Computacenter trading as expected in third quarter

30th Oct 2023 07:54

(Sharecast News) - Technology and services provider Computacenter said in a trading update on Monday that its third-quarter performance was in line with expectations.

The FTSE 250 company saw performance trends similar to the first half, with robust performance in Germany and the United States, but challenges persisting in the UK market.

As expected, it experienced a normalisation of technology sourcing volumes in the quarter, following exceptional growth in the first half.

The board said the normalisation occurred as some high-revenue, low-margin projects were completed.

Despite that, Computacenter was optimistic about its sales pipeline for the final quarter of the year.

Services revenue continued to show growth in the third quarter, and despite ongoing inflationary pressures, the company said it effectively managed its margin recovery.

Computacenter also reported significant progress in its strategic investments to enhance its long-term competitive advantage.

The company added that its strong cash performance in the first half, as industry supply chains normalised, led to further reductions in inventory and the generation of substantial cash levels during the third quarter.

That further solidified Computacenter's balance sheet strength.

"Notwithstanding that the fourth quarter is our largest quarter and much remains to be done, we continue to believe 2023 will be another year of progress with growth in profitability," the Computacenter board said.

"Looking further ahead, with our strength in technology sourcing, professional services and managed services, and focus on retaining and maximising customer relationships over the long term, we believe that we are well positioned to compete and gain further market share."

Computacenter said its next scheduled trading update would be its pre-close trading update on 24 January.

Reporting by Josh White for Sharecast.com.