Kainos, the only NI firm to be listed on the FTSE 250, posted record revenues of close to £200m for the first six months of the year, but saw profit before tax fall by almost £6m compared to the same period last year.
Brendan Mooney also said that he is optimistic about the company securing future work with the government ahead of Labour’s Budget.
The results for the first half of 2025 show the Belfast IT firm bringing in £196.1m, which was a 7% rise on the £183.1m made in the same period last year.
Profits before tax at Kainos, which is building a new HQ at Bankmore Square on Dublin Road, went down, however, as increased costs made a dent.
The company posted a statutory profit before tax of £28.4m, a 17% fall from the £34.2m made in 2024.
CGIs of the newly approved Kainos Headquarters. Credit: Cyanotype Media
Speaking to the Business Telegraph, Kainos CEO Brendan Mooney ascribed the fall to being in “the phase where you’re hiring strongly for permanent staff”.
“You’re using contract staff as a short-term measure to have the capacity to deliver some of the programmes of work. We see those additional contractor costs as a bit of a drag on our first half profit performance.”
New employees add costs themselves, he said, especially since the rise in employers’ national insurance kicked in earlier this year.
“It’s £1.5m for the first half of the year”, Mr Mooney said of national insurance employer contribution increases, “so annualised, just over £3m. It’s a significant increase in cost.”
The CEO was optimistic about the company’s sales performance, with £227.9m of bookings in H1 2025, and a contracted backlog of close to £400m.
Where the company makes these sales has changed notably in the past decade: “We are focused on the UK, but over the last 10 years we’ve gone from our international revenues being 4% of revenues to 43% in this set of results.”
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Kainos’ international business is focused on North America, with Canada identified as a key growth market. To that end, the firm recently purchased Nova Scotia-based company Davis Pier, acquiring 120 new staff in the process.
The prospect of Chancellor Rachel Reeves’ budget on November 26 has not had many businesses excited, but Mr Mooney is confident that, even in the event of cuts to government departments, Kainos will still have plenty of opportunities with the public sector.
“The work we do is about efficiency. It’s always about reducing the work companies do to support citizens. A lot of our projects are linked to getting off expensive legacy software or hardware.
“My general view is, if the government is looking to push a strong efficiency agenda, then they will want to use technology as part of the equation to fix those efficiency bottlenecks.”
