Asseco South Eastern Europe (ASE) Q1 2026 earnings summary

Executive summary

• Q1 2026 saw strong performance in Banking Solutions, with revenue up €1.4m–2.3m year-over-year and operating profit rising, driven by core solutions and efficiency gains.

• Cost growth was limited to 2%, reflecting optimization and restructuring benefits.

• Payment Solutions revenue declined or was flat, mainly due to client losses in India, UAE, and Turkey, but direct-to-merchant growth in Croatia and Spain provided some offset.

• Cash flow and cash conversion ratios improved significantly, resulting in a higher net cash balance.

• Growth was driven by scale and efficiency in Banking Solutions; new subsidiaries had minimal impact.

Financial highlights

• Revenue increased by 6% to €102.4m (PLN 434.5m up 9%) in Q1 2026, with operating profit up 15–18% and net profit up 22–33%.

• EBITDA rose 11–13% to €20.0m (PLN 84.8m), and EBIT grew 15% to €13.6m.

• Operating cash flow for the last 12 months reached EUR 80 million, with free cash flow for Q1 2026 at €12.6m (PLN 87.2m).

• Cash increased by EUR 8 million since year-end, with net cash (short-term) at €37.5m as of March 31, 2026.

• Gross profit margin improved to 26.5%, EBITDA margin to 19.5%, and net profit margin to 10.9%.

Outlook and guidance

• 2026 full-year revenue is forecast at €325.7m, slightly down 1% from 2025, but margin improvement of 4–5% is expected.

• Group growth guidance for 2026 is 10–15%, with Banking and Dedicated Solutions forecast to grow revenues by 5% and margins by 7%.

• Payment Solutions revenue is expected to decline 6% in 2026, but margin is forecast to improve by 4%.

• Cost growth expected to remain subdued due to restructuring and efficiency measures.

• AI initiatives underway, with monetizable effects anticipated later in the year.