'It's been a half of extremes' - Exertis boss on H1 results

Group MD reveals UK growth has bounced back as technology unit reports 10 per cent revenue increase

Exertis's first half of its fiscal year has been one of "extremes", according to group managing director Tim Griffin.

The broadliner's parent company DCC reported an overall revenue drop of 20 per cent year-on-year to £5.9bn for the group in its six months ending 30 September 2020. However, its group operating profit grew over eight per cent to £176.1m.

Revenue for DCC's technology unit - which trades as Exertis - climbed nearly 10 per cent to £1.9bn, with operating profit remaining flat at £25.5m.

"This half has been one of extremes - we've had some businesses that have been genuinely challenged, while others have been extremely blessed," Griffin told CRN.

"That's the beauty of our diverse model - that we do have a range of specialist capabilities that allows us to flex with the marketplace. But the net position is up both on revenue and profit.

"One of the specialist areas we have is being able to serve the etail marketplace and we've seen an increase in trade online generically. We have a pretty big consumer marketplace, particularly in the UK, and we've done particularly well in that area."

In its full-year results for its last fiscal year, Griffin noted that the UK market was a little behind because of the challenges of Brexit and the then-emergent coronavirus outbreak.

In this year's H1 results, the UK business recorded "good revenue growth", boosted by strong demand in consumer products from etailers, grocers and non-traditional retailers and from B2B customers offering mobility and remote working products.

However, operating profit in the UK was down on the previous year due to reduced demand for Pro AV, enterprise and other B2B products.

"The first quarter was very challenging; April and May's trading was poor as we went into the first lockdown. But as we establish new norms in working practices the second quarter of the year bounced really well," Griffin said.

"The UK got itself to a point where it was in growth both on revenue and profitability, so there was a really strong second quarter from the UK.

"You have to also bear in mind that during that time, we also managed to go live with SAP which is a significant investment and a major change for a company of the scale of our UK business. And we were able to manage the complexities of the market that was challenged by COVID-19.

"I'm confident that the UK business will step into the opportunities that the SAP investment affords us, in terms of being able to do more online, provide better services and so on. I'm pretty confident that what we've built is a great foundation for the next stage of UK growth."