Northern Ireland software company Kainos expects to deliver profit of up to £68.2 million (€79 million) this year, largely in line with expectations, the company said in a trading update on Monday.
Kainos Group, established in 1986 as a spin-out company from Queen’s University Belfast, provides digital technology services and platforms to customers that include the National Health Service.
The update for the year ended March 31st, 2025, said the group expects to deliver revenues and adjusted profit before tax in line with consensus forecasts following a “solid” last quarter performance, underpinned by a disciplined approach to costs.
The group underwent recent restructuring, which saw 190 people leave. “We continue to be supported by a robust backlog and pipeline, along with a strong balance sheet and a disciplined approach to capital allocation,” it said.
“Combined with healthy cash flow, these provide a solid foundation as we focus on driving long-term value for shareholders.”
It expects to deliver revenue of £363.3 million to £366.8 million, and adjusted profit before tax in the region of £64.1 million to £68.2 million this year. The respective consensus figures are £365.6 million and £65.4 million.
A Goodbody analyst said the statement was “broadly in line with expectations”.
It is encouraging to see some level of recovery on the public services side in the second half, in addition to continued strong growth and delivery on the workday product side; but the workday services element remains a drag therefore no changes to our full year 2026 forecasts at present,” he added.
Kainos said its business overall improved in the final quarter of the financial year, recording low-single-digit percentage growth.
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“We believe that given the volatile macro-economic environment, we have maintained an appropriate balance between growth, international expansion, investment for the future and profitability,” it said.
The group’s workday products division delivered a “very strong” financial performance, achieving revenue in excess of £72 million at period end.
It said the division was positioned “strongly” to meet its initial revenue goal of £100 million by 2026 and advance toward its target of £200 million by 2030.
“In digital services, following the election-related hiatus, our public sector revenues returned to growth in the second half and our team continues to work hard to position Kainos to benefit from the UK government’s commitment to improving public services through digital transformation,” it said.
“Our healthcare revenues continued to grow strongly, and we recorded very strong growth in our international-related revenues. Within commercial sector, activity remained well below prior-year levels.”
The company said demand in its workday services division has remained “subdued, leading to further reductions” in the second half of the year.
“As market-related pressures have started to moderate, we are cautiously encouraged by signs of recovery and increasing activity across our international customer base, including recent wins in Australia and New Zealand,” it said.
“Kainos continues to operate in markets where there are clear long-term structural drivers, including the emerging opportunities presented by the wider adoption of AI. We remain confident in our strategy to deliver against these opportunities.”
