- Revenue +37 percent and EBT +75 percent in the first half of 2022
- Success in the labour market: more than 10,000 talents worldwide for the first time, all countries with "Great Place to Work" certification
- Recognition by independent market experts as leader for digital banking and AI in the Google Cloud
- Diversification continued: Insurance sector grows year on year by 50 percent, Industry & Others by 48 percent
- Guidance raised slightly: revenue 2022 EUR 730 million, EBT EUR 60 million
Stuttgart, 11 August 2022 – In the global finance sector, demand for new types of cloud-native core banking systems is huge. In 3 Asian countries alone, 22 new digital banks are currently being set up or will be in the near future*. At the same time, established banks around the world are also under pressure by the competition to modernise their systems.
GFT Technologies SE (GFT) is a sought-after partner around the world for such complex digital banking projects – as well as for modernisation and transformation projects for insurance and industrial companies. GFT is leveraging the strong demand in all sectors to continue its dynamic growth of recent quarters.
Sustained above-market growth
In the first half of 2022, the company raised revenue by 37 percent and pre-tax earnings (EBT) by as much as 75 percent. Business was particularly strong in the Americas, UK & APAC segment, with an increase in revenue of 62 percent. This growth is being driven by complex, long-term modernisation and transformation projects. Banks and insurance companies in particular, as well as industrial clients, are turning to GFT to implement such projects.
In view of this positive business development and better than anticipated orders, GFT expects this development to continue. The company has therefore upgraded its full-year revenue guidance slightly to EUR 730 million (previously: EUR 720 million). This corresponds to revenue growth of around 29 percent compared to 2021. Pre-tax earnings for the full year are likely to reach around EUR 60 million (previously: EUR 58 million), corresponding to expected year-on-year growth of around 50 percent. The Group expects adjusted EBITDA to grow to around EUR 81 million (previously: EUR 79 million), around 25 percent more than in 2021. Russia’s war against Ukraine and its consequences have had no negative impact on GFT’s business so far.
Independent market experts rank GFT as "leader"
Independent market experts recognise GFT as an international leader. A new report by analysts Quadrant Knowledge Solutions ranks GFT as a global "leader” in the field of digital banking. One important reason for this is GFT’s digital banking solution BankLiteX. The analyst firm ISG has also named GFT a European “leader" for data analytics and machine learning in the Google Cloud.
"In the dynamic markets of the Americas, UK & APAC segment, we have successfully established ourselves as a leading provider for transformation projects in the banking and insurance sectors. We expect demand for these complex, long-term projects to continue,” explains Jochen Ruetz, CFO of GFT. “Solutions for cloud-native digital banks in particular are in strong demand. And we have very attractive offerings in this area with solutions such as BankLiteX."
Diversification continues to drive growth
The GFT Group generated revenue of EUR 357.25 million in the first half of 2022. The company thus exceeded the prior-year figure of EUR 261.58 million by 37 percent. Its diversification strategy once again proved to be a key driver of this growth: in the Insurance sector, revenue rose by 50 percent, in the Industry & Others sector by 48 percent. In the Banking sector, revenue was 32 percent higher than in the same period last year.
Success in the labour market
GFT is also successful when it comes to attracting the best specialists. Despite fierce global competition, as of 30 June 2022 the Group employed a total of 8,451 full-time employees (FTE). This represents growth of 24 percent compared to the end of the same period last year (6,806 FTE). Based on the total number of people employed by the company, including part-time employees and external contractors, this means that GFT has now passed the 10,000-talent mark for the first time. This increase resulted mainly from strong expansion in Brazil. What is more, all GFT’s national companies that exceed the required number of 10 employees recently obtained the globally recognised "Great Place to Work" certification.
There was significant growth in earnings in the first half of 2022. In addition to revenue growth, this was due to the focus on high-margin projects and economies of scale in operations. Adjusted EBITDA was 36 percent up on the previous year at EUR 39.38 million (H1/2021: EUR 28.95 million). EBT climbed by 75 percent to EUR 29.16 million (H1/2021: EUR 16.62 million). Net income improved by 71 percent to EUR 20.69 million (H1/2021: EUR 12.09 million).
Financial stability and flexibility remain sound
Operating cash flow amounted to EUR -0.44 million in the first half of 2022 (H1/2021: EUR 26.73 million). The decline was mainly due to unfavourable working capital effects, especially in connection with fixed-price projects. Net liquidity decreased to EUR -12.89 million (31 December 2021: EUR 1.93 million). Due to the increase in equity capital and simultaneous rise in the balance sheet total, the equity ratio of 37 percent was one percentage point up on the year-end figure (31 December 2021: 36 percent).
Revenue and earnings guidance 2022 raised slightly
The positive development of the GFT Group continued to gather momentum in the first half of the financial year 2022. This trend is rooted in consistently high demand for extensive and complex digitalisation projects. Recognised by independent experts for its sector and technology expertise, as well as its attractive portfolio of digitalisation and cloud solutions, GFT is excellently positioned to benefit from growth trends. For this reason, GFT expects to continue its growth and significantly raise its revenue and earnings in the financial year 2022.
As a result of its very positive business development and the further increase in demand, GFT has again slightly upgraded its guidance for the financial year 2022. GFT now expects revenue growth of 29 percent to around EUR 730 million. Adjusted EBITDA is expected to rise by 25 percent to around EUR 81 million. EBT is likely to increase by 50 percent to around EUR 60 million. For all three key figures, the current guidance is thus above the guidance published in the Annual Report 2021. For the second half of the year, however, it is likely that the growth momentum will slow somewhat, as the development in the corresponding period of 2021 was extraordinarily positive due to pandemic-related recovery effects.
"In the dynamic markets of the Americas, UK & APAC segment, we have successfully established ourselves as a leading provider for transformation projects in the banking and insurance sectors. We expect demand for these complex, long-term projects to continue."
Key figures (IFRS)
(Deviations possible due to rounding differences)
|In EUR million||
|Earnings per share in EUR||0.79||0.46||71%|
|Operating cash flow||-0.44||26.73||-102%|
|Employees (FTE, as of 30 June)||8,451||6,806||24%|
|In EUR million||30/06/2022||31/12/2021||∆|
|Equity ratio (in percent)||37||36||1|
** Adjusted for special items from M&A activities in the comparative period H1/2021.
Further information on the definition of alternative performance measures is provided here on the GFT website.
GFT consolidates above-market growth
IT specialist achieves significant revenue growth again and exceeds 10,000 talents for first time