Knights Group Holdings

Website: Knights Group Holdings
Index: AIM
EPIC: KGH
Supersector: Industrial Goods and Services
Sector: Support Services
Subsector: Business Support Services
Market Cap: £169.27M
Payout Frequency: Semi-Annual

Next Knights Group Holdings Dividend

Knights Group Holdings next goes ex-dividend on 12/02/2026. This will be the Interim dividend for 2026.

The dividend per share amount is 1.9400p (GBP) and the payment date is 13/03/2026.

Key Dividend Details

Dividend declared: Interim dividend of 1.94p per share (up 10% vs 1.76p).
Ex-dividend date: 12/02/2026 (derived as one business day before the record date).
Record date: 13/02/2026.
Payment date: 13/03/2026.
Form of payment: Cash only (no scrip/DRIP).
Indicative cash cost: ~£1.66m (1.94p on c. 85.4m shares).
Earnings cover: ~7.3x vs H1 underlying EPS of 14.09p; payout c. 14% of H1 underlying PAT (£12.0m).

Result Context Relevant to the Dividend

Underlying revenue up 30% to £103.2m; underlying PBT up 12.5% to £16.4m; basic underlying EPS up 11% to 14.09p.
Cash conversion strong at 122%; lock-up improved to 95 days (debtors 32 days).
Reported loss after tax of £0.3m due to elevated non-underlying acquisition-related costs; underlying profitability remains solid.
Net debt £75.2m; leverage 1.8x (within covenants). £100m RCF extended to November 2028 on same terms.
Underlying margins modestly lower (EBITDA margin 24.7%; PBT margin 15.9%) reflecting higher payroll taxes, lower client interest income and tech/AI investment.

Dividend Sustainability and Growth

Sustainability: The interim dividend appears well-covered by underlying earnings and cash flow (7.3x cover; 122% cash conversion). Working capital discipline and improved lock-up support cash-funded distributions.
Growth trajectory: A 10% uplift aligns with the stated progressive policy and H1 underlying EPS growth (+11%). Future growth will likely track underlying EPS, moderated by reinvestment priorities.
Support from financials/capital allocation: While operating cash generation is strong, elevated non-underlying acquisition costs, rising finance charges and higher net debt temper headroom. The Board’s language emphasises balancing returns with reinvestment and M&A, implying a prudent, incremental dividend path rather than aggressive increases.

Structural Changes and Capital Allocation Watchpoints

M&A-driven expansion: Acquisitions of Birkett Long (incl. BL IFA), Rix & Kay, and Le Gros; integrations progressing well. Partial disposal of BL IFA customer book and disposal of IBB’s crime business completed.
Deferred/contingent consideration: Multiple deals include deferred and contingent earn-outs payable over 1–3 years. These are non-underlying in P&L but represent real future cash outflows and can crowd out dividend capacity if growth underperforms.
Financing: £100m RCF extended to Nov-2028; leverage at 1.8x. Debt capacity supports M&A but raises ongoing interest cost and covenant considerations for dividend policy.
Technology investment: Ongoing AI and infrastructure spend (and a new CTO) are strategic, but near-term margin dilutive—management framing suggests continued reinvestment priority alongside a progressive dividend.

Risks and Flags for Dividend Stability

Balance sheet/leverage: Net debt of £75.2m and higher finance costs (+£1m YoY) reduce flexibility; sustained leverage or higher rates could limit dividend growth.
Non-underlying/acquisition costs: Elevated restructuring, contingent consideration and lease-related charges depress reported earnings and consume cash.
Margin pressure: Underlying margin compression from payroll tax increases and tech investment could cap earnings growth if not offset by pricing/mix and productivity gains.
Integration execution: Continued acquisition integration and retention of key fee earners are critical; slippage could affect cash flow and cover.
Cyclical exposure: Parts of the practice (e.g., property-related) are sensitive to macro/interest rate trends; a slowdown could weigh on organic growth and cash generation.

Dividends Used in Calculation:

Ex-Dividend Date	Payment Date	Type	Amount	Currency
13/02/2025	14/03/2025	Interim	1.76p	GBX
09/10/2025	07/11/2025	Final	3.05p	GBX

Total (Annual Dividends Per Share): 4.81p

Dividend Yield = Annual Dividends Per Share (4.81p) ÷ Share Price (198p) = 2.43%

Ex Dividend Date	Payment Date	Type	Amount	Currency
12/02/2026	13/03/2026	Interim	1.9400p	GBX
09/10/2025	07/11/2025	Final	3.05p	GBX
13/02/2025	14/03/2025	Interim	1.76p	GBX
29/08/2024	27/09/2024	Final	2.79p	GBX
15/02/2024	15/03/2024	Interim	1.61p	GBX
31/08/2023	29/09/2023	Final	2.50p	GBX
16/02/2023	17/03/2023	Interim	1.53p	GBX
01/09/2022	30/09/2022	Final	2.04p	GBX
17/02/2022	17/03/2022	Interim	1.46p	GBX
13/02/2020	16/03/2020	Interim	1.10p	GBX
29/08/2019	30/09/2019	Final	1.27p	GBX
14/02/2019	15/03/2019	Interim	0.60p	GBX

Year	Interim	Final	Currency	Total	Change
2024	1.610	2.790	GBX	4.400	9.180
2023	1.530	2.500	GBX	4.030	15.140
2022	1.460	2.040	GBX	3.500	218.180
2020	1.100		GBX	1.100	-41.170
2019	0.600	1.270	GBX	1.870

Number of Shares:

Payment	Paid	Amount
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