DTC
DTC
DTC - Datatec Limited - Interim Management Statement
Datatec Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1994/005004/06)
ISIN: ZAE000017745
Share Code: DTC
INTERIM MANAGEMENT STATEMENT
Datatec, ("Datatec" or the "Group", JSE and LSE: DTC), the international
Information and Communications Technology (ICT) group, is today publishing an
IMS (Interim Management Statement) covering the period from 1 March 2010 to 30
June 2010 ("the Period").
Group
Trading and profitability are continuing to improve in all of the Group`s
divisions. Revenues and operating profits in the Period have improved in
comparison with the four months ended 30 June 2009 ("the Comparative Period").
This is driven in particular by the continuing recovery in the US, stable
conditions in Europe and resilient performance in Asia. Brazil remains the most
promising of the major emerging economies in which the Group operates.
Overall gross margins have remained stable and the Group continues to benefit
from operational gearing. Operating costs remain tightly controlled and the
Group remains vigilant to any interruption in the overall global economic
recovery.
On 13 May 2010 the Group published a forecast for the financial year ending 28
February 2011 of revenues of between $4.1 billion and $4.4 billion, profit after
tax** of approximately $58 million, underlying* earnings per share of
approximately 35 US cents and earnings** and headline earnings** per share of
approximately 30 US cents. Based on current exchange rates and trading
conditions, these forecasts remain unchanged.
Jens Montanana, Chief Executive Officer said:
"We are delighted to report that the improvement in trading and profitability
reported at our recent full year results has continued in all of the Group`s
divisions. We remain cautiously optimistic for the year, in line with our
previously published forecasts."
Westcon and Westcon Emerging Markets
Westcon`s solid financial performance during the previous financial year is
continuing, with trading in all regions showing an improvement over the
Comparative Period. Trading increased in North America, Europe and Asia Pacific,
while trading in Latin America was particularly strong. Westcon produced its
fourth consecutive quarter of revenue growth during the first quarter of the
current financial year. Gross margins remain in line with historical trading
norms.
Westcon Emerging Markets (Africa, Middle East and India) is continuing to trade
well with an improved performance over the Comparative Period.
Supply constraints, existing at the previous financial year end, have eased and
product lead times are improving.
As anticipated, extended credit terms from suppliers during the previous
financial year have now been reduced to normal levels, resulting in a
consumption of working capital. Separately, Westcon is looking at earnings
enhancing re-financing activities by taking advantage of vendor supplier prompt
pay arrangements. These activities will reduce Westcon`s net cash position over
time.
Logicalis
The steadily improving performance of Logicalis from the end of the previous
financial year continued during the Period with revenues, gross and operating
margins all improving relative to the Comparative Period. In particular,
profitability in the US has improved, on the back of continued recovery and an
overall increase in the proportion of services in the revenue mix. Demand in
South America has strengthened and Asia Pacific is performing strongly. The UK
is performing satisfactorily, although the long term impact of government
austerity measures in the UK is unclear.
Consulting Services
Trading and profitability have improved over the Comparative Period, with an
encouraging performance from Analysys Mason and an increased order backlog from
the Intact business. Asia is delivering the best relative performance in this
division.
Interim results
The Group expects to release its interim results for the six months ending 31
August 2010 on Wednesday 13 October 2010.
The financial information on which this statement is based has not been reviewed
and reported on by Datatec`s auditors.
* Underlying earnings per share excludes goodwill and intangibles impairment,
amortisation of acquired intangible assets, profit or loss on sale of assets and
businesses, fair value movements on acquisition related financial instruments
and unrealised foreign exchange movements.
** Forecasts for profit after tax, earnings per share and headline earnings per
share do not take into account any fair value gains or losses on acquisition
related financial instruments, which are required under IFRS.
ENDS
Enquiries:
Datatec Limited (www.datatec.co.za)
Ivan Dittrich - Chief Financial Officer +27 11 233 1221
Jefferies International Limited
Chris Snoxall / Andrew Kenny +44 20 7029 8000
College Hill
Adrian Duffield/Jon Davies (UK) +44 20 7457 2020
Fred Cornet +27 11 447 3030
15 July 2010
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 15/07/2010 08:00:06 Produced by the JSE SENS Department.
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