Intuitively, you would think that Computacenter (CCC) is engaged in a particularly fraught marketplace; one inherently prone to the disruption brought about by online retail channels and resultant pricing pressures; a point borne out by the collapse of Microsoft distributor Entatech last year.
The reality is that Computacenter has undergone a unique digital transformation since its genesis in 1981 as a humble computer reseller. It’s been some time since the group transitioned to a ‘full-service offering’, providing its corporate and public sector customers with a broad spectrum of IT infrastructure and services. But the success of that process is reflected in these half-year figures, foreshadowed in July, when the group revealed that the trading result for 2018 would be “comfortably in excess of its previous expectations”.
That translated into a 24.3 per cent hike in adjusted profits at the half-year mark, with services revenue up 2.3 per cent to £575m, while technology sourcing revenue jumped 26 per cent to £1.43bn. The latter business strands, which include standardised and centralised IT procurement services, registered double-digit sales growth in the UK and Germany, but it’s clear that Computacenter has simply got ahead of the technological curve, evidenced by the business being generated by demand for cybersecurity services and cloud data services.
Investec is guiding for normalised pre-tax profits of £116m for the full year, leading to EPS of 75.1p, rising to £121m and 78.5p in 2019.
| COMPUTACENTER (CCC) | ||||
| ORD PRICE: | 1,514p | MARKET VALUE: | £1.73bn | |
| TOUCH: | 1,510-1,516p | 12-MONTH HIGH: | 1,632p | LOW: 860p |
| DIVIDEND YIELD: | 1.8% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 359p | NET CASH: | £49.7m | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 1.70 | 47.5 | 28.5 | 7.4 |
| 2018 | 2.01 | 52.0 | 32.1 | 8.7 |
| % change | +18 | +9 | +13 | +18 |
| Ex-div: | 13 Sep | |||
| Payment: | 12 Oct |
