In conjunction with the closing of our books for the year-end, we surpassed two significant levels: SEK 1,000 million in sales and SEK 100 million in profit before tax. Ten years ago, we passed the SEK 100-million milestone in sales and the SEK 10-million mark in profits. Our performance has been developing well and our business model has proven to be robust. Our aim is to create a customer offering that allows for us to generate recurring revenues that resemble subscriptions. In 2018, our total growth in recurring revenues was 21.9 percent, of which 6 percentage points comprised organic growth in local currency. In the fourth quarter, organic growth in recurring revenues was higher than the average for the year, totaling more than 8 percent.
During the fourth quarter, we designated a directed new share issue to several major institutional investors, increasing our shareholders' equity by nearly SEK 200 million. The directed new share issue is a building block for our continued growth and will provide us with financial vigor for the next few years.
Our fourth-quarter profits were charged with liquidation costs of approximately SEK 5 million, of which the greater part came from closing down a R&D facility in France that belonged to AcuVitec OY.
We are continuing to invest in our corporate culture, such as by arranging annually orientation courses aimed at managers and new employees. The events are named CEO@Vitec,Leader@Vitecand New@Vitec,and are arranged inhouse, using our own management as lectures. Our aim is to nurture and establish an understanding of a culture that supports our continued growth and our structure of delegated decision-making. We have also invested more than SEK 125 million in our product portfolio in 2018 and will continue to invest at similar levels, to ensure that we are a reliable and future-proofed supplier to our customers, and thereby live up to our brand promise: "To rely on - Today and Tomorrow."
The number of active acquisition dialogs remains high, and we are continuously allocating resources to stay abreast of and advance these dialogs. Our financial position is solid and we are well prepared for future acquisitions, and for continued acquisition-based growth. Supported by our acquisition of well-established companies and a high and increasing percentage of recurring revenues, Vitec will stay its course - to be a vertical software company with excellent risk diversification, as well as sustainable and profitable growth. And we also increase dividends for the 17th consecutive year.
Lars Stenlund, CEO
For more information, please contact
Patrik Fransson, Investor Relations firstname.lastname@example.org+46-76-9428597
This information is information that Vitec Software Group AB (publ) is obligated to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out below, at 08:30 CET February 13, 2019.
Vitec is market leader for Vertical Market Software in the Nordic region. We develop and deliver standard niche software. Vitec grows through acquisitions of well-managed and well-established software companies. The Group's overall processes together with the employees' in-depth knowledge of the customer's local market enables continuous improvement and innovation. Our 650 employees are based in Denmark, Finland, Norway and Sweden. Vitec is listed on Nasdaq Stockholm and had net sales of SEK 1,017 million in 2018. Find more at www.vitecsoftware.com.
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