Performance on track to deliver in line with expectations for the full year
Knights today provides a trading update for the half year ended 31 October 2022.
- Revenue up by 18% to £71m (H1 22: £60m)
- Underlying Profit Before Tax (PBT) of c.£9.0m, up 18% (H1 22: £7.6m), with margin maintained at 12.6% (H1 22: 12.6%)
- Continued focus by management on lock up, resulting in net debt of c.£35.6m (FY 22: £9m) after paying c.£7m of acquisition consideration and related costs in the half year.
The Group’s first half performance is in line with the Board’s expectations.
We have continued to selectively recruit high quality talent, many of whom have been attracted from other top 50 or leading independent law firms, by Knights' differentiated business model and collaborative culture.
Prior year acquisitions, Keebles, Archers Law and Langleys, have integrated and are performing well with the previously announced sale of the non-core HPL part of Langleys having completed in September 2022.
During the first half, the Group completed the acquisition of Coffin Mew, a leading independent law firm in the South of England, adding four offices and significantly expanding the Group’s presence in the region, an attractive growth market for legal and professional services.
Lock-up of 103 days at 31 October (October 2021: 99 days) reflects the Group’s continued discipline of day-to-day cash collection. This resulted in net debt2 of c.£35.6m, after paying c.£7m of acquisition consideration and related costs. As at 31 October 2022 there was significant headroom of £24.4m against the Group’s Revolving Credit Facility of £60m.
David Beech, CEO of Knights, commented:
"We have continued to successfully execute our strategy, delivering profitable, cash generative growth.
“As we enter the second half, we are encouraged by the Group’s strong performance, as we continue to attract high quality talent and potential acquisitions to the Group.”
Knights will provide a further update on trading with its half year results announcement in mid January 2023.