Datatec’s profits boosted by strong Westcon performance

International information and communication technology (ICT) company Datatec has reported higher full-year earnings in part due to a continuing excellent performance from Westcon International.

The group reported a 6.1% rise in revenue to $5.46bn for the year to end-February, while gross profit was 15.8% higher at $862.2m.

Continuing headline earnings per share (HEPS) recovered to 14.2 US cents after a loss of 10.8c a year ago.

A dividend of R1.30 per share has been declared.

In addition to the strong performance from Westcon International, the group reported improved cash generated from operations, a strong result from Logicalis International.

However, challenging conditions in Argentina and Brazil affected Logicalis Latin America.

“The group maintained a strong operational performance in the second half of the year to deliver a solid full-year result as global demand continues for our technology solutions and services. We have managed to successfully capture growth opportunities across many markets to deliver improved quality of earnings,” said CEO Jens Montanana.

Westcon International’s revenue increased by 7.7% to $3.69bn and profit jumped 22.7% to $403.4m due to strong demand for network infrastructures and cyber security solutions

Logicalis International’s revenue increased by 1.5% to $1.25bn, while a higher proportion of software sales that have been net accounted affected its full-year revenue.

Logicalis Latin America’s revenue increased by 4.5% to $512.9m, but foreign exchange losses of $20.3m arising mainly in Argentina affected earnings before interest, taxes, depreciation and amortisation (ebitda).

Looking ahead, the group said that despite uncertain political and economic challenges in many parts of the world, all the group’s divisions were expected to deliver improved financial performance in the 2025 financial year and benefit from strong technology fundamentals.

“The adoption of artificial intelligence [AI] should lead to a new cycle of PC and networking refresh,” it said.

The group continued to manage its businesses efficiently and mitigate the effects of high interest rates through effective working capital management and improving supply chains, it said.

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