As the German economy shows increasing signs of a slowdown, Computacenter (CCC) saw operating profit in its largest market remain largely flat in the first half of 2019 at £32.6m. With the private sector curbing its IT investment, the group came up against “massive cost-cutting measures” in industries such as car manufacturing, with its largest technology sourcing client cutting spending by 60 per cent. Offset by a resilient public sector, the IT infrastructure and services provider remains hopeful the adverse impacts of an economic downturn can continue to be mitigated.
Meanwhile, a “somewhat disappointing” UK performance saw lower volumes drag professional services revenue down 13 per cent to £55m. As customers plan workplace changes to accommodate Windows 10, the group expects a pick-up of activity in the second half. Customer attrition also dampened managed services sales by 3 per cent, but with a refocusing on the target market alongside a shift towards higher margin professional consulting work, there was an almost 2 percentage point margin increase in the services segment.
Investec anticipates adjusted pre-tax profit of £141m and EPS of 85.5p for the full year, rising to £146m and 88.4p in 2020.
| COMPUTACENTER (CCC) | ||||
| ORD PRICE: | 1,448p | MARKET VALUE: | £1.65bn | |
| TOUCH: | 1,444-1,449p | 12-MONTH HIGH: | 1,544p | LOW: 936p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 406p* | NET DEBT: | 25%** | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 2.01 | 52.0 | 32.1 | 8.7 |
| 2019 | 2.43 | 50.8 | 33.6 | 10.1 |
| % change | +21 | -2 | +5 | +16 |
| Ex-div: | 12 Sep | |||
| Payment: | 11 Oct | |||
| *Includes intangible assets of £118m, or 103p a share, **Includes lease liabilities of £111m | ||||
