tTech reports 50% increase in net profits for the first quarter

May 14, 2018 

tTech Limited (tTech) for the three months ended March 31, 2018 reported operating revenues  of $69.82 million, a 23% increase when compared to $56.59 million recorded for the corresponding period last year. tTech highlighted, “Our consulting team closed on a major Portfolio and Project Management services contract and closed strategic IT planning services contracts with new costumers. In addition to new clients, we extended existing contracts. The increase in activity required us to add additional consultants to support the new business.” They also noted, “Our Managed IT services also grew in Q1 as two financial services firms and a global nonprofit organization outsourced the management of their internal IT infrastructures to us.”

Cost of sales for the period increased 87% to total $17.42 million, up from $9.30 million recorded for the comparable period last year. As such, gross profit amounted to $52.39 million, an 11% increase from $47.29 million recorded in 2017.

Operating expenses increased by 7% to $46.24 million up from $43.33 million for March 2017. The growth was due primarily to, “support and maintenance cost of our new professional services automation (PSA) tools and additional subcontractors to help us execute the new consulting contracts.” Of total expenses, administrative expenses increased 8% to $39.98 million (2017: $37.06 million) whilst other operating expenses remained relatively flat at $6.26 million (2017: $6.27 million)

Other Income year over year posted a 7% improvement to $573,000 (2017: $538,000).

Consequently, Profit before Tax decreased by 50% from $4.50 million to $6.73 million. No Taxes were recorded for the period, thus Net Profit for the three months ended March 31, 2018 was reported at $6.73 million, an increase of 50% on the prior year’s corresponding period of $4.50 million.

Earnings per share (EPS) for the quarter amounted to $0.06 (2017: $0.04).The twelve-month trailing EPS amounted to $0.20. The number of shares used in our calculations is 106,000,000. Notably, tTech’s stock price closed the trading period on May 11, 2018 at $5.87.

Management indicated, “tTech has begun to reap the benefits of the marketing seeds that were sown throughout 2017 as all services and products increased uptake during the first quarter. The company also increased the size of its sales team to better manage the opportunities in the growing pipeline.”                              

Balance Sheet Highlights:

As at March 31, 2018, the Company reported total assets of $232.08 million, a 16% increase when compared to $199.35 million in 2017. This was as a result of an increase in ‘Investments’ and ‘Accounts receivable’ to $26.36 million (2017: $2.30 million) and $95.30 million ($39.59 million). Additionally ‘Cash and Cash Equivalents’ increased to $46.65 million relative to $34.16 million for the first quarter of 2017.

Shareholders’ Equity as at March 31, 2018 was $185.10 million compared to $168.47 million for the comparable period of 2017. This resulted in a book value per share of $1.75compared to $1.59 the prior year.

 

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2018-05-14T14:10:43+00:00