REG - Computacenter - Pre-Close Trading Statement

ComputacenterAnnouncement

30/01/2023 07:00

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RNS Number : 1750O  Computacenter PLC  30 January 2023

Computacenter plc

Incorporated in England

Registration number: 03110569

LEI: 549300XSXUZ1I19DB105

ISIN: GB00BV9FP302

FOR IMMEDIATE RELEASE

Computacenter plc

Pre-Close Trading Update - 30 January 2023

Computacenter plc ("Computacenter" or the "Group"), a leading independent
technology partner trusted by large corporate and public sector organisations,
today publishes a trading update, based on preliminary unaudited financial
information, for the year ended 31 December 2022 ("the year").

Overview

Computacenter has finished the year with a record fourth quarter, which will
result in an eighteenth consecutive year of underlying* adjusted diluted
earnings per share growth, and a 2022 full-year result which is slightly ahead
of the guidance given by the Group in its Q3 Trading Update. Whilst our
performance in 2022 has been helped by a strong US dollar, and a small
acquisition in the second half of the year, this assistance has been far
outweighed by the headwinds faced by the business as the Covid-related
benefits it experienced in 2020 and 2021 unwound, particularly impacting our
Services margins.

Financial Performance

Total revenue, on a Gross Invoiced Income basis, grew by over 30 percent
including the effects of acquisitions made in the middle of 2022, and by over
27 per cent in constant currency.

We saw strong demand in all countries from Technology Sourcing product sales
which remained extremely buoyant to the end of the year. Our Services revenue
performance was strong, whilst our Services margin performance was impacted by
the unwinding of covid-related benefits during the year, and inflationary
pressures which we expect to continue into 2023.

Financial Position

The Group's adjusted net funds, excluding IFRS16 lease liabilities, finished
extremely strongly at around £244 million. At the half year we reported
substantial increases in our inventory, primarily as a result of supply chain
shortages within the industry. Whilst our inventory levels continued to
increase through until the end of the third quarter, these shortages have
since improved materially, and as a result there has been a substantial
reversal of this inventory position as the industry, and particularly our
customers, readjusted to more plentiful supply. We expect our levels of
inventory to reduce further in 2023, towards historical normal levels, as this
trend continues. December is the peak month in our annual cash cycle with net
outflows expected to occur through to the end of March 2023 in line with our
cash cycle.

Group Outlook

In line with our expectations, adjusted profit before tax was down in the
first half of the year against H1 2021, by nearly 6 per cent. We are therefore
pleased with the profit growth which we have subsequently achieved for the
year as a whole, and the significant momentum that we will carry into 2023,
including in our previous and in-year US acquisitions, which have continued to
make good progress, both in terms of profit growth and cash generation.

Covid-19 factors have now washed through our results and will not impact
comparative numbers moving forward.

Our Technology Sourcing product sales remain extremely buoyant, and we are
confident of continued Services revenue growth. Services margins are broadly
in line with pre-covid levels, although inflationary pressures will make it
challenging to maintain this in the short-term.

As we announced at the half year and in our Q3 Trading Update, Computacenter
has an ambitious investment programme within the business, particularly in
systems, to enhance our competitive position and sustain our long-term
performance. Despite the uncertain macro-economic outlook within a number of
our core countries, and our substantial investment programme, we expect 2023
to be another year of progress.

Looking further ahead, we are encouraged by our customers continued investment
in technology, and we are as bullish as we have ever been about our target
market and competitive positioning.

We look forward to publishing our final results for the year ended 31 December
2022 on Monday 20 March 2023.

 

Enquiries:

 Computacenter plc
 Mike Norris, Chief Executive    01707 631601
 Tony Conophy, Finance Director  01707 631515
 Tulchan Communications
 James Macey White / Matt Low    020 7353 4200

 

* As described on pages 72 to 73 of our 2021 Annual Report and Accounts,
several one-off tax items were processed during the second half 2021 that
substantially reduced the tax charge, and therefore the adjusted ETR, for the
year as a whole. These one-off items are excluded from our internal underlying
adjusted diluted earnings per share measure which is used for measuring our
progress against LTIP performance conditions. Had the one-off items not
impacted during 2021, the underlying adjusted(1) diluted EPS for 2021 would
have been 160.9 pence per share.

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