Kainos: NHS supplier reports 14th year of growth as it ramps up use of AI
London-listed NHS software provider Kainos has reported increases in revenue and pre-tax profit in the full year 2024 even as bookings fell slightly, sending shares up over five per cent.
The company said revenue rose two per cent to £382.4m while adjusted pre-tax profit jumped 14 per cent to £77.2m, up from £67.6m in 2023. It is the company’s 14th consecutive year of growth across a number of metrics.
Cash grew 16 per cent to £126m and diluted earnings per share rose from 33.1p to 38.6p.
Kainos, a key NHS supplier, warned of weak demand from commercial clients in April and this was reflected in bookings, which were down one per cent in 2024.
Chief executive Russel Sloan said: “Our excitement is increasing about our Workday Products division. This year’s excellent performance is another significant step towards our goal of £100m ARR by 2026.
“We are further delighted that our fourth and latest product, Employee Document Management, has been our most successful product launch to date, with 26 international clients already signed up.
“Our Digital Services division has seen a solid performance with consistent demand from public sector clients, strong growth in our core healthcare business (excluding pandemic-related revenue) despite a reduction in our commercial business.”
Kainos said it has a “growing sense of excitement” around some of its smaller, high growth activities including automation, data and AI.
Over 500 of Kainos’s nearly 3,000 employees are trained in the use of generative AI, the company said today, with more than 30 per cent of projects making use of the technology.
However it said generative AI remains “largely experimental” for its clients, due to challenges in low data quality.
“Despite the ongoing global economic uncertainty, we believe that our largest business areas, Workday Products, Workday Services and the public sector segment of Digital Services, will continue to be resilient and will offer substantial growth opportunities in both the near term and medium term.
The company’s Workday Products, Workday Services, and the public sector segment of Digital Services make up a combined total of 80 per cent of revenue.
“We are well positioned within these markets, both locally and, increasingly, internationally, and we remain confident in our strategy,” Sloan added.
Kainos also announced a number of board changes today. The FTSE 250 company is involved in the UK’s National Health Service (NHS) digital transformation projects and looks set to benefit from an increase in spending on information technology by the NHS starting in the financial year 2025.