Connections decides to distribute dividends for 2023 and announces financial projections for 2024

Connections (CC), a digital transformation company listed on the AeRO market of the Bucharest Stock Exchange, recently published the budget for the year 2024 and the priorities for the current year. The company has decided to allocate dividends for the fiscal year ended and has initiated internal preparations for transitioning to the regulated market of the exchange.

For 2024, Connections estimates total revenues of 122 million lei, representing an accelerated growth of 49% compared to the budgeted amount for 2023, and a net profit of 8.8 million lei (a 57% increase compared to the budgeted amount for 2023), with a focus on EBITDA growth.

“2023 was the best year in the company’s history, with significant surpassing of all initially estimated results. Triple-digit growth has brought us large-scale projects, which we currently have in progress, and have confirmed Connections’ capabilities and relevance in the public sector digitization category in Romania. We continue to grow at a sustainable pace to ensure healthy and balanced development, with a focus in 2024 on the development of our software development and technology integration line. The main contributors to this year’s revenue are the Service Delivery and Software Development & Outsourcing divisions, with estimated revenues of 35 million lei and 87 million lei, respectively,” says Bogdan Florea, Founder & Co-CEO of Connections.

The organization is banking on revenue growth in the Software Development division, driven both by the development of substantial projects in the public sector and by expanding its portfolio of specialized solutions. The division is expected to achieve an estimated average compound growth of 60%, while the Service Delivery line is projected to see a 3% growth, remaining a significant source of revenue and a strategic pillar for Connections.

The primary target for the current year is private sector companies, aiming to ensure a balanced portfolio of clients and profitability growth that generates increased value for investors.

“Our plans for 2024 focus on four essential pillars: strategic technological partnerships, digital marketing to increase visibility, consultative sales to understand customer needs, and the development of innovative solutions for the public sector. We are confident that this year’s results will strengthen our market position and allow us, as planned, to distribute dividends each year, correlated with the financial realities of the moment,” mentions Radu Marcu, Co-CEO of Connections.

In addition to development initiatives, the company aims to internally focus on consolidating the corporate governance structure and kick-start preparations for transitioning to the primary market. The first planned step is to expand the Board of Directors by two seats, a measure that will bring diversified expertise to the board and improve decision-making processes within the company.

“Today, we have a corporate governance that is vastly superior to the time of listing, with processes and procedures maturing and requiring a much more rigorous business conduct over the next 3-5 years. In order to access the main market of the Bucharest Stock Exchange and prepare for the transition to IFRS reporting, we are determined to align ourselves with the highest standards and develop a transparent financial image. Our focus will be on long-term sustainability and constant value generation, both for shareholders through business results and for clients through the high quality of projects we deliver,” adds Bogdan Florea, Founder & Co-CEO of Connections.

Based on previous financial performances, Connections recently decided to distribute dividends totaling 3,300,000 lei from the net profit of the company for the financial years 2022 and 2023, to be benefited by shareholders registered in the shareholders’ register on the date of 26.04.2024, proportionally to their shareholding in the paid-up share capital. The gross dividend value is 0.2522 lei per share, and the dividend payment date through the Central Depository is 21.05.2024.

Connections’ dividend policy aims at consistent distribution of benefits to shareholders, based on the availability and cash needs of each year, correlated with profit growth.

The year 2023 marked exceptional growth, with the company standing out through impressive financial results and solidifying its position as a market leader in complex digitization projects. Key financial achievements include a 203% increase in turnover, reaching 177 million lei, and a 162% increase in net profit, reaching 11 million lei.

The complete report on audited financial results for 2023 and the budget for 2024 can be consulted here.