DiData still pushing home markets

Johannesburg, 15 May 2008

Despite a growth slowdown in the Africa and Middle East (AME) region, Dimension Data's regional CEO, Alan Cawood, says there are many opportunities the company is looking to leverage.

Yesterday, the company released its financial results for the six months ended 31 March. Although overall revenue increased 22.7%, to $2.2 billion, revenue from the AME region only increased 19.9%, to $456 million. In the full year ended 30 September, this region produced a growth rate of 36.9%.

"At an operational level, Internet Solutions (IS) and Dimension Data had very good performances. IS, in particular, delivered a 26% top line growth with margins holding. Our remaining operating unit, Plessey, delivered pedestrian growth. However, on an operational profit line, all three delivered very good growth," says Cawood.

At home

Cawood says the local market is still producing good double-digit growth, despite limitations imposed by the slow pace of telecoms deregulation.

"The fact is that what we can do with technology is being retarded by the slow pace of liberalisation. As soon as we see deregulation actually taking place, we will see the overall economy being stimulated," he comments.

However, this is not as yet restricting the company's aspirations.

"At home, we are focusing on a number of fronts to expand the business. We are building out our offerings and looking closer at the outsourcing market, particularly in telecoms. Through Plessey we are building an outside plant for telcos. This delivers on various technology implementations for operators. For now, that is more for the incumbents, but as deregulation picks up, the opportunities increase significantly," explains Cawood.

Playing away

As for its intentions for the continent and the Middle East, Cawood says the company is increasingly looking at extending its brands.

"Our East and West Africa hubs are now well bedded down. In the SADC region, we are looking at establishing a hub in Angola. And in North Africa we are still evaluating our options. As for the Middle East, we made an acquisition in the United Arab Emirates which covers that region and could probably set up a hub in Qatar," he reveals.

In terms of IS, the plan is still to build it up to a Pan-African player "in the fullness of time".

"We have fully-fledged operations in Nigeria and Kenya, but we are looking to grow this presence to leverage synergies between DiData and IS. In SA, that link is less important; but, in following our customers across the continent, it becomes more important. And, of course, there are opportunities for IS in the Middle East. Our growth strategy gives us flexibility to do greenfield investments, as well as acquisitions," says Cawood.

DiData's executive chairman and empowerment partner Andile Ngcaba has also been "working the business", says Cawood.

"About 80% of Ngcaba's focus is on SA, where he is very good on the public sector and telecoms fronts. The rest of the time his focus is on the continent, where he's proven to be an advantage. At the end of the day, he's an exceptional market player, strategic thinker and overall a very nice guy. We are very pleased with his contribution."