Kainos Group Plc · LSE:KNOS
Kainos — H1 FY2025 Earnings Presentation
28 slides from Kainos's earnings presentation, Nov 11, 2024
Slide 1: Interim Results
Interim Results 6 months ended 30th September 2024 Russell Sloan (CEO) Richard McCann (CFO) 11 November 2024
Slide 2: Safe harbour statement
Safe harbour statement This document contains statements about Kainos Group plc that are or may be forward-looking statements. Forward-looking statements include statements relating to (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, finan
Slide 3: Contents
Contents 1. Business Overview 2. Financial Performance 3. Divisional Performance 4. Looking Ahead For more information visit kainos.com/investor-relations 3
Slide 4: Business Overview
Business Overview kaines’
Slide 5: Business Overview
Business Overview We have an excellent position in long-term, high-growth markets MARKET CAGR MARKET CAGR MARKET CAGR £3.2b 15% £1.1b 32% £1.5b 32% £123m £162m £200m £224m £213m £37m £49m £71m £106m £112m £19m £24m £32m £45m £57m FY20 FY21 FY22 FY23 FY24 FY20 FY21 FY22 FY23 FY24 FY20 FY21 FY22 FY23
Slide 6: Expertise at a Global Scale
Expertise at a Global Scale - = AXIOM ” NETFLIX TEED tip Riso «« CaPt aH lOM match H United Z & Office IKIOIN|E stripe @ Nations KI Oo N _ The | . Ms = ey Genomics ING SD (PO) Exes, Bookingcom Comcast Fidelity ca @P aggreko — WHOLE @ slobalpayments acme | LSND 99 FOODS — M lan HM Courts at ; t.Jude
Slide 7: H1 FY25 Highlights
H1 FY25 Highlights Excellent Workday Products growth Workday offset by a subdued services market, Products +28% with profitability maintained H1 FY25: £34m H1 FY24: £27m • Increased ARR target to • Investment for future growth £200m by 2030 after Built Revenue(1) • Significant opportunities in Digit
Slide 8: Our Customers
Our Customers Delivering value to our clients drives long-term relationships New Client Revenue Healthcare Sector Rev enue Cent ral Europe (1 ) Revenue Existing Client Revenue Public Sector Revenue North America Rev enue £37m £37m Commercial Revenue £44m £50m £43m £35m £37m £68m £35m £138m £48m £138
Slide 9: Our People
Our People We are building an exceptionally talented and engaged workforce Equality, Diversity & Inclusion – Change-making CPR month – Argentina Office Volunteering days with Green at Queens People 20 Global Locations Engagement 3,029 93% Employee Retention 76% Peakon Employee FY21 2,024 engagement
Slide 10: Our Responsibilities
Our Responsibilities Being responsible towards our people, customers, communities and planet … Ruth McGuinness – winner of Microsoft Power Climate action in London 375 young people attend CodeCamp Women in Tech award Climate Action Gender Equality Quality Education Reducing our Promoting gender equi
Slide 11: Financial Performance
Financial Performance kaines’
Slide 12: Group Income Statement
Group Income Statement Digital Services: • Public and commercial revenue impacted by market conditions Income Statement • Public -15%, Commercial -27% • Healthcare +16% reflective of increased activity in UK healthcare sector £m H1 25 H1 24 Change • Gross margin increased slightly to 38.4% (H1 24: 3
Slide 13: Balance Sheet and Cashflow
Balance Sheet and Cashflow Balance Sheet: Balance Sheet Fixed assets and investments (£m) 30 Sep 24 31 Mar 24 • Land for office £4.6m (FY24: £10.3m). Part sale of site completed in period - £6.2m Fixed assets and investments 18.8 25.0 • New leases capitalised £1.9m (Toronto, Buenos Aires, L’Derry) G
Slide 14: Capital allocation strategy
Capital allocation strategy Growing the Maintaining a Progressive Returning surplus business robust balance dividend policy cash to sheet shareholders • Organically • Cash reserves - Interim dividend 9.3p • Share buyback: • Targeted £151.6m (H1 24: 8.2p) £30m acquisition • Debt free • Share buyback
Slide 15: Divisional Performance
Divisional Performance kaines’
Slide 16: Workday Products
Workday Products Excellent progress into expanding market opportunity; Revenue(1) ARR (2) Backlog £200m ARR target announced +28% +18% +11% following strong sales and new H1 FY25: £34m H1 FY24: £27m H1 FY25: £65m H1 FY24: £55m H1 FY25: £127m H1 FY24: £114m Built on Workday partnership Revenue trend
Slide 17: Built on Workday: $10m from August 24, £200m ARR by 2030
Built on Workday strategic partnership to co-sell Kainos products Products marketed & sold Annual Investment via Workday’s Marketplace $10m from August 24 Workday incentivised to sell our products Initial focus on enabling all the sales teams Main stage keynote presentation at Workday Rising 9,000 p
Slide 18: Kainos Employee Document Management
Kainos Employee Document Management 80% of HR documents One global system for 2,000 requests every year - fully automated 40 countries by 2026 now available for self service ING Bank is a Dutch multinational banking corporation with “Kainos EDM offers efficiencies on 60,000 employees. many levels -
Slide 19: Workday Services
Workday Services Increased competition Revenue(1) Bookings Backlog impacting performance, but global expansion and -10% -25% -5% adjacent services offer H1 FY25: £52m H1 FY25: £40m H1 FY25: £61m H1 FY24: £57m H1 FY24: £53m H1 FY24: £64m growth opportunities Revenue trend H1 / H2 Revenue reduction /
Slide 20: Workday Financial Management
Workday Financial Management 1,100 branded sites Live in Now a Smart across the US & Puerto Rico 6 months Test customer “Kainos was an amazing partner. They were RaceTrac operates gasoline service stations across the southern United able to provide resources and expertise States. It acquired Gulf Oi
Slide 21: Digital Services
Digital Services Strong growth in Revenue(1) Backlog Bookings Healthcare, with -11% -13% +12% delayed decision H1 FY25: £97m H1 FY25: £103m H1 FY25: £166m making in Public and H1 FY24: £109m H1 FY24: £119m H1 FY24: £149m Commercial Sectors Revenue trend H1/H2 Public sector / -15% to £62m FY21 £71m £
Slide 22: Our Future Health
Our Future Health: Secure digital platform for the UK’s largest health research programme Over 350,000 < 2 years from One platform to More than 1 blood samples build to pilot to full engage up to 5 million consented collected national launch million volunteers volunteers to date “Kainos is a great d
Slide 23: AI business continues to grow
AI business continues to grow AI related Revenue We are inspiring, guiding and enabling responsible AI adoption 37% growth YOY Examples of AI projects AI Catalyst driving sales – almost 40 engagements in six months Preventing travel document Creating an AI-ready architecture fraud, illegal immigrati
Slide 24: Looking Ahead
Looking Ahead
Slide 25: Outlook
Outlook We have strong positions in long-term growth, diverse, international markets Digital Services Workday Services Workday Products Short-term Short-term Short-term Current UK government hiatus Increased competition impacting All products growing strongly performance Medium-term Medium-term Medi
Slide 26: Appendix: Definition of terms
Appendix: Definition of terms
Slide 27: Definition of terms
Definition of terms Active customer: a customer who has signed a contract with us within the last three Contracted backlog: the value of contracted revenue that has yet to be recognised. months or has generated revenue in the last six months. Compound annual growth rate (CAGR): annual growth rate ov
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