Computacenter reiterates outlook as Q3 revenue edges up

IT infrastructure services provider Computacenter reiterated its 2016 expectations as it posted a small jump in reported third quarter revenue thanks to currency movements, but constant currency revenue was weaker.

Overall revenue in the quarter was up 2% to £735m on a reported basis but down 4% at constant currency.

Year-to-date revenue was up 4% and down 2% at constant currency, with reported group services revenue up 4% and 1% lower at constant currency in the third quarter, leading to year-to-date growth of 4% and a 1% drop, respectively.

Reported group supply chain revenue rose 1% but fell 5% in constant currency in the quarter, giving year-to-date growth of 4% and a 2% decline, respectively.

In terms of regions, Computacenter said UK markets remained soft in the third quarter, but the performance was better than the first half, with an overall revenue decline of 3% to £314m.

UK services revenue fell 10% in the quarter and 8% ytd, while supply chain revenue was up 2% and down 2% on ytd.

In Germany, third-quarter revenue was down 2% at constant currency but up 8% on a reported basis to £325m. Services revenue grew 10% in the quarter and 22% on a reported basis, while supply chain revenue was down 8% at constant currency and up 2% on a reported basis.

Revenue in France fell 12% at constant currency and 3% on a reported basis to £83m, with services revenue down 1% and up 9%, respectively. Supply chain revenue in the third quarter dropped 14% at constant currency and 5% on an a reported basis.

Computacenter had net funds of £96.7m at the end of the third quarter, up around £29m from the previous year, and said it remains on target to end the year with record levels of net funds.

“While much remains to be done in 2016 in the all-important fourth quarter, the performance in the third quarter has re-enforced our confidence for the year as a whole.

“Prospects for 2017 and beyond, particularly driven by the increased adoption of the digital workplace, are encouraging across all our geographies.”

At 0810 BST, the shares were up 1% to 738.50p.