OTT-ONE continues growing: in the first three quarters of 2020, the company achieved revenue of more than HUF 11 billion
In the third quarter of 2020, OTT-ONE achieves revenue of more than HUF 4 billion and an EBITDA of approximately HUF 60 million. The economic slowdown caused by the coronavirus epidemic still had no effect on the company’s operating results: together with the third quarter, its annual sales revenue is now more than HUF 11 billion, which is almost HUF 10 billion more than in the same period last year. Profile cleaning, which significantly affected the results of the first half of the year, mainly in the form of a time-proportionate decrease in amortization costs, already had a positive effect on the company’s figures in the third quarter.
Listed in the Standard category on the Budapest Stock Exchange, OTT-ONE Plc. has published its business report for the first three quarters of 2020. According to the report, the company’s third-quarter income reached HUF 4.3 billion, bringing the January-September 2020 sales to more than HUF 11.1 billion, which is about six times the sales of the same period in 2019. A significant factor in the development of sales revenue was the activity related to medical devices, which came to the fore in the first half of this year.
EBITDA (earnings before interest, taxes, depreciation and amortization) amounted to HUF 59.5 million in the third quarter, bringing the total value of the first three quarters to HUF 195.5 million – an increase of 46% compared to the same period last year. In the first half of the year, after reviewing its operations and future capabilities, the company decided to scrap a number of self-developed assets – the decision had a positive impact during the third quarter, primarily on the time-proportionate reduction in amortization costs.
During the third quarter, OTT-ONE reported a number of significant transactions. The company’s previously announced intention to give priority to the trade of health care products and the provision of health care-related services also appeared in the period under review: the contract with the National Healthcare Services Center (ÁEEK) for the supply of 3 million KN95 protective masks was completed. In addition, about 300 ventilators purchased for the National Healthcare Services Center will be handed over for the remainder of the year, with results expected to be realized during the 2020 business year.
In addition to healthcare, the company’s other focus area, streaming, which came to the front due to the development of new practices such as remote work as a result of the coronavirus pandemic, and online education also generated significant revenue in the period under review: the company sold a license related to the online education area for more than EUR 1 million for a foreign customer.
Furthermore, following the decision of the Board of Directors in July, the expansion of the capacity of the company’s server center, which has been operating since December 2019, began during the quarter, the first step of which was the sale of hardware. The expansion was justified by the appreciation of IT solutions enabling secure communication and the related cloud-based services, as well as the increase in customer demand.
In addition to these transactions, the company also won two Economic Development and Innovation Operational Programme (GINOP) grants: in September, the GINOP-5.3.12 “Incentive for Employment Expansion” tender, nearly HUF 42 million, and in October, the GINOP 1.2.7 “Development of Value Chain Quality at OTT-ONE” where the company received a non-refundable grant of HUF 310 million. With the help of the latter, the company implements in addition to a high level of IT security, the development of a manufacturing plant operating with smart solutions, and related to this, the development of a specialized, innovative production environment.
Regarding the capital market activity of the company celebrating its 10th anniversary being listed on the Budapest Stock Exchange this year, the start of the regular analysis of OTT-ONE shares within the framework of the BSE market development program can be mentioned as a significant event during the quarter. An initiation report was published by an analyst at MKB Bank at the end of August, followed by equity notes in October.
The company continued to show outstanding resilience in this extraordinary year, which is also reflected in the quarterly figures, as the third quarter brought a number of significant milestones, and the development orders related to core activities, the revenue coming from streaming services and other opportunities continue to generate stable profits. In addition, it is extremely important that the profile cleaning of the first half of the year has already appeared at the level of business results.