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DATATEC LIMITED - Interim management statement

Release Date: 17/07/2013 08:00
Code(s): DTC     PDF:  
Wrap Text
Interim management statement

Datatec Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1994/005004/06)
ISIN: ZAE000017745
Share Code: DTC
("Datatec" or "the Company")

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 2013 to 30 June 2013 ("the Period").

Group

Overall Group revenues and EBITDA in the Period are similar to those for the four months ended 30
June 2012 ("the Comparative Period") but underlying**, earnings* and headline earnings* per share
are slightly lower. However, based on current exchange rates and market conditions, the Group's
forecasts for the financial year remain unchanged.

Trading conditions remain largely the same as in the second half of the financial year ended 28
February 2013 (“FY13”). Westcon continues to experience a more challenging trading environment
whilst Logicalis has continued to perform robustly. Gross margins have remained stable.

On 15 May 2013 the Group published forecasts for the financial year ending 28 February 2014.
These are for revenues of between $5.6 billion and $5.9 billion, profit after tax* of approximately
$102 million, underlying** earnings per share of approximately 50 US cents and earnings* and
headline earnings* per share of approximately 46 US cents.

Jens Montanana, Chief Executive Officer said:

"We remain cautious about the prospects for growth in the geographies in which we
operate. However, our global footprint and the diversity of our business streams
continue to provide resilience in these mixed trading conditions.

“At Westcon the strongest performance has been in developing markets, Europe remains
persistently weak and the recent SAP implementation in North America has impacted
volumes in the short term. We are focused on improving Westcon’s operating margin.”

“We are very pleased with the continued robust performance at Logicalis.”

Westcon

Revenue growth in Westcon’s markets has been varied: Latin America, Middle East and Africa have
reported year on year sales increases; Europe had modest growth; and sales in Asia Pacific declined.
In North America the transition to a new SAP-based ERP platform has caused operating disruptions
which have negatively impacted revenues. Strong growth in security sales has been reported across
several regions.

Overall gross margins have improved from the Comparative Period despite some margin pressures in
Latin America.
As expected, operating costs are higher than the Comparative Period due to the acquisition of Afina
in July 2012.

Logicalis

Logicalis has had a strong start to the year, reporting overall revenue and operating profit growth
over the Comparative Period in line with the Board’s expectations.

Annuity revenue growth has been good with a positive impact on gross margins. Latin America is
the best performing region.

On 4 March 2013 Logicalis acquired four European operations of 2e2 for €24 million ($31 million).
These businesses have contributed positively to the overall performance of the division.

Consulting Services

The performance of the Consulting Services division has improved compared to last year with
increased profitability at Analysys Mason.

Interim results

The Group expects to release its half year results for the six months ending 31 August 2013 on
Wednesday 16 October 2013.

The financial information on which this statement is based has not been reviewed and reported on
by Datatec's external auditors.


* 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.

** Underlying earnings excludes goodwill and intangibles impairment, amortisation of acquired
intangible assets, acquisition related adjustments, profit or loss on sale of assets and businesses, fair
value movements on acquisition related financial instruments and unrealised foreign exchange
movements.

                                                 ENDS

Enquiries:

 Datatec Limited (www.datatec.co.za)
 Jens Montanana, Chief Executive Officer                                     +44 (0) 1753 797 118
 Rob Evans, Chief Financial Officer                                          +44 (0) 20 7395 9012
 Wilna de Villiers, Group Marketing Manager                                  +27 (0) 11 233 1013

 Jefferies Hoare Govett – Nominated Advisor and Broker
 Nick Adams/ Alex Collins                                                    +44 (0) 20 7029 8000

 finnCap – Broker
 Tom Jenkins / Henrik Persson                                                +44 (0) 20 7220 0500

 College Hill
 Adrian Duffield / Rozi Morris (UK)                                          +44 (0) 20 7457 2020
 Frederic Cornet / Lexi Ball (SA)                                            +27 (0) 11 447 3030

17 July 2013

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

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