Services demand boosts Computacenter profit
Computacenter shrugged off concerns about the Year 2000 issue to post turnover up 11 per cent on the back of strong demand for its services.
Computacenter shrugged off concerns about the Year 2000 issue to post turnover up 11 per cent on the back of strong demand for its services.
Pre-tax profit for the year ended 31 December was £75.1m, up from £64.6m for 1998. Turnover rose from £1.6bn to £1.8bn. Its UK operation accounted for £1.4bn - about 83 per cent of the group's turnover.
Computacenter said the impact of the millennium bug worry had been moderate as a strong demand for services compensated for a slowdown in product sales during the second half of the year. Mike Norris, chief executive of Computacenter, said the reseller had established three units - supply chain services, managed services and professional services - to streamline its service provision.
Computacenter's successes included an outsourcing deal with Gateway, expansion of its On-Trac electronic procurement system, and the creation of Biomni to make On-Trac available to the wider public. The reseller said its e-business arm, iGroup, in which it invested more than £3m, grew rapidly last year and launched several products and services.
The reseller made two acquisitions during the year: UK disposal services company RDS and the assets of Metrologie. It also established a subsidiary in Belgium.
Computacenter had greatly developed its service portfolio and anticipated strong growth for its services this year, Norris said. "Demand within our customer base will start in the first half of the year and accelerate in the second half as other projects, including Windows 2000, are implemented.
The investments made in 1999 will leave us well positioned to take advantage of this demand."
- Phil Williams, corporate development manager at Computacenter, has denied claims that the City was "jittery" about the reseller's prospects and pointed to the latest results. Williams also denied that Computacenter was interested in acquiring GE Capital IT Solutions.