REG - Kooth PLC - Unaudited Half Year Results
Tue 07:00
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RNS Number : 3328A Kooth PLC 23 September 2025
23 September 2025
Kooth Plc
("Kooth", the "Company" or the "Group")
Unaudited Half Year Results
User growth continuing at pace with key financial metrics increasing on a
constant currency basis
Implementation of strategy to solidify successes of recent, transformational
period in Kooth's history
Kooth (AIM: KOO), a global leader in youth digital mental wellbeing, announces
unaudited half year results for the six months ended 30 June 2025 (H1 2025).
All figures relate to this period unless otherwise stated.
Business highlights
· Investment in key growth drivers, including marketing to users in
California to drive long-term sustainable usage, led to a planned increase in
costs in H1 2025. This additional investment is now largely complete and,
coupled with a strengthened executive leadership team, Kooth is in a strong
position to benefit going forward.
· Significant progress in California with successful delivery,
impressive traction and over 130,000 users registering with Soluna since
launch. Kooth is on track to exceed Department of Health Care Services (DHCS)
targets for 2025.
· Continued momentum and robust strength of the business
demonstrated by underlying growth in annual recurring revenue (ARR), cash
position and number of users YoY, solidifying the transformational performance
achieved in 2024.
· Maintained position as the UK's largest digital mental health
providers for under 18s, with policy tailwinds setting a favourable course
toward sustainable growth.
· Evolution of our strategy, looking to solidify and build on
successes of a transformational period in Kooth's history.
· Successful launch and delivery of contract in New Jersey.
Financial highlights
· On a constant currency basis 1 (#_ftn1) , revenue increased 1.3
% over the prior period.
· Reported revenue fell marginally by £0.4m to £32.1m (2024:
£32.5m). This was due to the impact of a £0.8m negative foreign exchange
(FX) movement together with contract changes, largely in the UK, that reduced
revenue by £0.6m, offset by a £0.6m New Jersey contract win and £0.4m of
additional revenue recognition in California.
· Reported ARR fell £2.5m to £61.7m (2024: £64.2m), due to the
impact of a £3.2m negative FX movement.
· On a constant currency basis 2 (#_ftn2) ARR grew £0.7m through
a £1.1m expansion in New Jersey, offset by UK contract changes.
· Gross margin decreased by 19.6ppt to 62.8% (2024: 82.4% FY 2024:
77.9%), reflecting the significant front-loaded investment in direct service
user marketing expenditure in California. Intentionally weighted towards H1
2025, this is expected to moderate in H2 2025.
· Adjusted EBITDA of £1.6m (2024: £7.8m) decreased in line with
the accelerated investment in key areas of focus including user marketing in
California as noted above.
· Loss after tax of £1.3m (2024: £3.9m profit).
· Share buyback of £1.5m completed in period.
· Robust balance sheet with net cash of £15.3m (2024: £14.9m) to
support Kooth's long-term growth.
Strategic update - laying the foundations for sustainable growth
· We've built our market leading position by widening access to
support, connecting users with self-guided, peer and professional support when
they need it. Soluna now offers youth access to a range of services beyond
mental health support, acting as a 'digital front door' connecting users and
an ever-increasing range of public services.
· To evolve and grow, we need to take this further by expanding the
services we offer within our platform, allowing us to access funding from a
more diverse range of customers.
· Central to this will be further development of our clinical,
operational and product capabilities, harnessing our investment in Soluna to
allow for tech-led personalisation of care.
· This evolution, which builds on our unrivalled experience in the
UK and successful US entry, will underpin a refreshed go-to-market approach
and will use State funding to build the 'digital front door'. We will also
work with other public and private payers to offer more intensive or
personalised solutions to their populations, whether that's high schools or
health plans.
Outlook
· We have an active US pipeline, with proposal processes aligned
with State budget cycles, reflecting increasing demand for highly accessible
and scalable youth mental health solutions as part of State-level policy
platforms.
· Our UK market position remains strong, with one previously-lost
contract regained, and an increasingly diverse pipeline reflecting the
evolution of our strategy to target new customers. The strength of our local
system partnerships has ensured that the impact of NHS reorganisation has been
minimised.
· Soluna is on track to launch in the UK in 2026, with work to
ensure compliance with regulatory, safety and efficacy frameworks now well
underway.
· Critically, the policy environment is moving in our direction. In
the US, payors are prioritising cost-effective early intervention, including
moves to standardise reimbursement for digital mental health technologies. In
the UK, the Government's 10-year plan (Fit for the Future) sets a clear course
for digital access at the earliest moment of need and for contracting models
that recognise prevention and outcomes.
Financial outlook
· The Group expects to deliver revenue and adjusted EBITDA in line
with expectations for the year before accounting for the potential impact of
foreign exchange movements. At current rates the expected impact would be to
reduce full year consensus median revenue of £66.8m by c.2-3% and consensus
median adjusted EBITDA of £10.2m by c.6-8%.
· We have a robust balance sheet and an undrawn $9.5m working
capital facility to enable long-term investment to meet demand for Kooth's
services.
Kate Newhouse, Chief Executive Officer of Kooth, said:
"The first half of 2025 has been a period of significant investment, including
ramping up engagement with our services in the US and the ongoing product
development of Soluna to provide a robust platform for future success. We are
already seeing the benefits from this front-weighted investment, which will
decrease in H2 2025. Alongside our newly strengthened executive leadership
team and evolved strategy, we are in a strong place to be able to deliver our
vital services to more people in need.
Following our exceptional and transformative set of results in 2024, we have
continued to deliver on key metrics including annual recurring revenue and
user registrations. Alongside our strong cash position, we have solidified our
position of market leadership, sustaining progress despite the impact of FX
headwinds.
As a company we remain committed to providing our users and their communities
with open access to proven mental health support, helping them develop the
skills they need tackle life's challenges. We are proud of the vital role we
have played in so many lives."
Financial headlines
Six months ended 30 June 2025 Six months ended 30 June 2024 Change
£'000 £'000
Revenue
Total revenue 32,088 32,494 -1.2%
Annual Recurring Revenue 61,712 64,240 -3.9%
Gross profit 20,154 26,767 -24.7%
Gross margin 62.8% 82.4% -19.6ppt
Adjusted EBITDA 1,600 7,841 -79.6%
(Loss)/profit after tax for the period (1,255) 3,920 -132.0%
Cash generation (6,580) 3,936 -267.2%
Cash position 15,261 14,940 +2.1%
Basic earnings per share (£) (0.03) 0.11 -127.3%
Diluted earnings per share (£) (0.03) 0.10 -130.0%
Enquiries:
Kooth plc investorrelations@kooth.com (mailto:investorrelations@kooth.com)
Kate Newhouse, CEO
Sanjay Jawa, CFO
Stifel, Nominated Adviser & Joint Broker +44 (0) 20 7710 7600
Ben Maddison, Fred Walsh, Erik Anderson, Ben Good
Canaccord Genuity, Joint Broker +44 (0)20 7523 8000
Simon Bridges, Harry Gooden, Elizabeth Halley-Stott
FTI Consulting, Financial PR Kooth@fticonsulting.com (mailto:Kooth@fticonsulting.com)
Ben Atwell, Alex Shaw
About Kooth plc:
Kooth (AIM:KOO) is a leading provider of digital mental health services. Our
mission is to provide accessible and safe spaces for everyone to achieve
better mental health. Our platform is clinically robust and accredited to
provide a range of therapeutic support and interventions. All our services are
predicated on easy access to make early intervention and prevention a reality.
Kooth is a fully safeguarded and pre-moderated community with a library of
peer and professional created content, alongside access to experienced online
counsellors. There are no thresholds for support and no waiting lists.
Kooth is the longest standing digital mental health provider to hold a UK-wide
accreditation from the British Association of Counselling and Psychotherapy
(BACP) and according to NHS England data for 2024/25 is now the largest single
access provider for mental health support for under 18s.
In 2021, Kooth began executing on its international expansion strategy, with
an initial focus on the US market. This focus is due to the growing
recognition of the importance of improving youth mental health in this key
global healthcare market, with 1-in-6 people aged 6-17 experiencing a mental
health disorder each year.
For more information, please visit (http://www.koothplc.com/) www.koothplc.com
(http://www.koothplc.com/) .
Chief Executive's Review
It has been a privilege to work alongside our strengthened global leadership
team, with a number of strategic appointments in marketing, product and
operations demonstrating our growing reach and level of ambition.
Overview
I am pleased with the strength of our underlying performance during the period
and our execution against strategic priorities following the transformation
our business underwent in 2024. This can be seen within our financials on a
constant currency basis where notwithstanding the significant strengthening of
the pound against the dollar during the period, we continued to deliver
underlying growth. We maintained a robust balance sheet to enable long-term
investment, and notwithstanding FX movements, expect to deliver revenue and
adjusted EBITDA for the full year in line with expectations.
As we look to further solidify our position of market leadership, we took the
decision to significantly invest in service user marketing to ensure
acceleration of reach and ultimately sustainable usage in California in the
period. This investment is now largely complete and the Company expects
marketing costs in the second half to be significantly lower. The benefits of
this investment will continue to be felt in H2 2025 and beyond and are best
highlighted by the significant growth in user numbers in California during the
period, well exceeding our user registration targets and now standing at over
130,000 youth in the State. We remain on track to exceed the California
Department of Health and Care Services' (DHCS) targets for 2025.
Evolution of our strategy
To sustain our market-leading position and leverage the successes we achieved
in 2024, we have taken our unparalleled experience of the sector and the
learnings from our material US expansion to further evolve our strategy for
the years ahead.
Designed to address and capitalise on the changes we are seeing in the sector,
this evolved approach will expand the services we provide within our platform,
including access to more targeted tools to help users back into work or
education and support users at different stages, opening up new funding
opportunities and embedding us further with both our customers and users.
Funders are increasingly looking for solutions that not only increase access,
but can also deliver measurable and comparable outcomes, aligned to
standardised metrics of clinical, social or economic benefit. With our proven
ability to reach populations at scale, and deliver high-quality care, Kooth is
well placed to support this shift and we will continue to evolve Soluna with
new tools, guided programmes and more structured touchpoints such as CBT
therapy as we look to engage ever more stakeholders and funders as part of our
"State alliance" model.
Our market-leading position has been built on providing whole-population
access to evidence-based support, connecting users with self-guided, peer and
professional support when they need it. In California alone, we have reached
over 130,000 youth, in all 58 counties, in just 18 months. By providing a
universal, trusted 'digital front door', we can connect users to behaviour
health services within Soluna and provide a trusted route into other support,
whether through their health plan, school district or college.
By embedding Soluna across the state, within public and private sector
services, we can deliver value beyond our immediate funders to ensure
sustainability for the long-term.
This approach underpins the evolution of our strategy - our 'State Alliance'
model - which will build on our proven ability to reach whole populations,
expanding the scope of our services to more closely align to the requirements
of a wider set of customers.
The achievement of this vision, in which Government funding unlocks
population-wide access to our core Soluna provision and then other partners
can fund more targeted support for the populations they serve, requires the
development of a 'networked continuum of care', with personalised care
journeys embedded into our platform. The development of this 'care continuum'
will be at the forefront of our in-house work across clinical, product, tech
and operational teams as we shift into H2 2025 and beyond.
California
Our services continue to reach and support young people in improving their
emotional wellbeing and achieving their goals. Our landmark Soluna service in
California is making a significant impact in reaching and supporting
California youth, and is now well-valued by its users, their communities and
State leaders. The DHCS recent Impact Report
(https://www.rns-pdf.londonstockexchange.com/rns/0887P_1-2025-6-30.pdf)
described the programme as 'reimagining behavioural health care delivery for
children and youth' and emphasised Soluna's key role in providing timely and
effective care.
To ensure sustainable growth, we have made significant investments into our
State-wide advocacy, partnerships and integration programme in parallel with
focused digital marketing. We have built relationships with nearly 300 key
supporters across California's state, healthcare, education and
community-based organisations, activity based on our experience in the UK,
where we have demonstrated that local advocates are essential to building
trust and embedding services within the populations we serve. This activity
supports our shift from digitally-driven growth to more organic reach and
local brand recognition over the term of the contract, thereby driving down
the cost of user acquisition.
New Jersey
Similarly, we have made strong inroads into advocacy building in New Jersey,
resulting in steady growth in user registrations and positive feedback from
State leaders, with local advocacy targets exceeded in the first half of 2025.
Examples of this essential work include our partnerships with the Social
Emotional Learning Alliance for New Jersey's Youth Mental Health Advisory
Collaborative and NJ Institute for Community Schools, which enables us to
connect to approximately 150 school districts. Our team has also built strong
relationships with the New Jersey Statewide Student Support Services network,
a state-wide system that connects youth and their parents and caregivers with
resources to support their mental health and Soluna is now recommended via the
network.
Wider US
State leaders remain concerned about the real-world impact of poor youth
mental health, and are seeking solutions to address this nationwide issue. In
the context of reduced federal funding for Medicaid, a renewed focus on cost
effectiveness has generated greater focus on earlier intervention and digital
interventions - evidenced by recent moves to standardise reimbursement codes
for digital mental health technologies.
Our evolved strategy, as outlined above and which also takes learnings from
our recently concluded one-year partnership with Aetna in Illinois,
unparalleled insights from our experience in the UK and US, and significant
stakeholder engagement, is designed to ensure we are well-positioned for
success in this growing market.
UK
In spite of sustained pressure on public sector spending, we remain the
largest provider of digital mental health services to under 18s. As in the US,
increased policy focus on the relationship between good mental health and
improved social and economic outcomes, and support for digital interventions -
as evidenced by the Government's 10-year plan (Fit for the Future) - further
reinforces the need for our services. With Soluna on track to launch in the UK
in 2026, we are well-positioned to translate these policy shifts into
opportunities for growth.
Looking ahead
After a period of transformational growth, the first half of 2025 has seen
significant investment as we focused on solidifying our market position,
consolidation of our strengths and embedding ever-deeper connections with our
customers. With this investment largely complete, Kooth is well-placed to
achieve our objectives for the remainder of 2025 and beyond.
We have a robust balance sheet, an undrawn working-capital facility and clear
policy tailwinds in our core markets, and our ability to flex product,
partnerships and our go-to-market approach while maintaining clinical quality
and outcomes mean we are in a stronger position than ever before.
The need is greater than ever
As ever, I return frequently to the voices of our users, who remind everyone
at Kooth of the importance of our mission every day. Research undertaken by
our team this year has underlined the essential role that Kooth services have
played in supporting our service users to connect with their friends and
family, get back to school, re-enter the workforce, and build the skills we
all need to live more fulfilling, healthier lives, whether in Newcastle or
Newark, San Diego or Sunderland, London or Los Angeles.
Kate Newhouse
Chief Executive Officer
Chief Financial Officer's review
Kooth delivered a set of results in line with expectations for the half year,
with revenue growth from our new contract in New Jersey offset by an FX impact
of £0.8m reflecting the appreciation of GBP against USD compared to the prior
period in 2024. In line with our plans we made significant investment during
the half year in direct user marketing expenditure in California, impacting
both gross profit and adjusted EBITDA.
Key Performance Indicators
Revenue
H1 2021 H1 2022 H1 2023 H1 2024 H1 2025
£8.0m £9.0m £11.7m £32.5m £32.1m
Revenue is a KPI which reflects the work we are doing and the fees received
over a period of time for that work. The £0.4m decrease from 2024 is a £0.8m
negative FX impact and the full period impact of 2024 UK contract churn
(£0.6m), partially offset by US contract wins (£0.6m) and an uplift in
revenue recognised in California (£0.4m).
Annual Recurring Revenue
H1 2021 H1 2022 H1 2023 H1 2024 H1 2025
£16.6m £18.5m £21.4m £64.2m £61.7m
Annual recurring revenue (ARR) is the annualised revenue of customers engaged
or with an agreed contract as at the period end and is an indication of the
upcoming annual value of the recurring revenue. This is used by management to
monitor the long-term revenue growth of the business. ARR was impacted by a
negative FX impact of £3.2m. On a constant currency basis, ARR has grown
£0.7m which was driven by expansion in New Jersey (£1.1m), offset by UK
churn. The H1 2024 ARR balance has been restated to include an additional
£4.2m of product development revenue recognised over the full life of the
contract which aligns with revenue recognition.
Gross Margin
H1 2021 H1 2022 H1 2023 H1 2024 H1 2025
69.4% 68.4% 66.8% 82.4% 62.8%
Gross profit as a percentage of revenue. Direct costs are the costs of our
practitioners directly involved in the delivery of our services and direct
service user marketing expenditure. The decrease in margin from the prior
period is owing to the first half weighted significant investment in direct
service user marketing expenditure for the California contract during the
period which reduced the gross margin by 19.6ppt.
Adjusted EBITDA
H1 2021 H1 2022 H1 2023 H1 2024 H1 2025
£1.1m £0.5m £0.0m £7.8m £1.6m
Earnings before interest, tax, depreciation and amortisation in the period,
adjusted for share based payments. This metric provides a more comparable
indication of the Group's core business performance by removing the impact of
non-trading items that are reported separately. The decrease from the prior
period is owing to a £7.2m investment in direct marketing to drive engagement
with California service users.
Cash
H1 2021 H1 2022 H1 2023 H1 2024 H1 2025
£8.8m £8.3m £5.9m £14.9m £15.3m
Cash is a key metric as it provides assurance on our ability to invest to grow
the business, as well as provide comfort to customers from a vendor risk
perspective. The increase from H1 2024 derives from working capital management
and cash generated from operations of £8.7m over the last twelve months,
offset by investment in our platforms (£4.7m), tax payments on prior year
profits (£1.5m), adverse FX movements (£0.6m) on the translation of USD
balances and the share buyback programme which completed during the current
period (£1.5m).
Population coverage
H1 2021 H1 2022 H1 2023 H1 2024 H1 2025
9.5m 15.1m 16.7m 19.9m 18.5m
The total number of people who have access to the Kooth service is a good
indicator of our accessibility. This is determined as the population within
the contracted age range of each of our contracts that are live at the period
end. The drop in the current period is driven by reductions in a small number
of UK adult contracts.
Number of users
H1 2021 H1 2022 H1 2023 H1 2024 H1 2025
202k 228k 196k 242k 309k
The number of users to our Kooth and Soluna platforms, demonstrating the
increasing uptake of our service.
Revenue
On a constant currency basis, revenue increased 1.3% over the prior period and
Annual Recurring Revenue (ARR) increased 1.1%. Reported revenue decreased
£0.4m to £32.1m (H1 2024: £32.5m) and ARR decreased by 4% to £61.7m (H1
2024: £64.2m), predominantly driven by a £3.2m negative FX impact, offset by
an expansion in New Jersey (£1.1m).
US Revenue in H1 2025 was $30.6m/£23.4m (H1 2024: $29.3m/£23.3m), all of
which was recurring revenue (comprising income invoiced for services that are
repeatable, consumed and delivered on a monthly basis over the term of a
customer contract) with the increase coming from New Jersey and California.
UK revenue decreased by 6% to £8.7m (H1 2024: £9.2m) reflecting churn in our
English contracts (predominantly adult contracts) under budgetary pressure.
Overall, UK churn for the previous 12 months was 6% (£1.1m) giving net
revenue retention, measured by the total value of on-going ARR at the
period-end from clients in place 12 months earlier as a percentage of the
opening ARR from those clients, for the period to 30 June 2025 of 97% (H1
2024: 92%). UK churn is reduced from 13% (£2.4m) for the 12 month period to
30 June 2024.
Gross Profit
Gross Profit reduced by 25% from £26.8m to £20.2m with gross margin
decreasing to 62.8% (H1 2024: 82.4%) due to planned investments made in direct
marketing to drive engagement with service users in California. In the future
we forecast a reduction in marketing spend with the cost per user acquisition
falling as we become more embedded in local systems and see organic growth in
new and returning users returning gross margin to more historic levels of
70%+.
Direct costs are both the costs of the practitioners directly involved in the
delivery of our services, a total of 253 at the period-end (H1 2024: 303
heads) with reductions reflecting UK customer churn and rightsizing in the US,
and the commencement of promotion and marketing costs in California in support
of raising user awareness and engagement, including hard to reach communities
which were £7.2m.
The UK gross margin saw a slight increase, driven by a shift toward greater
usage of self-help tools in place of direct practitioner support.
Foreign currency impact
The US Dollar/GBP exchange rate has had a significant effect on results for
the period under review during which the Group had approximately 73% of
revenues and 55% of expenses denominated in US Dollars. The Group's exposure
to foreign currency risk resulted in a booked foreign currency loss of £1.0m
(H1 2024: £0.1m gain). Post period end we have seen sterling remain strong
against the US dollar which is expected to continue to have an impact on
revenue and adjusted EBITDA in the second half of the year as previously
quantified.
Adjusted EBITDA
Adjusted EBITDA in the period decreased from £7.8m to £1.6m, with the £6.6m
decrease in gross profit marginally offset by a £0.4m decrease in
administrative expenses (excluding amortisation, depreciation and share based
payments). The decrease in gross profit is driven by planned investment made
in California direct marketing to raise user awareness and engagement
including hard to reach communities. This has been offset by cost reductions
in practitioner costs and engagement related employee costs.
The total charge for share based payments in the period was £0.6m (H1 2024:
£0.5m) with the slight rise reflecting a higher number of participants as we
increased our headcount in the US in 2024. Within administrative expenses,
depreciation and amortisation increased to £3.1m (H1 2024: £2.6m) as capital
expenditure investment in the US platform continued in H2 2024 and H1 2025.
Adjusted EBITDA for the full year is expected to be in line with expectations
before accounting for the impact of FX. At current rates the anticipated
impact would be to reduce for the full year expected adjusted EBITDA by
c6%-8%.
Taxation
The overall tax credit for the period was £0.5m (H1 2024: £1.1m charge) due
predominantly to taxable losses and expected Research and Development
expenditure credits in the UK.
Profit after tax
The Group loss after tax for the period was £1.3m (H1 2024: £3.9m profit).
Basic earnings per share were negative 3p (H1 2024: 11p positive). Diluted
earnings per share were negative 3p (H1 2024: 10p positive).
Balance Sheet
The strength of the Group's balance sheet with net assets of £27.4m (30 June
2024: £25.3m), and high levels of recurring revenue provide the Group with
financial strength to execute on its investment strategy which is focused on
US business development and driving user engagement.
Cash flow and financing
Cash outflow during the six months was £5.7m (H1 2024: £3.9m inflow). The
reduced US product platform investment gave rise to capital expenditure of
£2.0m (H1 2024: £3.9m), adverse FX movements of £0.8m and cash outflows
from operating activities of £4.1m give a net cash position at 30 June 2025
of £15.3m (H1 2024: £14.9m). The Group remains debt free and maintains an
undrawn $9.5m working capital credit facility.
Forward-looking statements
Certain statements in this half year report are forward-looking. Although the
Group believes that the expectations reflected in these forward-looking
statements are reasonable, it can give no assurance that these expectations
will prove to have been correct. Because these statements involve risks and
uncertainties, actual results may differ materially from those expressed or
implied by these forward-looking statements.
Dividends
The Group's intention in the short to medium term is to invest in order to
deliver capital growth for shareholders. The Board has not recommended an
interim dividend payment in respect of the six months ended 30 June 2025
(2024: £nil) but may do so in future years.
Sanjay Jawa
Chief Financial Officer
Condensed Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2025
Six months ended 30 June 2025 Six months ended 30 June 2024 Year ended 31 December 2024
Unaudited Unaudited Audited
Note £'000 £'000 £'000
Revenue 8 32,088 32,494 66,744
Cost of sales 9 (11,934) (5,727) (14,757)
Gross profit 20,154 26,767 51,987
Administrative expenses 9 (22,223) (22,078) (42,831)
Operating (loss)/profit (2,069) 4,689 9,156
Analysed as:
Adjusted EBITDA 1,600 7,841 15,754
Depreciation and amortisation (3,069) (2,607) (5,376)
Share based payment expense (600) (545) (1,222)
Operating (loss)/profit (2,069) 4,689 9,156
Interest income 344 301 702
(Loss)/profit before tax (1,725) 4,990 9,858
Tax 10 470 (1,070) (1,824)
(Loss)/profit after tax (1,255) 3,920 8,034
Other comprehensive income
Items that are or may be reclassified subsequently to profit or loss:
Foreign currency translation differences (129) 72 244
Total comprehensive (loss)/profit for the period (1,384) 3,992 8,278
(Loss)/profit per share - basic (£) 11 (0.03) 0.11 0.22
(Loss)/profit per share - diluted (£) 11 (0.03) 0.10 0.21
Condensed Consolidated Balance Sheet
As at 30 June 2025
30 June 2025 30 June 2024 31 December 2024
Unaudited Unaudited Audited
Note £'000 £'000 £'000
Assets
Non-current assets
Goodwill 511 511 511
Development costs 12 9,100 10,179 10,124
Right of use asset 0 31 20
Property, plant and equipment 219 302 266
Deferred tax 1,679 1,537 1,244
Total non-current assets 11,509 12,560 12,165
Current assets
Trade and other receivables 13 7,654 6,234 8,733
Contract assets 783 2,157 292
Cash and cash equivalents 15,261 14,940 21,841
Total current assets 23,698 23,331 30,866
Total assets 35,207 35,891 43,031
Liabilities
Current liabilities
Trade payables (1,595) (1,001) (2,683)
Contract liabilities (1,255) (5,738) (3,781)
Lease liability 0 (34) (23)
Accruals and other creditors (3,838) (3,551) (5,264)
Tax liabilities (1,116) (312) (1,526)
Total current liabilities (7,804) (10,636) (13,277)
Net current assets 15,894 12,694 17,589
Net assets 27,403 25,255 29,754
Equity
Share capital 1,835 1,831 1,834
Treasury shares (1,500) 0 (17)
Share premium account 23,444 23,444 23,444
Retained earnings 4,721 1,627 5,955
Share-based payment reserve 2,938 2,431 2,444
Capital redemption reserve 115 115 115
Merger reserve (4,104) (4,104) (4,104)
Translation reserve (46) (89) 83
Total equity 27,403 25,255 29,754
Condensed Consolidated Statement of Changes in Equity
For the six months ended 30 June 2025
Share capital Treasury shares Share premium Share Based Payment reserve Retained earnings Capital Redemption reserve Merger reserve Translation reserve Total equity
Balance at 1 January 2024 1,825 - 23,444 2,142 (2,503) 115 (4,104) (161) 20,758
Comprehensive income for the period - - - - 3,920 - - - 3,920
Other comprehensive income - - - - - - - 72 72
Total comprehensive income 1,825 - 23,444 2,142 1,417 115 (4,104) (89) 24,750
Transactions with owners:
Share options exercised 6 - - (210) 210 - - - 6
Share based payment charge - - - 499 - - - - 499
As at 30 June 2024 1,831 - 23,444 2,431 1,627 115 (4,104) (89) 25,255
Balance at 1 July 2024 1,831 - 23,444 2,431 1,627 115 (4,104) (89) 25,255
Comprehensive income for the period - - - - 4,114 - - - 4,114
Other comprehensive income - - - - - - - 172 172
Total comprehensive income 1,831 - 23,444 2,431 5,741 115 (4,104) 83 29,541
Transactions with owners:
Share options exercised 3 - - (214) 214 - - - 3
Share based payment charge - - - 643 - - - - 643
Treasure shares purchased - (17) - - - - - - - 17
Deferred tax - - - (416) - - - - - 416
As at 31 December 2024 1,834 (17) 23,444 2,444 5,955 115 (4,104) 83 29,754
Balance at 1 January 2025 1,834 (17) 23,444 2,444 5,955 115 (4,104) 83 29,754
Comprehensive income for the period - - - - (1,255) - - - (1,255)
Other comprehensive income - - - - - - - (129) (129)
Total comprehensive income 1,834 (17) 23,444 2,444 4,700 115 (4,104) (46) 28,370
Transactions with owners:
Share options exercised 1 - - (21) 21 - - 1
Share based payments charge - - - 515 - - - - 515
Treasury shares purchased - (1,483) - - - - - - (1,483)
As at 30 June 2025 1,835 (1,500) 23,444 2,938 4,721 115 (4,104) (46) 27,403
Condensed Consolidated Statement of Cash Flows
For the six months ended 30 June 2025
Six months ended 30 June 2025 Six months ended 30 June 2024 Year ended 31 December 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
Cash flows from operating activities
(Loss)/profit for the period (1,255) 3,920 8,034
Adjusted for:
Depreciation and amortisation 3,069 2,607 5,692
Income tax paid (981) (456) (624)
Share based payment expense 600 545 1,222
Income tax recognised (470) 1,070 1,824
Interest income (344) (301) (702)
619 7,385 15,446
Movements in working capital:
Decrease/(increase) in trade and other receivables 588 (966) (1,600)
(Decrease)/increase in trade and other payables (5,274) 1,240 3,241
Net cashflow from operating activities (4,067) 7,659 17,087
Cash flows from investing activities
Purchase of property, plant and equipment (49) (77) (120)
Additions to intangible assets (1,960) (3,947) (6,887)
Interest income 344 301 702
Net cash used in investing activities (1,665) (3,723) (6,305)
Net (decrease)/increase in cash and cash equivalents (5,732) 3,936 10,782
Exchange adjustments (848) - 55
Cash and cash equivalents at the beginning of the period 21,841 11,004 11,004
Cash and cash equivalents at the end of the period 15,261 14,940 21,841
Notes to the half year financial statements
1. General information
The unaudited interim consolidated financial statements for the six months
ended 30 June 2025 and the six months ended 30 June 2024 do not constitute
statutory accounts within the meaning of Section 434 of the Companies Act
2006. Statutory accounts for the year ended 31 December 2024 were approved by
the Board of Directors on 14 April 2025 and delivered to the Registrar of
Companies. The auditor's report on those accounts was unqualified, did not
contain an emphasis of matter paragraph and did not contain any statement
under Section 498 (2) or (3) of the Companies Act 2006.
These condensed half year financial statements were approved for issue by the
Board of Directors on 22 September 2025.
2. Basis of preparation
This unaudited condensed consolidated financial information which incorporate
the financial information of the Group, have been prepared in accordance with
Accounting Standard IAS 34 'Interim Financial Reporting' as contained in UK -
adopted International Accounting Standards and IFRIC interpretations and with
those parts of the Companies Act 2006 applicable to companies reporting under
IFRS.
The interim condensed consolidated financial statements do not include all the
information and disclosures required in the annual financial statements and
should be read in conjunction with the Group's annual consolidated financial
statements prepared in accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006 for the year ended
31 December 2024.
Trading for the half year ended 30 June 2025 is aligned with the Board's
expectations, albeit adversely affected by a booked £1.0m foreign currency
loss. Management's expectations for the full year operating performance
remains unchanged, however, the exposure to foreign currency risk is expected
to remain similar to that seen in the first half of the year. Further details
and quantification are given in the CEO's overview, the operational review and
the financial review.
During the period the Group has generated a loss of £1.3m (H1 2024: £3.9m
profit) and is in a net asset position of £27.4m as at 30 June 2025 (H1 2024:
£25.3m). Management has prepared forecasts up until 12 months from the date
of approval of these financial statements which have been approved by the
Board, and after enquiry and review of these forecasts and other available
financial information, the Directors have formed the conclusion that the Group
has adequate resources to continue to operate for the foreseeable future and
that it is therefore appropriate to continue to adopt the going concern basis
of accounting in the preparation of these interim condensed consolidated half
year financial statements.
The financial information is presented in sterling, which is the functional
currency of Kooth plc. All financial information presented has been rounded to
the nearest thousand.
3. Accounting policies
The accounting policies applied in these interim financial statements are the
same as those applied in the Group's annual report and accounts for the year
ended 31 December 2024.
Current taxes on income in the half year period are accrued using the tax
rates that would be applicable to expected total annual profits. Deferred
taxes on income are calculated based on the standard rates that are enacted as
at the balance sheet date.
4. Critical accounting judgements and key sources of estimation uncertainty
Any critical accounting judgements and key sources of estimation uncertainty
that carry a significant risk of material change to the carrying value of
assets and liabilities within the next year are the same as those applied in
the 2024 Group Annual Report.
5. Principal risks and uncertainties
The 2024 Group annual report and accounts describes the principal risks and
uncertainties that could impact the Group's performance. These risks primarily
relate to system outages, safeguarding incidents, changes in laws and
regulations, cyber security and data protection, our people, public discourse
and political environment and the economic environment. These remain unchanged
since the annual report was published and are not expected to change for the
remaining six months of the financial year.
The Group actively manages these risks through risk management procedures and
actions are taken to mitigate risk wherever possible.
6. Financial risk management
The Group is exposed to financial risks including market risk, foreign
currency risk, credit risk and liquidity risk.
These interim condensed consolidated financial statements do not include all
financial risk management information and disclosures required in the annual
financial statements and therefore should be read in conjunction with the 2024
Group annual report and accounts.
7. Segmental reporting
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief operating
decision-maker (CODM), who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as the
executive directors that make strategic decisions. Accordingly, the CODM
determines the Group currently operates under two reporting segments being the
UK and US. The measure of performance of those segments that is reported to
the CODM is revenue and adjusted EBITDA, as shown below in note 8.
8. Revenue and segmental analysis
In accordance with IFRS 8, the Group requires consideration of the Chief
Operating Decision Maker ("CODM") within the Group. In line with the Group's
internal reporting framework and management structure, the key strategic and
operating decisions are made by the Executive Directors, who review internal
monthly management reports, budgets and forecast information as part of this.
Accordingly, the Executive Directors are deemed to be the CODM.
Accordingly, the CODM determines the Group currently operates under two
reporting segments being the UK and US. The measure of performance of those
segments that is reported to the CODM is revenue and adjusted EBITDA, as shown
below. In the prior year the Group operated under one segment only. The roll
out of the California contract across 2024 and development of further US
contracts has led the Group to diversify its global operations across two
regional leadership teams who monitor their cashflows separately.
Segment assets and segment liabilities are reviewed by the CODM in a
consolidated statement of financial position. Accordingly, this information is
replicated in the Group consolidated statement of financial position. As no
measure of assets or liabilities for individual segments is reviewed regularly
by the CODM, no disclosure of total assets or liabilities has been made, in
accordance with the amendment to paragraph 23 of IFRS 8.
Six months ended 30 June 2025 Six months ended 30 June 2025 Six months ended 30 June 2025 Six months ended 30 June 2024 Six months ended 30 June 2024 Six months ended 30 June 2024 Year ended 31 December 2024 Year ended 31 December 2024 Year ended 31 December 2024
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Audited Audited Audited
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
US UK Total US UK Total US UK Total
Provision of online counselling contracts 555 8,658 9,213 - 9,243 9,243 101 18,047 18,148
Platform build and behavioural support services contracts 22,875 - 22,875 23,251 - 23,251 48,596 - 48,596
Total revenue 23,430 8,658 32,088 23,251 9,243 32,494 48,697 18,047 66,744
Adjusted EBITDA 501 1,099 1,600 1,136 6,705 7,841 2,466 13,288 15,754
Non current assets 103 9,727 9,830 189 10,834 11,023 175 10,747 10,922
The geographical revenue information above is based on the location of the
customer.
Non-current assets for this purpose consist of goodwill, intangible assets,
right of use assets and property, plant and equipment and excludes deferred
tax assets.
9. Operating profit
Six months ended 30 June 2025 Six months ended 30 June 2024 Year ended 31 December 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
Labour costs 4,619 5,600 10,550
Direct marketing 7,242 - 3,935
Share based payment expense 71 122 261
Travel and subsistence 2 5 11
Total cost of sales 11,934 5,727 14,757
Employee costs 12,999 14,115 27,285
Rent and rates 335 308 666
IT hosting and software 1,225 1,200 2,505
Professional fees 2,179 1,645 4,201
Marketing 820 1,626 1,325
Depreciation and amortisation 3,069 2,607 5,376
Share based payment expense 529 424 961
Foreign exchange 1,007 (100) (55)
Other costs 60 254 567
Total administrative expenses 22,223 22,078 42,831
Total cost of sales and administrative expenses 34,157 27,805 57,588
1,007
(100)
(55)
Other costs
60
254
567
Total administrative expenses
22,223
22,078
42,831
Total cost of sales and administrative expenses
34,157
27,805
57,588
Cost of sales represent the costs of our service user facing employees
including external contractors and
direct service user marketing expenditure.
10. Taxation
The income tax credit recognised of £0.5m (H1 2024: £1.1m charge) reflects
management's estimate of the tax credit for the current period. This
calculation takes into consideration the estimated taxable losses incurred
from operational activities during the period, as well as relief earned under
the UK R&D scheme. The assessment utilises the 25% average UK corporation
tax rate (2024: 25%), the 21% average US federal tax rate (2024: 21%) and 8.8%
average California state tax rate (2024: 8.8%) for the current financial year.
11. Earnings per share (EPS)
The calculation of basic and diluted EPS is based on the following earnings
and number of shares:
Six months ended 30 June 2025 Six months ended 30 June 2024 Year ended 31 December 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
Earnings used in calculation of earnings per share:
On total (losses)/profits attributable to equity holders of the parent (1,255) 3,920 8,034
Weighted average no. of shares (Basic) 36,236,241 36,537,329 36,574,695
Weighted average no. of shares (Diluted) 38,548,724 38,505,149 38,995,084
Shares in issue
Ordinary shares in issue 36,694,683 36,593,784 36,677,766
Treasury shares acquired (890,718) - (9,250)
(Loss)/profit per share on total (losses)/profits attributable to equity
holders of the parent
Basic, £ (0.03) 0.11 0.22
Diluted, £ (0.03) 0.10 0.21
12. Development costs
£'000
Cost
At 1 January 2024 19,028
Additions 3,947
At 30 June 2024 22,975
Additions 2,940
At 31 December 2024 25,915
Additions 1,960
At 30 June 2025 27,875
Amortisation
At 1 January 2024 (10,278)
Amortisation (2,518)
At 30 June 2024 (12,796)
Amortisation (2,679)
Impairment (316)
At 31 December 2024 (15,791)
Amortisation (2,984)
At 30 June 2025 (18,775)
Carrying amount
At 1 January 2024 8,750
At 30 June 2024 10,179
At 31 December 2024 10,124
At 30 June 2025 9,100
The US Soluna platform has a carrying value of £7.8m, the Kooth Klassic UK
platform has a carrying value of £1.1m and the Soluna UK platform has a
carrying value of £0.2m. All three platforms have a remaining amortisation
period between 1 and 3 years.
13. Trade and other receivables
Six months ended 30 June 2025 Six months ended 30 June 2024 Year ended 31 December 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
Trade receivables 5,857 5,128 7,409
Prepayments 1,269 1,049 1,289
Other receivables 528 57 35
7,654 6,234 8,733
All amounts shown above are short term. The net carrying value of trade
receivables is considered a reasonable approximation of fair value.
14. Post balance sheet events
No significant events have taken place after the period end date.
1 (#_ftnref1) For H1 2024, the constant currency rate was 1.2604 for US
Dollar. The H1 2025 average rate is 1.3068
2 (#_ftnref2) The H1 2024 constant currency rate for ARR is the 30 June 2024
rate of 1.2646 for US Dollar. The H1 2025 end rate is 1.3661.
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