Computacenter shares ‘disappointing’ UK performance in FY24
The company shared a slight increase in revenue and a decline in GII despite a “record H2 performance”
Computacenter shared revenue slightly on the up in FY24 despite a poor performance in Europe.
Revenue reached £6.96bn, a 0.6 per cent increase from last year (£6.92bn).
Technology sourcing as well as services were on the up, respectively by 0.8 per cent and 0.1 per cent.
GII and gross profit went down 1.6 per cent and 0.9 per cent respectively.
Computacenter referred to its UK performance as being “disappointing”, as the market for hardware has been weaker than expected.
Total GII in the UK went down 7.1 per cent, from £2.38bn to £2.21bn, weighed down by a slump in technology sourcing gross invoiced income, despite a slight upward trend in services, which went up 2.5 per cent.
Gross profit plummeted eight per cent, landing at £230.8m compared to £250.8m the year prior.
Despite managed services being impacted by a large underperforming contract and going down 4.8 per cent, from 309.4m to 294.6m, professional services climbed 19.4 per cent, from £132.5m to £158.2m.
Total UK revenue went down 4.6 per cent, falling at £1.16bn compared £1.21bn the year before.
The results were negatively impacted by a greater customer caution throughout the year, with purchasing decisions taking longer to conclude, reportedly affected by the general election in July.
Another large underperforming contract impacted managed services in Germany, bringing managed services earnings down 7.2 per cent.
Total revenue in the country fell by two per cent, while total GII shrank 7.5 per cent.
On the other hand, professional services revenue was on the up in both Germany and North America but declined 5.2 per cent in Western Europe.
Those results were mainly impacted by the company’s H1 results, as it delivered “record performance” in the second half of the year.
"Computacenter delivered a solid performance in 2024 as a whole in the context of a tough first half comparative and a more challenging IT market,” said Mike Norriss, CEO of Computacenter.
"Encouragingly, the second half was the most profitable in our history and was derived from our highest number of major customers.
“We executed well in North America, achieving another record year while Germany performed robustly.
“Technology sourcing momentum improved through the year, and we were particularly pleased with professional service's double-digit growth.”
Looking ahead
Despite mixed FY24 results, the VAR remains confident in the future.
In the UK alone, it added “six major customers”, bringing the total to 54 at year end and matching the number achieved in 2021.
The company also renewed some important contracts in the region, such as a six-year agreement worth about £1bn with a large UK customer covering all three service lines.
It also strengthened its public sector presence and is optimistic about the technology transformation opportunities in the sector.
Computacenter reported a 0.5 per cent increase in constant revenue during H2, seeing the light after a tough first half year.
The company announced that it “remains mindful of the uncertain macroeconomic and political environment” across the world.
“Politicians, presidents, prime ministers come and go,” previously said Clare Parry-Jones, sales enablement director Europe at Computacenter, in an interview with CRN.
“Mike Norris has been CEO of Computacenter for 30 years.”
Norris added: "We are well-placed for progress in 2025, entering the year with a strong order backlog across all regions, an exciting opportunity set and a continued focus on helping our customers realise the transformative benefits of IT.
“While this outweighed the improvements we have made in how we approach the market, we delivered a more stable performance in the second half and ended the year with six more major customers.
“We are also encouraged by the excellent growth achieved in professional services revenue, positioning us well as market conditions improve.
“Our integrated offer remains compelling to our target market, as evidenced by some significant renewals including a six-year contract worth approximately £1bn with an existing customer, covering all three service lines.”