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Comarch - Consolidated financial statement in the First Half of 2009

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In the first half of 2009, Comarch Group sales revenue climbed by 49.2 million PLN, i.e. 18.0 % to 323.5 million PLN year on year. Operating profit amounted to -18.7 million PLN compared to 10 million PLN in the previous year. Net profit attributable to the company’s shareholders decreased to the level of -7.1 million PLN.
- The result is not a surprise for the market. Losses are generated by the costs of the restructuring program of SoftM, which was acquired in Germany. Comarch incurred costs related to foreign activity and the development of new products. We have developed branch offices in Germany, France and Asia. The major portion of the loss is from accounting costs. The results of a long-term strategy provided weak initial revenue in the short-term - said Janusz Filipiak, CEO of Comarch SA.
The Management Board of the Capital Group expects an upswing of revenue in the following quarters of this year.
- We have noted a revival of our contractors. This should improve our revenue in the fourth quarter of 2009 and the first quarter of 2010 - explained Filipiak.
As of end of July 2009 the backlog for the current year was 487.0 million PLN. The value of current orders for proprietary services and software rose by 7.3 %.
A significant rise in backlog for proprietary products and services compared to the analogical period of the previous year confirms that the Group can sustain stability of development in the following years. Decrease in the value of current orders for computer hardware and third party software is a temporary situation and is connected to the worsening economic situation in the current year. In stating this however, the Management Board stresses that increasing EBIT margin through sales of proprietary software remains one of the Group’s very highest priorities within the current and following year.
In the first half of 2009, revenue from sales in the Comarch Group increased by 49.2 million PLN, i.e. 18.0 % compared to the first half of 2008. Foreign sales recorded a significant growth of 111.2 million PLN and were up 221.9 % half-year on half-year. The share of foreign sales in overall sales was at 49.9 % against 18.3 % in H1 2008. The total recorded for revenue from foreign sales takes into account the SoftM Group with an amount of approximately 90 million PLN, which was incorporated in December 2008. Foreign sales would account for 71.4 million PLN and would be higher by 42.4 % than in H1 2008 without SoftM’s contribution.
- The revenue achieved from foreign sales has confirmed the efficiency of the implementation strategy of intensification of foreign sales of Western and Central European markets as an effective method for Comarch’s long-distance development - said Konrad Tarański, Vice President of the Board, Chief Financial Officer of Comarch SA.
Sales to customers in the DACH region have a great weight for the Comarch Group and constitute 32.3 % of the total revenue. The value of foreign contracts in current orders for 2009 amounted to 118.0 million PLN (excluding current orders in SoftM Group) and increased by 17.2 % compared to the previous year’s half year. Sales to the Telecommunications, Media, and IT sector enjoyed the greatest advance in the first half of 2009 with a year on year rise of 22.1 million PLN, which was up 48.7 % compared to H1 2008. There was also a significant increase in sales to Small and Medium-Sized Enterprises - Polish sector - up 12.0 % year on year. Sales to the Industry & Utilities sector over the year were 5.0 % higher than H1 2008.
- Regardless of the periodic amplitude of prosperity in particular sectors of the market, with the help of a varied backlog of customers and the diversification of revenue source and portfolio, Comarch has a possibility for the permanent development of our activity. The efficiency of this strategy is especially apparent this year,  as the economic slowdown has had a different impact on particular groups of our customers - commented Konrad Tarański,  Vice President of the Board, Chief Financial Officer of Comarch SA.