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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 September 2010 to
31 December 2010 ("the Period").
Group
The improvement in the Group`s trading and profitability reported at the interim
results continued during the Period. As anticipated, the financial results for
the second half of the current financial year ending 28 February 2011 are
expected to be better than the results for the first half of the current
financial year, and comparatively better than the results for the second half of
the prior financial year.
This is being driven by an improving global economy, with our largest market,
the US, in particular showing good signs of recovery. Asia, South America and
the Middle East remain the Group`s strongest performing markets, with trading
conditions in Europe also improving.
Momentum in both Westcon and Logicalis is particularly good, with all main
regions having a strong financial performance during the last few months.
Overall Group gross margins have firmed and operating profit margins are
expanding, as Datatec continues to benefit from operational gearing as a result
of a return to growth in its major markets.
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, although the Group expects to be at the high end of the revenue
guidance.
Jens Montanana, Chief Executive Officer said:
"The improvement in trading conditions reported at our interims results in
October last year has continued, with a notable return to confidence across all
our major markets, particularly the US.
"It appears that we are finally returning to a growth environment that we can
believe in. Gross margins are firming and profit margins expanding as the Group
continues to benefit from increased operational leverage and geographical
reach."
Westcon
Westcon`s solid financial performance delivered during the first half of the
current financial year has continued during the Period. Gross margins have
increased and operating margins expanded on the back of improved operating
leverage.
Profitability in the second half of the current financial year is expected to be
better than the first half of the current financial year.
Logicalis
The steadily improving performance of Logicalis reported in the interim results
on 13 October 2010, continued during the Period, with revenues and operating
margins improving over the first half of the financial year. In particular,
Logicalis` recovery in the US continued and revenue growth in Brazil was strong.
Profitability in the second half of the current financial year is expected to be
better than the first half of the current financial year, with Logicalis
recording its best ever revenue month in December 2010.
Consulting Services
Despite the improving market conditions in the Group`s major economies,
discretionary spending amongst this division`s corporate and telecommunications
customer base has remained constrained and this division`s recovery continues to
be slow.
Preliminary results
The Group expects to release its preliminary results for the financial year
ending 28 February 2011 on or about Wednesday 11 May 2011.
The financial information on which this statement is based has not been reviewed
and reported on by Datatec`s external 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 (including put option liabilities), which are
required under IFRS.
Enquiries:
Datatec Limited
(www.datatec.co.za)
Ivan Dittrich - Chief Financial +27 11 233 1221
Officer
Jefferies International Limited
Chris Snoxall/Justin Matthews +44 20 7029 8000
College Hill
Adrian Duffield/Jon Davies (UK) +44 20 7457 2020
Fred Cornet +27 11 447 3030
13 January 2011
Sandton
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 13/01/2011 09:00:01 Supplied by www.sharenet.co.za
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