Kinovo (KINO ), a provider of specialist property services centered on safety and regulatory compliance, announced audited results for the year ended 31 March 2023 (FY23).
Kinovo saw revenues rise 18% to £62.7m from £53.3m in FY22. Adjusted EBITDA likewise increased by 29% to £5.5m, and pretax profit jumped 58% to £4.4m. Cash conversion remained strong at 107%, albeit down from 223% last year. Net cash increased to £1.1m from a net debt of £0.3m last year after Kinovo repaid its £2.5m HSBC loan ahead of schedule. Basic earnings per share rose 63% to 5.97p.
Operationally, Kinovo's business continued to benefit from legislative drivers and its new strategy focused on 3 key areas: Regulation, Regeneration and Renewables, contributing 56%, 28%, and 16% of total revenues respectively in FY23.
Despite inflationary pressures, the company managed to drive gross margin growth through leveraging operational efficiencies. Margins increased 2.4% to 26.3% from last year, and EBITDA margins strengthened to 8.7% from 7.9% in FY22.
Kinovo continues to enjoy good revenue visibility, with current 3-year visible revenues of £146.4m for the £27m company. Of those, 98% are recurring and 71% have price-index linked clauses. £64m is expected to be recognised in FY24.
Notable contracts during the period include a 5-year contract with The Hyde Group worth £25m, potentially rising to £40m over 8 years. Kinovo also signed a a £4m 2-year contract with the London Borough of Waltham Forest.
Overall, the company delivered a year of solid growth, driven by a new clear strategy, operational efficiency, and legislative changes. A robust pipeline of opportunities with strong 3-year revenue visibility from both direct contract wins and awards under framework agreements position Kinovo well for further growth.
The strong set of results elicited a positive reaction from markets, driving KINO shares up 4% in early trading.
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