KNIGHTS GROUP HOLDINGS PLC

Earnings Release • Jan 12, 2026

National Storage Mechanism | Additional information

RNS Number : 4091O

Knights Group Holdings PLC

12 January 2026

Knights Group Holdings plc

("Knights" or the "Group")

Half Year Results

Strong first half with a firm return to organic growth; confident in delivering full year

Knights, the national legal and professional services business, today announces its half year results for the six months ended 31 October 2025.

Financial highlights

·      Underlying Revenue1 increased by 30% to £103.2m (H1 FY25: £79.4m), with a return to organic growth of c.3%

·      Underlying PBT2 up 12.5% to £16.4m (H1 FY25: £14.6m)

·      Underlying PBT margin at 16% (H1 FY25: 18%), as expected following anticipated higher payroll taxes (national insurance contributions), the impact of interest rate movements and planned investment in technology and AI

·      Reported profit before tax of £2.4m (H1 FY25: £9.0m) due to an increase primarily in acquisition related non-underlying costs

·      Basic underlying EPS3 increased by 11% to 14.09p per share (H1 FY25: 12.71p)

·      Debtor days of 32 (H1 FY25: 33) and lock up4 of 95 days (H1 FY25: 98), reflecting continued working capital discipline and success in reducing typically higher lock up4 in acquired businesses

·      Cash conversion5 was particularly strong at 122%

·      Net debt6 at £75.2m (H1 FY25: £50.1m, FY25: £64.8m) after c.£15m cash paid in relation to acquisitions and capex of c.£3.7m 

·      Interim dividend of 1.94p per share (H1 FY25: 1.76p), an increase of 10%

Strategic and operational highlights

Organic growth supported by strong recruitment and improvement in retention

·     Continued success in attracting high-calibre talent, with 46 senior fee earners joining or scheduled to join shortly (H1 FY25: 43)

·     Annualised churn7 reduced to 9% (H1 FY25: annualised: 20%), reflecting successful engagement and leadership initiatives

·     Strong pricing discipline maintained, supported by a continued focus on operational excellence

Strategically scaling our platform for organic growth

·   Cemented leading position in the Midlands: prior year acquisition, Thursfields, integrated and performing well

·   Built scale in the attractive South East market: Birkett Long and Rix & Kay extend presence following largest acquisition to date, IBB, in April 2025

·   Established a presence in Cardiff organically, complemented by acquisition: with initial high-quality recruits complemented by acquisition of Le Gros

Enhanced infrastructure investment provides platform for future growth

·      Strengthened operational management team: expanded Client Services Directors and new Chief Technology Officer role

·      Invested in our office network: Upgraded a number of offices, with 32 higher spec offices today (compared to 6 at IPO) providing access to wider pools of talent attracted by satellite locations

·      Targeted investment in technology: Advancing technology and AI initiatives to enhance productivity and client service and to drive further differentiation from independent firms

Current trading and outlook

·      H2 has started well, building on the momentum achieved in the first half

·      Well positioned to continue to drive organic growth momentum, reflecting the full benefit of recent hires combined with strong retention of existing talent

·      H2 to benefit from full period contribution from recent acquisitions

·      Confident in delivering a full year performance in line with market expectations

David Beech, CEO of Knights, commented:

"The first half has been a period of significant progress for Knights, as we firmly returned the Group to organic growth, while continuing to scale the platform we have developed over many years.

We are attracting top talent, with ambitious, high-calibre lawyers recognising and choosing our corporate structure, collaborative culture and the opportunity we provide to develop within a firm of both national scale and local reach.  We have also significantly expanded our presence in the South East, and Wales, whilst effectively integrating prior period acquisitions including our largest to date.

Looking further ahead, the combination of our strengthened platform and operational management structure, ongoing disciplined financial management, approach to harnessing technology, and the growing awareness of our national brand, positions Knights well to continue driving sustainable, profitable growth beyond the current financial year."

Footnotes

1      Underlying revenue excludes the Crime business which was acquired with IBB Law (completed on 4 April 2025). This business was non-core, as stated at the time of the acquisition, and we completed its sale on 18 July 2025.  The business generated revenue of £0.2m and a loss before tax of £0.4m in the period.

2     Underlying PBT excludes amortisation of acquired intangibles, non-underlying operating expenses, revenue, non-underlying finance costs and a gain on disposal of a customer list from an acquired business. Non-underlying revenue and operating expenses include transaction and onerous lease expenses in relation to acquisitions, contingent acquisition payments, disposal of acquired assets, along with one-off restructuring and professional expenses, mainly incurred on acquisitions, through streamlining support functions or strategic reorganisations.  Contingent acquisition payments are treated as a non-underlying expense as this represents payments for acquisitions which are dependent on the continued employment of certain individuals in the business for an agreed contractual period after an acquisition of one to three years to preserve the acquired goodwill and customer relationships. Accounting standards require such arrangements to be treated as remuneration in the Statement of Comprehensive Income. However, the individuals also receive market rate salaries, therefore, if not separately identified, these payments would significantly distort the reported results.

3      Underlying EPS is underlying PAT divided by the weighted average number of ordinary shares in issue.

4      Lock up is calculated as the combined debtor and WIP days as at a point in time. Debtor days are calculated on a count back basis using the gross debtors at the period end and compared with total fees raised over prior months. WIP days are calculated based on the gross work in progress (excluding that relating to clinical negligence claims, insolvency, and ground rents, as these matters operate mainly on a conditional fee arrangement and a different profile to the rest of the business) and calculating how many days billing this relates to, based on average fees (again excluding clinical negligence claims, insolvency, and ground rents fees) per month for the last 3 months. Lock up days excludes the impact of acquisitions in the last quarter of the reporting period.

5     Cash conversion is calculated as the total of cash from operations, less tax paid and underlying IFRS 16 net lease payments, divided by underlying profit after tax.

6     Net debt includes cash and cash equivalents, borrowings and acquired debt but excludes lease liabilities.

7     Churn is calculated based on the number of qualified fee earners who had been employed by the Group for more than one year. Churn is calculated taking the number of leavers in the above group over the financial year as a percentage of the average number of colleagues for the year. Churn excludes expected churn from acquisitions in the year of acquisition and the first full year post acquisition, redundancies and retirements. Retention is 100% less the churn rate.

These footnotes apply throughout the RNS

A presentation of the results will be made to analysts and investors at 9.00am this morning. To register for access, or for any other enquiries, please contact MHP Group on: [email protected].

Enquiries

Knights
David Beech, CEO Kate Lewis, CFO	Via MHP
Deutsche Numis (Nomad and Broker)
Stuart Skinner, Kevin Cruickshank	+44 20 7260 1000
MHP (Media enquiries)
Katie Hunt, Eleni Menikou, Lucy Gibbs	+44 (0) 7884 494112 [email protected]

Notes to Editors

Knights is a fast-growing, legal and professional services business, ranked within the UK's top 50 largest law firms by revenue. Knights was one of the first law firms in the UK to move from the traditional partnership model to a corporate structure in 2012 and has since grown rapidly. Knights has specialists in all key areas of Corporate and Commercial law and Private Wealth services. It is focussed on key UK markets outside London and currently operates from 32 offices located in Ascot, Basildon, Beaconsfield, Birmingham, Brighton, Bristol, Cardiff, Carlisle, Chelmsford, Cheltenham, Chester, Colchester, Exeter, Kings Hill,  Leeds, Leicester, Lincoln, Manchester, Newcastle, Nottingham, Oxford, Portsmouth, Reading, Sheffield, Solihull, Stoke, Teesside, Uxbridge, Weybridge, Wilmslow, Worcester and York.

Chief Executive's Review

The first half of the financial year has been one of significant progress for Knights, having returned to organic revenue growth and successfully integrated acquisitions, as we build on the platform we have developed over many years. Our focus remains on sustainable, profitable growth, delivered through disciplined operational and financial management, thoughtful investment, and a commitment to strengthening the quality of our team and diversified service offering.

A strong first half

We delivered a strong performance in the six months to 31 October 2025, with revenue from underlying operations1 rising 30% to £103.2m (H1 FY25: £79.4m) including organic growth of c.3%. This achievement is particularly pleasing given the broader market backdrop, demonstrating the strength of our diversified service lines, our ability to attract and retain high calibre talent, and the value we are creating through our acquisition strategy.

Underlying PBT2 from continuing operations increased to £16.4m, a rise of 12.5% on the comparative period (H1 FY25: £14.6m). This represented an underlying PBT margin of 16% (H1 FY25: 18%), which was in line with our expectations as we absorbed higher payroll taxation and the impact of interest rate movements and continued to invest in technology, including AI, where we see opportunities to enhance service delivery, operational efficiency, long-term scalability and strengthen our competitive advantage in the regions.

Reported profit before tax reduced to £2.4m in H1 FY26 (H1 FY25: £9.0m) as a result of higher non- underlying costs relating to the acquisitions in the period and prior years.

Returned to organic growth

Our ability to attract ambitious, high-calibre professionals is a key element in driving our organic growth. During the first half, 46 senior fee earners either joined the business or are scheduled to start shortly (H1 FY25: 43), reinforcing our position as a compelling home for top talent who value our corporate structure, culture of collaboration, and opportunity for development in a firm of national scale with a growing network of offices.

The other key driver of organic growth is staff churn7 which, at an annualised 9% (H1 FY25 annualised: 20%), has remained low in line with the step down achieved in the second half of FY25 (10%), reflecting the positive impact of the engagement and leadership initiatives introduced across the business over the past year.

These initiatives include increased mentoring from our Client Services Directors, more face to face time in the offices, and regular forums for colleagues to come together in our Stoke office. They are enabling a stronger team culture and better understanding of the breadth of our services and our business strategy which is supporting greater cross-collaboration, with an increasing number of teams being formed across multiple offices to deliver the best solutions to clients.

Our enhanced reputation, strong client base and breadth of services position us well to be the leader in local markets, sustain our strong pricing discipline, and be an employer of choice for ambitious professionals who are attracted to the combination of working locally with being able to offer diverse expertise from across our network to their clients.  Having grown our number of locations to 32, up from 6 at IPO in June 2018, we also now have access to substantially wider pools of talent.

Strategically scaling our platform

In line with our strategy, the business has continued to successfully scale up, in a disciplined way. This was achieved through acquisitions made in the first half of this year, the effective integration of those made in the prior year, and organic expansion, which substantially extended our presence across the UK - in the West Midlands, the Thames Valley, the South East, and Cardiff.

Cemented our leading position in the Midlands

We cemented our leading position in the Midlands by welcoming substantial teams across the West Midlands through the acquisition of Thursfields Legal Limited which completed in September 2024. The acquisition brought a national client base for its premium services, including a strong private wealth offering, spanning private client, family and residential property, alongside corporate, real estate and dispute resolution services.  Having integrated the business quickly, it is performing well generating revenues and contributing to profit as expected.

Built scale in the attractive South East market with three acquisitions

We have made three acquisitions over the last year, accelerating our growth in the South East region which is an attractive market due to its proximity to areas of inward investment, major corporate clusters and affluent communities.  By significantly extending our presence in the region, complementing our existing offices in Kings Hill, Weybridge and Portsmouth, we have created greater opportunities in the region across a diverse suite of premium legal services and are attracting high quality work and talent.

Our largest acquisition to date, IBB Law LLP, completed in April 2025 bringing offices across the Thames Valley, while extending Knights' existing services across corporate, real estate and private wealth.

In June 2025 we completed the acquisition of Birkett Long LLP and Birkett Long IFA LLP with the acquisition of Rix & Kay LLP completing in August 2025. Birkett Long expanded Knights' presence into Essex, extended our existing private client, real estate and corporate service lines further and provided an entry point into financial advisory, which Knights has long considered a complementary service line and growth opportunity. Rix & Kay, a smaller acquisition, strengthened our presence in Kent and Sussex, adding to our existing teams in Brighton and Kings Hill with experts across corporate, commercial property, disputes and private client.

Overall, we have significantly grown the number of fee earners in the key South East region with all businesses migrated onto our central operational infrastructure, performing well and working closely with our existing teams, a testament to our proven approach to integrating acquisitions effectively.

Established a presence in Cardiff organically, complemented by acquisition

Having established a presence in Cardiff through a number of senior fee earner appointments, we acquired Le Gros Solicitors Limited in August 2025, adding a team of six commercial and residential property fee earners. The Cardiff office is not only Knights' first outside England, but was also a predominantly organic opening, built initially around a team of high-quality recruits, aided by the city's proximity to our offices in Bristol and Cheltenham.

As part of Knights, all these acquisitions benefit from our well-developed infrastructure and access to its wider team of specialists across the country, enabling a broader service offering to clients from day one.

Together, these additions have not only broadened our geographic footprint but also strengthened our range of capabilities in key areas of demand.  With all acquired teams transitioning smoothly into the Group, and performing well, they are now providing strong platforms for ongoing recruitment in new locations, expanding the Group's opportunities for organic growth.  

Acquisitions remain an important part of our growth strategy, and the first half provided further evidence of the strength of our disciplined approach to identifying and integrating businesses with a strong fit.  We remain highly selective in our approach and continue to see a solid pipeline of opportunities that would complement our existing platform in the future.

A continued focus on financial discipline

We have maintained a strong focus on financial discipline. Debtor days improved to 32 (H1 FY25: 33) and lock up4 days were reduced to 95 (H1 FY25: 98) as at 31 October 2025, reflecting ongoing focus on working capital management.

Net debt6 is £75.2m, after c.£15m of acquisition-related cash expenditure during the period and capex of around £3.7m. Cash performance remained strong, and we were pleased to extend our existing £100m revolving credit facility, for a further year to November 2028 on the same terms. This provides long-term funding to support our growth strategy, including making selective, value-accretive acquisitions.

Investing in technology for the future

As a legal and professional services business of scale, we are committed to harnessing technology to enhance efficiency and client service.

During the first half, we appointed a Chief Technology Officer who has significant experience in global operations.  This is a new role within the Group and will help to enhance our focus on exploring, piloting and developing AI enabled tools and platforms. Our single core platform and one team culture allows us to deploy these new technologies rapidly and consistently, whilst being mindful of security issues.

In the first half we have enhanced our document management. We continue to work on other clearly defined initiatives, in particular to improve productivity and service, which will result in a more resilient, agile and scalable business platform.

Well positioned to leverage our strengthened platform

Having worked on the business to put in place effective infrastructure to support growth, including by expanding our operational management team - our Client Services Directors alongside the creation of the new CTO role, and invested in our office network, we feel well placed to support significant growth from our existing platform in the coming periods.

Dividend

The Group's progressive dividend policy seeks to maintain a balance between retaining profits to execute our strategy and delivering value for shareholders as our strategy yields positive performances.

The Board is, therefore, proposing an interim dividend of 1.94p per share (H1 FY25: 1.76p), an increase of 10%. The dividend will be payable on 13 March 2026 to shareholders on the register at 13 February 2026.

Outlook

The second half has started well, building on the momentum achieved in the first half.  We are well positioned to continue to drive organic growth momentum, reflecting the fuller benefit of recent hires combined with strong retention of our existing talent.  This, together with a full period contribution from recent acquisitions underpins our confidence in delivering a full year performance in line with market expectations.

The combination of our strengthened platform and operational management structure, ongoing disciplined financial management and approach to harnessing technology, and the growing awareness of our national brand positions Knights well to continue driving sustainable, profitable growth beyond the current financial year.

We remain committed to building a stronger, more efficient, scalable and more resilient business that continues to create long-term value for our people, our clients and our shareholders.

CFO Review

I am pleased to report another period of profitable, cash generative growth with strong underlying revenue1 growth of 30% to £103.2m compared to £79.4m in the prior year and underlying EBITDA increased by 19% from the prior year to £25.5m (H1 FY25: £21.4m).

Underlying profit before tax increased by 12.5% to £16.4m compared to £14.6m in the prior year.  Reported profit before tax (PBT) fell to £2.4m (H1 FY25: £9.0m) due to increased non-underlying costs driven primarily by the increased number of acquisitions completed in the six months, resulting in higher one-off costs from the acquisitions and subsequent restructuring and cost consolidation processes.

Our continued disciplined approach to financial management has generated excellent cash conversion5 of 122% for the half year enabling us to fund our continuing growth strategy from our existing bank facilities.

Financial results

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	% change
Revenue - underlying	103,220	79,414	30%
Other operating income	5,686	4,857	17%
Staff costs	(62,644)	(47,697)	31%
Impairment of trade receivables and contract assets	(542)	(622)	(13%)
Other operating charges	(20,219)	(14,535)	39%
Underlying EBITDA	25,501	21,417	19%
Underlying EBITDA %	24.7%	27.0%
Depreciation charges under IFRS 16	(2,948)	(2,499)	18%
Finance charges under IFRS 16	(1,496)	(1,000)	50%
Underlying EBITDA post IFRS 16 charges	21,057	17,918	18%
Depreciation and amortisation charges (excluding amortisation on acquired intangibles)	(2,355)	(1,571)	50%
Share of results of joint ventures	561	-	-
Underlying finance costs	(2,844)	(1,856)	53%
Underlying finance income	30	126	(76%)
Underlying profit before tax	16,449	14,617	13%
Underlying profit before tax %	15.9%	18.4%
Underlying tax charge	(4,410)	(3,691)	19%
Underlying profit after tax	12,039	10,926	10%
Basic underlying EPS (pence)	14.09	12.71	11%

Revenue

Total underlying revenue1 for the half year is £103.2m compared to £79.4m for the same period last year, an increase of 30%.  Of this increase, £21.8m is increased income from FY25 and FY26 acquisitions, with the balance of £2m being growth in organic income.

Organic revenues

We are pleased to report a return to organic growth of 2.6% in the period reflecting the benefit of continuing strong levels of recruitment of senior fee earners and a substantial reduction in fee earner churn7 over the last twelve months alongside pricing increases and higher revenues in property-related areas which are positively impacted by decreasing mortgage interest rates.  Our leading indicators of future organic growth, being recruitment of experienced fee earners with strong client following and reduced levels of churn7, are continuing to improve, supporting expectations of further organic growth in the future.

Revenue from acquisitions

During FY25 we acquired Thursfields Legal Limited and IBB Law LLP.  Both acquisitions completed during FY25 and were fully integrated onto our systems by the end of the financial year.  Both acquisitions have performed well during the first half of FY26, accounting for £12.7m of the increase in revenues from H1 FY25.

In the six months to 31 October 2025 we acquired Birkett Long LLP, Birkett Long IFA LLP, Rix and Kay Solicitors LLP and Le Gros Solicitors Limited.  All acquisitions are fully integrated onto our systems and are performing well, contributing total revenue of £9.1m in the period.

Employee costs

Total staff costs as a percentage of revenue were 60.7% for the half year (H1 FY25: 60.1%) reflecting the impact of increased payroll taxes of c.£1m in the period, offset by some leverage of support staff costs as the ratio of fee earners to support staff has increased to 3.9:1 as at 31 October 25 compared to 3.7:1 at 31 October 24.

Other operating income

Although the total value of other operating income has increased by £0.8m, as a percentage of revenue it has decreased from 6.1% in H1 FY25 to 5.5% in H1 FY26 as a result of lower interest rates. The absolute increase in total other operating income is primarily due to increased interest received on client monies (net of monies paid out to clients) due to increased volumes of client monies held (as a result of acquisitions made). 

Other operating charges

Other operating charges have increased as a percentage of revenue to 19.6% compared to 18.3% in the same period last year.  Expenses increased to support the increase in revenue and in the half year we have seen an increase in costs of c.£0.6m relating to further investment in AI and technology. 

Underlying EBITDA

During the period, underlying EBITDA increased by £4.1m to £25.5m (H1 FY25: £21.4m).  Underlying EBITDA margin has decreased to 24.7% (H1 FY25: 27.0%).  The 2.3% reduction in EBITDA margin is explained as follows: increased cost due to additional payroll taxes (higher national insurance contributions) accounts for 1.0% (£1m); the reduction of client interest income was 0.7% (£0.7m), and investment in enhanced AI and other technology spend of 0.6% (£0.6m) in the period.

Underlying EBITDA excludes non-underlying income and operating costs.  Non-underlying operating costs include transaction and onerous lease expenses mainly in relation to acquisitions, contingent consideration and one-off restructuring and professional costs incurred mainly as a result of streamlining the support services in relation to acquisitions.  The Board considers this to be a key metric to measure underlying business performance.

Contingent acquisition payments are treated as a non-underlying expense as these represent payments for acquisitions which are dependent on the continued employment of certain individuals in the business for an agreed period of one to three years after an acquisition to preserve the acquired goodwill and customer relationships. Accounting standards require these arrangements to be treated as remuneration in the Statement of Comprehensive Income.  However, the individuals also receive market rate salaries and therefore, if not separately identified, these payments would significantly distort the reported results.

IFRS 16 depreciation and finance charges

The IFRS 16 depreciation and finance charges reflect the accounting charges in respect of all leases with a term of over one year.  The costs in the period have reduced marginally to 4.3% of revenue (H1 FY25: 4.4%) as we continue to manage our property portfolio to leverage our property costs.

Depreciation and amortisation charges

The charge for the half-year has increased to 2.3% of revenue (H1 FY25: 2.0%) following recent investment in property refurbishments and IT infrastructure.

Share of results of joint ventures

The share of results of joint ventures of £0.6m in the period represents the share of net assets receivable from the Group's joint venture with Convex Corporate Finance Limited.

Finance charges

Finance charges, excluding lease interest, increased by £1m in the period to £2.8m (H1 FY25: £1.8m) as a result of the higher net debt6 balance due to cash paid in respect of acquisitions in the current and prior years.

Underlying finance income

This income related primarily to income recognised from sub-leases of excess space within our property portfolio.

Underlying Profit before Tax (PBT)

Underlying profit before tax does not include amortisation of acquired intangible assets, transaction expenses and onerous leases (mostly related to acquisitions), contingent payments for acquisitions, disposals of acquired assets, or one-time restructuring and professional fees largely incurred during the streamlining of support functions connected to acquisitions.

Underlying profit before tax also excludes profit on sale and related transactions recognised in the period on the sale of non-core areas of business acquired as part of recent acquisitions.   

In July, we disposed of the legal aid crime business acquired as part of the IBB acquisition. Our exit from this area of the business had been identified as part of the acquisition process.  The business was disclosed as held for sale in the year end accounts.  During H1 FY26, before it was sold, the business generated income of £0.2m and a loss of £0.4m.  This income and related costs are classified as non-underlying in the accounts.  A £0.02m profit on disposal is also included within non-underlying transactions for the period.

As part of refocussing the financial services business acquired with the Birkett Long acquisition towards higher value work, we have sold a book of clients to a third party enabling us to focus on providing a premium service to higher net worth individuals. Final proceeds are dependent on future income generated by the acquirer of the transferred clients.  The accounts for the half year to October 2025 include a gain on disposal of the customer list of £1.1m within non-underlying transactions.

Underlying profit before tax (PBT) is calculated to give a clearer picture of business performance and to make it easier to compare profitability from year to year.

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000
Profit before tax	2,403	8,974
Non-underlying revenue	(247)	-
Amortisation on acquired intangibles	2,693	1,869
Contingent acquisition payments treated as remuneration	4,871	1,447
Other non-underlying costs	6,729	2,327
Underlying profit before tax	16,449	14,617

The Group's underlying PBT2 has increased by 12.5% to £16.4m (H1 FY25: £14.6m).

The underling profit before tax margin has decreased to 15.9% compared to 18.4% in the prior period as a result of the reduction in underlying EBITDA margin of 2.3% (explained above), together with the increase in depreciation and finance costs of £2.8m (0.7% reduction), offset by the recognition of the share of results of joint ventures of £0.6m in the period (0.5% contribution).

Reported profit before tax

The reported profit before tax in the period has decreased to £2.4m (H1 FY25: £9.0m) due to the increase in non-underlying costs, contingent consideration and amortisation of acquired intangibles.

Taxation

The effective rate of tax on the underlying profit of the business was 27% (H1 FY25: 25%) reflecting the impact of higher disallowable depreciation in the period.

The tax charge for the period was £2.7m (H1 FY25: £2.8m). The effective tax rate increased to 111% (H1 FY25: 32%) predominantly due to higher contingent consideration charges which are disallowable for tax purposes.

Earnings per Share (EPS)

The basic underlying EPS3 has increased by 11% to 14.09p per share (H1 FY25: 12.71p).  The underlying EPS3 is reflective of the Group underlying performance and provides a meaningful comparison to the prior year.

The basic EPS for the period decreased 104% to (0.30p) from 7.14p in the prior year.  Taking account of the dilutive impact of potential share options, the basic diluted EPS also reduced to (0.30p) per share (H1 FY25: 6.87p). This reflected the increased effective tax rate explained above.

The weighted average number of shares used to calculate the undiluted EPS for the half year was 85,427,787 (H1 FY25: 85,934,299).

Dividend

In line with the group's progressive dividend policy, reflecting the improved underlying performance of the Group, balanced with the Board's strategy to continue to reinvest profits to fund future growth plans, the Board has declared an interim dividend of 1.94p per share (H1 FY25: 1.76p per share).

This will be a cash only dividend, payable on 13 March 2026 to all shareholders on the register on 13 February 2026.

Balance Sheet

	31 October 2025 (Unaudited) £'000	31 October 2024 (Unaudited) £'000	30 April 2025 (Audited) £'000
Goodwill and Intangible assets	114,697	90,877	105,873
Right of use assets	45,034	37,287	46,635
Investments	644	50	111
Loan to joint venture	-	2,500	2,000
Property, plant and equipment	25,431	19,895	23,685
Assets & Liabilities held for sale	1,178	171	394
Working capital	68,278	63,709	64,640
Other provisions and deferred tax	(22,603)	(15,476)	(20,272)
Lease liabilities net of lease receivables	(53,255)	(42,103)	(52,529)
	179,404	156,910	170,537
Cash and cash equivalents	8,496	4,075	5,853
Borrowings	(83,648)	(54,139)	(70,682)
Net debt	(75,152)	(50,064)	(64,829)
Deferred consideration	(2,444)	(2,399)	(1,175)
Net assets	101,808	104,447	104,533

The Group's net assets at 31 October 2025 are £101.8m compared to £104.5m as at 30 April 2025.

The decrease of £2.7m was primarily due to the accrued dividends in the period of £2.6m, together with the reported loss of £0.3m generated in the half year.  

Working capital

Working capital is calculated as follows:

	31 October 2025 (Unaudited) £'000	31 October 2024 (Unaudited) £'000	30 April 2025 (Audited) £'000
Contract assets	56,965	48,857	50,998
Trade and other receivables	42,987	33,009	39,552
Corporation tax receivable	703	915	882
Total current assets	100,655	82,781	91,432
Trade and other payables	(32,197)	(18,901)	(26,662)
Contractual liabilities	(180)	(171)	(130)
Total current liabilities	(32,377)	(19,072)	(26,792)
Net working capital	68,278	63,709	64,640

Net working capital has increased by £3.7m from £64.6m as at 30 April 2025 to £68.3m as at 31 October 2025.  Of this increase £2.0m related to working capital acquired as part of acquisitions during the period.  The remaining increase relates mainly to an increase in contract assets (work in progress), net of acquisitions, during the year of £3.7m.  Although an increase from the position as at 30 April 2025, this increase at half year is as expected following the normal work in progress cycle with work in progress days at 31 October 2025 having reduced by 2 days from the same time last year.  The increase in contract assets is offset by an increase in trade payables of £2.1m due to the timing of creditor payments.  

The management of working capital continues to be a key focus for the Group with strong systems and controls in place to manage the levels of trade receivables and work in progress.  The time taken to convert a unit of time incurred into cash is reported as the lock up4 days for the Group and is an important KPI monitored by the Board, Client Services Directors and the wider management team.  As at 31 October 2025 lock up4 was 95 days (31 October 2024: 98 days), made up of debtor days of 32 (31 October 2024: 33) and work in progress days of 63 (31 October 2024: 65) demonstrating continued excellence in financial management.

Due to the disproportionate amount of time that it takes to conclude certain types of work such as CL medilaw, real estate investment and insolvency matters these work types are excluded from our work in progress days calculation as an exception, so as not to distract the majority of the Group from focussing on achieving its excellent lock up4 days.  If work in progress days were calculated including all valued work in progress of the Group this would give work in progress days of 98 (31 October 2024: 111) and hence total lock up, with no exclusions, of 130 days as at 31 October 2025 (31 October 2024: 144 days).

Cash flow

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000
Underlying EBITDA	25,501	21,417
Change in working capital	(5,360)	(8,388)
Cash outflow for IFRS 16 leases	(3,466)	(2,957)
Movement in underlying share-based payment charge	735	445
Cash generated from underlying operations (pre-tax)	17,410	10,517
Tax paid	(2,712)	(3,617)
Net cash generated from underlying operating activities	14,698	6,900
Underlying profit after tax	12,039	10,926
Underlying cash conversion	122%	63%

Cash generation remains a key focus for the Board and management team.  The continued excellent financial management generated underlying operating cashflows of £14.7m in the period being a conversion rate of 122% on underlying profits.  This excellent cash generation has resulted in net debt6 of £75.2m as at 31 October 2025 (30 April 2025: £64.8m) after a cash outlay of £15m relating to acquisition consideration and £3.7m in respect of capital expenditure in the period.

Net debt	6 months ended 31 October 2025 (Unaudited) £'000
Net debt 30 April 2025	64,829
Other net cash (inflows) from operating activities	(14,712)
Deferred and contingent acquisition payments	3,243
Consideration paid for acquisitions in the year (including acquired debt and cash)	11,626
Unpaid acquired debt	117
Non-underlying costs paid & received	5,041
Purchase of own shares	598
Interest on borrowings	2,795
Joint venture loan capital and interest received	(2,058)
Capital expenditure (net of landlord contributions)	3,673
Net debt 31 October 2025	75,152

At £75.2m this level of debt was in line with internal budgets as at 31 October 2025, with leverage for bank covenant purposes at 1.8 times EBITDA (as defined for covenant purposes) which is within our banking covenants.

On 19 November 2025 we extended our existing revolving credit facility with HSBC UK, AIB (GB) and NatWest for an additional year, providing a committed facility of £100m until November 2028.  Terms and interest margins remain the same with applicable margins of between 1.65% and 2.55% over SONIA dependant on leverage.

The extension of these facilities demonstrates the continued support of our banking partners and ensures the Group has facilities available to enable us to continue to execute our growth strategy into the medium term.

Knights Group Holdings plc

Consolidated Statement of Comprehensive Income

For the 6 month period ended 31 October 2025

	Note	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Revenue - underlying*	3	103,220	79,414	161,966
Non-underlying revenue	3	247	-	-
Revenue	3	103,467	79,414	161,966
Other operating income		5,686	4,857	9,649
Staff costs*	4	(62,644)	(47,697)	(97,607)
Depreciation and amortisation charges*	5	(5,303)	(4,070)	(8,840)
Impairment of trade receivables and contract assets		(542)	(622)	(1,241)
Other operating charges*	6	(20,219)	(14,535)	(29,839)
Operating profit before non-underlying costs and amortisation on acquired intangibles		20,445	17,347	34,088
Amortisation on acquired intangibles	5	(2,693)	(1,869)	(4,033)
Non-underlying operating costs	7	(11,357)	(3,711)	(11,455)
Operating profit		6,395	11,767	18,600
Share of results of joint ventures		561	-	58
Finance costs*	8	(4,370)	(2,898)	(6,445)
Finance income	9	60	168	302
Non-underlying finance costs	7	(243)	(63)	(246)
Net finance costs		(4,553)	(2,793)	(6,389)
Profit before tax		2,403	8,974	12,269
Taxation - underlying*		(4,410)	(3,691)	(7,448)
Tax impact of non-underlying revenue		(62)	-	-
Tax impact of non-underlying costs		1,810	852	2,755
Taxation		(2,662)	(2,839)	(4,693)
(Loss)/profit and total comprehensive income for the period attributable to equity owners of the parent		(259)	6,135	7,576
Earnings per share		Pence	Pence	Pence
Basic earnings per share	10	(0.30)	7.14	8.83
Diluted earnings per share	10	(0.30)	6.87	8.43

The above results were derived from the Group's continuing operations.

* Excluding non-underlying items and amortisation on acquired intangibles

As the Group has incurred a loss after tax for the period ending 31 October 2025, the options are non-dilutive so basic and diluted earnings per share are the same.

Knights Group Holdings plc

Consolidated Statement of Financial Position

As at 31 October 2025

	31 October 2025  (Unaudited) £'000	31 October 2024  (Unaudited) £'000	30 April 2025 (Audited) £'000
Assets
Non-current assets
Goodwill	82,082	66,038	72,893
Intangible assets	32,615	24,839	32,980
Investments	644	50	111
Property, plant and equipment	25,431	19,895	23,685
Right-of-use assets	45,034	37,287	46,635
Finance lease receivables	1,486	1,486	1,335
Trade and other receivables	-	2,500	2,000
	187,292	152,095	179,639
Current assets
Contract assets	56,965	48,857	50,998
Trade and other receivables	42,987	33,009	39,552
Finance lease receivables	463	366	405
Corporation tax asset	703	915	882
Cash and cash equivalents	8,496	4,075	5,853
Assets held for sale	1,178	171	1,283
	110,792	87,393	98,973
Total assets	298,084	239,488	278,612
Equity and liabilities
Equity
Share capital	171	171	171
Share premium	75,262	75,262	75,277
Merger reserve	(3,506)	(3,506)	(3,506)
Other reserve	(792)	-	(576)
Retained earnings	30,673	32,520	33,167
Equity attributable to owners of the parent	101,808	104,447	104,533
Non-current liabilities
Lease liabilities	48,954	38,926	48,603
Borrowings	83,351	53,808	69,807
Deferred consideration	1,572	550	563
Deferred tax	11,822	8,923	11,217
Provisions	6,857	3,686	5,404
	152,556	105,893	135,594
Current liabilities
Lease liabilities	6,250	5,029	5,666
Borrowings	297	331	875
Trade and other payables	32,197	18,901	26,662
Deferred consideration	872	1,849	612
Contract liabilities	180	171	130
Provisions	3,924	2,867	3,651
Liabilities held for sale	-	-	889
	43,720	29,148	38,485
Total liabilities	196,276	135,041	174,079
Total equity and liabilities	298,084	239,488	278,612

Knights Group Holdings plc

Consolidated Statement of Changes in Equity

For the 6 month period ended 31 October 2025

	Attributable to equity holders of the Parent
	Share capital £'000	Share premium £'000	Merger reserve   £'000	Other reserve £'000	Retained earnings £'000	Total £'000
Balance at 1 May 2024 (audited)	171	75,262	(3,506)	-	28,333	100,260
Profit for the period and total comprehensive income	-	-	-	-	6,135	6,135
Transactions with owners in their capacity as owners:
Credit to equity for equity-settled share-based payments	-	-	-	-	448	448
Dividends	-	-	-	-	(2,396)	(2,396)
Balance at 31 October 2024 (unaudited)	171	75,262	(3,506)	-	32,520	104,447
Profit for the period and total comprehensive income	-	-	-	-	1,441	1,441
Transactions with owners in their capacity as owners:
Credit to equity for equity-settled share-based payments	-	-	-	-	713	713
Purchase of own shares	-	-	-	(598)	-	(598)
Issue of shares from EBT	-	15	-	22	-	37
Dividends	-	-	-	-	(1,507)	(1,507)
Balance at 30 April 2025 (audited)	171	75,277	(3,506)	(576)	33,167	104,533
Loss for the period and total comprehensive loss	-	-	-	-	(259)	(259)
Transactions with owners in their capacity as owners:
Credit to equity for equity-settled share-based payments	-	-	-	-	369	369
Transfer between reserves	-	(15)	-	15	-	-
Purchase of own shares	-	-	-	(598)	-	(598)
Issue of shares from EBT	-	-	-	367	-	367
Dividends	-	-	-	-	(2,604)	(2,604)
Balance at 31 October 2025 (unaudited)	171	75,262	(3,506)	(792)	30,673	101,808

Knights Group Holdings plc

Consolidated Statement of Cash Flows

For the 6 month period ended 31 October 2025

	Note	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Operating activities
Cash generated from operations	12	20,876	13,474	39,011
Non-underlying revenue received	3	247	-	-
Non-underlying operating costs paid	7	(5,288)	(2,468)	(5,366)
Tax paid		(2,712)	(3,617)	(5,820)
Contingent acquisition payments		(2,595)	(1,123)	(2,571)
Net cash from operating activities		10,528	6,266	25,254
Investing activities
Acquisition of subsidiaries (net of cash acquired)	11	(10,199)	(6,424)	(24,972)
Other loan repayments		2,000	-	500
Loan interest received		58	-	234
Purchase of intangible fixed assets		(87)	(24)	(83)
Purchase of property, plant and equipment		(3,690)	(6,117)	(11,753)
Proceeds from lease receivables		243	230	458
Disposal of assets held for sale		25	37	141
Payment of deferred consideration		(648)	(1,365)	(2,616)
Disposal of customer list		399	-	-
Proceeds from sale of investment		70	-	-
Net cash used in investing activities		(11,829)	(13,663)	(38,091)
Financing activities
Proceeds of borrowings		25,000	21,500	52,150
Repayment of borrowings		(11,400)	(7,550)	(22,550)
Proceeds from exercise of share options		1	-	-
Repayment of debt acquired with current year subsidiaries		(1,921)	-	(172)
Repayment of debt acquired with prior year subsidiaries		(752)	(428)	(473)
Repayment of lease liabilities		(2,248)	(2,271)	(4,661)
Landlord capital contribution		124	40	42
Associated lease costs		(20)	(78)	(306)
Interest and other finance costs paid		(4,321)	(2,798)	(6,213)
Purchase of own shares		(598)	-	(598)
Dividends paid		-	(2,396)	(3,903)
Net cash from financing activities		3,865	6,019	13,316
Net increase/(decrease) in cash and cash equivalents		2,564	(1,378)	479
Cash and cash equivalents at the beginning of the period		5,932	5,453	5,453
Cash - Continuing operations		8,496	4,075	5,853
Cash - assets held for sale		-	-	79
Total cash and cash equivalents at end of period		8,496	4,075	5,932

Knights Group Holdings plc

Notes to the Consolidated Interim Financial Statements

For the 6 month period ended 31 October 2025

1.      General Information

Knights Group Holdings plc ("the Company") is a public company limited by shares and is registered, domiciled and incorporated in England (registration no. 11290101).

The Group consists of Knights Group Holdings plc and all of its subsidiaries.

The principal activity and nature of operations of the Group is the provision of legal and professional services. The address of its registered office is:

The Brampton

Newcastle-under-Lyme

Staffordshire

ST5 0QW

2.      Accounting policies

2.1   Basis of preparation

The accounting policies used in the preparation of the interim financial information for the six months ended 31 October 2025 are in accordance with the recognition and measurement criteria of UK-Adopted International Accounting Standards and are consistent with those which will be adopted in the annual statutory financial statements for the year ending 30 April 2026.

The Group's statutory financial statements for the year ended 30 April 2025, prepared under UK-Adopted International Accounting Standards, have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. This interim financial information was approved by the board on 9 January 2026.

The financial statements contained in this interim report do not constitute statutory accounts as defined in section 434 of the Companies Act 2006.

The interim report has not been audited or reviewed in accordance with the International Standard on Review Engagements (UK) 2410 issued by the Financial Reporting Council.

Monetary amounts are presented in sterling, being the functional currency of the Group, rounded to the nearest thousand except where otherwise indicated.

2.2    Going concern

The interim financial information has been prepared on a going concern basis as the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group has a strong trading performance, generates strong operating cashflows and has banking facilities of £100,000,000, available until November 2028. The Group's forecasts show sufficient cash generation and headroom in banking facilities and covenants by comparison to anticipated future requirements to support the Directors' conclusions that the assumption of the going concern basis of accounting in preparing the interim financial information is appropriate.

The Group continues to trade profitably before non-underlying charges and cash generation at an operating cashflow level has remained strong and in line with expectation. In order to satisfy the validity of the going concern assumption, a number of different trading scenarios have been modelled and reviewed. Some of these scenarios forecast a significantly more negative trading performance than is expected. In all of these scenarios the Group remained profitable and with significant headroom in its cash resources for the 12 months from the date of approval of this interim financial information.

2.3 Accounting developments

There have been no new standards or interpretations relevant to the Group's operations applied in the interim financial information for the first time.

3.      Revenue

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Revenue - underlying	103,220	79,414	161,966
Non-underlying revenue	247	-	-
Revenue	103,467	79,414	161,966

Non-underlying revenue relates to revenue generated from IBB Law LLP, a subsidiary of Knights which operated a criminal law business. This subsidiary was held as an asset for sale at 30 April 2025 and during the period has been disposed of.

4.      Staff costs

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Employee costs	63,640	47,694	98,679
Share-based payment charge	735	448	1,200
Aggregate remuneration of employees	64,375	48,142	99,879
Redundancy costs and share-based payment charges analysed as non-underlying costs	(1,731)	(445)	(2,272)
Underlying staff costs in Consolidated Statement of Comprehensive Income	62,644	47,697	97,607

5.      Depreciation and amortisation charges

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025  (Audited) £'000
Depreciation	2,310	1,457	3,333
Depreciation of right-of-use assets	2,948	2,499	5,223
Amortisation on computer software	45	54	92
Loss on disposal of property, plant and equipment	-	60	192
Underlying depreciation and amortisation charges in Consolidated Statement of Comprehensive Income	5,303	4,070	8,840
Amortisation on acquired intangibles	2,693	1,869	4,033
	7,996	5,939	12,873

Amortisation on acquired intangibles has been separately identified within overall depreciation and amortisation charges as it is deemed to be a non-underlying cost, on the basis that it relates to acquisitions.

6.      Other operating charges

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Establishment costs	5,448	4,065	8,301
Short term and low value lease costs	193	113	62
Other overhead expenses	14,578	10,357	21,476
	20,219	14,535	29,839

7.      Non-underlying costs

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Contingent acquisition payments treated as remuneration	4,871	1,447	3,752
Impairment of acquired right-of-use assets	1,989	-	2,078
Transaction costs	1,900	1,533	2,277
Redundancy and reorganisation staff costs	1,731	442	2,266
Loss on disposal of intangibles and property, plant and equipment	844	149	315
Costs relating to disposed subsidiary	653	-	-
Recognition of onerous provisions on acquired contracts	311	-	750
Acquisition lease surrenders	132	-	-
(Profit)/loss on disposal of right-of-use assets	(4)	137	(340)
Other non-underlying operating costs	(8)	3	5
Gain on disposal of customer list	(1,062)	-	-
Impairment of acquired software	-	-	352
Non-underlying operating costs	11,357	3,711	11,455
Non-underlying finance costs	243	63	246
	11,600	3,774	11,701

Non-underlying costs relate primarily to acquisition related costs or one off transactions not relating to the core day to day trading of the Group. This includes redundancy costs to streamline the support function of the Group following acquisitions or strategic reorganisations, transaction costs relating primarily to the costs of surrendering acquired contracts and onerous costs in respect of acquisitions, this includes contracts acquired which Knights cannot exit and properties which have become vacant as employees have been moved into right-sized offices in the same region. Also disposals of acquired assets and share-based payment charges relating to one off share schemes offered to employees as part of the IPO and on acquisitions. During the period there was also a profit on the sale of a customer list from an acquired business.

Non-underlying costs cash movement

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Non-underlying costs	11,600	3,774	11,701
Adjustments for:
Contingent acquisition payments shown separately	(4,871)	(1,447)	(3,752)
Non-cash movements:
Impairment of acquired right-of-use assets	(1,989)	-	(2,078)
(Loss) on disposal of intangibles and property, plant and equipment	(844)	(149)	(315)
Recognition of onerous provisions on acquired contracts	(311)	-	(750)
Non-underlying finance costs	(243)	(63)	(246)
Profit/(loss) on disposal of right-of-use assets	4	(10)	468
Other non-underlying operating costs	8	(3)	(5)
Transaction costs	165	(63)	(107)
Gain on disposal of customer list	1,062	-	-
Impairment of acquired software	-	-	(352)
Additional cash movements:
Rental payments on onerous leases	559	193	435
Service charge payments on onerous leases	130	56	128
Dilapidation payments	18	180	239
	5,288	2,468	5,366

Contingent acquisition payments are included in non-underlying costs as it represents payments which are contingent on the continued employment of those individuals with the Group, agreed under the terms of the sale and purchase agreements with vendors of certain businesses acquired. The payments extend over periods of one to three years and are designed to preserve the value of goodwill and customer relationships acquired in the business combinations. IFRS requires such arrangements to be treated as remuneration and charged to the Consolidated Statement of Comprehensive Income. The individuals also receive market rate salaries for their work, in line with other similar members of staff in the Group. The contingent earnout payments are significantly in excess of these market salaries and would distort the Group's results if not separately identified.

8.      Finance costs

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Interest on borrowings	2,844	1,856	4,133
Interest on leases	1,526	1,042	2,312
	4,370	2,898	6,445

9.      Finance income

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Loan interest receivable	30	126	239
Lease interest receivable	30	42	63
	60	168	302

10.    Earnings per share

Basic and diluted earnings per share have been calculated using (loss)/profit after tax and the weighted average number of ordinary shares in issue during the period.

	6 months ended 31 October 2025 (Unaudited) Number	6 months ended 31 October 2024 (Unaudited) Number	Year ended 30 April 2025 (Audited) Number
Weighted average number of ordinary shares in issue	85,967,308	85,934,299	85,950,758
Weighted average shares held in EBT	(539,521)	-	(137,332)
Weighted average number of ordinary shares for the purposes of basic earnings per share	85,427,787	85,934,299	85,813,426
Effect of dilutive potential ordinary shares:
Share options	5,710,009	3,300,000	4,027,011
Weighted average number of ordinary shares for the purposes of diluted earnings per share	91,137,796	89,234,299	89,840,437
	£'000	£'000	£'000
(Loss)/profit after tax	(259)	6,135	7,576
Earnings per share	Pence	Pence	Pence
Basic earnings per share	(0.30)	7.14	8.83
Diluted earnings per share	(0.30)	6.87	8.43

As the Group has incurred a loss after tax for the period ending 31 October 2025, the options are non-dilutive so basic and diluted earnings per share are the same.

Underlying profit after tax (PAT) and adjusted per share (EPS)

Underlying PAT and EPS are presented as alternative performance measures to show the underlying performance of the Group excluding the effects of amortisation of intangible assets, share-based payments and non-underlying costs and revenue.

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
(Loss)/profit after tax	(259)	6,135	7,576
Non-underlying revenue (note 3)	(247)	-	-
Amortisation on acquired intangibles (note 5)	2,693	1,869	4,033
Non-underlying costs (note 7)	11,600	3,774	11,701
Tax impact of non-underlying revenue	62	-	-
Tax impact of non-underlying costs	(1,810)	(852)	(2,755)
Underlying profit after tax	12,039	10,926	20,555
Underlying earnings per share	Pence	Pence	Pence
Basic underlying earnings per share	14.09	12.71	23.95
Diluted underlying earnings per share	13.21	12.24	22.88

11.    Acquisitions

Acquisitions summary

During the year the Group has completed four acquisitions Birkett Long LLP, Birkett Long IFA, Rix & Kay Solicitors LLP and Le Gros Solicitors Limited. The table below summarises the consideration paid and the net cash flow arising on all acquisitions in the period:

	Total £'000
Total identifiable assets less liabilities acquired	3,210
Goodwill	9,283
Gain on bargain purchase	(8)
Total consideration	12,485
Satisfied by:
Cash	10,624
Deferred consideration arrangement	1,861
Total consideration transferred	12,485
Net cash outflows arising on acquisition:
Cash consideration net of cash acquired	10,199
Net investing cash outflow arising on acquisition	10,199
Repayment of debt acquired*	1,906
Net financing cash outflow arising on acquisition	1,906
Repayment of debt in future periods	31

Details for the individual acquisitions are included on the following pages. The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the tables below. The figures are provisional as the purchase accounting is not yet finalised.

The acquisition date in each case is the date of exchange of the sale and purchase agreement, being the date on which control passes and the Group is exposed to variable returns.

*The difference of £15k on repayment of debt acquired compared to the cashflow is due to payments made for acquired debt identified in the current period but relating to a prior year acquisition.

Birkett Long LLP "Birkett Long"                                                                                                                        

On 6 May 2025 the Group exchanged contracts to acquire Birkett Long by purchasing the controlling membership interests of the entity. This acquisition completed on 13 June 2025.  Birkett Long is a law firm which will significantly strengthen Knights' presence in the South East.                                                      

The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below. The figures are provisional as the purchase accounting is not yet finalised.                                 

	Carrying amount £'000	Fair value adjustment £'000	Total      £'000
Identifiable assets
Identifiable intangible assets	934	1,254	2,188
Property, plant and equipment	892	(322)	570
Investments	200	-	200
Right-of-use assets	-	3,369	3,369
Contract assets	1,501	-	1,501
Trade and other receivables	1,834	-	1,834
Cash and cash equivalents	14	-	14
Liabilities
Trade and other payables	(2,240)	138	(2,102)
Lease liabilities	-	(3,369)	(3,369)
Borrowings	(656)	-	(656)
Provisions	(892)	-	(892)
Deferred tax	-	(514)	(514)
Total identifiable assets and liabilities	1,587	556	2,143
Goodwill			7,916
Total consideration			10,059
Satisfied by:
Cash			8,370
Deferred consideration			1,689
Total consideration transferred			10,059
Net cash outflow arising on acquisition:
Cash consideration (net of cash acquired)			8,356
Repayment of debt			625
Net cash outflow arising on acquisition			8,981

Intangibles relating to customer relationships of £1,254,000 has been arrived at using the excess earnings method. The goodwill of £7,916,000 represents the assembled workforce, with the acquisition bringing a number of new fee earners and expected synergies. None of the goodwill is expected to be deductible for income tax purposes.        

A contingent consideration arrangement was entered into as part of the acquisition. This is contingent on the sellers remaining in employment by the Group so it has been excluded from the consideration and will be recognised in the Statement of Comprehensive Income on a straight-line basis as a remuneration expense over the 3 years post-acquisition period. This is recognised within non-underlying operating costs.                              

The maximum undiscounted amount of all potential future payments under the contingent consideration arrangement is £4,391,000 and is payable in equal instalments on the first, second and third anniversary of completion.                                                                                                                 

There are also undiscounted deferred consideration payments totalling £1,849,000 outstanding.  This is payable in instalments on the first, second and third anniversaries of completion.                                                                   

Birkett Long contributed £7,431,000 of revenue to the Group's Statement of Comprehensive Income for the period from 6 May 2025 to 31 October 2025. The profit contributed is not separately identifiable due to the hive-up of its trade and assets being incorporated into Knights Professional Services Limited from 13 June 2025.    

Birkett Long IFA LLP "BL IFA"                                                                                                          

On 6 May 2025 the Group exchanged contracts to acquire Birkett Long IFA by purchasing the controlling membership interests of the entity.  This acquisition completed on 13 June 2025.  Birkett Long IFA is an independent financial advisor which will further broaden Knights' offering as professional services providers.                 

The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below. The figures are provisional as the purchase accounting is not yet finalised.                                                                 

	Carrying amount £'000	Fair value adjustment £'000	Total      £'000
Identifiable assets
Identifiable intangible assets	-	1,067	1,067
Trade and other receivables	6	-	6
Cash and cash equivalents	222	-	222
Liabilities
Trade and other payables	(14)	-	(14)
Deferred tax	-	(267)	(267)
Total identifiable assets and liabilities	214	800	1,014
Negative goodwill arising on acquisition			(8)
Total consideration			1,006
Satisfied by:
Cash			898
Deferred consideration			108
Total consideration transferred			1,006
Net cash outflow arising on acquisition:
Cash consideration (net of cash acquired)			676
Net cash outflow arising on acquisition			676

Intangibles relating to customer relationships of £1,067,000 has been arrived at using the excess earnings method. The gain on bargain purchase of £8,000 has been recognised immediately in the Group's Statement of Comprehensive Income and included within non-underlying operating costs.                                                              

A contingent consideration arrangement was entered into as part of the acquisition. This is contingent on the sellers remaining in employment by the Group so it has been excluded from the consideration and will be recognised in the Statement of Comprehensive Income on a straight-line basis as a remuneration expense over the 3 years post-acquisition period. This is recognised within non-underlying operating costs.                                                              

The maximum undiscounted amount of all potential future payments under the contingent consideration arrangement is £282,000 and is payable in equal instalments on the first, second and third anniversary of completion.                                                                                     

There are also undiscounted deferred consideration payments totalling £118,000 outstanding.  This is payable in instalments on the first, second and third anniversaries of completion.                                                                            

Birkett Long IFA contributed £541,000 of revenue to the Group's Statement of Comprehensive Income for the period from 6 May 2025 to 31 October 2025. The profit contributed is not separately identifiable due to the hive-up of its trade and assets being incorporated into Knights Professional Services Limited from 13 June 2025.     

In September 2025, 20% of the overall customer base has been sold to a third party for an estimated cash consideration of £1,427,000, including initial proceeds of £399,000. The remainder will be paid in yearly instalments with final payment expected in September 2027. The total sales proceeds are subject to customer retention rates. On sale, customer relationships of £216,000 have been disposed of, this has resulted in a profit on sale of £1,062,000. The profit has been recognised within non-underlying operating costs. 

Rix & Kay Solicitors LLP "Rix & Kay"                                                                                                                              

On 27 June 2025 the Group exchanged contracts to acquire Rix and Kay by purchasing the controlling membership interests of the entity. This acquisition completed on 1 August 2025. Rix and Kay is a law firm which will bolster Knights presence in the south-east.                                                                                                              

The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below. The figures are provisional as the purchase accounting is not yet finalised.                                                 

	Carrying amount £'000	Fair value adjustment £'000	Total      £'000
Identifiable assets
Identifiable intangible assets	-	254	254
Property, plant and equipment	532	(84)	448
Right-of-use assets	-	619	619
Contract assets	703	-	703
Trade and other receivables	926	-	926
Liabilities
Trade and other payables	(1,598)	619	(979)
Lease liabilities	-	(619)	(619)
Borrowings	(605)	(676)	(1,281)
Provisions	(511)	-	(511)
Deferred tax	-	(64)	(64)
Total identifiable assets and liabilities	(553)	49	(504)
Goodwill			1,103
Total consideration			599
Satisfied by:
Cash			599
Total consideration transferred			599
Net cash outflow arising on acquisition:
Cash consideration (net of cash acquired)			599
Repayment of debt			1,281
Net cash outflow arising on acquisition			1,880

Intangibles relating to customer relationships of £254,000 has been arrived at using the excess earnings method. The goodwill of £1,103,000 represents the assembled workforce, with the acquisition bringing a number of new fee earners and expected synergies. None of the goodwill is expected to be deductible for income tax purposes.        

A contingent consideration arrangement was entered into as part of the acquisition. This is contingent on the sellers remaining in employment by the Group so it has been excluded from the consideration and will be recognised in the Statement of Comprehensive Income on a straight-line basis as a remuneration expense over the 3 years post-acquisition period. This is recognised within non-underlying operating costs.                                                              

The maximum undiscounted amount of all potential future payments under the contingent consideration arrangement is £270,000 and is payable in equal instalments on the first, second and third anniversary of completion.                                                                     

Rix and Kay contributed £966,000 of revenue to the Group's Statement of Comprehensive Income for the period from 27 June 2025 to 31 October 2025. The profit contributed is not separately identifiable due to the hive-up of its trade and assets being incorporated into Knights Professional Services Limited from 1 August 2025.                                                                                                                   

Le Gros Solicitors Limited "Le Gros"                                                                                                               

On 15 August 2025 the Group completed the acquisition of Le Gros by purchasing the controlling membership interests of the entity. This acquisition completed on the same date.  Le Gros is a law firm which provides and entry into the Welsh capital.                                                                                                       

The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below. The figures are provisional as the purchase accounting is not yet finalised.                                                                                                                                 

	Carrying amount £'000	Fair value adjustment £'000	Total      £'000
Identifiable assets
Property, plant and equipment	4	(2)	2
Contract assets	51	-	51
Trade and other receivables	410	-	410
Cash and cash equivalents	190	-	190
Liabilities
Trade and other payables	(96)	-	(96)
Total identifiable assets and liabilities	559	(2)	557
Goodwill			264
Total consideration			821
Satisfied by:
Cash			757
Deferred consideration			64
Total consideration transferred			821
Net cash outflow arising on acquisition:
Cash consideration (net of cash acquired)			568
Net cash outflow arising on acquisition			568

The goodwill of £264,000 represents the assembled workforce, with the acquisition bringing a number of new fee earners and expected synergies. None of the goodwill is expected to be deductible for income tax purposes. No intangibles have been recognised in relation to customer relationships.                                                                     

A contingent consideration arrangement was entered into as part of the acquisition. This is contingent on the sellers remaining in employment by the Group so it has been excluded from the consideration and will be recognised in the Statement of Comprehensive Income on a straight-line basis as a remuneration expense over the 3 years post-acquisition period. This is recognised within non-underlying operating costs.                                                              

The maximum undiscounted amount of all potential future payments under the contingent consideration arrangement is £175,000 and is payable in equal instalments on the first, second and third anniversary of completion.                                     

There are also undiscounted deferred consideration payments totalling £71,000 outstanding.  This is payable in instalments on the first, second and third anniversaries of completion.                                                                            

Le Gros contributed £155,000 of revenue to the Group's Statement of Comprehensive Income for the period from 15 August 2025 to 31 October 2025. The profit contributed is not separately identifiable due to the hive-up of its trade and assets being incorporated into Knights Professional Services Limited from 15 August 2025.                                

12.    Reconciliation of profit to net cash generated from operations

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Profit before taxation	2,403	8,974	12,269
Adjustments for:
Non-underlying revenue	(247)	-	-
Amortisation on computer software	45	54	92
Amortisation on acquired intangibles	2,693	1,869	4,033
Depreciation - property, plant and equipment	2,310	1,457	3,333
Depreciation - right-of-use assets	2,948	2,499	5,223
Loss on disposal of property, plant and equipment	-	60	192
Contingent acquisition payments	4,871	1,447	3,752
Other non-underlying operating costs	6,486	2,264	7,703
Non-underlying finance costs	243	63	246
Share-based payment charge	735	445	1,194
Non-operating income	-	-	(48)
Share of results of joint ventures	(561)	-	-
Finance income	(60)	(168)	(302)
Finance costs	4,370	2,898	6,445
Operating cash flows before movements in working capital	26,236	21,862	44,132
(Increase) in contract assets	(3,353)	(6,719)	(4,850)
Decrease/(increase) in trade and other receivables	1,128	648	(1,903)
(Decrease)/increase in provisions	(83)	325	71
Increase/(decrease) in contract liabilities	53	(17)	(58)
(Decrease)/increase in trade and other payables	(3,105)	(2,625)	1,619
Cash generated from operations	20,876	13,474	39,011

13.    Alternative performance measures

Underlying EBITDA is calculated as follows:

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Operating profit	6,395	11,767	18,600
Non-underlying revenue (note 3)	(247)	-	-
Depreciation and amortisation charges (note 5)	7,996	5,939	12,873
Non-underlying operating costs (note 7)	11,357	3,711	11,455
Underlying EBITDA	25,501	21,417	42,928
Depreciation of right-of-use assets (note 5)	(2,948)	(2,499)	(5,223)
Interest on leases (note 8)	(1,526)	(1,042)	(2,312)
Lease interest receivable (note 9)	30	42	63
Underlying EBITDA post IFRS 16	21,057	17,918	35,456

Underlying PBT (Profit Before Tax) is calculated as follows:

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Profit before tax	2,403	8,974	12,269
Non-underlying revenue (note 3)	(247)	-	-
Amortisation on acquired intangibles (note 5)	2,693	1,869	4,033
Non-underlying operating costs (note 7)	11,357	3,711	11,455
Non-underlying finance costs (note 7)	243	63	246
Underlying profit before tax	16,449	14,617	28,003

Underlying operating profit to underlying profit after tax (PAT) is calculated as follows:

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Operating profit before non-underlying costs	20,445	17,347	34,088
Non-underlying revenue (note 3)	(247)	-	-
Share of results of joint ventures	561	-	58
Finance costs (note 8)	(4,370)	(2,898)	(6,445)
Finance income (note 9)	60	168	302
Underlying profit before tax	16,449	14,617	28,003
Taxation - underlying	(4,410)	(3,691)	(7,448)
Underlying profit after tax	12,039	10,926	20,555

Net debt is calculated as follows:

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Borrowings	83,648	54,139	70,682
Cash and cash equivalents	(8,496)	(4,075)	(5,853)
Net debt	75,152	50,064	64,829

14.    Free cash flow and cash conversion %

Free cash flow measures the Group's underlying cash generation. Cash conversion % measures the Group's conversion of its underlying PAT (Profit After Tax) into free cash flows. Free cash flow is calculated as the total of net cash from operating activities after adjusting for tax paid and the impact of IFRS 16. Cash conversion % is calculated by dividing free cash flow by underlying PAT, which is reconciled to profit after tax (note 10).

	6 months ended 31 October 2025 (Unaudited) £'000	6 months ended 31 October 2024 (Unaudited) £'000	Year ended 30 April 2025 (Audited) £'000
Cash generated from operations (note 12)	20,876	13,474	39,011
Tax paid	(2,712)	(3,617)	(5,820)
Net underlying cash outflow for IFRS 16 leases	(3,466)	(2,957)	(6,515)
Free cash flow	14,698	6,900	26,676
Underlying profit after tax (note 10)	12,039	10,926	20,555
Cash conversion (%)	122%	63%	130%

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