GFT Technologies AG sees record revenues and results in 2007

27 March 2008

During the 2007 financial year, GFT Technologies AG (GFT), leading international IT service provider, was able to significantly increase revenues as well as earnings before taxes (EBT). “For the GFT Group, 2007 was by far the most successful year in the company’s history,” said Ulrich Dietz, Chief Executive Officer (CEO) of GFT Technologies AG, on Thursday during the presentation of the company balance sheet in Stuttgart.

At €247.1m, the overall revenues were up by 42 per cent compared with the previous year. The forecast, which was increased to €230m during the course of the year, was thus exceeded once again. Earnings before taxes (EBT) rose correspondingly: the GFT group generated €12.4m, 85 per cent more than in 2006. As expected, the result margin was at around five per cent. At the end of the previous year, it was at 3.8 per cent.
Further international expansion

GFT’s CEO has set himself ambitious goals. He is hoping to achieve the target for 2011, of €350m in revenue, at least one year early. Further international expansion is also planned. During the current financial year, the national and international positioning of the GFT Group in the Services and Resourcing business areas will be further expanded through targeted acquisitions.

Ulrich Dietz: “There are interesting prospects for the Services business area in South and North America. The strategic partnership with Software AG provides a solid basis for taking optimum advantage of these opportunities. We are looking towards Eastern Europe as a further target region for Resourcing and negotiations are currently underway.”

Positive development despite challenging market conditions

The market conditions for the financial sector continue to be a challenge. With its international software development network, the GFT Group is able to respond flexibly and take advantage of the opportunities that emerge from these new challenges. Ulrich Dietz’s forecast is thus positive: “In 2007 we have shown that the GFT Group is excellently positioned to benefit from growth opportunities in attractive markets and to further develop the business internationally.” For 2008, the GFT CEO is forecasting continued positive development. Revenues and results will be up from the previous year. “This means that we are on our way to grow by more than 40 per cent by 2010,” Ulrich Dietz continues.

Further key figures

At €140.4m, the Resourcing business area generated the highest revenue. This further increased the business area’s share in the overall revenue, now at around 57 per cent (previous year: 49 per cent). In 2007, GFT expanded its activities in this business area to include its locations in London and Zurich. The rising shortage of skilled manpower in the IT market, as well as the continuing trend to outsource IT projects to freelance specialists, means that the market environment continues to grow dynamically in this segment.

In the Services business area too, the GFT Group experienced significant growth in 2007: up by 22 per cent to €100.8m. The determining factor was the development of business with existing clients in the financial sector. The inclusion in the American FinTech 100 Ranking confirmed the company’s leading position among IT service providers in the financial services sector. GFT ranked 57 worldwide among the one hundred best IT service providers in this sector. Due to the tense situation in the financial services industry and the capital markets, the fourth quarter of 2007 saw a slight decline in investments in new projects.

Revenues in the Software business area fell short of expectations at €5.9m, a reorientation towards the area of email archiving has been undertaken. “Our archiving solution, inboxx, is among the best technology solutions worldwide. With this integrative archiving architecture we are addressing a market which is worth billions and opening up extraordinary growth opportunities. inboxx offers the potential to be blockbuster in this market. We will strengthen and develop our position in Europe through significant sales and marketing investments” Ulrich Dietz explains.

On 31 December 2007, the GFT Group had a total of 1,087 members of staff – ten more than on 30 September 2007 and 30 more than in the previous year. 72 per cent of employees work outside Germany.

In the fourth quarter of 2007, the GFT Group generated revenues of €70.8m. The earnings before tax (EBT) in this period were around €3.7m. On 31 December 2007, the balance sheet of the GFT Group showed liquid assets and securities valued at €28.7m. The group’s equity ratio was at 52 per cent.

A payout of dividends is not planned for the 2007 financial year.

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