International Internet Magazine. Baltic States news & analytics
Thursday, 31.07.2014, 14:27
Preliminary results of Baltic IT industry in 2010 are encouraging
The article is prepared for the Round Table “Information technologies in business management: challenges and risks.”, organised by the Baltic International Academy, Latvian Employers Association and International Web-Magazine “The Baltic Course” on 27st of April in Riga, Latvia.
Based on the preliminary results in 2010, there might be a positive growth in IT services revenues as well as in total revenues. IT revenues have grown by around 8%, while other revenues that include software and hardware sales improved by a total of 61%. However, please also note that final results might be somewhat less impressive. Currently, the data is largely influenced by successful results of Santa Monica Networks, Elsis and Atea that had outstanding results already in 2010 half year, as indicated below.
Survey results received in autumn 2010 showed some signs of recovery already. Despite continuing stagnation in IT services market, other revenues that include sale of hardware, third-party software and other services were rising notably during 2010H1, while the sales of IT services have declined by 3%, y-o-y. Growth of other revenues reached 41% mainly due to successful development of Lithuanian market players, namely, Santa Monica Networks, Atea, and Elsis group. All these companies, despite being relatively large, managed to achieve spectacular growth of other revenues totaling 43%, 55% and 268%, respectively. Santa Monica Networks has been actively promoting its products throughout 2009 and now sees the results. In particular, its efforts to promote a complex Santa Care service have paid off. Atea managed to win few notable projects financed from EU funds, invested into higher value services and streamlined its sales process by introducing e-commerce. The company now indicates that private sector is beginning to understand IT as an efficiency enhancing tool rather than a cost centre, and the outlook is optimistic. Elsis Group succeeded in winning projects in AB Lietuvos dujos as well as in public sector and abroad to secure outstanding growth, especially of its telecommunication and intelligent engineering systems business; on the other hand, as indicated by Elsis group management, they feel that mainstream sales to small and middle sized companies were still stagnating.
Surveyed companies’ revenue growth by type,