Computacenter PLC Q3 2015 Trading Update (8945C)
October 21 2015 - 2:00AM
UK Regulatory
TIDMCCC
RNS Number : 8945C
Computacenter PLC
21 October 2015
Computacenter plc
Q3 2015 Trading Update
21 October 2015
Computacenter plc ("Computacenter" or the "Group"), the provider
of IT infrastructure services that enables users, today publishes a
trading update for the third quarter. Figures below are based on
unaudited financial information for the year to date.
The revenue results in the text below exclude the impact of our
subsidiary R.D. Trading Limited ("RDC") in 2015 and 2014, following
the Group's disposal of RDC on 2 February 2015. For comparison
purposes, results including RDC are shown within the table included
in the Appendix to this trading update.
Financial Performance
Overall revenue for the third quarter was up 4% to GBP721
million (2014: GBP696 million) on an as reported basis, and up 10%
in constant currency. Year-to-date revenue grew by 2% on an as
reported basis, and by 8% in constant currency. Group Services
revenue grew by 1% on an as reported basis and by 7% in constant
currency in the third quarter, bringing the year-to-date position
to a growth of 1% and 6% respectively. Group Supply Chain revenue
grew by 5% on an as reported basis and by 12% in constant currency
in the third quarter, bringing the year-to-date position to a
growth of 2% and 8% respectively.
The outlook for the Group's trading result for the whole of 2015
remains in line with the Board's expectations which were upgraded
at the time of our interim results, despite continuing significant
currency headwinds.
UK
The UK continued to perform well in the third quarter with
overall revenue growth of 7% to GBP323 million (2014: GBP303
million), bringing the year-to-date position to a growth rate of
6%. Services revenue in the third quarter and during the year to
date grew by 10%, and Supply Chain revenue grew by 5% in the third
quarter, bringing the year to date position to a growth of 4%.
We continue to take on the new contracts that were won in 2014
in a satisfactory manner. There is a pipeline for new contract wins
in the fourth quarter of 2015 where we have been shortlisted, but
these new contract wins are by no means certain.
Germany
German revenue for the third quarter increased by 20% in
constant currency and by 7% on an as reported basis to GBP301
million (2014: GBP281 million). This brings the year-to-date
position to an increase of 16% in constant currency and 4% on an as
reported basis. Services revenue increased by 7% in the third
quarter in constant currency which is a decline of 4% on an as
reported basis, bringing the year to date position to an increase
of 5% and a decline of 6% respectively. As previously indicated the
winning of new contracts recently taken on is now giving a strong
impetus to the local currency Services growth rate. Supply Chain
revenue grew by 26% in constant currency and by 13% on an as
reported basis during the third quarter bringing the year-to-date
position to 22% and 10% respectively. The strong Supply Chain
revenue growth seen in the first half has been maintained and we
would expect it to continue throughout the year.
France
In the third quarter, French revenue decreased by 5% in constant
currency and by 14% on an as reported basis to GBP85 million (2014:
GBP99 million), bringing the year-to-date position to a decline of
7% and 16% respectively. Services revenue declined by 16% in
constant currency and by 25% on an as reported basis, bringing the
year-to-date position to a decline of 9% and 19% respectively.
Supply Chain revenue in the third quarter declined by 2% in
constant currency and by 12% on an as reported basis, bringing the
year-to-date position to a decline of 6% and 16% respectively.
Some of the revenue decline in France has been intentional and
expected, as we shift our target market there to be more in line
with that seen across the rest of the Group. The business in France
is in a more predictable position than 12 months ago and its bottom
line performance has improved. However, much work remains to be
done.
Financial Position
At the end of Q3 2015, Group net funds was GBP67.7 million. This
is up by approximately GBP18.1 million on last year. It should be
noted that the quarter-end position was flattered by approximately
GBP10 million from unusually favourable working capital inflows
during September 2015.
After adjusting for the disposal of RDC and the net cash impact
of the Return of Value transaction completed in Q1 2015,
Computacenter's underlying net funds position has improved by circa
GBP61.7 million in the last 12 months.
Group Outlook
We are clearly pleased with the performance levels that we have
maintained in the UK and even more pleased with the consistently
improving position of Computacenter in Germany. The fourth quarter
is always critical to the Supply Chain performance for the year,
whereas Services performance relies on a stream of new contracts
that produce predictable growth rates. In Germany, the level of
business that has already been secured will provide pleasing
Services growth for 2016. However, for the UK the outlook is
closely linked to a number of large opportunities that are expected
to be awarded towards the end of the year. The outcome on these
will largely determine whether the UK business will be able to
maintain its impressive growth performance of recent times.
The significant reduction in losses in France will aid
Computacenter's performance as a whole in 2015. However, much of
the hard work to drive us into profitability is ahead of us.
Computacenter continues to reinvest in its business to sustain
organic growth. We are excited by our customers' appetite to
digitize their businesses which should foster growth in the
marketplace.
Computacenter's next scheduled trading update will be the
pre-close briefing, prior to the annual results, which is scheduled
for 22 January 2016.
Change vs 2014 Q3 Change Q3 Change Q3 Change Q3 Change
As Reported Constant As Reported Constant
* Currency * Currency
(incl ** (excl **
RDC) (incl RDC) (excl
RDC) RDC)
---------------------- ------------- ---------- ------------- ----------
Supply Chain Revenue
UK (1%) (1%) 5% 5%
Germany 13% 26% 13% 26%
France (12%) (2%) (12%) (2%)
Group 3% 9% 5% 12%
----------------------- ------------- ---------- ------------- ----------
Services Revenue
UK 8% 8% 10% 10%
Germany (4%) 7% (4%) 7%
France (25%) (16%) (25%) (16%)
Group 0% 6% 1% 7%
----------------------- ------------- ---------- ------------- ----------
Total Revenue
UK 3% 3% 7% 7%
Germany 7% 20% 7% 20%
France (14%) (5%) (14%) (5%)
Group 2% 8% 4% 10%
----------------------- ------------- ---------- ------------- ----------
* Change vs Q3 2014 revenues reported at Q3 2014
exchange rates
** Change vs Q3 2014 revenues reported at Q3
2015 exchange rates
Enquiries
Computacenter plc
Mike Norris, Chief Executive 01707 631601
Tony Conophy, Finance Director 01707 631515
Tulchan Communications 020 7353 4200
James Macey White
Matt Low
This information is provided by RNS
The company news service from the London Stock Exchange
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