Revenue and earnings will show an improvement in the half-year when its results are released next month, says London- and Johannesburg-listed Datatec.
The company, which is in talks to buy out local computer distributor Comztek, told the market this morning that revenue for the six months to August should be about $2.1 billion, compared with $1.8 billion a year ago. Overall gross margins are expected to remain stable.
Datatec said in July that it expects revenue for the full year to February to be between $4.1 billion and $4.4 billion. At the time, it explained revenue and operating profit were better than a year ago.
“This is driven in particular by the continuing recovery in the US, stable conditions in Europe and resilient performance in Asia. Brazil remains the most promising of the major emerging economies in which the group operates,” it said at mid-year.
For the half-year, Datatec expects underlying earnings per share to be between 15 and 16 US cents per share, compared to 11.5 US cents per share a year ago. This measure of profitability strips out non operating items such as sale of assets, goodwill impairments and foreign exchange movements.
The company has to recognise potential liabilities to buy out minority shareholdings under accounting rules. This liability increased during the half-year to $6.8 million, compared with $6.4 million in 2009.
As a result, earnings per share and headline earnings per share should be between eight and nine US cents a share, compared to 4.9 US cents a year ago.
Stripping out the non-cash increase in the fair value of put option liabilities, earnings per share and headline earnings per share would have been between 12 and 13 US cents per share.
Datatec's results should be released on 13 October.
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