Gloster Group expands with New York-based Sony Music software supplier - Gloster completes largest acquisition in its history

SPECIAL ANNOUNCEMENT
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Gloster Infocommunications Public Limited Company (company registration number: 13-10-042012; registered office: 2142 Nagytarcsa, Csonka János utca 1/A A/2; hereinafter: the Company, Gloster, the Issuer) hereby informs its esteemed investors of the following in accordance with the General Terms and Conditions of the Budapest Stock Exchange Xtend and applicable laws and regulations.

Gloster Group expands with New York-based Sony Music software supplier - Gloster completes largest acquisition in its history

Nagytarcsa, Budapest, June 9, 2023. – The Gloster Group is expanding with the acquisition of an international software development company with 120 employees that operates in both Silicon Valley and London. With the acquisition of P92 IT Solutions Kft., a financially stable company with a 30-year history and subsidiaries in California and the United Kingdom, the Gloster Group further strengthens its stock market performance. Thanks to the acquisition, the Gloster Group’s consolidated revenue (according to Hungarian accounting standards) is expected to grow by about one-third, and its EBITDA by nearly half; the export ratio may already exceed management’s preliminary 2025 expectations by the end of this year.

The Chairman of the Board of Directors of Gloster Infokommunikációs Nyrt., listed on the Xtend market of the Budapest Stock Exchange (BÉT), and the owners of P92 IT Solutions Kft. (hereinafter: P92) signed the largest acquisition agreement in Gloster’s history today. Upon closing of the transaction, Gloster will acquire 94% of the Budapest-based IT company—which also operates a development center in Szeged—along with its British and American subsidiaries.  P92 strengthens the Gloster Group’s International Software Development Division, and the company will continue to be led by its former CEO, Gusztáv Turschl.

More Major Global Companies Join Gloster's Client Ranks

P92, now in its 30th year, has a stable client base of more than 100 companies, including global giants such as Sony Music and Blackhawk Network, as well as medium-sized German companies, including Valuenet[1]. This development company, which serves the global market, has built its success on the development of state-of-the-art business applications in industries such as media, telecommunications, financial services, and the automotive industry. In addition to Budapest, the company has offices in London and Palo Alto, and provides professional services in the United Kingdom, Germany, and the United States.

A significant amount of value is being injected into the corporate group

This tenth anniversary acquisition aligns closely with the Gloster Group’s 2025 growth strategy, under which the Company aims to quadruple its 2021 figures through organic growth as well as the acquisition of software development and cloud-based companies. P92 is a company with a global corporate client base that is deeply embedded in international operations and boasts a highly skilled team of developers. With this acquisition, the Gloster Group’s headcount will increase from the current 208 to 340, and the group’s export share of revenue is expected to grow by 85%, rising from 37% to 44% of total revenue.

International Growth Continues: The International Software Development Division Is Expanding to Become the Largest Business Unit

The Company last acquired a company of similar size and business scope on October 19, 2021, when Gloster acquired a majority stake in Minero-IT Hungary Kft., thereby adding global brands such as BMW and Audi—also a German company—to its client base.

“With the addition of P92, we are creating an experienced team of more than 340 people, of whom more than 200 work in our International Software Development division on export projects,and Sony Music will become a global client of the group,”emphasized Viktor Szekeres, Chairman of the Board at Gloster, regarding the acquisition. He added that, thanks to the acquisition, Gloster will join an exclusive club of Hungarian IT companies comprising firms with revenues in the billions that base their growth largely on global clients and international development projects.

Analysts are pricing in a rise in the exchange rate

Glostert is uniquely covered by two analysts on the Xtend market. ERSTE set a 12-month target price of 1,130 HUF[2] for the Company’s shares on February 22, 2023, while Equilor set a target price of 1,396 HUF[3] on June 15, 2022; both analysts maintain a “hold” recommendation. OTP provides a bid-ask service for Gloster shares to ensure greater liquidity.

Further details in the company's first investor presentation

Gloster executives will discuss the new acquisition and the group’s growth plans on June 13, 2023, starting at 6:00 p.m., at the company’s investor meeting—the first in-person event of its kind held by the group since its inception. In addition to the outlook for the domestic IT and financial markets, the event will also address developments in the global economic environment, with the participation of Gloster representatives as well as renowned domestic experts and investors. Attendance is free, but registration is required. You can register on the following page: https://www.gloster.hu/gloster-reszvenyesi-talalkozo

Nagytarcsa, June 9, 2023

Gloster Infokommunikációs Nyrt.
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[1] https://p92.hu/aboutdetails

[2] Analysis dated February 22, 2023 https://www.erstemarket.hu/files/gloster_CR_20230222.pdf

[3] Analysis dated June 15, 2022 https://gloster.hu/uploads/befektetoknek/kozzetetel/rendkivuli_tajekoztatasok/20214-Gloster-Infokommunikacios-Nyrt---Initiation-report_final2.pdf