TIDMKINO

RNS Number : 4978Z

Kinovo PLC

15 September 2022

15 September 2022

Kinovo plc

("Kinovo" or the "Company")

AGM Trading Update

Kinovo Plc (AIM: KINO), the specialist property services Group that delivers compliance and sustainability solutions, provides a trading update ahead of the Company's Annual General Meeting ("AGM") being held at 10am today.

Current Trading

Kinovo has continued the strong momentum it achieved during the last financial year and the first quarter, despite a difficult trading environment resulting from the impacts of significant inflation, supply chain constraints and labour availability. Kinovo has been able to partially offset these challenges through positive contract discussions regarding pricing, effective supply chain management and maximising its available labour pool. Based on management accounts the directors expect to report for the first six months ending 30 September 2022, revenues of approximately GBP30.0 million (H1 2022: GBP23.8 million) and Adjusted EBITDA in the region of GBP2.3 million (H1 2022: GBP1.8 million). The directors expect this positive momentum in financial performance to continue into the second half of the financial year.

Throughout the pandemic the industry experienced a fall in demand as both clients and residents limited access to properties. However, due to the regulatory driven, non-discretionary nature of our work, the current financial period has seen a significant rebound in activity as the backlog of essential work has started to be addressed. Additionally, the heightened increase in regulation and compliance, for example through the Building Safety Act which was granted Royal Assent on 28 April 2022, has also resulted in greater demand for our services.

During the period, the Company renewed contracts for the London Borough of Bexley and Estuary Housing worth a total of GBP7.0 million over a four-year period, new clients were gained including the Royal Borough of Greenwich and Orbit Housing worth in aggregate GBP2.6 million per annum and a GBP1.0 million contract for an emergency lighting program, to be completed within the current calendar year, was awarded by the London Borough of Southwark. In addition, we have a number of selective new business proposals that have already been submitted and are awaiting decisions, which the Company will announce, when appropriate.

Discussions continue with clients on the DCB construction projects and Kinovo hopes that on site activity will recommence in the near future, enabling Kinovo to progress its commitments under the parent company guarantees. Costs to complete the projects are expected to be in the region GBP4.0 million plus expenses, as previously announced.

Our banking partner, HSBC UK Bank plc, continue their positive support of the Group and we are in the process of completing documentation for the refinancing of the GBP1.5 million term loan that was due for repayment on 30 September 2022 and the renewal of the current GBP2.5 million overdraft facility.

With the current macro-economic challenges offering no immediate sign of abating, coupled with the continued catch up from the pandemic, the pressures for local councils and authorities within the social housing sector remains ever increasing. The Company and our range of services are well positioned to support the authorities in addressing these challenges together.

David Bullen, Chief Executive Officer of Kinovo plc, commented:

"I am delighted to issue this trading update and report on the considerable progress made so far during FY23. I am proud of the underlying business' performance and how this has continued amid a number of very challenging conditions.

It is rewarding to observe the benefits of our strategic repositioning. All of our staff deserve recognition for embracing and implementing the strategy with commitment and vigour, enabling us to deliver such strong progress. The Company is well-positioned for growth and I look forward to further updating the market on our progress."

Enquiries

 
 Kinovo plc 
 Sangita Shah, Chairman                          +44 (0)20 7796 4133 
  David Bullen, Chief Executive Officer           (via Hudson Sandler) 
 
 Canaccord Genuity Limited (Nominated Adviser 
  and Sole Broker)                               +44 (0)20 7523 8000 
 Adam James 
  Andrew Potts 
  Harry Rees 
 
 Hudson Sandler (Financial PR)                   +44 (0)20 7796 4133 
 Dan de Belder 
  Harry Griffiths 
 

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September 15, 2022 02:00 ET (06:00 GMT)

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