Computacenter H1 profit seen up 50% despite supply shortages, FX headwinds

Computacenter said on Wednesday that it expects adjusted pre-tax profit for the first half to be around 50% ahead of the same period a year ago despite supply shortages and FX headwinds.

In an update for the period to 30 June, the company said trading across all of its major geographies has been "robust", with a particularly strong performance at the end of the second quarter.

"This means that the group will deliver an adjusted profit before tax for the first half of 2021 circa 50% ahead of the same period last year," it said. "We have seen strong organic technology sourcing and services growth in the UK, Germany and the US."

Computacenter said profitability would have been "even further ahead", had it not been for substantial supply shortages in the industry caused by the shortage of key components, and the strengthening of the pound.

"We have seen particular strengths from our German operation compared to last year in Q2 due to the majority of our industrial clients now being fully operational. We have also been extremely pleased with the financial performance from our US operations, a large part of which was only acquired during Q4 2020," it said.

"The UK showed some progress in the first half even though it had by far the most challenging comparison in the group, following a very strong second quarter in 2020."

Computacenter said the integration of its newly-acquired French networking business is on track and there has been an uptick in performance from its subsidiaries in Belgium and the Netherlands.

"As we enter the second half of the year our services backlog and more particularly our product backlog, across all geographies, are at a record high which gives us a high degree of comfort," the group said.

"We do however remain concerned about product shortages within the industry and obviously further strengthening of the pound would create a stronger FX translation headwind, but we are not predicting either of these headwinds to get any worse."

At 0905 BST, the shares were up 4.3% at 2,566p.