Computacenter results healthy.

Reseller defies economic climate with pre-tax profit and puts success down to focus on services.

Services and reseller giant Computacenter has said it is optimistic about the remainder of its financial year, after reporting interim pre-tax profit ahead of market expectations.

However, the firm said it has not yet detected any signs of upturn in the IT market as a whole.

For the six months ended 30 June 2002 the firm reported a turnover of £975m, compared with £1.2bn last year. Profit before tax was £24.4m, compared with £29.3m a year earlier. Ron Sandler, chairman of Computacenter, said further deterioration in the market was unlikely and he had a "growing confidence" in the group's prospects.

Mike Norris, chief executive of Computacenter, was upbeat about the second half of the year. He told CRN the firm expected profit for the full year to be similar to or maybe even better than the £51.1m achieved last year.

"We have been very descriptive with our forecasts, and it is a long time in IT since any company has been this specific about their future profits," he said.

He cited the firm's services business as having achieved particularly good results. "We are on the up again now," he said. "Our growth in services is part of a real trend."

Computacenter's move to invest £11m in a new solutions centre (CRN, 25 February) appears to have paid off, as turnover for its UK Professional Services division rose by almost 20 per cent.

Sandler said services were central to the firm's business, and had enabled it to win contracts such as the massive BT desktop outsourcing deal for about 100,000 seats (CRN, 2 April). This is understood to be the largest deal of its type awarded in the UK.

Steve Brazier, chief executive of research firm Canalys, was also positive about the results. "Computacenter's UK business has performed particularly well and the BT outsourcing contract is a major success," he said. "Maintaining profitability in a declining market has proved impossible for most IT firms."

Rival Morse was unable to maintain its profitability for its year ended 30 June. The firm reported a loss of £124,000 after tax and items, while turnover dipped 21 per cent to $465.2m.