Multinational ICT group Datatec expects its performance for the current financial year, ending 28 February, to be lower than originally forecast.
In an interim management statement issued this morning, Datatec says group revenue for the financial year is expected to reach approximately $5.4 billion (2012: $5 billion), including Westcon's acquisition of Afina Group in July 2012 and continued revenue growth in Logicalis. Profit after tax is expected to be in the range of $80 million to $90 million (2012: $89 million).
The company previously forecast revenue of between $5.5 billion and $5.8 billion, and profit after tax of about $104 million.
Underlying earnings per share are unlikely to reach that of last year, 47.9c, but are expected to be in excess of 40c, the company says. Earnings and headline earnings per share are also unlikely to reach that of last year (43.5c and 43.1c, respectively) but are expected to be in excess of 35c.
Since the group's trading statement on 3 December 2012, which was prompted by a weaker than expected performance by Westcon in the third quarter, Westcon has reported continuing softness in its performance. Datatec says December was particularly challenging, especially in the US and Europe. In contrast, Logicalis continues to perform strongly and in line with expectations.
The group's gross margin expansion has continued in the second half and overall Latin America once again is the strongest market. The group says it continues to operate with comfortable head room against its working capital lines.
"Our global reach and diversity are continuing to provide relative resilience against the poor economic backdrop of many of the world's economies. Although disappointed by the recent developments in Westcon, we are not immune to the continuing weakness in many sectors, especially in the more mature markets. We are already adjusting our business model accordingly," says CEO Jens Montanana.
"Latin America, the Middle East, Africa and Asia remain the best performing regions. Westcon's performance in North America and Europe has been weaker than expected, while Logicalis has performed robustly in both of these regions."
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