12th Mar 2015 10:34
LONDON (Alliance News) - Computacenter PLC said Thursday it is determined to make 2015 "a year of progress", and posted a rise in pretax profit for 2014, as a strong performance in the UK helped offset declines in Germany and a continued weak performance in France.
The company proposed a final dividend of 13.1 pence, taking its total dividend for 2014 to 19.8 pence, compared to 17.5 pence a year before.
Computacenter reported pretax profit of GBP76.4 million, up from GBP50.5 million a year before, as revenue rose 1.4% to GBP3.11 billion from GBP3.07 billion, and it posted lower exceptional costs. Revenue growth was constrained by the strength of sterling, and would have been up 4.2% at constant currency.
Computacenter posted exceptional costs of GBP7.8 million for 2014, mostly in relation to the restructuring of its French business. However this was less than a third of the GBP27.1 million in exceptional costs it posted in 2013 due to three onerous contracts in Germany.
In the UK, revenue rose 10.2% in 2014, driven by an 11% rise in supply chain revenue, and a 8.6% rise in services revenue. The company cited the continued economic improvement in the UK as a driver of growth.
Revenue in Germany fell 8.2%, as supply chain revenue was hampered by the loss of customers, and services revenue was flat. However, Computacenter noted that there was an improvement towards the end of 2014, with supply chain revenue growth returning to 16% in the fourth quarter.
In its French business, revenue rose 6.4%, but was still below the amount it produced in 2012, Computacenter said. Whilst supply chain revenue rose 6.4%, this mostly came from higher activity with lower-margin customers. Services revenue also rose 6.5%, as it won a significant contract, but the company said this contract hides an underlying decline in activity and opportunities in the French services business.
Revenue rose 9.3% in Belgium, boosted by a significant one-off order in its supply chain arm, and flat services revenue.
The company said its progress since the beginning of 2014 and recent contract wins gives it confidence for the future. However, it cited some challenges in the short-term.
Service contract wins in the UK during 2014 will take time to mature, the company explained, and whilst its fourth quarter performance in Germany was encouraging it is "too early to tell whether this is a substantial move in the right direction, or simply represents a good quarter."
Whilst it expects to reduce the loss of its French business "materially" in 2015, a return to profitability is "some way off", Computacenter said.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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