Computacenter’s (CC) decision to focus on higher-margin products appears to be paying off as a trading statement revealed the corporate reseller expects to post higher profits for 2006.
Pre-tax profits are set to hit £38.2m for the year to 31 December, up from the £34m recorded in 2005, with the company claiming that UK profitability “improved steadily” over the year.
CC, which last week boosted its presence in the managed services market with the purchase of Digica (CRN, 4 January), did not disclose top-line figures, although the firm admitted product turnover was down “marginally” because it sold less low-margin kit through its distribution unit.
Turnover from services, in contrast, grew “modestly” as professional services sales growth was offset by weaker demand for its contractual services.
Henrietta Lacey, consultant at market-watcher Pierre Audoin Consultants, said: “The recent trading statement serves as a positive sign that Computacenter is returning to growth. However, the company still has a long way to go with profit being only half that recorded in fiscal year 2003 or 2004.
“Its modest growth in services also shows that this is a very difficult market to break into and this could hamper profits in future. So, while Computacenter is on the mend, it is not yet fixed.”
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