Kainos Group plc (KNOS), the UK-headquartered IT services and software provider, has reported strong interim results for the six months ended 30 September 2026, with group revenue rising 37% to £268.8 million against £196.1 million in the comparable period. Adjusted pre-tax profit grew 30% to £41.7 million, while group bookings climbed 27% to £402.3 million, underpinned by several large multi-year government contract awards. The board declared an interim dividend of 10.4 pence per share, up 6% year-on-year, and said it expects further growth in revenue and adjusted profit before tax in the second half of FY27, in line with current market expectations.

Key Points

  • Kainos Group plc (KNOS), listed on the London Stock Exchange
  • Group revenue increased 37% to £268.8m in H1 FY27; adjusted pre-tax profit up 30% to £41.7m
  • Contracted backlog reached £853.0m; Workday Products ARR at £96.0m, tracking towards £100m target by end of 2026
  • Investors will be watching H2 Digital Services revenue growth moderation and progress on Workday Products crossing the £100m ARR milestone

Digital Services Drives 57% Revenue Growth on Back of Major UK Government Contract Wins Including £150m Defra Deal

Digital Services, the division that builds digital platforms for public sector, healthcare and defence clients, delivered revenue of £162.5 million, up 57% year-on-year, making it the primary growth engine in the period. Healthcare revenue surged 85% to £54.7 million, public sector revenue rose 55% to £76.0 million, and defence revenue grew 44% to £15.3 million. The announcement states that Kainos was one of the top-performing suppliers to the UK Government by total contract value of digital framework wins since April 2026. Major awards included a five-year contract worth up to £150 million with Defra, a £30 million contract with the Department for Transport, and contracts of £111 million with the Home Office and £84 million with the Foreign, Commonwealth & Development Office, the latter two due to be signed in H2.

Workday Products ARR Reaches £96.0m with Over 750 Customers as £100m Target Comes Into Sight

Workday Products, which develops proprietary software that complements Workday's enterprise platform, reported ARR of £96.0 million at 30 September 2026, up 24% from £77.5 million a year earlier, with division revenue rising 22% to £48.0 million. The company stated the division will surpass its £100 million ARR target within the current quarter and reiterated its longer-term goal of £200 million ARR by the end of 2030. The customer base now exceeds 750, with around 40% taking two or more products. Research and development expenditure rose 33% to £11.4 million. Derek Brown, formerly of Quantexa, joined as Workday Products CEO in June 2026 to support scaling ambitions.

AI-Related Revenues Up 40% to £28.5m as Kainos Launches Actonomy to Bridge Pilot-to-Production Gap

Revenues from AI and data-related projects grew 40% to £28.5 million in the period, with Kainos stating it has delivered over 475 AI and data projects across public, healthcare and commercial sectors, including 75 in H1 FY27 alone. The group launched Actonomy, a dedicated business to help customers move AI projects from pilot into production, with four initial customers already secured across specialist lending, utilities, healthcare and academic research. Kainos also joined the Cosine coalition supporting development of a UK sovereign AI model and confirmed certification in Anthropic's Claude Partner Network, underscoring its growing positioning in responsible AI deployment for enterprise and government clients.

Group Cash Falls to £86.5m After Belfast Office Construction and £12.5m Share Buyback Programme

Period-end cash, including treasury deposits, stood at £86.5 million, down from £105.5 million at 30 September 2025, reflecting £7.1 million invested in the construction of Kainos's new Belfast office and £12.5 million deployed under a share buyback programme that concluded in May 2026. Cash conversion improved to 62% from 48% in H1 26. The adjusted profit margin held broadly steady at 16%. Digital Services gross margin declined 3.9 percentage points, which the announcement attributes to the use of contractors and supply partners to support rapid growth, a situation the company describes as a short-term staffing decision it expects to unwind as employed headcount rises. Total staff reached 3,885 at the period end, up from 3,132 a year earlier.