presented financial results for the first nine months of 2023.

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Russian IT infrastructure services provider Selectel (OOO Selectel)

Selectel's revenue for the first nine months of 2023 amounted to RUB 7.5 billion. This is 27% more than for the same period in 2022 - RUB 5.9 billion. Net profit doubled - RUB 2.3 billion in 2023 against RUB 1.1 billion in 2022. Revenue growth was due to a steady increase in demand for the company's core products from both current and new customers.

"We see growing interest from indonesia whatsapp number database Russian businesses in outsourcing IT infrastructure and using cloud services. The number of Selectel clients is constantly growing and reached 24.7 thousand by the end of September. Demand is increasing from the financial sector, retail, construction and education," noted Selectel CEO Oleg Lyubimov.

Selectel's net profit doubled due to revenue growth and improved operating efficiency, with an additional positive effect from foreign exchange gains in the reporting period. Net profit margin increased to 31% in 2023 from 19% a year earlier.

Selectel continues to invest in maintaining high business growth rates with capital expenditures at the level of RUB 1.5 billion, which is half the value of the 2022 period due to temporary effects. The company invested RUB 0.7 billion in server equipment. RUB 0.6 billion - in the development of data center infrastructure in accordance with the schedule of construction and modernization of data center sites with the transition of the construction of a new data center to the active phase in 2024.

FG Finam analyst Leonid Delitsyn explained the reasons for the company's growth: "The growth of revenue in the long term is due to digital transformation - the transition of the IT infrastructure of enterprises to the clouds - and import substitution, including the departure of Western providers. The result was determined by the main direction - "Private clouds based on dedicated servers", which accounts for almost 60% of revenue. It brought in 28% more and determined the final result. As for net profit, this indicator reflects both market growth and the company's focus on effective management. Often, an increase in profit (or a decrease in losses) is also a sign that the company is preparing to hold an IPO and is sending investors a signal that it knows how to manage costs."

Freedom Finance Global analyst Vladimir Chernov commented on the sharp increase in net profit: "The twofold increase is due to improved operational efficiency, increased profitability amid higher revenue growth rates compared to the growth rate of operating expenses, as well as an additional positive effect of profit from exchange rate differences. At the same time, free cash flow continued to grow in the reporting period, resulting in a decrease in the company's net debt, and the Net Debt/EBITDA ratio fell to 1.0x against 1.7x at the end of 2022."

Leonid Delitsyn gave a forecast for the company's financial indicators for the following reporting periods: "Selectel's revenue for 2023 will amount to 10.5 billion rubles. In the first half of 2024, revenue will amount to about 7 billion rubles."

Vladimir Chernov suggested more optimistic figures for the end of 2023: "By the end of 2023, the company's revenue could be in the range of RUB 11 billion to RUB 14 billion, and net profit could more than double, by about 2.5-2.8 times, to RUB 3.15-3.5 billion. In the first half of 2024, we expect revenue at the level of RUB 6-7 billion, and net profit in the region of RUB 1.7-2.2 billion."