Ailleron Group improved FinTech segment profitability and doubled profit in Q1 2023

• The Ailleron Group generated PLN 110.6 million in consolidated revenues in Q1 2023, a 44% increase compared to Q12022.
• Exports accounted for 80% of revenues generated, reflecting the company’s growing international presence. 
• EBITDA exceeded PLN 15.6 million (up 28% year-on-year).
• The consolidated net profit reached PLN 8.1 million, which doubled from the previous year. Additionally, the profit attributed to the parent company’s shareholders was PLN 2.8 million, significantly higher than the adjusted profit of Q1 2022, which was PLN 0.8 million.
• The revenue of Software Mind Group has risen to PLN 95 million, marking a 51% increase year-over-year, which includes a 26% organic growth.
• The revenues of the FinTech segment rose by 16% year-over-year to reach PLN 14.9 million. 

– Another very good quarter is behind us. Net profit for the last four quarters attributable to the parent company shareholders, excluding one-offs, rose to PLN 19.5 million. In Q1 2023, we maintained our high dynamics and determination to grow while working to improve the profitability of the FinTech segment – said Rafal Styczeń, CEO of Ailleron SA. – We consistently implement our strategic goal of developing two independent, profitable and fast-growing international businesses – Software Mind and Ailleron. As for the FinTech segment, despite the global turmoil in the banking sector, we still see robust demand in the market from financial institutions for IT products and services – adds Rafal Styczeń.

At the end of 2022, the company sold the loss-making HotelTech business. As a result, the first quarter of this year was the first period where the impact of this segment did not burden the result of the Ailleron Group. The sale of HotelTech was another step in implementing Ailleron SA’s New Strategy, which emphasizes the dynamic development of sales of IT services to financial institutions, improving profitability and cash generation capacity.

– We are in a very good financial position. The Group’s reserves of cash and cash equivalents have increased; at the end of March, they amounted to PLN 98 million. EBITDA in Q1 exceeded PLN 15.6 million – says Tomasz Król, board member and CFO of Ailleron SA. – As for the operating results of Ailleron’s businesses, Ailleron managed to significantly reduce the FinTech loss in Q1 (PLN 1.0 million loss compared to PLN 3.4 million in Q1 2022). However, it is essential to note the cyclical nature of revenue realization. In FinTech, seasonality indicates that the first quarter is the “weakest” in annual results (e.g., most service contracts for Ailleron’s products are settled once in the fourth quarter). This means that the full effects of the FinTech segment’s scale-up and gradual improvement in profitability will only be visible in the following quarters – Tomasz Król adds.

The Software Mind Group achieved PLN 94.9 million in revenue and PLN 13.1 million in EBIT. The Software Mind Group’s net profit attributable to shareholders of the parent company Ailleron SA amounted to about PLN 4.6 million in Q1 of this year.

– In 2023, we expect further organic growth of the Software Mind Group, but we also do not rule out acquisitions. We have a large cash reserve and expect interesting investment opportunities to arise in the coming quarters. Despite our good results, we note uncertainty about the economic situation, which means that growth in the global IT services market this year may be weaker than in 2021-22 – explains Grzegorz Mlynarczyk, Software Mind’s CEO. – We believe that our situation is secure due to long-term relationships with clients, which also translates into our stability as an employer- adds Grzegorz Mlynarczyk.

In line with the announced Board of Directors’ recommendation to pay dividends, the company’s Supervisory Board positively evaluated the proposal. As a result, for 2020 and 2021, Ailleron paid a dividend of 32 gr per share. This year, shareholders are expected to receive over PLN 12.3 million in dividends, which is PLN 1 per share. The Annual General Meeting of Shareholders will make the final decision on the payout. 

– We appreciate our shareholders, which we also wanted to emphasize with the dividend recommendation. The Board of Directors intends to share profits with shareholders by, as far as possible, increasing dividends while continuing the dynamic growth of the Ailleron Group. This year, we have proposed a dividend payment of PLN 1 per share, with a 50gr dividend from current consolidated earnings and a 50gr payment from cash from the sale of shares in Software Mind in 2021. Despite the economic uncertainty, we look to 2023 with optimism. Moreover, the Group’s strong balance sheet allows us to take ambitious steps in growth and share profits with shareholders both this year and next,” adds Rafal Styczeń.

Ailleron SA is a dynamic capital group based in Krakow, Poland, trading on the Warsaw Stock Exchange. Its subsidiary, Software Mind, a joint-venture with Enterprise Investors, delivers cutting-edge software development services to pioneering companies worldwide. Ailleron specializes in financial technology services and creating innovative IT solutions tailored for the financial industry across Europe and Asia. With a global reach spanning over 40 countries, the Ailleron Group serves more than 200 clients and employs a robust team of over 1,500 specialists. International markets contribute to a remarkable 80% of the group’s revenue, showcasing its truly global impact.