Computacenter sees 'strong top line growth' in Q1 trading update

But reseller claims adjusted profit before tax grew ‘at a more modest level’

Computacenter has reported ‘strong top line growth' in its Q1 trading update but claims that profits grew at a more modest rate.

One "very large customer" diluted its overall margin during the three-month period, Computacenter claims, contributing to muted growth in its adjusted profit before tax for the quarter.

The removal of lockdown measures globally has meanwhile affected Computacenter's cost base, moving to a "more normal, and more sustainable" model post-Covid.

The Hatfield-based firm said it is pleased to have grown profits year on year during the quarter, especially when faced with a "challenging comparison" with the first half of 2021.

The firm celebrated record high pre-tax profits last year, with pandemic-related cost savings and organic investments in the business leading to a 27.5 per cent jump on 2020's figure to £255.6m.

It meant that the company had more than doubled its profits over the three-year period.

But adjusted profit before tax for the first six months of this year will likely be behind that of 2021, Computacenter claims. The reseller however reassured that it is still operating in line with "the historical seasonality" of its business.

Computacenter's share price fell by as much as five per cent this morning after the trading update was published.

The firm also pointed to wage inflation and supply chain shortages as challenges that continue to impact Computacenter as well as the wider industry.

"We remain confident that FY 2022 will be a year of further progress, and we remain on track for the year as a whole," the firm said.

"These [challenges] offer us opportunities to differentiate from our competition with superior execution. The momentum Computacenter has built over many years and the strength of our balance sheet gives us confidence for the future."