Kainos half-year revenue rises 37% to £268.8m as government digital contracts grow
The UK-headquartered IT group's Digital Services arm grew revenue by 57%, led by public sector and healthcare work, and its Workday software business is about to pass £100m of annual recurring revenue.
By Daily Oracles News Team2 min read
Kainos, the IT services and software company, reported revenue of £268.8 million for the six months to 30 September, up 37% from £196.1 million a year earlier. Adjusted pre-tax profit rose 30% to £41.7 million and statutory profit before tax 26% to £35.8 million.
The interim dividend goes up to 10.4p a share, from 9.8p.
Most of the growth came from Digital Services, the division that includes its public sector, healthcare and defence work. Its revenue rose 57% to £162.5 million. Within that division:
- healthcare revenue rose 85% to £54.7 million
- public sector revenue rose 55% to £76.0 million
- defence revenue rose 44% to £15.3 million
Kainos said it had been one of the leading suppliers to the UK government since the start of April, measured by the total value of digital framework contracts won. Awards included contracts worth up to £150 million with the Department for Environment, Food and Rural Affairs, signed during the half, and contracts of £111 million with the Home Office and £84 million with the Foreign, Commonwealth and Development Office, which are due to be signed in the second half.
Order book
The company has changed how it counts Digital Services bookings and backlog, so that they reflect the full value of contracts in line with industry practice. On that basis, group bookings rose 27% to £402.3 million, taking the contracted backlog to £853.0 million against £679.3 million a year earlier.
Workday and AI
Workday Products, the company's own software for Workday customers, lifted annual recurring revenue by 24% to £96.0 million and now has more than 750 customers. Kainos said it would pass its £100 million target in the current quarter and remains on course for £200 million by the end of 2030. Workday Services grew revenue by 9% to £58.3 million.
Revenue from AI and data projects rose 40% to £28.5 million. During the half Kainos launched Actonomy, a business that helps customers move AI projects from pilot into full use, and it has four customers so far.
Headcount reached 3,885 at the end of September, up from 3,132 a year earlier.
Kainos expects revenue and adjusted profit to grow again in the second half of the financial year, in line with market expectations, though it said Digital Services growth would slow from the first half's pace because the comparison with last year gets tougher.
