The Novian IT infrastructure and software services group had aggregated revenue of EUR 9.9 million in the first half of this year, a decrease of 6.3% compared to the same period last year. The group’s aggregated EBITDA was EUR 0.6 million and fell 21%. The Novian group’s operating profit for the six-month period was EUR 0.32 million and decreased 23.5% compared to the first half of 2020, when it was EUR 0.41 million.
“This year Novian is distinguishing itself with ambitious projects in the technologies and software services business areas ranging from the installation and maintenance of hyperconverged IT infrastructure platforms at Lithuanian Railways’ main technology unit to the creation of a modern information system for public procurement. We welcome such multifaceted challenges that make us grow faster too, since implementing complex projects with modern and effective solutions is part of what Novian is all about,” says Evaldas Rėkus, the CEO of Novian.
He notes that the results for the first half of the year were impacted by uneven market demand and fluctuations in the value of the US dollar, and that currently the group’s companies have returned to their usual rhythm. “Financial performance was also influenced by work to increase the share of long-term managed services agreements, which give clients stability and clarity about IT service costs for several years in advance. While at this stage for us that means bigger investments to promote those services and a shifting of some revenue to future periods, having contracts for several years will ensure stable revenue of that type,” Evaldas Rėkus says. The corporate sector’s share of revenue has grown from 33% in 2019 to 44% in the first half of this year and the financial sector’s has risen from 17% to 23%, while the share of revenue from the public sector has shrunk from 44% to 28%.
“At the start of the year we continued to refine the group’s operating areas with a focus on integrated services and gave a lot of attention to the joint activities of the merged companies Novian Systems and Acena,” the CEO says. Considering the market’s needs for digitalization, he says, the Novian group offers relevant software, business analytics and process automation solutions as well as critical IT infrastructure managed services, and is implementing digitalization projects of diverse scale.
Novian is unique in the region in its ability to conduct large-scale digitization projects and adapt digitized material for further use. Currently Novian Technologies, together with the other Novian group companies Andmevara Services OU and Zissor, is implementing projects to digitize documents and upload them to relevant systems in Lithuania, Estonia and Moldova. The geography of the group’s activities in the first half of the year included over 30 countries. As in the first half of last year, the share of revenue earned aboard was 32%.
Novian Technologies, the main Novian company working in the technologies area, had revenue of EUR 7.2 million in the first half of 2021, or 8.5% less than in the same period last year. The company’s operating profit was unchanged at EUR 0.48 million. Also operating in the group’s technologies area are Andmevara Services OU of Estonia and Andmevara SRL of Moldova.
“The first half of this year is notable for the number of large projects completed and new ones started. One of the most interesting is at Lithuanian Railways, where we will upgrade and maintain extremely critical hyperconverged IT infrastructure. We also see a growing need on the market for digitization services and many organizations that are keen to extend the lifetime of computer hardware. We are building significant international partnerships. And we have resumed travel and work for clients in Africa and other foreign countries – business processes are gradually returning to their earlier, pre-pandemic course,” Novian Technologies CEO Gytis Umantas says.
Worth noting among this year’s most important projects are the completed installation of a high-performance computing cluster at Vilnius University’s Faculty of Mathematics and Informatics, the completed first phase of a GovCloud installation project, and modernization of the Kyrgyz postal system. Together with Andmevara Services OU and Zissor, digitization of documents is underway at Vilniaus Vandenys and Vilniaus Šilumos Tinklai. Work to digitize tens of millions of pages for the National Archives of Estonia and the Cadastral Archive of Moldova is also ongoing.
Novian’s technologies area companies have earned the largest portion of their revenue this year from the corporate sector, at 50%, which is up from 36% in 2019. The share of their revenue from the financial sector has risen to 25% from 20%, while the public sector’s share of revenue has fallen to 21% from 39%.
Lithuania accounted for 69% of revenue in this business area, while in the first half of 2020 the level was 70%. Projects have been carried out in 32 countries this year. The technologies companies are focusing heavily on critical IT infrastructure, cloud computing, modern digital workspaces, and other technological solutions.
Novian Systems, Novian’s main company in the software services area, had revenue of EUR 1.5 million in the first half of this year, or 3.6% less than in the same period last year. Its operating loss for the period, at EUR 70,000, was up from EUR 19,000 in the first half of 2020 (following the merger of Novian Systems and Acena at the end of 2020, operating results reflect their aggregated figures.). Andmevara AS of Estonia also operates in the Novian group’s software services area.
“We are pleased to be contributing to projects of such importance to Lithuania as the creation of the modern public procurement information system Saulė, for which we will use the latest solutions. We are also seeing increased demand for rapidly built solutions based on cutting-edge technologies,” says Paulius Vaitkevičius, the Head of Business Development at Novian Systems. He notes that the group’s companies in this area also offer data analytics, robotics, and artificial intelligence solutions.
The Novian companies working in the programming area have conducted projects in 8 countries this year. Of their revenue, 76% was earned in Lithuania, up from 72% in the first half of last year. While the public sector was the source of most revenue again this year, since 2019 its revenue share has fallen from 64% to 56%. The corporate sector’s share of revenue is little changed at 24%, while the financial sector’s share has grown from 4% to 16% and the academic sector’s share has decreased from 6% to 2%.
Projects of special note in the reporting period include development of the ESKIS Taxpayer Electronic Education, Consulting and Information Service as well as the implementation of automation solutions for a municipal waste collection system at Visagino Būstas and for handling milk collection waybills at the Pienas LT agricultural cooperative.
The Norwegian company Zissor, a provider of media monitoring software and digitization services, had revenue of EUR 484,000 in the first half of the year (65.2% more than in the first half of 2020), while its operating profit was EUR 102,000, or 7.8 times the amount in the same period last year. The company earned the largest part of its revenue, 44%, in the UK, with 18% in Sweden and 13% in Norway, and also conducted projects in Germany and elsewhere.
Noteworthy among Zissor’s projects is the digitization of the archives of the Norwegian newspaper Vesterålen, in which Zissor digitized the newspaper’s entire archive of 200,000 pages for the years 1921-2010. Additionally, in collaboration with Visiolink, work is underway to digitize German newspapers – the project involves converting PDF pages to articles and pictures and generating XML codes. Zissor is also digitizing the Danish newspaper Ingeniøren.
The Novian group’s companies operate in the Baltic countries, Norway and Moldova. The Novian group of businesses is owned by INVL Technology, a company that invests in IT businesses.
Presentation: the Novian companies group results for the 1st half of 2021.