The condensed Interim Financial Statement of RS2 Software plc reports that the company’s revenue for the first six months of the year increased by 67% over the same period of 2010 to €4,737,968.
This is mostly attributable to licence fees concluded during the period.
The group is principally engaged in the development, installation, implementation and marketing of specialized computer software for financial institutions, under the trademark of BANKWORKS, and processing of payment transactions with the use of BANKWORKS.
As at the end of June 2011, the company managed to meet and exceed its projections for new licence contracts for the year. Licence fees inherently yield higher profit margins than other sources of revenues, and consequently the revenue mix has a significant impact on profitability.
Gross profit for the company increased from €646,012 in 2010 to €2,168,436 in 2011.
Net profit (before tax) increased from €266,223 in 2010 to €1,699,157 in 2011. Gross profit margin for the period under review was 46%, compared with 23% in 2010.
Net profit (before tax) margin was 35%, compared with 9% in 2010. The improvements in the profit margins is attributable to the increases in cost of sales not being directly proportionate to increases in revenue.
During the period, RS2 continued to invest in its US subsidiary, albeit with a cautious approach. While the subsidiary remains a loss-making entity, it continues to generate and enhance brand recognition of BANKWORKS within the US market. As a direct result, the has managed to sign on another US client, processing substantial volumes of transactions by using its BANKWORKS platform in the United States.
Similar results are also being achieved in the Asian region through the subsidiary in the Philippines. Whilst this office was initially intended to serve a cost-efficient support centre for the core development centre in Malta and the company’s clients, it has now also developed into a base from where to market BANKWORKS in the region. To date, the company has obtained its first client in the Philippines, and it continues to see positive interest from the market in general.