There was never any doubt that Computacenter would comfortably emerge as the UK’s biggest VAR on this year’s list. But 2011 was not without its challenges for the Hatfield-based firm and its dominance has been eaten into somewhat since we last compiled this rundown.
While the number-one VAR endured a double-digit decline, the remainder of the top five all grew UK sales in their last fiscal year. The size advantage Computacenter holds over second-placed SCC has narrowed from £650m to £440m.
Computacenter’s UK revenue in 2011 continued on the same yo-yo pattern of the last few years: up in 2008, down in 2009, up in 2010, down in 2011.
Last year’s sales drop of 12.9 per cent took the top line for Computacenter’s home country down to £1.1bn. Operating margins were down slightly, but still held relatively steady as operational profit fell 14 per cent to £37.3m.
The picture in the services space was considerably brighter, as sales dropped a comparatively modest 1.7 per cent to £374.1m. This meant that services has gone up in the revenue mix from the previous year, rising from 35 to 38 per cent.
Some 26 per cent of the VAR’s UK top line came from managed services last year, with eight per cent being contributed by professional services and four per cent from third-party services. Systems and printers provided 24 per cent of revenue for Computacenter, while datacentre and networking wares chipped in 27 per cent and software provided 11 per cent.
The annual report for the year characterised the 3.3 per cent increase in contractual services revenue as one of the most promising developments of the year. The company’s services contract base also spiked 1.6 per cent over the course of 2011, to a year-end value of £244.8m.
The report says that the outlook is even brighter than that, “as billing on a large portion of these deals will not commence until 2012”.
At a group level, Computacenter’s revenue grew 6.6 per cent to £2.85bn, with operating profit rising 12.6 per cent to £72.5m. Germany was undoubtedly the star of the show last year, overtaking the UK as the firm’s biggest revenue contributor for the first time. German sales in 2011 were up 20.3 per cent to more than £1.2bn, with the vast majority of this growth coming organically. Operating profit soared 26.1 per cent to £27.7m.
France also performed solidly for the VAR giant last year, with revenue growing 31.4 per cent to £478.6m. The acquisition in February 2011 of Parisian reseller Top Info gave the top line of its new owner a big boost, but organic French growth was pegged at 6.5 per cent.
During the first half of 2012, Computacenter has returned to sales growth in the UK, but success at a group level has come at a cost, and its most recent financial release admitted it had encountered “growing pains” in the first half of the year.
Services continues to be a key growth engine, but a 15 per cent spike in H1 revenues meant the reseller needed to spend £7m more than previously anticipated this year to bring on board more than 700 new staff and keep pace with its expansion.
All of this means we can probably start work on next year’s Top VARs project safe in the knowledge that we will have a non-mover at the top of the charts once again.
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