12th Mar 2019 08:34
LONDON (Alliance News) - Computacenter PLC on Tuesday reported a slight dip in annual profit on the back of some acquisition costs and amortisation.
The computer services firm's statutory pretax profit for 2018 fell 3.2% to GBP108.1 million, as it booked GBP5.7 million of one-off purchase costs and GBP4.4 million of intangibles amortisation.
Excluding this, pretax profit on an adjusted basis rose 11% to GBP118.2 million.
The acquisition costs were mainly related to its September 2018 purchase of FusionStorm for USD70 million.
Computacenter's revenue rose 15% to GBP4.35 billion, with Services revenue up 1.5% and Supply Chain, its main business, rising 21%.
Supply Chain is now known as Technology Sourcing, and the business was helped by a strong first-half performance, especially in the UK, though new software volumes have diluted margins.
In Services, Computacenter was not able to replace a contract that finished in 2017, but said its order book is starting to build again in 2019.
Computacenter will pay a final dividend of 21.6 pence, taking the total for 2018 to 30.3p, 16% higher than what it paid a year before.
Chief Executive Mike Norris commented: "2018 was a record year in revenue, adjusted operating profit and adjusted diluted earnings per share for the group. We have also laid foundations for further growth in the years ahead.
"We have invested in the physical infrastructure that enables our Technology Sourcing, increased our Services capability and expanded our geographical footprint through acquisitions. Even after these substantial investments, Computacenter finished the year with a strong balance sheet and a cash surplus, which underpins our confidence in the future."
"Specifically, while the Technology Sourcing success of last year creates a difficult comparison in 2019, particularly in the first half, lower Services margins in 2018 give us a significant opportunity to improve. We also expect a profit contribution from our acquired business in the USA," Norris added.
Shares were 2.8% higher on Tuesday morning at 1,145.00 pence each.
Related Shares:
Computacenter