http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.83Change: -0.12
R/$ = 11.04Change: -0.17
Au 1172.85 $/ozChange: 3.68
Pt 1231.00 $/ozChange: -0.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
May 18, 2012

IT group focusing on managed services growth

Back
Datacentrix|Information Technology|Services|Solutions|Ahmed Mahomed|Gary Morolo|Infrastructure|Bearing|Information Technology
|Services|Solutions|Infrastructure|Bearing|
datacentrix|information-technology-industry-term|services|solutions|ahmed-mahomed|gary-morolo|infrastructure|bearing|information-technology
© Reuse this



JSE-listed information technology company Datacentrix is seeking to grow annuity revenue by investing in skills to support its services and business solutions development, while reducing its dependence on government-related business, chairperson Gary Morolo reports.

In the past, more than 50% of the group’s revenue was derived from the public sector.

“Managed services and business solutions now account for more than half of the group’s earnings,” said Datacentrix CEO Ahmed Mahomed at the company’s financial results presentation, held at the Inanda Club, in Sandton, in April.

The company grew its revenue by 11.6% to R1.76-billion, but experienced sustained margin squeeze, with operating profit falling to R123-million from R124-million during its financial year ended February 29, 2012.

Its earnings before interest, taxes, deprecia- tion and amortisation (Ebitda) dropped to R145-million from R150-million, which means its Ebitda margin decreased to 8.3% from 9.5%.

The decreasing margins have prompted the company to increase investment in its skills base, which is aimed at future growth. The company will also continue to focus on its organic growth and is not actively seeking acquisitions except to jump-start targeted new growth areas, says Mahomed.

“The three- to five-year strategic thrust (towards a services-based revenue model) remains unchanged and implementation has progressed satisfactorily,” says Morolo.

The scarcity of skills in the information and communication technology sector led to Datacentrix focusing on skills development, learnerships and vocational training programmes, which have been successful, he adds.

“We also deploy graduate-level skills in specific areas, which will be a long-term boon, and we focus strongly on internal skills devel- opment, opting to develop managers from internal staff.

Datacentrix increased its headline earnings per share by 1.2% to 46.9c a share and has R313-million cash on hand with no interest-bearing debt, which is partly a requirement as a vendor for blue-chip companies, and is disbursed and recharged during the course of a financial year, explains Morolo.

Datacentrix’ improved mixture of business reduces its reliance on depressed commodity infrastructure spending in the private and public sectors, while the managed services and business solutions units in the company are showing good margins. Coupled with its strong market position and strong vendor exposure, the company is placed in a favour- able position, concludes Mahomed.

Edited by: Martin Zhuwakinyu
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other News This Week News
In the next 20 years, it was expected that, in Africa, more people would live in cities and towns than in rural areas, United Nations Habitat executive director Dr Aisa Kirabo Kacyira said at the Human Settlements Indaba that took place earlier this month in...
Tough-talking Human Settlements Minister Lindiwe Sisulu has committed government to building 1.5-million low-cost houses over the next five years, telling the Human Settlements Indaba in Johannesburg on Wednesday that the State would achieve this target through the...
Over the past 20 years there has been persistent concern about deindustrialisation in South Africa, as well as the fact that locally produced manufactured products have been increasingly displaced by imports.
More
 
 
Latest News
The retail price of 95-grade petrol in South Africa will drop by 45 cents or 3.3 percent a liter from next Wednesday, while wholesale diesel will decrease by 4.9 percent, the government said on Friday. Petrol will cost 13.16 rand ($1.20) a liter while the wholesale...
Special purpose vehicle GreenCape will, by the end of 2014, make an application to the Department of Trade and Industry (DTI), the Western Cape provincial government and the City of Cape Town to declare Atlantis, on the Western seaboard, a special economic zone...
The German government has committed a further R70-million towards the second phase of the Non-Motorised Transport (NMT) programme. The NMT programme forms part of the Department of Environmental Affairs’ 2010 FIFA World Cup National Greening Legacy Programme.
More
 
 
Recent Research Reports
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
 
 
 
 
 
This Week's Magazine
In the next 20 years, it was expected that, in Africa, more people would live in cities and towns than in rural areas, United Nations Habitat executive director Dr Aisa Kirabo Kacyira said at the Human Settlements Indaba that took place earlier this month in...
Tough-talking Human Settlements Minister Lindiwe Sisulu has committed government to building 1.5-million low-cost houses over the next five years, telling the Human Settlements Indaba in Johannesburg on Wednesday that the State would achieve this target through the...
Over the past 20 years there has been persistent concern about deindustrialisation in South Africa, as well as the fact that locally produced manufactured products have been increasingly displaced by imports.
Financial agreement for Ghanian independent power producer (IPP) Cenpower Generation Company’s $900-million, 350 MW combined-cycle gas-turbine power plant was finalised earlier this month, paving the way for the project’s construction to begin before 2015 in Tema,...
The revenue implications for South Africa of ‘base erosion and profit shifting’ by corporate taxpayers are firmly in the crosshairs of the Davis Tax Committee (DTC) and Judge Dennis Davis hinted last week that recommendations were being considered to “detect and...
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks