Asseco's dynamic growth - record-breaking sales and further expansion on international markets
In the first half of 2019, Asseco achieved a record-breaking sales and significant growth at the level of operating profit. The Group's sales revenues in this period reached the level of nearly PLN 5 billion. Asseco successfully continues its growth strategy on foreign markets, where it generates 88% of its sales revenues. Asseco's core business is the sale of proprietary software and services, which in the last semester reached over PLN 4 billion or 82% of the Group's total turnover. The Group's operating profit amounted to PLN 453.6 million or 22% more than in the corresponding period in the previous year.
For the assessment of the financial position and business development of the Asseco Group, the basic figures published on a non-IFRS basis constitute an important piece of information. They are complementary to the data reported under the IFRS standard*. In the first half of 2019, non-IFRS operating profit amounted to PLN 565 million and was higher by 13%, while non-IFRS net profit amounted to PLN 180 million.
This was another good quarter for Asseco. We are satisfied with our results and once again we report double-digit increases in revenues and operating profit. We are particularly pleased with the positive impact of our strategy, which is based on international expansion. Over PLN 3 billion in revenues and 18%-growth in the Formula Systems Group companies, as well as PLN 1.3 billion in sales and 10%-growth in Asseco International are the result of consistent diversification of our business. Recent acquisitions give us interesting prospects for growth on new markets and for expanding our offer of innovative IT products. We are also satisfied with our performance in Poland, especially in the banking sector. Despite a very successful 2018 year and a high base effect associated with it, in the past six months we again achieved excellent results and we also see good prospects in the public sector. Large tenders were resolved and we signed new, important agreements with public sector institutions and enterprises, including ARiMR (the Agency for Restructuring and Modernisation of Agriculture), KRUS (the Farmers' Social Security Fund), ZUS (the Social Insurance Institution) and PGNiG. We are also actively developing promising areas, such as cyber security or cloud solutions, said Rafał Kozłowski, Vice President of the Management Board, Asseco Poland.
The sales revenues of the Asseco Group are diversified by sectors. In the first half of 2019 the banking and finance segment accounted for 40% (PLN 2.0 billion) of total sales, the general business segment for 37% (PLN 1.8 billion) and the public administration segment for 23% (PLN 1.2 billion). Asseco is also geographically diversified and presents its results broken down by three segments: Formula Systems generated 61% of the Group's consolidated revenues (PLN 3 billion), Asseco International - 27% (PLN 1.3 billion), and Asseco Poland - 12% (PLN 0.6 billion).
At present, the Group's order backlog for 2019 at the level of revenues amounts to PLN 9.1 billion and is by 13% higher than in the case of the backlog presented in August 2018.
*Non-IFRS figures include adjustments for: the cost of amortization of intangible assets recognized under the combination settlement (PPA), the costs of share-based payment transactions with employees (SBP) and the costs and financial revenues resulting from the transactions of purchase and sales of companies (M&A) and tax effects associated with them).