Asseco - continued stable growth and strong financial performance
In the first half of 2022, Asseco generated PLN 8.3 billion in revenues, which marked an increase by 22% year-on-year. The sales of proprietary products and IT services went up, compared to the first six months of the previous year, by 21% and amounted to PLN 6.4 billion. Consolidated operating profit amounted to PLN 930 million, up by 38%. Net profit attributable to the shareholders of the parent company stood at PLN 249 million, up by 3%. The Group continued its growth in all business segments.
For the assessment of the financial situation and development of the Asseco Group's business activities, the basic data published in non-IFRS* terms is an important piece of information. In the first half of this year, non-IFRS operating profit amounted to PLN 964 million, up by 17% versus the first half of the previous year, and non-IFRS net profit amounted to PLN 271 million, up by 8%.
The Group pursued its strategy of geographic, product and sector diversification of its business, resulting in increased sales in all operating segments. In H1 2022, foreign markets represented by Formula Systems and Asseco International accounted for 90% of the Group's total sales.
Revenues in the Formula Systems segment amounted to PLN 5.5 billion, up by 27%, and operating profit reached PLN 635 million, having increased by 87% versus the corresponding period in 2021. The reported level of operating profit in this segment is significantly and negatively impacted by additional amortization costs of intangible assets recognized under the acquisition settlement (PPA) and costs of equity-settled transactions with employees (SBP), which reduced it by PLN 162 million in H1 2022. At the same time, in the reporting period, operating profit in the amount of PLN 192 million was favorably impacted by the sale of shares in Infinity Labs R&D. After taking these adjustments into account, the Formula Systems segment's non-IFRS operating profit stood at PLN 605 million, which marked an increase by 27% versus the same period last year.
In the Asseco International segment, sales rose by 15% to PLN 1.9 billion, and operating profit reached PLN 155 million. The segment's non-IFRS operating profit was 3% higher year-on-year, reaching PLN 213 million.
The Asseco Poland segment generated PLN 838 million in revenues, 12% more than a year earlier, and operating profit was 2% higher at PLN 141 million.
Asseco's revenues are very well diversified by sector. In H1 2022, they were distributed as follows: general business segment - 43%, banking and finance segment - 33%, and public institutions segment - 24%.
In Q2 2022 alone, the Group recorded sales of PLN 4.2 billion, which marked an increase by 23%. Operating profit was PLN 540 million (up by 54%), and non-IFRS operating profit reached PLN 484 million (up by 13%). Net profit attributable to the shareholders of the parent company stood at PLN 141 million (up by 1%), and in non-IFRS terms at PLN 147 million (up by 10%).
The first half of the year was positive for us. Despite the difficult situation in the economy, we maintained the upward trend in our financial results. We reported revenue growth in all business segments. Our geographic, product and sector diversification of business and strong demand for digital solutions allow us to grow steadily. On a non-IFRS basis, our operating profit grew by 17% and non-IFRS net profit by 8%. The lower growth rate of non-IFRS operating profit vs. non-IFRS net profit is due to our sales mix and the more dynamic growth of the places where we do not consolidate 100% of net result, i.e. mainly the Formula Systems Group companies. Non-IFRS operating profit of the Asseco Poland segment, which is consolidated at the net level practically in its entirety, and for which there is no exchange rate effect, increased by 2%. We see these increases as a great success in such a turbulent environment, comments Karolina Rzońca-Bajorek, Vice President of the Management Board of Asseco Poland.
In the first 6 months of 2022, we executed servicing and development contracts for existing customers. We also signed new long-term contracts. We have consistently pursued a strategy based on our proprietary products and M&A. In the first half of this year, 7 new companies joined the Asseco Group. We approach the future with caution, taking into account the macroeconomic situation and the increase in labor costs. However, we are not slowing down when it comes to contracting new projects, which is confirmed by the double-digit growth of Asseco's order backlog for 2022, added Karolina Rzońca-Bajorek, Vice President of the Management Board of Asseco Poland.
Asseco's consolidated order backlog for 2022 in floating exchange rates, in the area of proprietary software and services, is now worth PLN 12.5 billion and is 24% higher than in the same period last year. In constant exchange rates, in which the backlog for 2021 was converted, the increase is 11% to PLN 11.2 billion.
*Non-IFRS recognition includes adjustments for the cost of amortization of intangible assets recognized as part of the merger settlement (PPA), for the cost of equity-settled transactions with employees (SBP), and for income and expenses related to company acquisitions/sales and one-time events (and related tax effects).