Didata share price falls on lack of trading detail
Didata share price falls on lack of trading details
Lesley Stones
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Information Technology Editor
EFFORTS by Dimension Data to keep analysts abreast of its business activities backfired on Friday when its failure to provide a detailed trading forecast triggered a 7% drop in its share price.
The company held a briefing for investors and analysts on Thursday, but provided no forecasts or insight into trading performance. Analysts had hoped for more than an overview of its technologies and past performances, and wiped 35c off the share.
The counter fell from R4,83 to R4,48 on Friday morning, then fluctuated until its close at R4,54.
Details, which the technology company provided, included confirmation that it would take a charge of $6m for the year ending September this year relating to a new share incentive scheme.
The company also said operating profit for the year would come in $2m lower than expected because of changes to the way it accounted for its lease on the Campus, its showy headquarters.
Didata’s most recent figures for the year ending September last year represented a partial recovery, when it turned a previous loss of $36m into a profit of $11,4m, on a revenue of $2,5bn. Exceptional losses of $48m took that to a net loss of $38m.
Its profit margin was barely there at 1,1%, making investors anxious to see Didata boost its margins in this financial year. Didata is aiming at a margin of 4%-5% in the longer term.
At the time, analyst Irnest Kaplan rated Didata a sell.
Even when the company’s shares were trading at R3,45 Kaplan viewed them as too expensive given its likely margins.
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