• In the first half of 2023, the Ailleron Group generated consolidated revenues of PLN 226.2 million (a 27% year-on-year increase).
• The Ailleron Group’s net profit (excluding one-time events) was PLN 20.3 million (a 28% year-on-year increase), with the profit for the controlling entity’s shareholders reaching PLN 9.6 million, which was more than three times higher than in the same period in 2022.
• The EBITDA result (excluding one-time events) reached nearly PLN 35 million (a 50% year-on-year increase).
• Reported results were significantly impacted by one-time write-offs and provisions related to the termination of the agreement with Bank PEKAO SA.
• The Technology Services segment (Software Mind Group) achieved revenues of PLN 195 million (a 32% year-on-year increase).
• The FinTech segment recorded sales of PLN 29.7 million (a 6% year-on-year increase), with the FinTech segment’s revenues, excluding the Pekao project, growing by 19% year-on-year in the first half of 2023.
– Revenues have increased from quarter to quarter despite a rather challenging market situation. As an exporter, we felt the effects of the slowdown in the global IT industry and the impact of a strong PLN exchange rate in the first half of 2023. In the first two quarters of this year, we generated consolidated revenues of PLN 110.6 million and PLN 115.6 million, accordingly. This is the result of further organic growth and the consolidation of entities within M&A processes.– said Rafał Styczeń, CEO of Ailleron SA. – In the upcoming months, we aim to steadily increase our sales in the Technology Services and Financial Technology segments,” added Rafał Styczeń.
Not including the costs of one-time events related to the financial statement provisions and write-offs due to the termination of the agreement with Bank PEKAO SA, the net result for H1 2023 was at the level of PLN 20.3 million, compared to PLN 15.8 million of cleared net profit in H1 2022 (adjusted for costs related to ongoing M&A processes).
– It should be emphasized that in the first half of 2023, the net profit value for the controlling shareholder (excluding one-time events) was PLN 9.6 million, a more than threefold increase compared to the same period last year. We are glad because these results confirm that the decision to develop part of the business together with Enterprise Investors was the right one, enabling acquisitions and further rapid organic growth of Software Mind. – concludes Rafał Styczeń.
The reported operating loss of the FinTech segment in the first half of 2023 (-PLN 3.6 million) is mainly due to one-time charges related to the termination of the agreement with Bank Pekao SA, as well as the costs associated with executing this contract over H1 2023. After adjustment, assuming hypothetically no contract from the beginning of 2023, the operating result of the FinTech segment would have been PLN 1.1 million. The FinTech segment’s revenue (excluding the contract with Bank Pekao SA) increased from PLN 25 million (H1 2022) to nearly PLN 29.7 million in H1 2023, representing a growth of +19%.
– In the FinTech segment, we identify areas where we see potential to increase our revenues. Our goal in the following quarters is to focus on developing Financial Technology Services, LiveBank, and LeaseTech. We notice a lot of promising capabilities for LiveBank and intend to change the positioning strategy for this product shortly. Our clients also recognize the effectiveness of LiveBank in selling their products. For example, ING Bank, which uses our solution for servicing and selling mortgages, receives high satisfaction ratings from agents and customers. – said Piotr Piątosa, Vice President of the Management Board and COO at Ailleron SA. – Currently, we also see a strong demand for technological solutions that leverage AI and ML, and we are conducting development work in this area apart from our current services. Our strength lies in our extensive experience in collaborating with the FinTech industry, allowing us to understand financial sector clients’ needs and stand out with the relevant know-how. – emphasized Piotr Piątosa.
The dominant segment of the Group’s operations, both in terms of scale measured by sales and results, remains Technology Services (under the Software Mind Group). In the first half of this year, the Technology Services segment achieved sales of PLN 195 million, marking a 32% increase compared to the corresponding period in 2022 (PLN 147.6 million). The operating profit after six months of 2023 was PLN 28.1 million, compared to PLN 21.3 million last year (while maintaining the operating profit margin at 14%).
– Despite reductions in customer budgets or postponements, we maintain high contract commitment levels. This is evidenced by our business’s continued high growth rates – in Q2 alone, we increased revenue organically by 18% year-on-year. We see potential for higher demand early next year. Diversification is a key advantage for us, both in terms of geographic presence and the range of clients and teams we manage. Additionally, the recent acquisitions and team integration processes have proven successful at this stage. As mentioned previously, we are actively exploring opportunities for further acquisitions to expand our Group. – explains Grzegorz Młynarczyk, CEO of Software Mind.
Throughout the current year and in the coming years, the primary direction of development for both Throughout the current year and in the coming years, the primary development direction for both the Company and the Ailleron Group will be international expansion. In the first half of 2023, export sales exceeded PLN 169.5 million, showing nearly a 26% year-on-year growth rate. Specifically, the consistent increase in international sales results from the growing share of the Technology Services business, which is almost entirely export-oriented. Ailleron emphasizes growth in several key directions where higher margins can be achieved – Western Europe, Southeast Asia, and the United States. Export revenues for the Group are steadily rising (already accounting for nearly 75%), and Ailleron aims to maintain this trend in the future.
– The achieved financial results confirm the economic and financial stability of the Ailleron Group, with profitable business operations. In H1 2023, we generated net cash from operating activities of PLN 12.0 million, compared to PLN 6.9 million in the same period in 2022. As of the end of June this year, the Group held nearly PLN 91 million in cash and cash equivalents. This level ensures our financial security, enables profit-sharing with Ailleron SA shareholders, and provides opportunities for the continued growth of the Group, both organically and through acquisitions. – says Tomasz Król, Member of the Board and CFO of Ailleron SA.
Ailleron remains a dividend-paying company. In the current year, the Company’s shareholders decided at the General Meeting to pay PLN 12.3 million in dividends, equivalent to PLN 1 per share. The dividend record date was set for September 27th, with payment scheduled for October 18th this year. For 2020-2022, Ailleron has already paid its shareholders a total of PLN 20.3 million.
Conference retransmission – H1 2023 financial results (in polish language) – available HERE
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.