Comarch IT's current order backlog for 2024 higher by around 2-3 pct y/y

Order backlog's value for 2024 of listed IT group Comarch is now approximately 2-3 percent higher than a year ago, the company's CFO Konrad Taranski told a press conference.

"The order backlog is unchanged - as after the first quarter, the dynamics are around 2-3 percent depending on the day," Taranski said.

"Contracts are signed every day, and the level of dynamics has been similar for several quarters. (...) Here we do not consider exchange rate effects, this has a considerable impact on the readings in the individual quarters," he added.

Comarch's CFO assessed that the group's business is shaping up stable this year.

"We have a lot of contracting in some areas, but these contracts are of a long-term nature and do not immediately have a significant impact on the improvement of sales revenues," he explained.

For the entire first half of 2024, Comarch had revenue of PLN 878.5 million (EUR 205.3 mln), EBIT of PLN 37.3 million (EUR 8.7 mln), EBITDA of PLN 87.3 million (EUR 20.4 mln) and the attributable net profit of PLN 23.5 million (EUR 5.5 mln).

As reported, the group's results in the first half of 2024 were affected by, among others, the creation and release of allowances for doubtful trade receivables, which reduced operating profit by PLN 5.07 million (EUR 1.18 mln), and the creation of an impairment loss on goodwill related to Comarch Healthcare S.A.S., which reduced operating profit by PLN 5.04 million (EUR 1.17 mln).

"At the end of the first half of the year, revenues increased. (...) Business grew especially in areas such as telecommunications, ERP solutions on the Polish market or finance and banking. Part of the revenue growth is related to exchange rate differences, especially these effects were visible in the second quarter," Konrad Taranski said.

Comarch group's operating profit amounted to PLN 9.8 million (EUR 2.3 mln), up from PLN 4.5 million (EUR 1.1 mln) a year ago. This result was 57.5 percent lower than the consensus of PLN 23.1 million (EUR 5.4 mln).

EBITDA stood at PLN 35 million (EUR 8.2 mln), up 28 percent year on year and 26.7 percent below consensus of PLN 47.8 million (EUR 11.2 mln).

Sales revenue amounted to PLN 443.8 million (EUR 103.7 mln), up 12.4 percent year on year and 8.7 percent above consensus.

In the second quarter of 2024, the group achieved PLN 205.8 million (EUR 48.1 mln) in domestic sales, up by 12.5 percent from the prior year period. Foreign sales amounted to nearly PLN 238 million (EUR 55.6 mln), up by 12.3 percent year on year.

Foreign sales accounted for 53.6 percent of the group's total revenue.

As stated in the report, the increase in the value of revenues from foreign sales was significantly influenced by exchange rate differences realised and from the balance sheet valuation of trade receivables, related to the strengthening of the PLN exchange rate against foreign currencies, which increased sales revenues by PLN 1.95 million (EUR 455,700).

Profitability on operating sales in the first half of 2024 increased to 4.2 percent from 2.9 percent a year earlier, while net profitability fell to 2.7 percent from 6.1 percent.

The size of the Comarch group's workforce decreased by 2 percent in the first half of 2024. As of June 30, the group employed 6,351 people, 128 fewer than on December 31, 2023.

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