Networking and IT services group Datatec has reported headline earnings of 0.04 US cents per share for the six months to end-August, a 96% drop from the 1.13 US cents it achieved in the six months to end-September 2002.
CE Jens Montanana says while revenue increased from $1.03 billion to $1.13 billion, Datatec continued to feel the bite of its depressed industry sector.
"This decline is largely a result of lower margins in the industry as a consequence of difficult conditions in the sector, costs associated with consolidating operations and foreign exchange losses from the appreciation of the rand," he says.
The group has changed its reporting currency from rands to dollars, beginning with the current financial year. "The dollar is the currency in which most of the group`s trading is conducted," Montanana says. "Over 95% of the group`s revenues are earned offshore in hard currencies."
Revenue at Westcon rose by 8.1% to $859.72 million. It achieved an operating profit of $11.47 million (2002: $13.17 million). Logical achieved revenue of $186.92 million ($164.68 million) and incurred an operating loss of $0.81 million ($1.24 million loss) and Mason reported revenue of $13.78 million ($13.28 million) and an operating profit of $0.45 million ($1.17 million).
Salient figures
Datatec results for the six months to 31 August 2003.
Figures for the six months to 30 September 2002 in parentheses:
Revenue: $1.13b ($1.03b)
EBITDA: $12.32m ($16.5m)
Operating profit: $0.08m ($4.56m)
Profit before tax: -$10.55m (-$4.32m)
Attributable earnings: -$11.11m (-$5.72m)
EPS: -8.06c (-4.15c)
HEPS: 0.04c (1.13c)
NAV per share: 241c (257c)
NTAV per share: 194c (201c)
Current assets: $782.1m (764.44m)
Cash and equivalents: $177.25m ($165.67m)
Current liabilities: $541.64m ($521.64m)
Cash generated from operations: -$4.05m ($85m)
Other holdings accounted for revenue of $47.78 million ($36.48 million) and an operating loss of $7.43 million ($2.9 million loss).
Montanana says although the IT sector appears to have stabilised and the US appears to be on the way to a recovery, "the group remains vigilant to any potential weakening of economic conditions".
"Margins remain tight and the pressure on operating margins intense. Visibility is still very much limited and we are unable to make a clear prediction for the second half."
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