Computacenter suffers UK product sales slump
But industry bellwether posts higher group revenue and profit
Computacenter has sent a shudder through the channel after announcing a 23 per cent slump in first-half UK product sales.
Despite posting a rise in both profits and sales at a group level, the industry bellwether's UK revenue fell by 16 per cent year on year to £547.3m in the six months to 30 June.
UK services revenue rose by 0.7 per cent but product sales nose-dived 22.6 per cent, which Computacenter attributed to a "shift in spend profiles" among certain large customers.
This allowed Germany, which posted first-half revenue of £580m, to overtake the UK as Computacenter's largest territory.
At a group level, Computacenter posted a 25 per cent rise in adjusted pre-tax profit to £26.6m on revenue that rose six per cent to £1.37bn (up 3.1 per cent excluding acquisitions).
Net cash rose to £104.3m, despite Computacenter splashing out £22.8m on two acquisitions, investing in UK VAR ICS Solutions and outlaying £10.7m on new facilities for IT recycling arm RDC.
Computacenter said the fall in UK product sales had been partly offset by improved profitability within both product and services business. UK operating profits fell by just 7.9 per cent to £16.7m, which the firm said points to "stability and increased resilience" across the UK business as a whole.
It said it will continue to invest in the UK business in areas such as pre-sales and improving services profitability.
The London-listed outfit hinted that Microsoft Windows 7 and cloud computing would be growth hotspots for the firm's UK business, but admitted both were still young technologies.
"Although adoption of Microsoft Windows 7 into our large corporate and government customers is in its infancy, Computacenter is to date responsible for over two thirds of all the current UK deployments," said Computacenter chairman Greg Lock.
He added: "We are supporting our customers in their quest towards becoming 'cloud ready' and while we have not yet seen a significant uptake of pure cloud offerings - other than rebranded virtualisation solutions - there has been such a marked interest, we are confident that cloud-based solutions will make a greater contribution in the near future."