Dual-listed Datatec seeks expansion opportunities in emerging markets as its geographic diversity aids it to weather the economic storm.
This morning, the company released its full-year results for the year to February, reporting revenue at the bottom end of its predicted turnover.
However, CFO Ivan Dittrich says the results are still pleasing and the company views its results as a “solid performance”.
Datatec reported revenue of $3.74 billion, down from last year's $4.19 billion and at the bottom end of its targeted $3.7 billion to $4 billion in revenue.
Underlying earnings per share came in at 30.3 US cents, slightly down from last year's 33.1c. However, trading conditions improved in the second half, which accounted for 77% of the earnings growth, explains Dittrich.
Dittrich says, despite the challenging environment, the company's cost containment meant that it was able to hold margins stable. He explains Datatec's slowdown in revenue is due to an especially difficult first half, and it is now seeing signs of recovery.
Plans to emerge
Dittrich says the company wants to continue expanding in emerging markets, and is targeting China and Latin America for growth opportunities. He adds that the company has very little debt, and cash-on-hand of $311 million. It also has room to increase debt by about $400 million.
In January, Datatec completed its acquisition of Netstar, for $19.8 million. The purchase, Datatec's first big step into the Asia-Pacific region, will start adding to revenue growth this year, says Dittrich.
CEO Jens Montanana says the company is “actively reviewing a number of strategic initiatives in Asia and Latin America and, in particular, China and Brazil, which we see as key market opportunities for the group”.
“Having very tightly managed the group's business while expanding the geographic footprint over the last few years, we are well positioned to take advantage of improving market conditions and the recovery that we have seen in our major geographies,” says Montanana.
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