4iG - Continuing momentum despite lockdown
4iG has announced its Q120 results. These show continuing momentum from the step change achieved in FY19, where revenues almost tripled to HUF41bn. Q120 revenues were HUF8.6bn, representing 78% organic growth y-o-y (Q119: HUF4.9bn), with EBITDA rising to HUF578m, up 20% y-o-y (Q119: HUF483m), an EBITDA margin of 6.7% (FY19: 9.9%, FY20e: 8.5%). Weaker margins were expected as 4iG is carrying additional personnel costs (HUF0.79m) to allow the business to scale (headcount increased to 620) as well as high software development investment. Q120 will also include weakness due to the COVID-19 lockdown, although management indicated that the impact on the business has been minimal, with previous financial guidance maintained. 4iG has HUF23bn of contracted revenue for FY20, close to 50% of our FY20e revenue forecast of HUF49.1bn. We maintain our estimates.4iG Nyrt, formerly Freesoft Szoftverfejleszto es Szamitatechnikai Szolgaltato Nyrt is a Hungary-based company engaged in providing software products and consultancy. The Company's activities include development and implementation of specific, custom-made software systems, document management, knowledge management, portal and collaboration applications, complex services for business needs in the areas of implementation, support and consultation, intranet- and Internet-based development, services, graphical and creative design, and consultation, design, development and implementation of mobile business applications, as well as operation, support, outsourcing, application service provision (ASP), application portfolio management (APM), hosting and other services. The Company has three subsidiaries: Axis Consuling 2000 Kft, BankSoft Kft and HUMANsoft Kft.
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