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10 Jul 2008 07:00
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Computacenter plc
Pre-Close Trading Update
Computacenter is today holding anΒ Investor andΒ Analyst conference call to provide an update on trading for the six months to 30 June 2008.
GroupΒ revenuesΒ for theΒ first-halfΒ ofΒ 2008Β will showΒ growth ofΒ approximatelyΒ 8%. Even after taking into consideration the benefit of a strengthening euro, the organic growth rate is the strongest for a number of years.Β
Since we last reported on trading,Β the improved performance at ourΒ UKΒ and French subsidiaries has continued. We are pleased to report that the Q2 2008 performance was ahead of Q1 2008, and ahead of Q2 2007Β in both revenue and profitΒ in both countries.
As we have already announced, theΒ UKΒ had aΒ difficultΒ start to 2008 and the first six weeks trading was particularlyΒ tough,Β howeverΒ UKΒ sales for the firstΒ six monthsΒ wereΒ up 4.8% and up 8.3%Β in Q2.Β We have seen strong growthΒ from our SoftwareΒ Business UnitΒ where we believe we have gained significant market share however this doesΒ have a diluting effect on ourΒ overallΒ gross margins.
We continue to invest heavily in ourΒ UKΒ business toΒ buildΒ ourΒ position in theΒ mid-market and to increase our services capability.Β These investments,Β together with the poor start to the year will,Β as anticipated,Β result inΒ UKΒ first-halfΒ profitability below last year.
The improved performance in France in Q2 has meant that the first half loss will be broadly similar to H1 2007 in local currency but the positive trend in performance together with some major contract successes bodes well for the second half of 2008.
InΒ GermanyΒ trading has been consistent throughout the first half of 2008.Β RevenueΒ in local currencyΒ has fallen slightly in comparison to the first-half of 2007,Β however,Β mainly due to improved services margins,Β the profit growth we experienced last year has continued.Β
Group debt at the end of the period will be approx Β£30M (2007H1: Β£16.5M) before customer specific financing. Good cash generation meant that before taking into account the Β£20.8M we have spent buying back shares since 1 July 2007 our net debt position improved by Β£7.3M.
We are encouraged by the Group's performance in the second quarter. Although there is much uncertaintyΒ in the market place,Β customersΒ undoubtedlyΒ need to invest in information technology to increase the efficiency of their businesses, reduce risk and improveΒ theirΒ competitiveness. We believe customers are increasingly looking to Computacenter to gain an increased value from their information technology investment.
As anticipatedΒ first-halfΒ GroupΒ pre-taxΒ profitsΒ are expectedΒ to be lower than the same period last year. However, due toΒ the impact ofΒ share buy backsΒ and an improved tax position, earnings per shareΒ willΒ show anΒ improvement.
Computacenter will report its Interim results onΒ 28Β AugustΒ 2008.
Enquiries:
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Computacenter plc
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Mike Norris, Chief Executive
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01707 631601
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Tony Conophy, Finance Director
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01707 631515
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Tessa Freeman, PR Manager
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01707 631514
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Tulchan Communications
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020 7353 4200
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Andrew Grant
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Stephen Malthouse
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