Monday 21 September 2020 9:28 am

Kin and Carta shares bounce as it raises expectations

Kin and Carta has said it expects revenue and profit for the 12 months to the end of July to be better than previously forecast, helping its shares to rise almost eight per cent.

In a trading update to investors this morning, the digital transformation firm said the pandemic had boosted its business as companies turned to digital while staff worked from home.

It cited a number of big client wins in the last few months, as well as an expansion of its partnerships with Google and Microsoft.

Kin and Carta said it had reduced its net debt to £31.7m as of 31 July, down from £39.5m at 31 January. This was due to strengthened cash flow generation as well as reductions in working capital, which helped to offset cash outflows of £7.1m.

It added that it continues to focus on managing costs and cash flow to keep its balance sheet in check during this difficult period.

This plan resulted in the decision to sell off consultancy firm Pragma at the end of last month, which Kin and Carta said was “not core to the company’s [digital transformation] focus”.

“The company remains cautious regarding the continuing effects of the pandemic on [the first half] of the current financial year,” it said in the update.

“Nonetheless, early signs of improvement in client activity, pipeline and continued traction with our strategic partners give us confidence in the company’s future prospects.”

Preliminary results for the full financial year ending on 31 July will be announced in November.