Business

Kainos acquires two additional companies as fast growth continues

Kainos has acquired two businesses in England and Germany
Ryan McAleer

FAST growing IT services firm Kainos has acquired two businesses in England and Germany after a six month period in which its revenue grew by almost one third and it recruited 232 people.

The company, which employs 1,562 people across 12 locations in Europe and North America, yesterday confirmed the take-over of Worcestershire-based Formulate, and a Hamburg division of German IT group Implexa.

Both operate in similar fields to the Irish software firm. The sum paid for the companies has not been disclosed.

It follows new offices opened by the firm in Paris and Toronto.

Kainos said the latest acquisitions will improve its position in the provision of Adaptive Insights, a cloud-based platform for modernising business planning that was acquired by US software giant Workday for £1.2bn in 2018.

The Belfast firm is the leading provider for Workday services in Europe, which spans a series of business planning and financial management software solutions.

Formulate employs 16 people, providing services to around 100 customers across the UK and Europe.

Kainos said Implexa, as the only accredited Adaptive Insights partner in Germany, will add Hamburg-based software and consulting capabilities to its existing operation in Frankfurt. In all 21 new staff have been absorbed into the group.

The Belfast IT firm’s other key area of activity is in digital transformation projects for government departments and agencies as well as commercial and healthcare organisations.

In its half-year results released yesterday, Kainos said some government departments had deferred some new programmes until they obtain greater clarity around spending plans.

But it predicted that Brexit could see a surge in new work, with over 300 IT systems across the UK Government potentially impacted.

One of just a handful of Northern Irish companies listed on the London Stock Exchange, Kainos’ steady growth saw it promoted to the FTSE 250 in June this year.

Half-year results released by the group yesterday confirmed that the growth continued during the six months to September 30 2019.

Adjusted pre-tax profits surged by 27 per cent to £12.8 million on the back of revenue growth of 29 per cent to £86.9m, up from £67.2m during the same six months last year.

International revenues increased by 86 per cent to £17.9m in the six months on last year’s performance during the same period.

Kainos’ digital services business also continued to show signs of rapid growth, rising 29 per cent to £73.7m, up from £57.3m.

The group said 232 people were recruited in the six months to September 30 from 8,879 applicants.

In February, Kainos bought the former Movie House Cinema site at Bankmore Square in Belfast for £7m. The company plans to build a new flagship headquarters for its 650 staff in the city, which are currently based in nine buildings across the city.

Kainos’ chief executive Brendan Mooney said the group is on track to deliver its tenth consecutive year of growth.

“Our success continues to be delivered by an exceptional group of colleagues and supported by excellent relationships with our ambitious customers,” he said.

“We remain focused on the needs of both as we continue our growth journey.

“The Group's pipeline of prospects continues to strengthen and the Board believes that the Group is well-positioned for growth both in the short term and in the coming years.”

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