquire and integrate high quality and accretive
acquisitions and we are proud to have built a diverse group of
businesses that are positioned to deliver robust performances
across all economic cycles.
As ever there remains a degree of uncertainty in the markets in
which we operate, however we begin the 2022 financial year with
great confidence. Along with investing in the Group to expand the
range and depth of our service lines, we have also invested in our
internal resource to provide us with the flexibility and capacity
to service an increase in demand. Additionally, we continue to
identify further opportunities to expand the range and depth of our
service lines. In summary, the board is delighted with the
performance of the Group and remains confident of continuing its
strategy and making further progress in the upcoming financial
year."
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU No. 596/2014) which is part of UK law by virtue of
the European Union (withdrawal) Act 2018. Upon the publication of
this announcement, this inside information is now considered to be
in the public domain.
For further information, please contact:
K3 Capital Group plc Tel: c/o finnCap 020 7220
0500
John Rigby, Chief Executive Officer www.k3capitalgroupplc.com
Andrew Melbourne, Chief Financial Officer
finnCap Ltd (Nominated Adviser and Joint Tel: 020 7220 0500
Broker)
Jonny Franklin-Adams, Emily Watts, Charlie Beeson (Corporate
Finance)
Tim Redfern, Richard Chambers (Corporate
Broking)
Canaccord Genuity Limited (Joint Broker) Tel: 020 7523 8000
Bobbie Hilliam (Corporate Broking)
Alex Aylen (Head of Equities)
About K3 Capital
K3 Capital Group plc is a multi-disciplinary professional
services firm providing advisory services to SMEs, with operations
throughout the UK and overseas.
Services provided by KBS Corporate, KBS Corporate Finance,
Knightsbridge and KBS Capital Markets:
-- Mergers and Acquisitions (M&A) - Company sales, brokerage
and corporate finance services to SME's looking to achieve full or
partial exit, advising on sales to private, trade, plc, private
equity or overseas acquirors. Strategic advisory and valuations,
financial due diligence and debt advisory.
Services provided by RandD UK Limited:
-- Research & Development tax credit advisory: advising
clients on Research and Development Tax Credit (RDTC) claims.
Services provided by Quantuma Advisory Limited:
-- Restructuring advisory: formal insolvency appointments,
informal restructuring advisory, personal insolvency and pension
restructuring and insolvency advice.
-- Financial advisory: comprehensive analysis of business
performance through business toolkit, independent reviews,
stakeholder management and turnaround and interim support.
-- Creditor Services: creditor representation and liquidations.
-- Forensic accounting and expert witness: forensic
investigations, intelligence and forensic accounting.
-- Intax: Tax Investigations relating to tax fraud / tax
avoidance / disclosures and code of practice 9 (COP9) related
work.
The Group's medium-term strategy is to build a wider group of
growing and complementary professional services businesses to
provide SME's with high quality advice across specialist
disciplines.
K3 Capital Group trades on the London Stock Exchange (AIM:
K3C.L), having listed on 11 April 2017. Please visit
www.k3capitalgroupplc.com for more information.
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