AROBS Transilvania Software (BVB: AROBS), the largest technology company listed on the Bucharest Stock Exchange, posts a consolidated turnover of RON 105 million (EUR 21.1 mln) in the first three months of 2024, slightly down by 5%, compared to the first quarter of 2023, normalized EBITDA of RON 20.6 million and a normalized net profit of RON 11.7 million.
“The first quarter of the year continued to be difficult for the global IT industry, reflecting the companies’ tendency to focus on operational optimizations and budget constraints for software development projects and delaying new project launches. However, in a volatile, uncertain, complex and ambiguous context of the times – VUCA, we are motivated to remain persistent and focus on growth and development opportunities for our business lines. Despite the challenges, we maintained a steady level of revenue from the software services segment, and revenue from software products increased. The decline came from the delay in the launch of some projects in the integrated systems field. We are confident that we can achieve our goals, which we have assumed through the revenue and expense budget, as well as those in the medium and long term. We continue to believe that our growth strategy will provide results, being based on a greater proximity to customers in the US and Europe and to global technology centers, on focusing on embedded technologies, cybersecurity and R&D, but also on intensifying the integration of the companies that have joined in the last two and a half years,” stated Voicu Oprean, founder and CEO of AROBS.
In terms of revenue at the consolidated level, in the first quarter of 2024, revenue from software services remained almost at the same level as in the first three months of 2023, contributing 82% to revenue, respectively RON 86.4 million. The software products segment registered a 14% increase due to new customers being added to the company’s portfolio, its contribution to the turnover being 17%, RON 16 million. Also, the third business line, the integrated systems segment, contributed 1% to the turnover, generating revenues of RON 0.4 million in the first three months of 2024. This business segment focuses on implementing hardware and software services for the public sector.
“The first quarter of 2024 continued to be marked by challenges. The turnover related to the software services and software products segments recorded, cumulatively, a 1% increase compared to the same period of the previous year. However, at the level of the integrated systems division, a significant decrease was recorded compared to the first quarter of 2023, determined by the seasonality and the type of contracts won in the public tenders in which we participate through this division. Therefore, this led to a 5% decrease in turnover at the group level in the first three months of the year compared to the first quarter of 2023,” stated Bogdan Ciungradi, CFO of AROBS.
Regarding the contribution of the companies acquired by AROBS as of 2023, in the first quarter of 2024, at the level of the turnover of the software services segment, the new companies contributed RON 7.2 million, a significant increase compared to RON 1,4 million in the first quarter of 2023. Regarding the software products division, the companies that joined the group in 2023 contributed RON 1.5 million to the turnover related to this segment.
The strategic perspective of AROBS is based on organic expansion in the European Union and US markets, through an even greater proximity to customers and global technology centers, on capturing new opportunities in non-automotive embedded technologies, and in the field of cybersecurity. The company wants to consolidate its position as the R&D partner of choice for global partners in complex projects of Embedded (Automotive, Aerospace, Maritime, Medical Devices), Clinical Trials, IoT, Travel, Enterprise Solutions, Fintech and Intelligent Automation. Another significant activity for AROBS is the continuation of the integration process of the entities in the group. This process, in some cases, will also include the absorption of the acquired entities to simplify the structure of the Group, facilitate operations between companies, and, above all, reduce costs and redundant functions, as well as maximize synergies.
In terms of M&A activity, AROBS will continue the acquisition process by carefully examining the present opportunities, focusing on synergies, complementarities, and solid results of potential acquisitions. For this purpose, in the medium and long term, the Group considers using its own reserves and obtaining financing from sources specific to the capital market.
Based on this strategy, management maintains the prudent revenue and expenses budget approved by the shareholders during the annual GSM at the end of April 2024. The budget targets a consolidated turnover of RON 494.9 million, a normalized EBITDA of RON 92.9 million, and a normalized net profit of RON 48.8 million.
As of September 25, 2023, AROBS Transilvania Software is listed on the Main Market of the Bucharest Stock Exchange, Premium category.
* This is a press release.
