Compel chalks up 90% growth

One of the UK's largest resellers, Compel Group, has achieved a massive hike in turnover - showing an increase of nearly 90 per cent - when it revealed its annual results for the year ended 30 June.

Annual results showed turnover had hit £210 million - an increase of 88 per cent from £111.8 million. Pre-tax profit was £9 million, from £5.1 million for the same period last year - a 78 per cent jump.

Neville Davis, chairman and chief executive of Compel, said: 'The market Compel addresses remains healthy and we believe that it will continue to grow for the foreseeable future. Our businesses are strong and we believe that they will continue to increase their share of this growing market.

The board considers the prospects for the group are very good.'

The results also reflected the reseller's two acquisitions - Computer Microrentals on 8 August 1997 and P&P Rentals on 24 March this year. The deals generated a total of £210 million per year.

However, one City analyst called on Compel to reveal the breakdown of what it generates from services, as opposed to hardware, because he believed if the reseller was moving in this direction it should be revealed. He pointed out that Computacenter, which floated earlier this year on the UK Stock Exchange, does not reveal its services figures either.

When Compel released its results on 15 September, shares rose 6.5p to 359p. On 18 September, shares stood at 350p.

Analysts are forecasting 1999 pre-tax profit of £10.7 million, giving the shares a forward P/E (price earnings) of 14.5.

Compel won a three-year supply and service contract with the BBC believed to be worth at least £25 million a year, pushing out incumbent partner P&P - which now trades as GE Capital (PC Dealer, 19 August).