On 6 August 2021, BMIT Technologies plc published its condensed interim financial statements for the six-month period ended 30 June 2021.
During the first six months of 2021, revenues surged by 9.4% to a record (at interim stage) of €12.8 million (H1 2020: €11.7 million) on the back of: (i) higher demand for cloud services, driven by increased customer technology adoption; (ii) the drive to online, even as a result of the pandemic, especially for some of the company’s larger customers; and (iii) the considerable growth in managed services (+47%) as this revenue stream continues to recover from the negative effects of COVID-19.
On the expenditure side, operating costs increased at a slower pace than the growth in revenues and amounted to €8.34 million (+7.7%). As a result, the operating profit climbed by 12.8% to €4.48 million whilst the operating profit margin improved to 35% from 33.9% in H1 2020. Excluding depreciation and amortisation charges, EBITDA grew by 11.8% to €5.7 million (H1 2020: €5.1 million) translating into an EBITDA margin of 44.5% (H1 2020: 43.6%). Meanwhile, net finance costs dropped to €0.1 million from €0.12 million in the first half of 2020.
Overall, BMIT reported a 13% increase in pre-tax profits to €4.38 million compared to €3.88 million in H1 2020. After taking into account tax charges amounting to €1.63 million, the net profit generated by BMIT in the first six months of 2021 amounted to €2.75 million (H1 2020: €2.54 million) which, in turn, translates into an annualised return on average equity of 61.3% (H1 2020: 54.3%).
The condensed Statement of Financial Position as at 30 June 2021 compared to the corresponding figures as at the end of 2020 shows that total assets contracted by 3.2% to €24.8 million as the decline in trade and other receivables outweighed the increase in property, plant and equipment. On the other hand, total liabilities expanded by 17.1% to €16.3 million reflecting higher balances of tax liabilities and trade and other payables. As a result, total equity contracted to €8.47 million compared to €11.7 million as at the end of 2020.
In their commentary, the Directors of BMIT explained that throughout the first six months of the year, the company continued to implement various measures aimed at ensuring continuity of service and mitigating any negative impact on business from the pandemic. Nonetheless, the growth registered in the first six months of 2021 was strong enough to mitigate any adverse impact resulting from those customers who were negatively affected by the pandemic.
With respect to the recent decision by the FATF to place Malta on its ‘grey list’, BMIT explained that it is evaluating the medium to longer term impact that this development might have on the company’s business as any delays in the restoration of the country’s reputation internationally may result in structural challenges in the longer term.
BMIT concluded by saying that it is cautiously optimistic about that its current positive performance which can be sustained further for the foreseeable future. The company will continue to actively monitor local and international developments to overcome any challenges that might arise, be they economic, regulatory, or technological. Moreover, BMIT reiterated its objective for market expansion beyond Malta as the company continues to look out for opportunities to achieve this priority. In addition, BMIT expressed its commitment to pursue a well-managed investment programme to help achieve sustainable business growth and long-term return to shareholders.