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16/03/2021

Final results for the year ended 31 December 2020

 

Computacenter plc (“Computacenter” or the “Group”), a leading independent technology partner trusted by large corporate and public sector organisations, today announces audited results for the year ended 31 December 2020.

Financial Highlights

 

2020

2019

Percentage
Change
Increase/
(Decrease)

Financial Performance

Technology Sourcing revenue (£ million)

4,180.1

3,822.2

9.4

Services revenue (£ million)

1,261.2

1,230.6

2.5

Revenue (£ million)

5,441.3

5,052.8

7.7

Adjusted1 profit before tax (£ million)

200.5

146.3

37.0

Adjusted1 diluted earnings per share (pence)

126.4

92.5

36.6

Dividend per share (pence)

50.7

10.1

402.0

Profit before tax (£ million)

206.6

141.0

46.5

Diluted earnings per share (pence)

133.8

89.0

50.3

Cash Position

Cash and cash equivalents (£ million)

309.8

217.9

42.2

Adjusted net funds3 (£ million)

188.6

137.1

37.6

Net funds (£ million)

51.2

20.3

152.2

Net cash inflow from operating activities (£ million)

236.8

198.3

19.4

Reconciliation to Adjusted1 Measures

Adjusted1 profit before tax (£ million)

200.5

146.3

 

Exceptional and other adjusting items:

Gain on acquisition of a subsidiary (£ million)

14.0

-

 

Costs related to acquisition (£ million)

(0.6)

(0.9)

 

Other exceptional items (£ million)

0.1

-

 

Amortisation of acquired intangibles (£ million)

(7.4)

(4.4)

 

Profit before tax (£ million)

206.6

141.0

 

Operational Highlights:

  • The Group’s revenues increased by 7.7 per cent and were 6.6 per cent higher in constant currency2. Significant reductions in expenditure from industrial customers have been offset by new business within the Public Sector and financial services. COVID-19-related cost reductions and improving Services and Technology Sourcing margins has resulted in an increase in adjusted1 profit before tax of 37.0 per cent during the year.
  • The UK saw an increase in revenues of 11.0 per cent as Technology Sourcing revenues surged to cope with the demand generated by the COVID-19 crisis. Strong Services margins, due to increased utilisation and reduced external contractor costs and improving Technology Sourcing margins have resulted in an increase in adjusted1 operating profit of 40.2 per cent for the year.
  • Germany saw overall revenues decline by 2.5 per cent, on a constant currency2 basis, with falls in Managed Services and Technology Sourcing partially offset by another strong performance in Professional Services. The increase in Professional Services volumes, at higher margins, coupled with overall margin improvements and a fall in administrative expenses have resulted in an increase of 38.1 per cent in adjusted1 operating profit, on a constant currency2 basis.
  • France has had a difficult year, being more impacted by a slow-down of its large industrial customer base, and a switch to lower margin workplace product, and the downturn in its Services business which resulted in modest revenue growth but decreasing gross profits and a reduction in adjusted1 operating profit of 27.3 per cent on a constant currency2 basis.
  • North America saw a weaker than expected year with a marked reduction in activity by its higher-margin mid-market customer base which resulted in slightly declining revenues overall in constant currency2, excluding the impact of the Pivot acquisition. Pivot added $292.7 million of revenue and $6.8 million of adjusted1 operating profit in the last two months of the year.

The Group has experienced significant operational and financial impacts from the unprecedented effect of the COVID-19 crisis. All results in this announcement include these COVID-19 impacts and no attempt has been made to adjust for or exclude these impacts whether they be positive or negative. Further information on the COVID-19 impacts on the Group, and our response, can be found within the COVID-19 Impact Statement. The continued adoption of the going concern basis by the Directors in the preparation of the Consolidated Financial Statements is within note 2.1 to the summary financial information contained in this announcement.

The result has benefited from £261.0 million of revenue (2019: £26.0 million), and £6.5 million of adjusted1 profit before tax (2019: £0.2 million), resulting from all acquisitions made since 1 January 2019. Of this, for the entities acquired in 2020, the result has benefited from £232.6 million of revenue, and £3.2 million of adjusted1 profit before tax. All figures reported throughout this announcement include the results of these acquired entities.

A reconciliation to adjusted1 measures is provided within the Group Finance Director’s review contained in this announcement. Further details are provided in note 2 to the summary financial information contained within this announcement.

 

 

At the start of last year, our performance in 2019 set us a high bar for 2020. The COVID related lockdowns towards the end of the first quarter made improving on 2019 feel even more challenging.

After multiple upgrades during the year and today’s excellent results it is clear that the 2020 performance has exceeded all expectations and 2020 has seen the fastest profit growth Computacenter has achieved in its 22 years as a public company. Clearly, the challenge it gives us is to grow again in 2021.

While Computacenter will always focus on the long term and resist the temptation of short-term actions to maintain growth, we feel the opportunity for progression this year, while not certain, is real. We have come into 2021 with solid momentum and have experienced a very positive start to the year. As always, we will give an update to shareholders in our April statement once we have completed our first quarter at the end of March.

Growth rates are obviously difficult to predict as our geographies will come out of lockdown at different times, but our experiences of the last 12 months has convinced us more than ever that our customers will continue to invest in Information Technology and will require the services of Computacenter to enable them to do so. This, combined with the fact that we are growing in more geographies and across more technology platforms than we have ever done before, makes us even more excited about our long-term growth potential.

Mike Norris, Chief Executive of Computacenter plc

 

Read the full report
For further information, please contact: 
Computacenter plc.
Mike Norris, Chief Executive                01707 631 601
Tony Conophy, Finance Director        01707 631 515
www.computacenter.com

Tulchan Communications                020 7353 4200
James Macey White
www.tulchangroup.com

1 Adjusted operating profit or loss, adjusted net finance income or expense, adjusted profit or loss before tax, adjusted tax, adjusted profit or loss, adjusted earnings per share and adjusted diluted earnings per share are, as appropriate, each stated before: exceptional and other adjusting items including gains or losses on business acquisitions and disposals, amortisation of acquired intangibles, utilisation of deferred tax assets (where initial recognition was as an exceptional item or a fair value adjustment on acquisition), and the related tax effect of these exceptional and other adjusting items, as Management do not consider these items when reviewing the underlying performance of the Segment or the Group as a whole. A reconciliation to adjusted measures is provided within the Group Finance Director’s review contained in this announcement which details the impact of exceptional and other adjusted items when compared to the non-Generally Accepted Accounting Practice financial measures in addition to those reported in accordance with IFRS. Further detail is provided within note 6 to the summary financial information contained in this announcement.

2 We evaluate the long-term performance and trends within our strategic objectives on a constant currency basis. Further, the performance of the Group and its overseas Segments are shown, where indicated, in constant currency. The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information gives valuable supplemental detail regarding our results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our prior-year local currency financial results using the current year average exchange rates and comparing these recalculated amounts to our current year results or by presenting the results in the equivalent local currency amounts. Wherever the performance of the Group, or its overseas Segments, are presented in constant currency, or equivalent local currency amounts, the equivalent prior-year measure is also presented in the reported pound sterling equivalent using the exchange rates prevailing at the time. 2020 highlights, as shown above, are provided in the reported pound sterling equivalent.

3 Adjusted net funds or adjusted net debt includes cash and cash equivalents, other short or other long-term borrowings and current asset investments. Following the adoption of IFRS 16 this measure excludes all lease liabilities. A table reconciling this measure, including the impact of lease liabilities, is provided within note 9 to the summary financial information contained in this announcement.


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