Computacenter cautions on first half results amid ‘challenging’ UK market
"Germany and North America delivered solid underlying performances while the UK remained challenging," Computacenter said on Wednesday.
London-based tech company Computacenter has said the UK market “remained challenging” during its first quarter, although its business in Germany and North America performed well.
The FTSE 250 company said first quarter trading was “broadly in line with” expectations as revenue normalised following a period last year which benefited from a small number of “exceptional contracts”.
“Germany and North America delivered solid underlying performances while the UK remained challenging,” Computacenter said on Wednesday.
It went on to say that the performance in the quarter “largely reflected the normalisation of higher-volume, lower-margin Technology Sourcing contracts in North America and the excellent growth achieved in Germany in the prior year.”
But the firm, which assists businesses in setting up and managing their computer systems and software efficiently, expects adjusted pre-tax profit for the first half to be below the same period in 2023. This is due to lower services revenue in the first quarter as certain contracts expired.
“The strength of our integrated Technology Sourcing and Services model, our committed product order backlog and pipeline of opportunities, give us confidence in delivering a stronger performance with growth weighted to the second half of the year,” the company said.
At the beginning of the second quarter, it began a large four-year public sector contract in the UK, which was secured at the start of 2024.
In March, Computacenter posted record revenue and profit, fuelled by significant investments from large businesses in IT services.
Shares in the company have risen 11 per cent in the past year.
