Datatec flags a return to profit

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Datatec flags a return to profit

Published Date: 2019-05-09 | Source: Stephen Gunnion | Author: Stephen Gunnion

Datatec flags a return to profit

The ICT group says it's made good progress in reshaping its Westcon International business, while Logicalis and Analysys Mason have continued to do well.

Datatec expects to report a strong rise in full-year profit following a restructuring of its business after it sold its Westcon Americas business to SYNNEX Corporation in 2017.

In a trading statement, the information and communications technology group said it would report underlying earnings per share of 6.6 US cents for the year to end-February after posting a 5.6c loss a year ago. On a headline basis, it expects to report earnings of 0.7c per share from a 19.1c loss in 2018. However, earnings per share will be 73% lower than last year at 5.5c as a result of the profit it generated on the sale of Westcon Americas and Logicalis SMC.

Datatec said the increase in underlying and headline earnings per share was due to the good progress it had made in reshaping the remaining Westcon International business, combined with continued improved performances from Logicalis and Analysys Mason.

When it reported its interims results in October, Logicalis was the largest contributor to Datatec in terms of profitability and also provided the widest geographical exposure. At the time, it said it had stabilised Westcon International's enterprise resource planning system (ERP) after a long and disruptive multi-year implementation process. It had also made good progress in reducing central costs to an appropriate level following the disposal of Westcon Americas.

It plans to release its results next Thursday.

Its shares fell 3.5% to R32.61 on Tuesday.

Other related stories:

- Datatec to return to profitability after subsidiaries step up

- Datatec returns to profits

- Datatec's underlying, headline earnings expected to swing back into black

- Datatec raises FY EPS and HEPS guidance, expects positive underlying EPS





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