UK biz buoys Computacenter
Expects VAT-related surge in spending
Computacenter's unaudited results for the first six months of the year show a decent performance all round - with even troublesome Germany showing signs of improvement.
Sales for the six months ended 30 June 2010 are up 5.4 per cent to £1.29bn. Profit before tax was up 75.1 per cent to £21m (less exceptional items) and the interim dividend is up 16.7 per cent to 3.5p per share. The reseller said there was also clear signs of improvement in Germany, despite a difficult start to the period.
Mike Norris, Chief Executive of Computacenter plc, said: "The improvement in profitability in the period, was largely driven by a strong rebound in infrastructure spend, together with steady growth in services, as well as our continued focus on cost control."
He said the company was on track to hit targets for the full year and continue to increase services revenues.
The company expects continued pressure on public sector spending in the UK, but said this would be offset by positive growth in the financial sector in the UK and industrial markets in Germany. It also said VAT rises in 2011 might spark a spending flurry towards the end of 2010.
UK revenues were up 12.7 per cent to £651.9m and services business grew eight per cent. Adjusted profit jumped 43.7 per cent to £18.1m. It won two contracts to install Oracle/Sun Exadata storage kit at a big bank and a solution provider. Computacenter said the integration of IBM reseller Thesaurus was now complete.
In Germany the story was less good - profits fell 48.1 per cent to £3.7m thanks to a weak start for services. The German business lost a major contract in late 2009 and struggled to fill the gap.
German revenues grew eight per cent with the fall in services revenue made up for by a 14.9 per cent growth in hardware sales - mainly sales of high-end security, network and datacentre kit.
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