BMIT Technologies plc - Full-Year Results

On 11 March 2024, BMIT Technologies plc published its Annual Report and Financial Statements for the year ended 31 December 2023.

Performance Overview

Revenues increased by 11.2% to a record of €28.7 million mainly as a result of a 9.8% growth in Data centre, cloud and managed services to €25.2 million (FY2022: €22.9 million). In this respect, revenue from cloud services increased by 38%  while revenue from managed services grew by 22%. Furthermore, sales of hardware and licenses climbed by 10.6% to €3.14 million from €2.84 million in the previous year. Additionally, BMIT’s revenue was boosted by €0.33 million reflecting the first month of income from the management of the mobile network towers purchased from GO in December 2023.

Operating costs also increased by 20.2% to €20.7 million (FY2022: €17.2 million) in line with the expansion in business. Notably, 77% of the additional expenses are related to an increase in the cost of sales stemming from revenue growth in business segments which carry a lower profit margin. Furthermore, €0.56 million of the incremental expenses are attributable to the operation of the mobile towers which started in December (including a one-off pre-acquisition cost of €0.35 million).

Since expenses increased at a sharper rate than revenues, operating profit (‘EBIT’) declined by 6.8% to €8.00 million compared to €8.59 million in 2022. Excluding depreciation and amortisation charges of €2.04 million, EBITDA fell by 6.2% to €10.0 million and consequently, the EBITDA margin eased to 35.0% compared to 41.5% in 2022. Similarly, the EBIT margin declined to 27.9% from 33.3% in the previous year.

After accounting for a marginal finance cost of €0.35 million, BMIT reported a pre-tax profit of €7.65 million, representing a decrease of 8.2% over the previous corresponding figure of €8.34 million. The tax charge for the year amounted to €2.93 million, thus leading to a net profit figure of €4.72 million (-11.9%) which translates into a return on average equity of 43.2% (2022: 49.0%).

The Statement of Financial Position shows total assets jumped to €80.7 million in 2023 (31 December 2022: €25.5 million) mainly consisting of €51.8 million (64.2%) in intangible assets (relating to the tower purchase agreement with GO), €12 million (14.8%) in receivables, €9.1 million (11.3%) in property, plant and equipment, as well as €3.75 million (4.7%) in cash and equivalents. Similarly, total liabilities surged to €69.9 million from €14.4 million on 31 December 2022, mainly driven by bank borrowings which increased to €48.3 million from €3.54 million in the previous year. Furthermore, trade payables doubled to €15.9 million from €7.83 million in 2022. As a result, the company’s equity base declined by 2.5% to €10.8 million compared to €11.1 million as at 31 December 2022.

Dividend

The Directors of BMIT are recommending the payment of a net dividend of €0.02456 per share which represents a payout ratio of 105.9% and is roughly in line with the net dividend in the previous year. The dividend will be payable to all shareholders as at close of trading on 25 April 2024, who will have the option to receive the dividend either in cash or in new ordinary shares at an attribution price of €0.351 per share. BMIT also scheduled its Annual General Meeting for 29 May 2024.

Outlook

In the commentary to the 2023 Annual Report, the CEO remarked that BMIT’s sustained financial performance as well as the positive impact of its ongoing transformation positions the company for sustainable growth.  In this respect, he remarked that BMIT’s vision is to be a leading digital infrastructure and managed services provider offering hybrid solutions to an enhanced customer base. He concluded by stating that the previous year was a testament to BMIT’s adaptability and that through strategic investments in digital infrastructure and product diversification, BMIT has overcome challenges and positioned itself for sustained progress in a dynamic technology industry.