JSE-listed technology group Datatec has posted revenue of $5.5 billion (R101 billion) for the year ended 29 February (FY24). The company says revenue was up by 6.1%.
“The group maintained a strong operational performance in the second half of the year to deliver a solid full-year result as global demand continues for our technology solutions and services,” says Jens Montanana, Datatec CEO.
“We have managed to successfully capture growth opportunities across many markets to deliver improved quality of earnings.
“Operationally, Westcon International continues on its growth trajectory, delivering an exceptional performance in FY24. Logicalis International also performed well; however, Logicalis Latin America faced numerous challenges in Argentina and Brazil, which impacted its financial performance.
“We are optimistic about FY25 and remain focused on unlocking value for shareholders.”
The group's gross margin in FY24 was 15.8% (FY23: 14.5%), while gross profit was $862.2 million (FY23: $744.5 million).
Datatec has declared a cash dividend of R1.30 per share payable to ordinary shareholders.
According to the company, the increase in gross margin is largely due to a return to more stable foreign exchange rates compared to FY23, when the rapid strengthening of the US dollar against the euro and pound sterling had a significant negative impact on gross margins in Westcon Europe.
It notes these negative impacts on Westcon International during FY23 were partially offset by foreign exchange hedging gains as reported in operating costs.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) was $177.6 million (FY23: $98.3 million) and EBITDA margin was 3.3% (FY23: 1.9%).
Westcon International’s revenue increased by 7.7% to $3.69 billion (FY23: $3.42 billion) due to strong demand for network infrastructure and cyber security solutions. Its gross profit increased by 22.7% to $403.4 million (FY23: $328.7 million) and the gross margins increased to 10.9% (FY23: 9.6%), says the firm.
It adds that despite uncertain political and economic challenges in many parts of the world, all the group’s divisions are expected to deliver improved financial performance in FY25 and benefit from strong technology fundamentals.
“The adoption of artificial intelligence should lead to a new cycle of PC and networking refresh. The group continues to manage its businesses efficiently and mitigate the effects of high interest rates through effective working capital management and improving supply chains,” says Datatec.
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