London and JSE-listed IT company Dimension Data reported on Wednesday that its earnings per share before exceptional items for the full year to 30 September had increased to 7.4 US cents from a previous 5.6 cents.

Earnings per share were reported up by 28.3 percent to 7.7 US cents.

The only exceptional item reported during the period was a $4.1-million gain on disposal of Automate, a software development company providing solutions to the automotive industry, to Britehouse, a Group associate.

Operating profit was up 39.1 percent to $182.2-million, and the operating margin was reported up to 4.0 percent from 3.3 percent a year earlier.

Revenue was up 19.5 percent to $4.5-billion and gross profit up 19.7 percent to $973-million.

Overheads grew by 13.3 percent, well below revenue, to $791.1-million. Of this, variable overheads (including bonuses and sales commission) were up by 18.9 percent to $143.3-million while fixed overheads grew by 10.8 percent to $647.8-million.

Commenting on Dimension Data's results, CEO Brett Dawson said: "The group's financial performance for this fiscal year was extremely strong. Our overall 19.5 percent revenue growth was supported by strong performances across all regions and an outstanding Services growth rate."

"Our financial performance," said Dawson, "puts us firmly on track to achieve our medium term goal of five percent operating margin."

Dawson suggested that long-term market opportunity is still strong. "Over the last few years we have enjoyed tremendous momentum and consistent improvement as a business. The growth achieved has consistently been at rates greater than the market, indicating that we have been building our competitive strength and gaining market share from the competition. We believe that the long-term fundamentals of the IT market segments in which we compete are favourable and have good growth prospects."

Commenting on the global macro-economic environment, Dawson said: "The global crisis of confidence which started in the financial markets is now undermining most industries. Within this environment we expect the IT infrastructure market will be slower in general and that we will be affected accordingly. To counter the impact of these circumstances we will be prioritising our client engagement above all else and have implemented a conservative plan to manage our overhead base. We have tightened our investment and expenditure levels to match our view of short-term market conditions and will continue to re-evaluate and adjust expenditure on an ongoing basis."

"The strength of the group's balance sheet, our market leading positioning and offerings, and our expansive geographic footprint provide us with confidence that we will successfully endure this market downturn and emerge in an enhanced competitive position," concluded Dawson.

I-Net Bridge