K3 considers closure of ‘under-performing’ third-party solutions arm

Microsoft and Sage partner   K3 is “actively reviewing” the possibility of shuttering one of its under performing third-party solutions units.

It issued the warning as it announced it would be revealing its full-year results for its year ending 30 November 2019 at a later date, following advice from the FCA and AIM.

K3 is declining to forecast business operations for the current financial year, due to the impact of COVID-19. It intends to provide a further trading update in May.

The company warned that while the board was encouraged by the company’s trading prospects at the start of the current financial year, the unprecedented events now being experienced due to the coronavirus outbreak, which has resulted in contract delays and deferrals, make it difficult to forecast revenues for the year to 30 November 2020.

“The coronavirus pandemic and its potential impact on the business is now the board’s primary focus. The Company’s priority is the welfare of its employees and supporting customers and business partners during this crisis. A number of measures are being taken to mitigate its impact, and material steps are being taken to reduce costs. This includes a decision to cancel the dividend in respect of the year ended 30 November 2019”, the company said.

“Separately, the board is actively reviewing options to wind-down one of the group’s underperforming third-party solutions units in the UK. Plans are being assessed and updated as the situation evolves.”