Trading Statement (3337F)
June 14 2012 - 2:00AM
UK Regulatory
TIDMCCC
RNS Number : 3337F
Computacenter PLC
14 June 2012
Computacenter plc Trading Update 14 June 2012
'Significant new business wins to incur additional start-up
costs in 2012'
Computacenter plc, Europe's leading independent provider of IT
infrastructure services, today publishes a trading update and
outlook for the full year, based on unaudited information. As we
stated at the time of our Interim Management Statement on 18 April
2012, Services revenue growth has increased substantially and is
likely to have grown in excess of 15% at a Group level, in constant
currency, during the first half of 2012. This is clearly an
acceleration, compared to the 11% growth rate experienced in the
first quarter. As we look forward into the rest of the year, we see
no indications that this growth rate will moderate, as it is
underpinned by contracts already won, as well as a substantial new
business pipeline. We expect that our Supply Chain business will
experience high single digit growth for H1 2012 and while there are
sectors of challenging market conditions, such as investment
banking in the UK and the public sector in France, caused by the
uncertainty around the changes in their Government, investment by
our customers in capital expenditure projects, remains
satisfactory. We are clearly pleased with the substantial Services
growth rate, which is testament to the commercial market's appetite
for Computacenter's offerings and our track record of excellent
execution for our clients. However, it has become apparent to the
Board that the significant amount of new business growth requires
material investment through our P&L, to deliver successful
take-on of the new business and drive high customer satisfaction to
underpin Computacenter's success in the years ahead. The take-on
cost of this new business includes, but is not limited to, the
recruitment of over 700 new Services personnel and the transfer of
many staff from customers and their historical suppliers. Clearly,
there are material recruitment and training costs for these new
starters. Our investment in systems, both back office and customer
facing, has also been substantial. Understandably, we are seeing
these capital investments increase our depreciation costs. The new
business has also attracted significant costs associated to sales
commissions, which are predominately paid up-front. These
incremental investments to support our future growth are likely to
cost Computacenter in the region of an additional GBP7 million in
2012, compared with our previous expectations. It should also be
noted that the depreciation of the euro against sterling, if it
were to remain at the current level, would impact Computacenter's
profit in 2012 by approximately an additional GBP3 million.
Mike Norris, CEO of Computacenter said: 'While we highlighted
the necessity for investment in our statement of 18 April 2012,
both the size and scope of the opportunities we have won have
increased significantly, requiring us to invest further.'
Our next scheduled trading update will be the pre-close update
prior to our Interim Results, which is scheduled for 17 July 2012.
Enquiries:
Computacenter plc:
Mike Norris, Chief Executive 01707 631601
Tony Conophy, Finance Director 01707 631515
Tessa Freeman, PR Manager 01707 631514
Tulchan Communications: 020 7353 4200
Christian Cowley Rebecca Scott
This information is provided by RNS
The company news service from the London Stock Exchange
END
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