AT Consulting: For the next three years we are going to grow up twice

TAdviser: What for the company was 2014 in terms of business? How did revenue, profitability of the company change?

2014 in terms of business was successful. We grew quite significantly, by 20%. At the same time, despite all crisis problems which began in 2014 we were profitable. In many respects it was connected with weak dependence of AT Consulting on deliveries of the import equipment. I will note that revenue from providing IT services made 80% of total income of the company. The greatest income of AT Consulting is the share of implementation and support of IT systems, software development to order, IT consulting and IT outsourcing.

TAdviser: Whether it was necessary to reduce people?

We did not reduce people at all. On the contrary, gathered. We grew by 15% on number of staff. If for the beginning of 2014 we had about 2000 people, then at the beginning of 2015 – more than 2350.

TAdviser: How in 2014 did clients behave?

We observed changes in demand pattern. Customers are forced to approach planning and justification of costs for IT more seriously. It, on the one hand, toughens the competition among software suppliers and services, and with another — stimulates increase in demand for projects which help to increase business performance of customers. Today we can note that work becomes more, at the same time there are very tough negotiations with customers on the price.

TAdviser: It is the general trend of all market?

In my understanding – yes. It is what I see on our customers. All clients began to analyze the costs attentively. Began to think of economy, especially under the end of the year. It, of course, affected business of integrators as many projects requiring big investments were frozen. They were not cancelled – they were frozen to look how the market will develop further and also to confirm business need of these investments. In an uncertainty customers do not hurry to spend money.

TAdviser: In your opinion what factors influenced IT market in 2014?

The devaluation and "informal" sanctions which were expressed that a number of the western vendors anyway inspected the partnership with the Russian companies became significant blow for equipment suppliers and licenses of the western software. The general unstable situation in economy led to toughening of the competition in IT market in general, having provoked pricing wars among suppliers and integrators. However in the segment of IT services key for our company, we did not feel reduction of amounts of works.

Sanctions affected also that now the companies do not want to think of risks of suppliers and order "turnkey" complex projects. Our large project in St. Petersburg – "The safe city" where we act on the general contract at Rostelecom can be an example.

TAdviser: How often you face an import substitution subject?

Already over a year in the country the import substitution subject is actively discussed. Though in a public sector this trend was shown long ago. There customers actively looked earlier towards the open source. Our company considers it and develops the solutions for a public sector on the free software. We already implemented projects on automation of activity of municipalities and regional authorities more than in 30 regions of the country. In these projects we used domestic and open source software.

Regarding the system software, however, with import substitution everything is much more difficult. The western IT corporations already spent a huge number of marketing efforts to make the largest corporate customers dependent on the products. A problem of creation of analogs of the largest DBMS and operating systems and furthermore mass transition to such products of big domestic customers, will demand enormous efforts.

TAdviser: I.e. nevertheless not to do without Oracle?

Happens differently. For large industrial implementations of the database on Open Source are not always adequate. Completely replace Oracle extremely difficult as the producer created a serious ecosystem. It does not mean that DBMS from Oracle the most perspective. It is rather on the contrary. But nevertheless is with what we live now.

In new projects we try if it is possible, to use Open Source. But it is always situational, we consider customers needs. We work only with big customers, and they have the history of development of IT with already implemented products and also politicians to which it is necessary to adapt.

TAdviser: Whether there are in the market product proposals of domestic suppliers?

Is. For example, 1C Company has very strong history. Earlier they were focused on a mass product. Now from 1C there is a huge interest in entering the market of big commercial customers. We see also many interesting solutions for public sector and we develop the whole lines of own products, for example, Smart-Kit line for automation of regional state services.

TAdviser: Whether the company plans growth on revenue and on personnel in 2015?

We planned moderate growth and we will carefully monitor costs. Simple – to do trends for smaller money not less, than earlier, and it is even more. Therefore cost analysis becomes priority. Positive dynamics will be reached due to development of systems which are already implemented by us, demand for the completions increasing process performance of our customers is also considerable. Also at us the "long" projects begun last year actively develop.

TAdviser: In what sectors do you expect increase in demand for IT services? In what falling? Your estimates.

Under big risk now banking sector. A huge number of commercial banks is unprofitable now. However all of them put budgets on IT, hope for improvements in the business, calculate that in 2016 it will be possible to start and show good results again. Demand in telecommunication and state sectors stabler thanks to dependence of these industries on IT.

In general in IT market I would call a situation indefinite. As it will develop, depends on that how effective will be measures for development of import substitution in the real sector of economy. If efficient development mechanisms of domestic production are started, then we can expect growth of investments and into technologies at our customers. Internal IT market always follows in the growth investment volume in economy. Regarding sales of the equipment I would not hope for recovery of former volumes. Import substitution in this area is extremely difficult at the moment, it is necessary to be guided by the import equipment so far, and customers will be very careful in its purchases.

TAdviser: What technology niches will grow? What to fall?

Clients actively look at complex services when the contractor is responsible for full functioning of big business process and can provide a full stroke of the works necessary for high-quality automation.

One of world trends – processing of Big Data, and in this area at us huge competence. For example, for VimpelCom company we create "factory of the ideas" using Big Data technologies which gives the chance to the operator to offer the subscribers individual additional services.

Our customers also actively move towards "didzhitalization": representations of the companies on the Internet, social networks, interactive interaction with users and clients.

TAdviser: How today the state can stimulate IT market?

In 2014 demand for IT services from government institutions was high. If in the current conditions it is possible not to freeze at least already starting initiatives, then it can become very good support for IT market and in the current year. The IT companies will be helped also by effective measures in the field of stimulation of import substitution in the real sector of economy that will lead to growth of projects on automation, especially in a segment of production of the consumer goods in which the import share is big now. If the initiative on import substitution in the real sector of economy is effectively implemented, it will automatically urge on demand for IT services from customers.

TAdviser: What further development plans for AT Consulting? Whether you plan carrying out the IPO?

We think about an exit to the IPO, but now not the most suitable time for this purpose. We have a good audited reporting, we the "white", transparent company, and it is possible, after a while we will make the positive decision.

For the next three years we are going to grow up twice, despite all current general economic difficulties and what this year of sharp growth will not turn out. We have long-term experience of successful implementation of very difficult projects, we are able not only to work with IT services, but also to solve complex business challenges of our clients. Customers know about it therefore demand for our services continues to grow.