GFT Technologies AG posts most successful financial year in the company's history

5 March 2008

For GFT Technologies AG (GFT), a leading international provider of IT services, 2007 was the most successful financial year in the company’s history. After preliminary calculations, the company was able to significantly increase both revenue and earnings before tax (EBT).

At EUR 247.1m the total revenue was 42 per cent above that of the previous year. The forecast – raised to EUR 230m during the course of the year – could thus be exceeded yet again. Earnings before tax (EBT) also rose accordingly: the GFT Group generated EUR 12.4m, 85 per cent more than in 2006. As expected, the earnings margin stood at around five per cent. At the end of the prior year it was still 3.8 per cent.

At EUR 140.4m, Resourcing was the strongest business division in terms of revenue. Its share of total revenue increased further and now stands at around 57 per cent (previous year: 49 per cent). The division benefited from an increase in demand for IT freelancers and, in particular, from the considerable requirements of a new customer in the Third Party Management segment. The increasing shortage of experts in the IT market, and the continued trend towards fulfilling the needs of IT projects with freelance IT specialists, continue to provide an attractive market environment in this segment.

The GFT Group also achieved significant growth in 2007 in the Services division, by 22 per cent to EUR 100.8m. The deciding factor here was the expansion of the business with existing customers in the finance sector. Due to the tense situation in the financial services industry and on the capital markets, the fourth quarter of 2007 saw a slight hesitancy for the first time on the part of bank customers when investing in new projects.

Although revenue in the Software division fell short of expectations at EUR 5.9m, with the new alignment of the software segment to the e-mail archiving segment, a new and promising market will be quickly addressed. A significant increase in revenue is to be expected here in the coming years.

In the fourth quarter of 2007, the GFT Group achieved revenues of EUR 70.7m. Earnings before tax (EBT) in this time period came to around EUR 3.6m.

As of 31 December 2007, the GFT consolidated balance sheet posted liquid funds and securities of EUR 28.7m. The equity ratio came to 52 per cent. As of 31 December 2007, the GFT Group employed a total of 1,087 people – ten more than as of 30 September 2007 and 30 more than at the same time the previous year. 72 per cent of employees are employed outside Germany.

“Happily, we have even been able to exceed the ambitious goals that we set for ourselves for 2007,” Ulrich Dietz, Executive Board Chair of GFT Technologies AG, explains. “In the Resourcing business division we are also expecting dynamically increasing revenues in the coming years. The market conditions for our customers in the finance sector continue to be challenging. With our international software development network we can flexibly respond to this and use the chances which emerge from these new requirements,” Ulrich Dietz continued. “Due to reasons pertaining to stock corporation law, we will not be able to use the financial distribution capability for a dividend until next fiscal year. Since we intend to utilise our own funds and external funds to finance these strategic acquisitions, no other type of distribution of dividends is planned. Both in the Resourcing and in the Services business division we intend to strengthen our position through appropriate acquisitions during this financial year. Negotiations to this effect are currently underway.”

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