K3 is a leading global supplier of integrated business systems to retailers, manufacturers and distributors. We have over 25 years’ experience of delivering award winning solutions for more than 3000 customers across 20 countries. Our success is built upon world class software, tailored by our industry expertise and delivered by our world class service.

World Class Software
We are a leading supplier of Microsoft’s business solutions and a member of Microsoft’s Inner Circle and President’s Club. Our close relationship with Microsoft and in depth knowledge of their solutions means that you can be confident that the investment you’re making today will continue to payback now and in the future.

We also develop our own best practice software which is tailored to companies within the food, retail and manufacturing industries. These industry bespoke solutions are designed to maximise our customers’ efficiency and overall business performance. Between K3 and Microsoft we know we can provide a market leading solution that will fit a diverse range of business needs.

World Class Service
We are renowned for our unique personal service, our skill of listening to our clients and offering expertise that allows us to deliver the right solution, on time and on budget.

Collaboration is the foundation of our approach. We get to know your business by immersing ourselves in your strategy, we consult with you, we design the perfect solution to match your business needs, we implement it, make it work and ensure it continues to deliver business benefits.

Industry Expertise
We are experts in the retail, manufacturing and distribution industries and know about their processes, needs and wants – in depth. Our success is based on our ability to convert this knowledge into value for our customers.

As with all business solutions people are the key to success when it comes to implementation which is why we employ experienced industry professionals who understand the issues you face on a daily basis. Because our team of experts have this industry insight they make sure you get a best-of-breed solution that will address your specific requirements and objectives – both today and for the future.

K3 Business Technology Group is in the software and computer services sector. The Company’s securities are not traded on any exchange or trading platform other than AIM.


http://www.k3btg.com/

20 Jan finnCap 435.00 Corporate

Half Yearly Report

RNS


RNS Number : 6593S

K3 Business Technology Group PLC

21 March 2016




AIM: KBT

21 March 2016





K3 BUSINESS TECHNOLOGY GROUP PLC

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

Provider of industry specific mission-critical software (owned and third party), hosted solutions and managed services to the retail, manufacturing and distribution sectors



Interim results for the six months to 31 December 2015



KEY POINTS



Financial

· Results in line with management expectations - and profitability substantially ahead of prior year

· Adj. PBT1 up 33% to £4.72m (2014: £3.56m) (up 36% with constant currency)

- benefiting from strong performance from retail activities, increase in own IP and cloud hosting revenues as well as efficiency initiatives

Reported PBT up 27% to £2.28m (2014: £1.79m)

· Adj. EPS2 up 43% to 12.0p (2014: 8.4p) / Reported EPS up 51% to 5.9p (2014: 3.9p)

· Revenues up 1% to £42.29m (up 4% with constant currency) (2014: £41.67m)

- recurring revenue margin up to 70% (2014: 64%) and account for c.47% of total

- higher margin own IP revenues represented 23% of total sales (2014: 22%)

· Net debt reduced by 13% to £10.45m (2014: £12.07m)

· Adj. cash generated from operations3 rose to 114% (2014: 109%) with higher rate of cash conversion

Operational

· Continued encouraging progress as business transitions to increase own IP content

- strong growth in chosen focus areas of own IP, channel sales and hosting

· Major new orders remained buoyant at £11.3m (2014: £12.3m)

· Channel partner sales - a key to accelerating growth - progressing very well, with first major contracts with Global Systems Integrators ("GSIs")

· Major endorsement from Microsoft - membership of elite Microsoft Dynamics 'Inner Circle' - supports channel partner sales strategy and relationships with GSIs

· Hosting and managed services activities growing well and bolstered by the acquisition of Starcom in April 2015

· Board remains confident regarding future prospects



Lars-Olof Norell, Chairman, said:



"We are encouraged by these results, which show a significant increase in profits, driven by a strong performance from our retail activities, own IP sales and cloud hosting as well as cost reduction initiatives.



A key part of our growth plans for K3 is to drive sales of our own IP software products, particularly our retail product on Microsoft Dynamics AX. As part of this strategy, we are focused on growing sales through channel partners as well as through our own direct sales teams. We made encouraging progress here in the period and received our first orders through a Global Systems Integrator for our ax I is fashion" product. Microsoft's endorsement of K3 in July 2015 as member of its elite Microsoft Dynamics 'Inner Circle' supports growing channel partner interest in our solutions and we are also engaging with Microsoft on potential opportunities.



Looking forward, we remain confident about the potential to exploit our own IP and expect to see continuing progress in our growth strategy together with rising channel partner sales and hosting. As we have previously noted, cloud-based subscription models are becoming increasingly important to us as customers move towards consumption-based licensing. This means that whilst income from contracts is recognised over longer periods rather than upfront, the lifetime value has the potential to be significantly higher.



As we seek to further develop the business, we also intend to consider acquisitions which enhance our existing product offering."

21 Mar finnCap 435.00 Corporate

ST of IC - Offering 19 per cent upside to my 425p upgraded target price, I rate K3's shares a buy on a bid-offer spread of 354p to 358p.

Pre-close Trading Update

RNS


RNS Number : 1323E

K3 Business Technology Group PLC

14 July 2016














14 July 2016

AIM: KBT



K3 Business Technology Group

("K3" or "the Group")



Pre-close Trading Update



K3, which provides and supports software, hosting and managed services to the retail, manufacturing and distribution sectors, provides the following update on trading for the financial year to 30 June 2016.



The Group's overall trading performance remains encouraging, particularly in core sectors, and results for the full year are expected to be broadly in line with market expectations, notwithstanding the impact of a major customer entering administration in June. The seasonally important final months of the period saw a pleasing level of contract wins and the new business pipeline continues to provide significant opportunities for the new financial year. Contracts wins and renewals also supported significant new business for K3 hosting. Recurring income (from software licence renewals, support contracts and hosting) remains high and is expected to show a year-on-year increase as the Group continues to transition to a product/cloud-centred business.



The integration of the DdD business, acquired in April, which provides proprietary cloud-based software for retailers, is progressing well and is expected to be earnings enhancing in the next financial year.



The Group's net debt at the year end is expected to show a reduction to £8.9m, representing a year-on-year decrease of £3.2m (30 June 2015: £12.10m; decrease of £1.55m).



The Board looks forward to providing further information on trading with the publication of K3's full year results in mid-September.



This announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

Final results



Financial Highlights


•Benefits of growth strategy and transition to own IP model coming through in higher margins and profitability:

o K3 Product licence revenues increased to c.25% of total licence sales (2015: 23%)

o gross margins up to 54.4% from 51.5%

o channel partner sales gaining momentum

o new orders hit a record high of £35.3m, up 66%
• Results broadly in line with market expectations despite a significant customer, My Local, entering administration at the end of the period


• Recurring revenues (from software maintenance renewals, support contracts and hosting & managed services) grew to £41.62m and remain high at 47% of total revenues


• Adj. EPS*2 increased by 21% to 23.5p (2015: 19.4p)


• Operating cash at £5.50m was affected by record sales activity at year end


•Placing in April raised £13.04m (net) for acquisition of DdD Retail and to support growth


•Net debt reduced by 26% to £8.88m, aided by placing proceeds - debt expected to decrease significantly


• Proposed final (and total) dividend of 1.75p per share (2015: 1.50p)







Operational Highlights




• Record software licence sales at £16.23m, up 17% - helped by a strong contribution from retail software sales, including "ax l is Fashion" deals


•Channel partner network secured three major wins, Lacoste, KLiNGEL, TriStyle


•Hosting & managed services activities progressed well - although impacted by the major customer entering administration


• Acquisitions - of DdD Retail (April 2016) and Merac Limited (acquired since the year end)

- add valuable IP and recurring revenues


•Pipeline of new business up 23% to £76.1m on a like-for-like basis


•Proposed Board changes - David Bolton, CEO to become Chairman


•Board remains confident about growth outlook

ST of IC today - So, with the outlook positive, and K3 well funded, I have no hesitation reiterating my buy advice. On 13.5 times forward earnings, and offering decent upside to my 425p target price, K3's shares are a decent buy at 350p.