Morse the merrier for positive results

Three companies from the IT services sector have bucked the general trend in the market and reported half-year results that surpassed expectations.

Three companies from the IT services sector have bucked the general trend in the market and reported half-year results that surpassed expectations.

Although Computacenter reported plunging profit recently, its rivals Morse, CMG and Specialist Computer Holdings (SCH) have all enjoyed positive financial results.

The most positive set of results came from Morse, which claims to be Sun Microsystems' biggest European reseller. For the year ended 30 June, Morse's profits before goodwill and one-time items jumped by 36 per cent to £32.1m, while turnover grew by 78 per cent to £506.3m. The growth of its professional services was even more successful, with a figure of £55.6m representing an increase of 105 per cent.

Analysts attributed the success of the company to its ability to adapt to the new demands for services brought about by the impact of the internet. Unlike Computacenter, Morse has successfully negotiated the dramatic shifts in IT spending stirred up by the internet, which this year have been exacerbated by the Y2K problem.

One analyst, Richard Holway, attributed Morse's success to its relationship with Sun. "Sun leads the world in server sales, and its time has come in the new e-services market," he said. "They can't help making money now."

Meanwhile, the upturn in profit for computing services group CMG was a result of the biggest leap in demand for mobile data ever witnessed in the UK. Although the profit was a result of a surge in use of text messaging on phones, this was seen as a portent of the increase in demand for more sophisticated, high-end mobile business solutions.

A ten-fold increase in profit and trebling of sales in its wireless division has helped the company share rise. "We were powered by the enormous growth in text messaging," said Tom Rusting, chief executive of CMG.

SCH reported an increase in turnover of just 15 per cent to £581m, while its profit before tax was up by 36 per cent.

An SCH representative said: "Y2K was hard, but we've made the investment and we've got quality services. We're not reliant on desktop sales to drive us forward."