Reporting its interim results for the six months ended 31 August, multinational ICT group Datatec says it achieved "solid" revenue growth of 8%, to $3 billion, compared to the same period a year ago.
This reflects a 14.3% increase in Westcon revenue, partially offset by a 6.9% decline in Logicalis. During this period, developing markets outside North America and Europe generated 37% of Datatec's revenue and 45% of the group's gross profit, compared to 39% of revenue and 44% of gross profit in the six months ended 31 August 2013.
The company also reported gross margin was maintained at 15%, while earnings before interest, tax, depreciation and amortisation were at $90.1 million - up from $89.2 million a year ago. Gross profit increased by 7.9%, to $446.2 million, while operating costs were up 9.8%, to $356.1 million.
Operating profit for the period was $65.7 million, slightly down from $67 million a year ago, while profit before tax was virtually flat, at $57.5 million. The company further reported earnings per share of 18.2 US cents, compared to 19.2 US cents in the comparative period. Headline earnings per share were 16 US cents, down from 18.2 US cents.
Datatec generated $204.5 million cash from operations during the period and had cash and cash equivalents of $104.7 million as at 31 August 2014. The group ended the period with net cash of $48.9 million.
"We have delivered revenue growth and margin improvements in mixed trading conditions across the group," says CEO Jens Montanana. "Westcon's return to a growth trajectory has been very encouraging, with recovery in market share and sales volumes in North America following successful resolution of the ERP transition issues. We have also seen strong growth in our security practice globally."
Montanana also states Logicalis experienced a reduction in sales, as anticipated; largely due to delays as a result of the Fifa World Cup in Brazil, as well as reduction in server and storage product sales, particularly in the US and UK.