Feeds

Datatec splashes red ink

Strong rand

  • alert
  • submit to reddit

Datatec, the South African-owned networking equipment reseller, fell into the red for the year to Feb end.

The company blames the cost of restarting the European reseller operations of Landis and a strong rand for what it calls the "headline loss" of -R224m before tax on revenues of R20.2bn (approx US $2.6bn).

Also, Datatec's tax planning went awry during the year, with the "effective tax rate on profit before exceptional items and goodwill rising from 30.6% in 2002 to 75.2% in 2003.

Jens Montanana, CEO, said: "The effective tax rate is disproportionate because some subsidiaries made losses which will be carried forward for tax purposes, while others made taxable profits in countries with tax rates equal to or higher than the South African tax rate," he says.

Gross margins fell from 14.1% in 2002 to 12.2% in 2003. This was due "mainly to the reduction in margins from sales of Cisco products and a decrease in professional services revenue".

In March 2003, Datatec walked away from Landis' distie operations. It had agreed to buy the Dutch-owned business, but walked away following an argument over price. ®

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.