Kálmán Faur, Chief Executive Officer

There are increasingly few Hungarian companies today that can claim to have roots going back to the middle of the last century. Libra Szoftver Zrt. is one of them: its predecessor, Volán Elektronika, was founded in 1959. Even before their privatisation in 1989, in 1984, they came out with their first own development, the LIBRA accounting software, and the company has been the leader among Hungarian developers in the field of integrated ERP systems since 1994, almost 30 years ago.

But life always brings new challenges, and it became clear to Kálmán Faur, the company’s owner and Chief Executive Officer, that he needed to stand on more than one foot, so in 2017 he saw the time to expand. Over the next three years, they made a steady stream of acquisitions, acquiring the BaBér and Abacus payroll and HR systems, as well as Memolux, an accounting and payroll firm. This way, by 2020, Libra Szoftver Zrt. became a group of four business units, which fully covers office administration processes, both in software development and services, which is unique in the Hungarian market.

As a result of the acquisitions, the 60-strong Librasoft Kft. with a sales revenue of HUF 1.6 billion, was transformed into a 180-strong private company limited by shares with a sales revenue of HUF 3.5 billion and a profit of almost HUF 1 billion, using its own resources and no external financing. So, in four years, they have increased their sales revenue by almost two and a half times and doubled EBITDA at group level.

As Kálmán Faur puts it, even with a conservative development strategy, they managed to double in four years, while at the same time significantly increasing salaries and dividends. “We certainly could have grown even faster, even bigger, but with that the risk would have increased exponentially and there is no acquisition or market target at the moment that would make it worthwhile”, he adds.

The company did not lose customers due to the pandemic;, the number of clients that left the company was the same as the number of new customers, so they could continue their organic growth at 5%. This may not seem much but, as Kálmán Faur points out, after the fast pace of the previous three years, they had to stop a little and consolidate systems and teams, so as not to lose efficiency.

While Libra Software had 800 clients, with the acquisition they now serve 2,000, which shows, as Kálmán Faur says, that the whole business model is based on a large number of clients, each generating a relatively small portion of the total sales revenue. Their customers are mainly SMEs, but they also offer solutions for large enterprises.

The answer to why they are chosen, according to the CEO, is two words: stability and experience. A well-known brand name inspires confidence in colleagues and clients alike and, if it can be filled with content, they will not only choose it, but stay with it for the long term.

LIBRA systems are customisable business management/ administration solutions, thanks to their modular design and extensive parameterisation. They can be used to automate company processes, thus enabling more efficient work. Their systems are fully integrable, with fast and effective develop- ment to meet specific needs, as well as ongoing software tracking and vendor support.

Their products are used in all sectors of the economy, as well as in the non-profit sector and education. It is no coincidence that the Budapest School of Economics has been teaching on their software for 25 years. Development in Hungary, proprietary products and licences give a high degree of flexibility in both development lead times and fees.

The company also has an expert reseller base covering the entire country (in Tatabánya, Győr, Debrecen, Kaposvár, Nyíregyháza, Zalaegerszeg, Miskolc, and Szolnok) and offers flexible licensing options that best suit the client’s needs.

According to the CEO, the growth driver in both the software and BPO businesses will be innovation: a new phase of automation has started in the field of business administration, fuelled in part by the rise of artificial intelligence and in part by the continuous developments of the National Tax and Customs Administration. Extending this over the market is a longer process and, from a revenue point of view, it mainly entails restructuring, so it is more of a need for renewal, but not a major growth driver. Rapid, double-digit growth is only possible in this market through M&A transactions.

After another successful year in 2020, Libra has the resources left to carry out more CSR activities than ever before. Therefore, during the year, they donated more than HUF 25 million to help mitigate the effects of the coronavirus pandemic and, as they are in contact with many institutes of secondary and higher education, they have mainly provided them with essential equipment for digital education, but they also supported hospitals. “We were lucky; we felt it was important to help others”, says Kálmán Faur.