| Wed 17 Nov 2010, 9:45 | | DDT - Dimension Data Holdings Plc - Press release: unaudited results for the |
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DDT
DIDDT
DDT - Dimension Data Holdings Plc - Press release: unaudited results for the
year ended 30 September 2010
Dimension Data Holdings Plc
Incorporated in Great Britain under the Companies Act 1985
Registration Number: 3704278
Share Code: DDT
Issuer code: DIDDT
ISIN number: GB0008435405
("Dimension Data" or "the Company")
PRESS RELEASE: UNAUDITED RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2010
Dimension Data Reports Strong Results and Market Share Gains
Systems Integration, Managed Services and the US - all deliver stand-out
performances
Financial Performance Summary
- Revenue growth of 19.4% in reported currency, and 9.9%(2) in constant
currency
- Product revenues up 11.3%(2), strong second half recovery
- Continued growth in Managed Services revenue, up 13.2%(2)
- Continued robust performance from the Systems Integration business
- Operating profit up 22.3%(1) in reported currency, and 8.2%(1,2) in
constant currency
- Operating margin(1) 5.0% (2009: 4.9%)
- Exceptional costs of $15.2 million relating to NTT transaction
- Earnings per share(1) 9.0 cents (2009: 7.6 cents)
- Total cash $613.6 million (net cash $435.4 million)
Notes:
1. Before exceptional items.
2. Adjusted for the impact of currency movements and, where relevant,
before eliminating intercompany revenue.
London (UK) and Johannesburg (South Africa), 17 November 2010 - South African
headquartered specialist solutions and services provider, Dimension Data
Holdings, today announced a strong set of results for the year to end-
September 2010.
Revenue for the period was $4.74 billion, up 19.4% in reported currency over
the prior period. These reported results were supported by the appreciation
in the average exchange rates for the year of some of the Group`s main
trading currencies (in particular the South African Rand and the Australian
Dollar) against the US dollar. In constant currency, Group revenues grew by
9.9%. Operating margin expanded slightly to 5.0% (2009: 4.9%) and operating
profit was $237.8 million, up 8.2% on the prior year.
The Group`s Systems Integration business delivered a very strong performance
across all regions, growing revenue by 14.9% to $3.89 billion and operating
profit by 31.8%, to $183 million, at an operating margin of 4.7%.
Group product revenues bounced back at $2.73 billion, up 11.3% in constant
currency, while Services were $2.02 billion, up by 8.2%. Good Services
growth in Systems Integration was supported by Managed Services growth of
14.1% and Professional Services growth of 14.7%. Internet Solutions showed
strong growth, but this was offset by a sharp decline in Plessey.
The Group`s effective tax rate was 27.4% (2009: 26.7%), while earnings per
share were 9.0 cents compared to 7.6 cents in 2009.
Commenting on the Group`s overall performance, Brett Dawson, CEO of Dimension
Data Holdings said, "The Group`s vision of the market evolution which focuses
on key, high-growth technology sectors including the network, unified
communications and collaboration, and virtualisation, continues to stand us
in good stead. Our growth rates are greater than the market, implying market
share gains in nearly all of our areas of focus."
The Group was recognised throughout the year for its industry leadership,
receiving 96 industry and partner awards. From an employee perspective, for
the fifth consecutive year since the initiation of the Group`s employee
satisfaction survey, the employee satisfaction results increased.
In this review, growth rates are in relation to FY 2009 and, unless otherwise
indicated, are calculated before eliminating intercompany revenue and are
adjusted for the impact of currency movements (i.e. constant currency).
Regions improve profitability within Systems Integration
The Americas delivered an excellent increase in operating profit, up to $25.1
million from $5.5 million in 2009, driven by an excellent recovery in the US.
Revenue was up 34.6%, the result of a recovery in Product volumes but also
excellent Managed Services growth of 27.4% where the region recorded some
good multi-year contract wins. Operating margin was up from 1.0% to 3.5%.
Outside the US, Mexico delivered very good revenue and operating profit
growth, while Brazil showed a much improved performance in the second half.
In Asia revenues were up by 17.6%. Operating profit increased slightly to
$53.3 million (2009: $53.0 million), constrained by continued progress on a
planned investment programme. An operating margin of 7.2% was achieved.
Revenues in Australia were up by 8.2%. Services growth of 22.9% was
particularly strong. Operating profit and operating margin grew to $34.8
million and 5.3% respectively (2009: $23.1 million and 4.6%).
Europe`s revenues grew by 8.0%, a very strong performance given continued
constrained macro-economic conditions in the region. Operating profit
improved to $34.2 million (2009: $29.5 million) at an operating margin of
3.3% (2009: 3.1%). Within the region, Germany, the UK and the Benelux
countries reported strong performances. Spain was weak, and Switzerland
recorded some improvement off a low base compared to the previous period.
The Group`s Middle East & Africa business grew revenues by 9.7%. Operating
profit and operating margin were strongly up to $53.7 million and 8.2%
respectively (2009: $33.6 million and 6.4%). The Group`s Emerging Africa
operations reported a solid increase in operating profit, with good traction
in the region for the Group`s services offerings.
Five acquisitions made during the year under review are expected to increase
the Group`s global footprint and enhance its specialist IT solutions and
services capabilities in selected geographies. These include the acquisition
of interests in a Moroccan systems integrator, a Chilean systems integrator,
an Australian infrastructure hosting business, an African Wi-Fi provider, and
mVision, a UK video conference integrator.
Other Group businesses
Turning to the Group`s other businesses, Internet Solutions grew revenue by
10.5% with good growth in its Communications, Cloud, and Carrier business
units. The Plessey business experienced tough trading conditions during the
year: revenues were down by 43.2%, however, the second half saw an
encouraging improvement in conditions.
Merchants delivered a solid performance. Product pricing pressures caused by
the strong Australian and New Zealand currencies during the period resulted
in a 2.3% decline in Express Data`s revenue.
Lines of Business
Across the lines of business, Network Integration delivered strong growth of
13.1% - more than twice the forecast market growth rates. This growth was
driven mainly by a strong recovery in Product revenues, especially in data
centre networking, wireless and mobility. Growth was also supported by
success in multinational contracts and in the Group`s Managed Services base.
Looking at the other lines of business, Microsoft Solutions line of business
grew revenue by 20.1%; Security Solutions revenues increased by 19.8%;
Converged Communications line of business ended 18.4% up on 2009, and Data
Centre Solutions increased by 32.2%. Dimension Data`s Customer Interactive
Solutions (CIS) line of business recorded a decline of 1.8%, which represents
a decline in Product revenues offset by an excellent performance in Managed
Services.
"Our employees around the globe have worked extremely hard to build our
business and I want to thank them for their commitment, focus, and steadfast
pursuit of excellence on behalf of our clients.
"In the last seven years we have doubled the business and expanded from
operating in 29 countries to 49 countries. We`ve built a winning culture and
are widely recognised in many countries around the world as one of the best
places to work. We continue to aggressively build on our value proposition
across our Solutions and Services on a day-to-day basis," said Dawson.
Outlook
Dawson believes the opportunities ahead for Dimension Data remain exciting.
"Dimension Data`s solutions and services are well-suited to our clients`
needs. We will continue to strive for growth rates greater than market
average.
"We believe that the network is the core platform for all forms of
communications and IT. Technologies and services which are reliant on the
network will only grow over time and we are well-placed to continue to
exploit this opportunity.
"We place enormous emphasis on our outstanding employee base of technology
and managed services specialists with the skills to offer value-added
solutions and services to our clients - particularly in the areas of unified
communications and collaboration, virtualisation, and network performance and
optimisation. We will continue to invest in our employees to enable them to
provide leading, world class capabilities to our clients.
"Our services journey remains on track and we envision Dimension Data
developing and taking to market a richer array of Managed Services in the
future. Increasingly our services opportunities are multi-year Managed
Services, and we expect this to increase going forward," Dawson concluded.
Note: Subsequent to the year end, Dimension Data was wholly acquired by NTT.
Dimension Data has made applications to cancel the listing of Dimension Data
Shares from the Official List of the United Kingdom Listing Authority and
from the Main Board of JSE Limited (the "JSE") and has made applications to
cancel admission to trading in Dimension Data Shares on the London Stock
Exchange (the "LSE") and JSE`s markets for listed securities (together the
"Delisting"). The proposed Delisting is expected to take effect on 14
December 2010.
About Dimension Data
Dimension Data plc (LSE:DDT), a specialist IT services and solutions
provider, helps clients plan, build, support and manage their IT
infrastructures. Dimension Data applies its expertise in networking,
converged communications, security, data centre solutions, Microsoft and
contact centre technologies, and its unique skills in consulting, integration
and managed services to create customised client solutions.
www.dimensiondata.com
Sponsor:
J.P. Morgan Equities Limited
Date: 17/11/2010 09:45:01 Produced by the JSE SENS Department.
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