Sirma H1 2018: Net income nearly 60% up

Sirma Group Holding

Sirma Group Holding

IT company Sirma Group Holding expanded consolidated top line 29.4% y/y to BGN 28.5m, net income surged 58.9% y/y to BGN 2.8m in H1 2018, according to latest interim financials published by the Company. Sales in Sirma’s top market in Europe added 69.7% y/y to BGN 18.9m, with Bulgarian sales alone advancing 50.9% y/y to BGN 13.5m. The Company’s second biggest market in North America, however, registered a 27.8% y/y decline to BGN 4.5m, with US sales alone dropping 28.7% y/y to BGN 3.8m. In H1 2018, labor costs were kept flat at BGN 10.6m.

Higher expenditure in H1 2018

Operating expenditures were up by 59.1% y/y to BGN 14.9m, with external costs boosted twice to BGN 6m on higher expenditures for software services and COGS adding 16.5% y/y to BGN 9.7m. Amortization & depreciation (A&D) and capitalized costs dropped by 59% y/y and 61% to BGN 2m and BGN 2.8m, respectively. Lower A&D decreased EBITDA by 29.5% to BGN 4.9m, yet coupled by accelerated revenue growth resulted in a net income surge of 58.9% to BGN 2.8m.

Consistently following strategy to 2022

Following discussions with shareholders and stakeholders, earlier in 2018 Sirma Group Holding officially disclosed its Strategy for Development and Growth for the period 2018 – 2022.

The Strategic aim of the Group is reaching EUR 100 million of sales revenue by 2022. This corresponds with CAGR 30% of revenue over the period. The Strategy provides 70% of sales revenue in 2022 to be generated in North America and Europe with a overwhelming share (again 70%), achieved using the XaaS sales model. The fast growth rate should be achieved while preserving the operational efficiency of 29% EBITDA margin.

Read more in Strategy 2018 – 2022

Check the latest equity research reports by ELANA Trading in ELANA Online