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August 18, 2022

Bittnet Group reports 20.2 million lei revenues in Q1 2021; targets consolidated turnover of 157 million lei for the entire year

Bittnet (BNET), a group of IT companies listed on the Main Market of the Bucharest Stock Exchange, reports 20.2 million lei in revenues in the first quarter of 2021. The first three months marked an intense M&A activity for Bittnet, as the Group finalized the investments in the eLearning Company and Softbinator and announced the first cross-border investment project in a Servodata, company that has been successfully operating in the Czech and Slovakian markets for over 25 years.

“When looking at the past 12 months, the operational changes introduced in our Group began to generate results quicker than we expected. In the last months we have reinvented our business model. The pandemic changed in the way we prospect and support new customers, how we deliver what they want, and finally, how we turn them into loyal and recurring clients. Despite this major operational transformation, the revenue and gross margin generated during the last 12 months are consistent, proving that our new go-to-market approach works,” said Mihai Logofatu (photo L), CEO and co-founder of Bittnet Group.

The Technology Division, which includes Dendrio Solutions and Elian, registered a solid result in the context of all delivery gaps from producers, recording revenues of 18.1 million lei, a 3% increase YoY, which generated a 5% increase in the related gross margin. The global semiconductor crisis continued to cause delays in the delivery of hardware. Therefore, even if some of the deliveries were successful in Q1 and resulted in an increase in revenues from the sale of goods by 7%, the revenues from the provision of services decreased by 8.5% since not all related services were provided. These revenues will be included in the Q2 2021 results.

The revenues of the Bittnet Group’s Education Division that consists of Bittnet Training and Equatorial Gaming declined 39% year on year as the revenues in Q1 2021 reached 2.1 million lei while gross margin amounted to 1 million lei. The decrease in turnover is due to the postponement of decision to acquire trainings, in the context of the possibility for accessing European funding for education and digitalization projects within companies. The Group has registered a growing demand for digital skills development courses offered by Bittnet, therefore expecting an increase in the number of projects in the coming period.

“In the 12 months ended March 31st, 2021, the consolidated revenues of the Group increased 5%, up to 108 million lei, with gross margin similar to that in the comparable period of last year, of 20 million lei. The static evolution of sales and administrative expenses, paired with a positive evolution of other revenues, generated an increase of 13% in operating profit, up to 2.6 million lei. The increased profitability at the level of gross and net profit in the past 12 months is the result of a significant improvement in the financial result, which reinforces the idea of developing a public offer of preferential shares, which would eliminate the cost of interest rates, thus allowing the Group to record a gross profit much closer to the operational one,” added Cristian Logofatu, co-founder at Bittnet.

For 2021, Bittnet targets a consolidated turnover of 157 million lei and a gross profit of 12.8 million lei. These estimates include the results generated by the companies that joined the Group in 2020. As of 2021, Bittnet Group’s Education Division consists of Bittnet Training, Equatorial Gaming and the eLearning Company. The Technology division consists of Dendrio Solutions, Elian Solutions and Softbinator Technologies. As soon as the transaction is completed, the Technology division will also integrate the Central and Eastern Europe activity of Servodata.

In terms of the capital markets activity, in Q1 2021, 27,6 million BNET shares were traded by the Bucharest Stock Exchange investors, representing over 11% of the total number of shares. The high liquidity of Bittnet in the past years resulted in BNET shares being included in two global micro-cap stock indices of FTSE Russel as of March 22nd, 2021. Only four Romanian listed companies are included in FTSE’s global indices – Banca Transilvania, Nuclearelectrica, Teraplast and Bittnet.


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