13/10/2005
Chief executive Andy Makeham’s attempts to refocus supply chain software group K3 Business Technology are slowly starting to pay off.
September’s interims showed gradual progress, sales rising £6.6m to £9.3m and last year’s pre-exceptional £126,000 loss converting into a £72,000 profit. Moreover, a series of acquisitions and disposals have seen K3 reposition itself.
Historically the group’s major emphasis was on selling software to manufacturers, a solid market, yet one hardly brimming with potential. These days the company makes around 60% of its money from the more dynamic retail sector and was able to secure an impressive seven new orders (from the likes of Carpetright and Moss Pharmacy amongst others) in the first half of the year alone. A strong relationship with Microsoft, provider of the core technologies on which K3’s products are based, should enable Makeham et al to take advantage longer term too.
Investors should reflect that despite several years of promise the company has still to genuinely deliver. That said K3 is now better positioned than it has ever been and is forecast to generate a profit (before goodwill) of £1.8m for the full year on £20.2m of sales. Trading off a prospective p/e of 11.4 the shares remain worth gambling on.
| Market cap: | £14.3m |
| PE Forecast: | 11.4 |
| Share price: | 91.5p |
| AIM | £16.99m |
71.50p
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| Other company articles: |
| 28/04/2008 |
| 01/05/2007 |
| 06/10/2006 |
| 25/09/2006 |
| 13/10/2005 |
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