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Datatec reduces operating costs as revenues tread slightly down

21st July 2020

Creamer Media Senior Deputy Editor

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Information and communications technology group Datatec reported slightly lower group revenues for the period from March to June compared with the revenues for the four months ended June 30, 2019.

However, significantly lower operating costs during the period under review boosted operating leverage and improved group earnings before interest, taxes, depreciation and amortisation (Ebitda).

Westcon International improved its revenues and Ebitda for the four months to June, compared with the same period last year, the latest business update revealed.

“Demand was strong for networked cloud computing, remote access solutions for home working and virtual office environments, unified communications and enhanced network security,” the company highlighted.

Revenues from Logicalis were modestly lower compared year-on-year, however, services revenues were strong and Ebitda improved.

“When Datatec issued its results for the financial year ended February 28, 2020, the group indicated that trading subsequent to the 2020 financial year had remained steady and that Westcon International revenues and order intake for the first quarter of the 2021 financial year were similar to the same period in the prior financial year,” Datatec commented.

For Logicalis, order intake for the first quarter of the 2021 financial year remained steady, with slightly lower revenues compared with the first quarter of last year.

The group also indicated that cash collections from customers during the first few months of the 2021 financial year have remained in line with historic norms.

Datatec will not issue any forward-looking guidance given the uncertain operating environment.

“Our focus remains on optimising our business in the current environment, which includes cost and liquidity management,” the company concluded.

Edited by Creamer Media Reporter

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