Investors buy in after Computacenter hits record revenues

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Investors buy in after Computacenter hits record revenues
Master Investor Magazine

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FTSE 250 IT infrastructure and services provider Computacenter (LON:CCC) has announced a 14.7% improvement in revenues for the year ended 31st December, which put revenues over £4 billion for the first time. The group posted a lower statutory profit than in the prior year, but this was due to exceptional items primarily linked to the acquisition of FusionStorm during the year.

Chief executive Mike Norris said that: “2018 was a record year in revenue, adjusted operating profit and adjusted diluted earnings per share for the Group. We have also laid foundations for further growth in the years ahead.

We have invested in the physical infrastructure that enables our Technology Sourcing, increased our Services capability and expanded our geographical footprint through acquisitions. In addition, we reduced the number of shares in circulation by 6.97 per cent, through a Return of Value Tender Offer of £100 million. Even after these substantial investments, Computacenter finished the year with a strong balance sheet and a cash surplus, which underpins our confidence in the future.

Specifically, while the Technology Sourcing success of last year creates a difficult comparison in 2019, particularly in the first half, lower Services margins in 2018 give us a significant opportunity to improve. We also expect a profit contribution from our acquired business in the USA.

As we look out further into the future, we remain enthusiastic about our customers’ desire to enhance the digital experience, grow their network capacity, modernise their infrastructure and enhance their competitiveness, by investing in technology“.

The price of Computacenter shares rose by 5.66% to 1,177.05p (as of 11:55 GMT).

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