This year, everything hinges on Germany and how quickly Computacenter (CCC) can recover after the IT services provider "stumbled" there last year. It took on too many contracts at the back-end of 2011, which stretched resources and cost it millions. Still, a surge in the UK covered the shortfall and adjusted pre-tax profit at constant currency was flat. Germany is recovering and a promise to hand back £75m to shareholders, probably via an issue of B shares, has generated excitement.
An influx of big deals ramped up revenue in Germany by 4 per cent to €1.47bn (£1.29bn), but spending €12m to rectify a handful of problem contracts slashed adjusted operating profit in half to €14.4m. Thankfully, about two-thirds of those costs were one-offs and things should get "a lot better" in Germany this year, says chief executive Mike Norris. Analysts, with a steer from Mr Norris, expect an extra £10-14m of profit, although a couple of "stubborn" contracts and dearth of new business make it hard to be precise. Computacenter's UK business had a "splendid" year as the benefit of new contracts won in 2011 drove services revenue up 15 per cent and adjusted operating profit up 40 per cent to £52.2m. However, fewer orders won in 2012 suggests a "plateau year" ahead for the UK.
Broker Investec Securities expects underlying pre-tax profit of £82m in 2013 and adjusted EPS of 41.1p (£71.3m and 35.6p last year).
COMPUTACENTER (CCC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 500p | MARKET VALUE: | £770m | |
| TOUCH: | 498-501p | 12-MONTH HIGH: | 522p | LOW: 285p |
| DIVIDEND YIELD: | 3.1% | PE RATIO: | 15 | |
| NET ASSET VALUE | 274p* | NET CASH: | £128m | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 2.56 | 39.5 | 24.7 | 8.2 |
| 2009 | 2.50 | 48.4 | 25.7 | 11.0 |
| 2010 | 2.68 | 65.4 | 34.1 | 13.2 |
| 2011 | 2.85 | 72.1 | 41.0 | 15.0 |
| 2012† | 2.91 | 64.8 | 32.9 | 15.5 |
| % change | +2 | -10 | -20 | +14 |
Ex-div: 13 May Payment: 14 Jun *Includes intangible assets of £104.6m, or 68p a share †Excludes proposed £75m special dividend | ||||
