Shlomo Eisenberg (photo by Inbal Marmari)
Malam Timm, the largest IT services group in Israel, closed 2022 with revenues that broke its all-time record. The group’s revenues amounted to approximately NIS 2.7 billion, an increase of approximately 19.1% compared to the revenues of the corresponding year last year, in which the group’s revenues amounted to approximately NIS 2.27 billion. The annual revenues were affected, among other things, by organic growth in the hardware and cloud infrastructure sector and the software sector, projects and business solutions, from the acquisition of companies and activities, and an increase in the average exchange rate of the US dollar (an increase of about 4.2% of the average exchange rate during the reporting period compared to the corresponding period last year ).
Revenues in the fourth quarter of 2022 amounted to approximately NIS 699.6 million, an increase of approximately 7.1%, compared to the corresponding period last year, in which the group’s revenues amounted to approximately NIS 652.7 million. The increase is due, among other things, to the project for the elections to the 25th Knesset that took place in the fourth quarter of 2022, from organic growth in the software sector, projects and business solutions, an increase in the average exchange rate of the US dollar (an increase of approximately 10.7% of the average exchange rate during the reporting period compared to the corresponding period last year), and the acquisition of companies and activities.
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The gross profit in 2022 amounted to approximately NIS 331.8 million, an increase of approximately 7.3% compared to the gross profit in the corresponding year last year, which amounted to NIS 309 million. The increase is mainly due to an increase in the hardware and cloud infrastructure sector in 2022 and on the other hand receiving compensation from an insurance company for an arbitration award amounting to approximately 9 million shekels received in the fourth quarter of 2021.
The gross profit in the fourth quarter of 2022 amounted to approximately NIS 85.2 million, a decrease of 6.3%, compared to the corresponding period last year, in which the gross profit amounted to approximately NIS 91 million. The decrease is mainly due to compensation from an insurance company for an arbitration award in the amount of approximately NIS 9 million received in the fourth quarter of 2021.
The annual profit amounted to approximately NIS 55.8 million, a decrease of approximately 17.2%, compared to the corresponding period last year, in which the net profit amounted to approximately NIS 67.5 million. The decrease is mainly due to an increase in other expenses and financing costs, offsetting the decrease in tax expenses.
Excluding the other expenses (net of tax) and the company’s investments in 4Cast, the net profit in 2022 amounted to approximately NIS 96 million compared to approximately NIS 89.7 million in the corresponding period last year, an increase of approximately 7%. In the fourth quarter of this year, the net profit amounted to approximately NIS 7.2 million, a decrease of approximately 46%, compared to the corresponding period last year, in which the net profit amounted to approximately NIS 13.3 million.
The EBITDA in the fourth quarter of 2022 amounted to approximately NIS 61.1 million, a decrease of 18.1%, compared to the corresponding period last year, in which the EBITDA, excluding other revenues, amounted to approximately NIS 74.6 million net. The EBITDA in 2022 remained stable and amounted to approximately NIS 241.1 million, similar to the corresponding year last year.
Revenues in the infrastructure (hardware) and cloud solutions sector in 2022 recorded sharp growth and amounted to approximately NIS 1.324 billion, an increase of approximately 24.7%, compared to the sector’s revenues in the corresponding year last year, which amounted to approximately NIS 1.07 billion. The sector’s revenues were affected, among other things, by organic growth in hardware infrastructure and growth in cloud services, consolidation for the first time of an acquired company (“Tsilomatik”), continued growth in the volume of computer equipment orders, and above it in the average exchange rate of the dollar (an increase of approximately 4.2% of the average exchange rate during the reporting period compared to the same period last year).
Revenues in the infrastructure (hardware) and cloud solutions sector in the fourth quarter of 2022 amounted to approximately NIS 326.5 million, a decrease of 2.6%, compared to the same period last year, in which the sector’s revenues amounted to approximately NIS 335.2 million. The decrease in revenues is mainly due to large-scale transactions in the field of storage servers in the corresponding period last year, offsetting the consolidation for the first time of an acquired company (“Tsilomatik”).
Revenues from the software, projects and business solutions sector in 2022 amounted to approximately NIS 1.142 billion, an increase of 15.5%, compared to the corresponding period last year, when the sector’s revenues amounted to approximately NIS 989.5 million. The increase is mainly due to organic growth.
Revenues from the software, projects and business solutions sector in the fourth quarter of 2022 amounted to approximately NIS 307 million, an increase of approximately 16.9%, compared to the corresponding period last year, when the sector’s revenues amounted to approximately NIS 262.4 million. The increase is mainly due to organic growth and the project for the elections to the 25th Knesset that took place in the fourth quarter of 2022 and on the other hand from a smaller number of working days during the reporting period compared to the corresponding period last year.
The consolidated group’s equity in 2022 amounted to approximately NIS 582.5 million, compared to approximately NIS 577.3 million in the corresponding period last year, an increase of approximately 0.9% resulting mainly from the profit for the period and the dividend paid during the reporting period.
Shlomo Isenberg, chairman of K.V. Malam Timm: “The group’s results in 2022 are the result of organic expansion, the acquisition of new activities, the beginning of expansion into activities abroad. And increased investment in start-up companies. The results of these moves will be felt even more strongly in the years to come.”