Sygnity Group has reported its financial results for H1 FY 2015/2016

04.08.2016

Improvement of revenue outlook is one of the key objectives that were achieved through hard work on broad business expansion in three sectors where Sygnity has a solid position - public, banking and finance and utilities.



Sygnity Group has reported its financial results for H1 FY 2015/2016, for the period commenced October 1, 2015 and ended March 31, 2016.


Several key elements merit particular attention, which in the opinion of the Management Board will be contributing towards consistent improvement of results in the coming months of the current fiscal year.


These include:

  • higher revenues – PLN 244.3 million (+6.3% y/y),
  • improved profits: EBITDA of PLN 15.6 million (+17.8% y/y) and EBIT of PLN 7.2 million (+29.8% y/y),
  • EBIT margin was 2.9% (+0,5 pp y/y),
  • higher y/y backlog for H2 of the fiscal year,
  • total order book value for H2 2016 is PLN 160 million, and for 2017 and subsequent years it is PLN 256 million, bringing the present backlog for future periods to PLN 416 million,
  • maintaining cost discipline – the overhead expenses were 8.2% of revenues (-2.4 pp y/y),
  • contract awards in 18 tenders of total value exceeding PLN 108 million meaning achievement of the market leader position in function of values of contracts won in IT sector tenders that were awarded by public administration in Q1 of 2016 calendar year.


Improvement of revenue outlook is one of the key objectives that were achieved through hard work on broad business expansion in three sectors where Sygnity has a solid position - public, banking and finance and utilities.


“The situation in the public sector, which is of key importance to us, was strongly influenced by remodeling of the political arena. It resulted in decrease of number of procurements by tendering and thus their budgets. Also the continuing delay in assignment of another tranche of EU funds has its consequences. Despite unfavorable environment in Q1 2016 calendar year, Sygnity has been the market leader in the total value of tender contracts awarded for IT in the public administration. We have won with 18 bids of total value of over PLN 108 million. Our strong position in the sector is underlined by realization of important contracts for the government administration as well as acquisition of new contracts, including those of high public profile, such as the “Family 500 Plus” Program for the Ministry of Family, Labour and Social Policy” – comments Janusz R. Guy, CEO of Sygnity S.A.


In H1 of its current fiscal year Sygnity has developed and implemented the system running the government “Family 500 Plus” program. This solution, developed in relatively short time, allows complete processing of all stages of the 500 Plus child benefits scheme: commencing with acceptance of applications, through issuance of administrative decisions and payout of the benefits in cash or by transfer.  


The central government administration’s strategic e-Taxes Program is also being delivered according to schedule. In January 2016 the Mass Channel for Disability Pension Agencies was launched, followed in March by the new PFR (Prefilled Tax Return) module for PIT-37 and PIT-38 tax returns supplemented with information coming from the Disability Pensions Agencies. Also at the beginning of the year the Tax Portal was expanded with the Taxpayer Account, a completely new functionality available to logged-in users. The next element of the system, currently under development, will be the Register of General Powers of Attorney.


To balance out the revenues in the income portfolio and to limit backlog fluctuations, the company consistently strives to increase its revenue stream from the banking and finance sector. Sygnity’s stable position in the segment and strong trust by its clients are reflected in delivery of important contracts, including for the Bank Gospodarstwa Krajowego. Customers from this sector are highly interested in the new proprietary omnichannel solutions that allow maximizing the accessibility of bank or financial institution offerings through selected access channels. Sygnity intends to introduce such new products to the market already this year.


Thanks to signing several important contracts in the utilities sector the company has achieved its planned revenue level. Particularly notable is the implementation of the Sygnity’s authored SUS system at a Power Utility. The system comprehensively covers all key business processes relating to customer service in the deregulated electricity and gas market during the entire customer lifetime – commencing with customer acquisition, through contract fulfillment, up to its termination.


“New agreements and significant contracts, including with ZUS, ARiMR, or PSE Innowacje, allow consistent build out of our order portfolio. Revenues for H2 FY 2015/2016 from contracts signed by May 6, 2016, are PLN 160 million and are c.a. 3% higher on year to year basis. In turn, the portfolio of orders for FY 2017 and subsequent years is PLN 256 million, bringing the current backlog for future periods to PLN 416 million. Moreover, the order book, as we were announcing, is becoming ever more diversified in function of share of key sectors, clients, scope of products and services supplied as well as the value of orders. This allows us to assume higher profitability of our future contracts” –summarizes the CEO of Sygnity. “Sales effectiveness, new high profile contracts, backlog level, cost discipline and permanent decrease of overhead expenses will in the opinion of the Management Board be contributing towards achieving positive dynamics both in revenues and in the profits in the coming quarters of this fiscal year.”


H1 FY 2015/2016 RESULTS.


Revenues of the Sygnity Group in H1 FY 2015/2016 were PLN 244.3 million (+6.3% y/y). Gross profit on sales amounted to PLN 37.9 million (-4.9% y/y), EBITDA was PLN 15.6 million (+17.8% y/y), EBIT was PLN 7.2 million (+29.8% y/y), and the net profit was PLN 3.0 million (-34.0% y/y). EBITDA margin in H1 was 6.4% (+0.7 pp y/y), EBIT margin was 2.9% (+0.5 pp y/y), while the net profit margin was 1.2% (-0.8 pp y/y).


The company is maintaining cost discipline. Overhead expenses in H1 FY 2015/2016 were 8.2% of revenues and compared to H1 of previous year their share in revenues dropped by 2.4 pp. The cost of goods sold increased to PLN 13.5 million (5.5% of revenues, +1 pp), however it was a planned increase related to the intensification of sales operations as well as optimization of the Sales Team. This decision is already reflected by results such as: high contract win rate by the tendering teams and increased Group’s revenues in this period on year to year basis. Also the financing structure has been optimized, clearly reducing the financial expenses – in H1 they were 18% lower on year to year basis.


PDF (221.07 kB) Sygnity Group has reported its financial results for H1 FY 2015/2016   

Contact for media

Lidia Klosowska

Marketing and Partnerships Director

+48 508 021 623

lklosowska@sygnity.pl