Computacenter PLC Interim Results 2018
Interim Results for the six months ended 30 June 2018
Computacenter plc (“Computacenter” or the “Group”), the independent provider of IT infrastructure and services that enables users and their business, today announces unaudited results for the six month period ended 30 June 2018.
- Group revenue increased 18.1 per cent to £2.01 billion (H1 2017: £1.70 billion) and by 16.8 per cent in constant currency2;
- Group adjusted1 profit before tax increased by 24.3 per cent to £52.1 million (H1 2017: £41.9 million) and by 23.8 per cent in constant currency2;
- Adjusted1 diluted earnings per share (EPS) of 32.7 pence (H1 2017: 25.6 pence), an increase of 27.7 per cent
- Net funds3 of £49.7 million (H1 2017: £137.3 million), a decrease of £87.6 million following the Return of Value Tender Offer of c£100 million completed in Q1 2018; and
- Interim dividend of 8.7 pence (H1 2017: 7.4 pence), an increase of 17.6 per cent.
- Group revenues exceed £2 billion for the half, the first time this milestone has been reached in the first six months of a year. The Group's total revenues grew £309 million during the period, £288 million in constant currency2;
- Germany delivers another strong performance with revenue growth of 11.4 per cent during the period driven by excellent Technology Sourcing sales leading to a 53.1 per cent increase in adjusted1 operating profit, both on a constant currency2 basis;
- The UK continued positive sales momentum with growth of 29.5 per cent in revenue during the period, albeit flattered by two very large margin-dilutive Technology Sourcing deals. These Technology Sourcing margin challenges, and several challenging Professional Services engagements, have resulted in an adjusted1 operating profit of 20.6 per cent during the period; and
- France has successfully negotiated a difficult period of contract renewals, and the expiry of a significant Managed Services contract, with a revenue decline of 1.2 per cent contrasted by a 41.2 per cent increase in adjusted1 operating profit, both on a constant currency2 basis.
Mike Norris, Chief Executive of Computacenter plc, commented:
“The Board’s outlook remains in line with its expectation which was upgraded on 12 July 2018. While the second half of the year is a more difficult comparison to the first half, due to the outstanding performance in H2 2017, 2018 is proving to be a year of significant progress particularly for our Technology Sourcing business.
The buoyant market conditions are being driven by a number of factors specifically, but not limited to, the need to increase network capacity, the constant need for enhanced cyber security, workplace upgrades and a move to the cloud. While it is impossible to predict how long these buoyant market conditions will continue, most of these drivers have significant momentum.
As always Computacenter will continue to focus on the long term, investing in our business, innovating our offerings and enhancing our customer service. It is through delivering increased value and competitive offerings to new and existing customers which enables us to deliver shareholder value over the long term.”
- Adjusted operating profit or loss, adjusted profit or loss before tax, adjusted tax, adjusted profit or loss for the period, adjusted earnings per share and adjusted diluted earnings per share are, as appropriate, each stated before: exceptional and other adjusting items including gain or loss on business disposals, gain or loss on disposal of investment properties, amortisation of acquired intangibles, utilisation of deferred tax assets (where initial recognition was as an exceptional item or a fair value adjustment on acquisition), and the related tax effect of these exceptional and other adjusting items, as Management do not consider these items when reviewing the underlying performance of the Segment or the Group as a whole. Additionally, adjusted gross profit or loss and adjusted operating profit or loss includes the interest paid on customer specific financing (CSF) which Management considers to be a cost of sale. A reconciliation between key adjusted and statutory measures is provided within the Group Finance Director’s review included within this announcement. Further detail is provided within note 4 to the summary financial information included within this announcement, Adjusted measures.
- We evaluate the long-term performance and trends within our strategic objectives on a constant currency basis. Further, the performance of the Group and its overseas Segments are shown, where indicated, in constant currency. The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information gives valuable supplemental detail regarding our results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our prior-period local currency financial results using the current period average exchange rates and comparing these recalculated amounts to our current period results or by presenting the results in the equivalent local currency amounts. Wherever the performance of the Group, or its overseas Segments, are presented in constant currency, or equivalent local currency amounts, the equivalent prior-period measure is also presented in the reported pound sterling equivalent using the exchange rates prevailing at the time. 2018 interim Financial Highlights, as shown at the beginning of this announcement, and statutory measures, are provided in the reported pound sterling equivalent.
- Net funds includes cash and cash equivalents, CSF, other short or other long-term borrowings and current asset investments.
For further information, please contact:
Mike Norris, Chief Executive 01707 631 601
Tony Conophy, Finance Director 01707 631 515
Tulchan Communications 020 7353 4200
James Macey White