Bittnet Group posts consolidated revenues of 192.5 million lei and operating profit of 8.5 million lei in 2022
Bittnet (BNET), a group of IT companies listed on the Main Market of the Bucharest Stock Exchange, posts consolidated revenues of 192.5 million lei in 2022, a 71% increase compared to 2021, and an operating profit of 8.5 million lei, a 119% appreciation. The financial result decreased from a profit of 9 million lei in 2021 to a loss of 7.6 million lei in 2022, the difference being 75% explained by the different impact of non-cash adjustments on the market (mark-to-market) of the group’s stakes in other listed companies.
“2022 marked the transition to a new level of development. Our growth efforts, both organic and through acquisitions, led to the registration of the highest values in the company’s history for turnover, gross margin, operating profit, cash flow, equity, and cash position. At the same time, for the second time in 16 years, in 2022, the gross profit was negative, mainly due to the various non-cash adjustments required by IFRS standards.
After a period in which we have focused both on the successful completion of acquisitions of companies and their integration into the Bittnet Group and on accelerated organic growth, we are approaching the critical size from where the net profitability will no longer define the operational one. Considering the size reached in 2022, and the transactions signed or in the pipeline, we believe that in 2023 we can already start focusing more on extracting profit from the business “, stated Mihai Logofatu, CEO of Bittnet Group.
In 2022, the Technology Division, which includes Dendrio Solutions, TopTech, 2Net and Optimizor, FORT, Elian, Nenos Software, and Nonlinear companies, recorded total consolidated revenues of 172.2 million lei, a 75% increase compared to 2021 and a gross margin of 33.4 million lei – up 95%. Last year was incredibly dynamic for this division, both in terms of business growth and structure. During the past year, two new companies entered the division, TopTech, and 2Net, and the three cybersecurity companies (Global Resolution Experts, GRX Advisory, and ISEC) were transformed into a single brand (FORT). At the level of Dendrio were also implemented several operational and team-level changes.
In 2022, the Bittnet Education division consisting of Bittnet Systems, Computer Learning Center, and Equatorial Gaming, recorded consolidated revenues of 21.5 million lei, a 44% increase compared to 2021, and a gross margin of 9 million lei, a 24% increase. In 2022, this division saw a significant increase in projects, teams, trained students, and collaborators trainers. At the same time, the division registered an accelerated growth in the volume of courses, over 550 private and public sessions, with over 5,900 trained participants, double compared to 2021.
“2022 is the sixth year of positive operating cash flow: almost 18 million lei, a value 4.5 times higher than 2021. At the end of the year, 42 million lei, the cash position represents approximately 25% of the company’s stock market capitalization. Combined with the ongoing capital increase, through which we estimate to raise 20 million lei in cash, and with the fact that trade payables are approximately equal to client receivables, we believe that the financial position with which we start 2023 is a substantial one. Thus, we look with confidence at our activity for this year, with the main objectives being the increase in operating profitability, recurring revenue, and the share of services provided outside the country’s borders. However, we do not underestimate the difficulty of this year because of the external factors related to the market, the geopolitical context, inflation, the workforce, delays in supply chains, etc., and also because of internal challenges related to the continuation of the operational integration of all current and future companies in the structure and business processes of the group,” stated Cristian Logofatu, co-founder of Bittnet Group.
In 2020, when the group’s shares were transferred to the Main Market, the assumed objective of the company was to reach a turnover of 500 million lei at the end of 2024. In the three years since listing on the Main Market, Bittnet Group has doubled its turnover while operating profit increased ninefold. Also, as of 2020 and until today, the group’s assets have increased by 150% and equity by 70%. According to current estimates, the company’s management estimates that it will reach the mentioned threshold at the end of next year even without carrying out any other M&A transaction, only from organic growth.
About Bittnet Group
Bittnet was founded in 2007 by brothers Mihai and Cristian Logofatu as a training and IT solutions company in Romania and abroad. Today, Bittnet is a Group of IT&C companies that includes the following brands: Bittnet Training, Dendrio, FORT, ELIAN Solutions, Equatorial Gaming, The eLearning Company, ISEC Associates, Computer Learning Center, Nenos Software & Nonlinear, Optimizor, 2Net Computer, and TopTech. Bittnet Group is listed on the Main Market of the Bucharest Stock Exchange under the symbol BNET.