IBM SA had a record year, delivering a 20% rise in revenue for its 2006 financial year, says Mark Harris, IBM SA country GM.
Harris told the company's channel partners that 2007 would see it address flexible financing - a weakness that could impact market growth.
Speaking at the annual IBM gala dinner for channel partners, Harris noted the year saw growth of 33% from the company's Server and Technology Group, 30% from Business Consulting, 33% from its Software Group and 59% from its Services Group.
In terms of its New York Stock Exchange listing, the local company is unable to provide figures related to the African region.
Providing clarity on the performance, Stelio Frasco, IBM SA channel executive, pointed to exceptional sales in the last quarter of the year: "2006 saw us post our largest quarter and full year revenues in the region's history. December was a particularly good month for us, with revenues for the month outperforming the whole of IBM SA's third quarter."
Driving services
The company reported growth of above 30% for almost all of its divisions, although IBM SA's overall growth came in at 20%. This could be attributed to the company's Integrated Delivery Centre (IDC), which operates largely as a global cost centre.
According to Mteto Nyati, global technology services executive for the local company, the division's 59% growth did not include revenue from the IDC, unless the deals had been signed in SA.
IBM SA has been under pressure from its parent company to increase revenue from its services division. Globally, services contribute about 30% to the company's revenue. However, locally, IBM's channel-focused route to market has kept this figure down.
In June, Nyati said the company was on track to sign $385 million in new services business during the year as it aimed to take the top services post in the South African industry. This required the group to go head-to-head with its biggest partners, including Business Connexion, at the time the top services provider and one of IBM's biggest local partners.
Since then, the company has been tight-lipped on the value of deals signed with clients and it is understood it does not divulge figures to market analysts.
In perspective
Comparatively, the company's international results, posted last month, disappointed the market, knocking 4% off the share price in the days following the announcement.
Although IBM's fourth quarter delivered 7% revenue growth, the company's full year financials show total revenue of $91.4 billion, up 4% excluding the divested PC business.
Of this, IBM said the Europe, Middle East and Africa region delivered $9.3 billion in revenue, up 11%, for the fourth quarter, but relatively flat full year results at $30.5 billion.
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