Computacenter revives
Shift to higher-value products leads to rise in profits, reports Dave Friedlos
Infrastructure services firm Computacenter’s focus on higher-margin activities such as enterprise products, software and services has resulted in a 77 per cent increase in profits.
Pre-tax profits for the first half of the year rose to £14.5m, which the firm says were driven by a cost-cutting exercise and its new areas of attention. But revenue declined 3.5 per cent to £1.1bn.
Ovum analyst Kate Hanaghan says Computacenter has struggled over the past two years, with operating profits in the UK slumping 44 per cent.
The UK business is the largest in the group, accounting for 60 per cent of Computacenter’s revenues. UK revenue declined 7.6 per cent to £661m in the first half of this year, largely because of hardware price declines.
‘The company is, however, evolving in the right direction, with PCs now accounting for less of the business and services accounting for more,’ said Hanaghan. She says the first half was disappointing for Computacenter’s managed services business.
‘However, it is worth highlighting some broader positives across
the services business,’ said Hanaghan.
‘The project services business has seen good growth – 12.2 per cent at group level.
‘And heavy investment into services such as helpdesks and technical skills, that can be shared across its customer base, makes good sense for a company that needs to be as streamlined as possible.’
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Further reading
Doncaster College goes high-tech