Computacenter shows French resistance to UK sales slump

UK product revenue plummets in Q1, but French and German strength keeps reseller on growth track

A strong performance in France and Germany helped offset a product sales slump in the UK during a "satisfactory" first quarter for Computacenter.

An interim management statement (IMS) released today reveals that the resale giant's total Q1 2011 revenue was up two per cent annually. Services turnover rose six per cent, while product sales remained flat.

In the UK, services sales spiked six per cent, but kit revenue fell off a cliff, plummeting 23 per cent. The decline was attributed, in part, to a reduction in government spending and also to a particularly meaty one-off deal closed in Q1 2010.

The corporate reseller stressed that the product downturn has had little impact on its profitability and also claimed the "UK services new business pipeline for the rest of the year looks promising".

Germany and France both performed well for Computacenter, with the former showing product and services annual sales growth of 28 and nine per cent, respectively.

The VAR's French operations grew its Q1 services top line by 10 per cent year on year, with kit sales enjoying a 22 per cent rise. From this month, French sales will also be boosted by Computacenter's recent €21m (£17.7m) acquisition of reseller Top Info.

The reseller claims it ended Q1 in a cash-rich position, helped by a £30m credit extension from one of its vendors. Today's IMS sounded an optimistic note for the rest of 2011.

"We remain confident that 2011, as a whole, will be another year of improvement for Computacenter's performance," said the statement. "Our services growth is solid across the group and we have again benefited from our portfolio of countries in the product business. While much remains to be done, we are trading in line with management expectations for the year."