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Strong Q2 buoys Computacenter
Trading statement from channel firm indicates it is on track to double pre-tax profits in H1 compared with the same period last year
Operations in North America continued to drive Computacenter’s business forward, with the firm experiencing better-than-expected performance in its second quarter.
The channel player issued a trading statement that revealed it had been able to build on a solid Q1 with a decent three months to the end of June, with first-half adjusted pre-tax profits now expected to be around double the previous year’s performance of £81.5m.
Indications that the second quarter was strong came on the back of a Q1 that the firm described as putting the business ahead of expectations and up on yearly comparisons.
One of the themes of the fiscal year so far has been the stellar performance of the North American business, which has been heavily contributing to the firm’s financial performance.
In Q2, the region delivered “stronger-than-expected volume growth” with hyperscaler customers, but there were also positive comments about the UK business, which “also delivered excellent growth in Technology Sourcing, including further AI [artificial intelligence]-related projects, and strong growth in Professional Services”.
Germany also contributed growth in the quarter with Technology Sourcing doing well, although the services side was “subdued”.
The result of the strong quarter and the robust H1 is that the firm was able to talk up the prospects for the rest of the year.
Ahead of expectations
Computacenter indicated its order backlog was ahead of where it stood at the end of last year, which was a result of orders going out the door in the first half. “Looking to the full year, while we remain mindful of a tougher comparative in the second half of the year, we now expect to deliver full-year results comfortably ahead of market expectations,” the trading statement concluded.
That optimism comes despite the business continuing to deal with macroeconomic challenges caused by wars in the Middle East and Eastern Europe, signalling the firm’s resilience.
Computacenter has spent the past few years establishing and expanding its North American business, using M&A to bolster its position on the other side of the Atlantic. Last January saw the firm add AgreeYa Solutions into the portfolio, which followed on from earlier moves for FusionStorm and Pivot Technology Solutions that bolstered the performance of the business.
As well as underlying the benefit of geographic diversity, the Computacenter numbers come after those from SysGroup, which highlighted the financial rewards for those able to tap into customer demand for some of the key technologies, including AI and security.
One of the contributors to the growth Computacenter delivered in the UK in its first quarter was attributed to its ability to service customer demand for AI technologies.
Computacenter’s most recent results for FY 25 showed technology sourcing GII climbing by 37.8% to £11.3bn, and services revenue improving by 2.9% to £1.69bn, with pre-tax profit for the year decreasing by 2.5% to £238.5m.
Breaking down the services performance on the professional side, revenue grew by 8.8%, but managed services declined by 2.4%, with a weak performance on that front in the UK dragging down the numbers.
Computacenter will release its half-year numbers in September, providing the operativity for further analysis of its performance.
