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(Sharecast News) - Kainos reported higher full-year revenue and profit on Monday after a stronger sales performance across the group, with growth in Digital Services, Workday Services and Workday Products supported by increased bookings and a larger contracted backlog.
The FTSE 250 IT services provider said revenue rose 17% to 431.1m for the year ended 31 March, from 367.2m a year earlier, while statutory profit before tax increased 19% to 58.1m.
Adjusted pre-tax profit rose 2% to 67.1m, or 5% at constant currency, with the adjusted profit margin narrowing to 16% from 18%.
Kainos said profit growth was held back by higher delivery and employee costs after a series of large contract wins led to a greater use of contractors and third-party suppliers.
Contractor costs rose to 18.5m from 4.5m, while third-party supplier costs increased to 30.1m from 14.7m.
The year also included a first full year of investment in its Built on Workday partnership, higher National Insurance costs and increased bonus payments.
Bookings increased 32% to 505.3m, while contracted backlog rose 18% to 433.9m.
Cash fell to 89.1m from 133.7m after the company returned 55.7m through share buybacks, acquired Davis Pier, progressed construction of its Belfast headquarters and paid restructuring costs.
Kainos said its latest 30m buyback programme completed on 15 May, with 3.7m shares repurchased.
Workday Products revenue rose 15% to 81.7m, while annual recurring revenue increased 23% to 89.0m.
The company said the division remained on track to reach 100m of ARR by the end of 2026 and 200m by the end of 2030.
It now has nearly 700 customers, with around 41% taking two or more products.
Digital Services revenue increased 23% to 241.7m, helped by major contract wins in healthcare and the public sector, including programmes with the Home Office, the Department for Transport, the Driver and Vehicle Standards Agency and NHS England.
Public sector revenue rose 11% to 136.0m, while healthcare revenue grew 55% to 74.9m.
North American revenue more than doubled to 20.2m, helped by organic growth and a six-month contribution from Davis Pier.
Workday Services revenue rose 9% to 107.6m, with growth driven by stronger sales and a focus on more complex deployments.
Bookings in the division increased 44% to 121.8m, and contracted backlog rose to 74.9m from 59.3m.
Kainos lifted its total dividend for the year by 4% to 29.6p per share.
Chief executive Brendan Mooney said it had been "a positive year" for the group, adding that strong customer relationships and the contracted backlog positioned it well for further progress.
Looking ahead, Kainos said it expected continued momentum in Workday Products, further growth in Digital Services led by UK public sector and healthcare work and North America, and another positive year for Workday Services.
At 0902 BST, shares in Kainos Group were down 3.63% at 785p.
Reporting by Josh White for Sharecast.com.
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