Computacenter sees 'modest' growth in 2022 profit

Computacenter said on Friday that 2022 was set to be a year of "modest" growth in adjusted pre-tax profit following two "exceptional" years.

In an update for the third quarter to 30 September, the company - which provides computer services to public and private sector customers - said this will be achieved despite the substantial headwind of the unwinding of the Covid-19 cost and utilisation benefits it received in 2020 and 2021.

"We are benefiting from currency movements and the positive, but limited, contribution from our in-year acquisitions, but these are much smaller than the Covid headwinds," it said.

Computacenter hailed a "strong" performance in technology sourcing, adding that the US acquisition made in July has performed well.

The company’s services businesses, meanwhile, were more challenged due to the effects of the Covid unwinding and ongoing cost and inflationary pressures. Nevertheless, Computacenter said some recent contract wins, which have not yet contributed, give it confidence.

"The supply chain challenges mean that our inventories remain much higher than last year for the reasons we have explained previously," it said. "We expect the supply constraints and the inventory levels to unwind as the year progresses but will not be substantially resolved until well into next year.

"As we look ahead into 2023, we look forward to another year of growth. The company continues to invest heavily in its future, particularly in its IT roadmap and, understandably, cyber security."

Computacenter said these investments will continue to hold back short-term profitability, but are essential to secure long-term success. "This commitment to invest for the long-term gives us confidence for the future," it said.