< Back to Trader Blog Articles

Harvest Technology p.l.c. exceeding IPO expectations


Harvest Technology plc is the holding company of the Harvest Group which is engaged the technology and e-commerce solutions industries across a spread of geographical regions, primarily in Malta but also in parts of Europe and Africa. The Group currently consists of three significant operating subsidiaries, which operate separately and distinctly from each other under their respective brand names.

PTL Limited, being one of the Group’s three operating subsidiaries, provides bespoke information technology solutions to clients based on its expertise in hardware infrastructure and software business applications. APCO Systems Limited, which is another subsidiary within the Group, operates under the brand Apcopay and is a payment solutions provider, offering e-commerce processing services for retailers and internet-based merchants. Moreover, the third operating subsidiary, APCO Limited, is mainly engaged in the supply of a wide range of automation and security solutions catering principally to the retail and banking sector.

As per latest results (FY19), Harvest registered a positive financial performance, with the results exceeding previous IPO budgetary targets. The main three attributes contributing towards this positive performance are discussed in further detail below.


During FY19, the Group recognised revenues amounting to €16m, representing an increase of circa 3% when compared to a revenue figure of €15.6m in FY18. This revenue growth was predominantly driven by an upsurge in activity within the payment gateway services division, and also demonstrates an increase of approximately 4.1% over IPO expectations.

Revenue growth was also attained by other members within the Group, namely PTL and APCO Limited. In a partnership entered into with IBM during FY19, PTL managed to secure a significant five-year contract in Mauritius to install and maintain a broader security system. No revenue has been recognised on this project as it is still in early stages, however the conclusion of this contract is expected to boost the Group’s revenue potential moving forward.

Moreover, the Group also reported that APCO Limited had an encouraging response to its efforts in terms of expanding its automation business segment, particularly in retail automation.

Operating expenses

Although the Group reported an increase in revenue during FY19, cost of sales and administrative expenses (exclusive of depreciation and amortisation) decreased by 9.4% and 26.1% respectively in comparison to FY18.

Net profit

During FY19, Harvest registered an overall net profit figure of €2.1m, signifying an improvement of circa 33.8% from previous targets anticipated at IPO stage (€1.6m).


Prior to the listing of the Harvest securities on the MSE (FY19), Harvest paid a net interim dividend of €950k or €0.0417/share (eligible to shareholders prior to listing). Additionally, as per latest results the directors proposed a final net dividend payment amounting to €410k or €0.018/share. It is important to highlight that this proposition was not included in previous IPO projections, and as such we deem this to be another positive attribute of the Harvest Group.

Profit before tax – Q1 2020

It is also worth mentioning that as per FY19 results publication, the unaudited consolidated net profit before tax recorded by the Group during Q1 2020 amounted to €0.84m. This signifies a further improvement of 25% on the IPO budget projections (€0.67m), thus once again demonstrating the Group’s capability of reaching and exceeding their targeted financial budgets.

In view of the current COVID-19 pandemic, the Group explained that certain aspects of the business may suffer if the current situation is prolonged. For instance, Apco Systems Limited highlighted that it could experience a decrease in transactions due to a decline in customer spending. Given that Gaming providers represent a significant part of that company’s client base, management is anticipating a negative impact on the Group’s revenue which is deemed to be in line with a general decline in sports betting. Additionally, PTL has indicated debt collection and reduced sales as the company’s main challenges, whereas APCO Limited signalled difficult new business prospects both locally as well as abroad.

Although the pandemic’s impact on the Group’s financial performance is not fully known, the Group sustained that with the current cash-flow headroom, Harvest is not currently foreseeing any defaults with respect to salary payments, creditors and banking commitments for the immediate future. To this end, the Group also explained that the situation is currently under control and all subsidiaries are seeking to mitigate any downturns with new opportunities that may be created by this new reality.

Although this pandemic is expected to adversely impact the Group’s revenue mainly due to an expected decline in sports betting, this might however prove to be an opportunity for Harvest to attract and on-board new clients within different industries and assist such companies to make the necessary changes to survive this pandemic, and even thrive in a post-COVID-19 world. In fact, management explained that they are currently in discussions to expand their service offerings both at local and at an international level.

As the payments industry is constantly evolving, and gradually being dependent on by other industries, we believe that Harvest is already well positioned to utilise its essential capabilities within the industry and capitalise on the current situation.

The Calamatta Cuschieri Traders Blog is available daily on CC WebTrader. Other market coverage including coverage of the International Bond Markets is also available.

The information provided on this website is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Similarly any views or opinions expressed on this website are not intended and should not be construed as being investment, tax or legal advice or recommendations. Investment advice should always be based on the particular circumstances of the person to whom it is directed, which circumstances have not been taken into consideration by the persons expressing the views or opinions appearing on this website. Calamatta Cuschieri & Co. Ltd. (CC) has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website. You should always take professional investment advice in connection with, or independently research and verify, any information that you find or views or opinions which you read on our website and wish to rely upon, whether for the purpose of making an investment decision or otherwise. CC does not accept liability for losses suffered by persons as a result of information, views or opinions appearing on this website.
This website is owned and operated by Calamatta Cuschieri & Co. Ltd (Co. Reg. No. C13729) of 5th Floor, Valletta Buildings, South Street, Valletta VLT 1103, Malta. CC is licensed to conduct Investment Services in Malta by the Malta Financial Services Authority.