Okay, good. Let's start. Welcome, everybody. Sorry for this small delay. We will quickly go through the numbers of Q1 and tell you about the prospects for the remaining part of the year. Highlights: the most important elements, points. Payment, Payten, was very strongly contributing to the Q1 numbers in the operating profit. We've seen very good e-com performance, processing as well, much lower POS-related services, and better ATM. Yes, but you will see later on the slides that the contribution of e-commerce and merchant business is very much growing in the overall payment environment, which is very—we are very happy about it. Yes, banking was positively surprising thanks to core banking and channel solutions, and this was good information for us. Dedicated solutions still leave a lot of room for improvement.
In dedicated solutions, we see that many of the projects we were counting that they will kick off from the beginning of the year. Some of them were postponed to Q2, even Q3 of this year. A lot of this is happening in Serbia due to the political turbulences. I will mention more by the end of the conference about it. Also, some BPM projects in Romania and also Serbia also a bit delayed. ITS projects, infrastructure, which are not that important, they also were delayed. These were the things that negatively contributed to the dedicated solutions. Yes, you can see, and Michał will be showing, we have much better cash conversion. Last year, especially in the third quarter, it did not look too good. We said, "This will reverse, this will improve," and now we see this reversal.
One thing that we are observing slowly is that the nature of the business in the Middle East and India is much different. The collections are not looking as we are used to European business, and the payment official terms versus real payment there differ very much. Basically, we decided to take a very conservative regime like we do. We take all the time in Asseco South Eastern Europe, Payten, and we are making provisions for all such outstanding receivables. If this would not be the case, probably the results from that region would be even better. The currency we've seen in the first quarter is a lot strengthening. Michał will show it, but it had a lot of negative impact. Euro is pretty neutral for us. The last thing I would mention are the transactions revenues.
You see the nice dynamics, the highest in independent POS transactions because of very, very big market openings, especially in Romania, but also Croatia, very, very dynamically growing, processing nicely developing, and e-commerce traditionally growing. We do expect these lines will be growing in the future. Let's look at the numbers now, please.
Okay, let's move to numbers. I don't know how much familiar you are with our slides, but let me walk you through. First, two columns are numbers as they are reported in our financial statements for Q1. The following two columns are numbers excluding effects of hyperinflation reporting. This is non-cash, purely accounting reporting of hyperinflation for there. We are concentrating on those numbers excluding hyperinflation on this slide and on the following ones. As you see on top line level, we have 13% growth year over year. Here, the majority of this growth, roughly 80%, is generated by own activities, mostly in the payment area and in smaller value in banking.
As for resale, here we have growth of almost EUR 2.5 million year over year, but payment contributed with EUR 5 million growth, and dedicated solutions in this third part in resale part of business dropped by around EUR 2.5 million, what was already mentioned by Piotr in highlights. On EBIT level, we have growth 8% year over year in euro, and in Polish Zloty, it is 4% year over year. This is due to the effect of strengthening Polish Zloty during Q1. Similar growth on EBITDA, 9% year over year. When we look down below operating profit, we have a drop of result on level of net operating profit, and this is due to financial activity.
Here, result on financial activity is by EUR 2 million lower than previous year, and the majority of this drop is in the amount of EUR 1.6 million is due to loss recognized on disposal of subsidiary, which is more than . On top of this, we had EUR 300,000 low bigger cost of revaluation of contingent liabilities and put options. The balance of FX gains is still positive, but lower by EUR 300,000 than in 2024. This was partially compensated by interest, which were higher, positive interest higher by EUR 100,000 than in previous year. As for taxes, here in absolute values, taxes are around EUR 100,000 higher than in 2024. When we look at effective tax rate, excluding this loss on sale of subsidiary, which is not taxable, the effective rate is 0.4% higher than year over year. We can say it's on the same level.
Let's move to results by segment, and let's start from banking. In banking, flat profitability, 24% in the same in previous year, growth of revenues by EUR 1.7 million, own revenue, own activities, and EUR 400,000 growth of operating profit. Those growths in banking are mainly thanks to core and channel solutions, core in Serbia and in channels in Romania, Serbia, and Bulgaria. Dedicated solutions, as I already mentioned, drop of revenues. You can see here EUR 2.2 million lower revenues. Drop is mostly in third-party areas, so advanced infrastructure services in Romania, Serbia, Poland, and Bosnia and Herzegovina. Partially, it is compensated by this business line responsible for own software, but still in overall drop of result by EUR 700,000 in dedicated solutions. The last line, but the one showing growth, Payten, EUR 11.6 million higher result in total and growth of EBIT by more than EUR 1 million.
We've slightly lower profitability by one percentage point. What is related with change of structure of EBIT? Let's go a bit more deeply in payment. The line showing biggest growth year over year, over EUR 5 million, is e-com and processing. This is thanks to operations in Turkey, Serbia, Western Europe, and Croatia. This generated 60%-70% of the growth. Additionally, we have also effect of consolidation of India and United Arab Emirates operations, which were not part of the group in Q1 2024. In ATMs, almost EUR 5 million growth of revenues. This big growth in big part is thanks to deliveries of ATMs, which happen in Serbia, Bulgaria, and Romania, those three geographics. Independent networks, ECRs and IPD, EUR 1.2 million growth year over year.
Here we have a big part in Croatia, where we started with those business lines, but also nice growth in Romania, this is what Piotr already mentioned, so new market. On top of this, Serbia and Czechia and Slovakia. POS, here revenues very similar to last year, only slight increase. Changes between countries, some a bit higher, some a bit lower, but in general, very similar to previous year, but lower result, mostly due to Western Europe and with lower impact Serbia and Slovenia. What is worth to mention, we created some write-offs, allowances for inventory, mostly in POS, but also in ATM, following our quite strict policy about write-offs in case of overdue inventories. We hope that we'll be able to deliver this in coming quarters and then to reverse those write-offs. Okay, let's move to results by countries, by geographies.
Southeastern Europe, EUR 5 million higher result, mostly thanks to Croatia, for which this first quarter was good for dedicated solutions. Overall, on group level, it is not good, but as I mentioned, drops in third-party business were partially covered by own solutions. This is an example in Croatia, year over year, EUR 5 million growth in result on BPM solutions. In Serbia, talking about big changes in Southeastern Europe, EUR 300,000 drop, and this mixture of three changes. As I mentioned, good for banking thanks to core solutions and increase of result. Also pretty good for payment, growing result in e-com and processing. Weak start for dedicated solutions and drop of result, what is visible. Moving to Central Europe, here EUR 400,000 better result than in Q1 last year, mainly thanks to banking and payment and negative dedicated solutions. In banking, channels in Romania, which I already mentioned, contributed to growth.
In payment, it's mostly thanks to Romania and Czechia in this traditional POS and ATM business, whereas in the dedicated solutions, drops in Romania and Poland. In Western Europe, here we have slowdown by EUR 700,000, mostly in area of payment. Actually, this is the only significant business we have in Western Europe payment. The drop is on traditional POS business due to mostly lower deliveries, partially compensated by better performance of e-commerce and processing and IPD networks. We have Middle East and India. Together, around EUR 1 million contribution to result in Middle East lost in amount of EUR 800,000, which was generated due to those write-offs of receivables, which Piotr already mentioned. We created them and this impacted on result. In India, positive result. In this case, we have some effect of reversal of write-offs, which were created during Q3 and Q4 of previous year.
Let's move to balance sheet and cash position. As you can see, it looks pretty good at the end of March. Our cash balance increased by EUR 9 million and net cash increased by EUR 5 million. This increase of bank loans is related with investment loan, which we took to finance equipment and licenses, which we outsourced to one of clients in Romania. Pretty big project with big investments and long-term outsourcing project for five years. We financed this investment from external loan. In case of lease liabilities, the growth of liabilities is due to amending lease contracts and signing new contracts in Macedonia. When we look down through operating assets, receivables liabilities both declined, nothing special.
What we are happy that we managed to decrease balance of inventory thanks to this, mostly thanks to payment and delivered or activated as fixed assets, POSs and ATMs, plus this equipment for this outsourcing project, which I mentioned, one company loan. When we look at cash flow, very nice quarter. Operating cash flow for Q1 2025, over EUR 15 million, whereas last year it was less than EUR 1 million. It looks very nice. EBITDA to operating cash flow conversion, 83% for last 12 months versus 65% and adjusted for one of 76% last year. It looks very good, and it showed that this slowdown, which we had during especially Q3 last year, it simply it's ripped up this, yes, and now it's better.
The investments in Capex, it increased year over year by EUR 3 million more or less, and it's visible also on last 12 months versus previous year. This is due to investments into outsourcing of POS and ATMs and this dedicated related solutions related project, which I already mentioned. Okay, this is about cash. It looks good, and we hope that in next quarters, it will be also on nice levels. Let's move to Outlook for 2025.
In backlog coverage, as you see, it's pretty good. Actually, it's a coincidence, but this graph looks the same for us and Payten for all business lines. You can see the Q2 and the rest of the year coverage is about 13-14% roughly for all the businesses. What is the takeaway from this?
I mean, we sustain our pretty positive outlook for the rest of the year as in the beginning of the year. We do not see major reasons to worry. If I may comment some additional observations. In Serbia, we have some delays like last year due to political upheaval and some problems. There were protests throughout the winter, some strikes, reconstruction of the government. Everything paused with decision-making, especially in public administration and related entities. Now it seems the government is reconstructed and it is slowly back to life, but let's see how this will continue to develop. Second observation is Turkey. I am sure you followed the imprisonment of counter-candidate to Mr. Erdoğan in the upcoming presidential election. The mayor of Istanbul was imprisoned, and this has created a lot of protests, including silent strikes or decisions not to buy goods on e-com once a week.
To what extent this will impact the economy and some things in Turkey is hard to say. We believe it will be step by step back to normal, but we've seen this weakening of lira happening recently after this imprisonment took place. Let's see how this will develop further, yes. For Dubai and Indian market, we have a very rapid revenue expansion, which is good news, but with very poor collection capacity. We are still learning this market and checking to what extent this is market-specific and nature of the market, to what extent there are some mistakes made. We are putting much more focus on collections, but just in case, as mentioned during the beginning of the presentation, we are taking a conservative stance on this and doing some provisions for outstanding receivables like we have in the past for this type of business.
As mentioned, these numbers maybe could be better, but we prefer this approach, a bit more conservative. In dedicated solutions, in billing, we see already new projects, and it's happening in intelligent transport systems, so tunnels, highways, monitoring systems. This was delayed, as mentioned in the beginning, by one quarter. We think Q2, Q3 will show quite nice contracts, long-term contracts, so this should also strengthen the dedicated solution system. In Serbia, we don't know how quickly it will open up again, but we are positive, yes, here. This is in payment overall. As mentioned, we expect continuity of the trend. Very good prospects in Romania, where we are increasing dramatically our market share in independent POS, the merchant business. We hope to see some nice growth this and next year. Overall, this business is nicely expanding.
We are planning on a business plan how to expand with e-com and invoicing business and independent POS business to Spain now from Portugal. This is a plan. We've made small acquisition of the fiscal register player in Spain. This will help us to open up to merchant business on the Spanish market. I think that's it for the summary, and we are open very much to your questions. If you want to use the chat or you can use the voice, we'll unmute, or I'll make Monika, we can unmute everybody, and you can just ask us the question, yes?
Yeah, the microphone is available.
It is, yes. You can use the micro chat. Please ask questions if there are any. Are we, question, are we actively working on acquisitions currently? Yes, we are.
We had a small slowdown because of major acquisitions done by the end of the year. Yes, we're working on the pipeline. We don't plan to change our policy with that respect, and we'll be continuously acquisitive, yes. Prospects in India. I would say this is very strong to business lines. By this acquisition, we bought Middle East and India, yes. Middle East is more white label software solution business, but we are entering also merchant business aggressively. On both markets, we are where India is much more merchant business. On both markets, we are waiting for applying for licenses in India, which will definitely take much more time as the market is much more regulated and difficult. In Dubai, we expect to get this license maybe this year even.
Still, in all our business models, we plan to do it through intermediaries, which leaves some commission to the intermediaries, but we expect this to generate sufficient profits for the company. Basically, growth potential is quite big. What worries us only is that we have a lot of outstanding receivables, even from very reputable customers and big banks, but some of them exceed half a year, sometimes even one year. That is why the provisions we started to make just in case. They, of course, will be reversed as the payments are made. Here, the integration with these companies is increasing. There are more interactions, more visits, and more joint systems that we use in reporting, in sales, in finance. We are very positive about it so far.
I don't know if I answered your question about prospects in India, but please feel free to narrow it down if you wish. On the Polish conference, we got also questions. I can just help out here that what is the consequence of Constellation acquisition or the very same process of Asseco Poland? I said we had no interactions with Constellation so far, but after our study, we see some similarities and some differences. The major similarity is that they are very acquisitive, so as we. We are looking. The difference is that our acquisition targets, they are looking at everything that moves in the software domain, any industry, any area, any geography, whereas we are narrowing down the industries. If I look at 10 years past and now, our focus is more focused, yes.
We are definitely looking at a smaller amount of industries, trying to increase concentration in the verticals where we are strong. The second difference is we are always working on integration, very much on the synergies. We should have a coming next two to three years from the moment of start, but we see them after a couple of more years bringing very nice effects. We have common financial systems, sales systems, reporting systems, HR, marketing. This is creating a corporate group, which is our policy, and we rebrand the companies long term and create Asseco or Payten brands on respective markets, yes. That is the difference. Any questions? Anything additional you'd like to ask? You can use chat, voice. We hope to follow on the stock market of Asseco Poland and in terms of especially PE valuations. Let's see if this will be observed or not.
If no more questions, we invite you to direct contact. If you want to contact, if you want to call, the close period is finished over. We can talk much more openly. If you would like to set up a call with me and Michał or either of us, for sure one of us will be available. Just let us know. Thanks a lot. Enjoy the rest of Friday and the weekend, and we'll be in touch. Thank you. Bye-bye.
Thank you.
Bye-bye.