BRISBANE, Wednesday 22 February 2017: Australian business technology solutions leader Data#3 Limited (ASX: DTL) today announced its results for the six months ended 31 December 2016 (1H FY17). These results saw the company deliver continued profit growth and a further strategic shift towards services.
1H FY17 – growth across all key metrics
Commenting on the 1H FY17 result, Data#3 Chief Executive Officer & Managing Director Laurence Baynham said: “The solid financial and operational results reported today reflect our strategic and increasing focus on growing our portfolio of services. This includes the rapidly growing cloud services market and I am confident that we are well positioned to satisfy market demand.”
Continued growth in 1H FY17
In 1H FY17, total revenue was up 10.6% to $506.0 million, with product revenue up 11.5% to $413.9 million and services revenue up 6.6% to $91.3 million. This included $58.0 million of cloud-based revenues.
Total gross profit (excluding other revenue) increased 8.1% to $74.0 million. Total gross margin decreased from 15.0% to 14.6% reflecting a shift in sales mix.
Product gross profit increased by 0.9% to $34.7 million and services gross profit increased by 15.4% to $39.2 million.
Staff costs increased by 6.6% with market-based increases and headcount growth in Business Aspect consulting. Operating expenses stabilised after the acquisitions in FY15 & FY16, increasing 1.6% on PCP.
The revenue and gross profit growth drove net profit after tax (excluding minority interests) up 34.0% to $5.7 million.
Interim dividend increased by 34%
Reflecting the company’s financial performance and strong balance sheet, Data#3’s directors declared an interim fully franked dividend of 3.35 cents per share, a 34.0% increase on the prior corresponding period. This represents a payout ratio of 90.4% of net profit after tax. The record and payment dates for the interim dividend are 17 March 2017 and 31 March 2017 respectively.
Data#3’s Chairman Richard Anderson said: “Data#3’s performance both in increased profit and continuing strong cash flow allowed the board to declare a 34% increase in first half dividend to 3.35 cents per share. The board is very pleased with the sustained growth in profit.”
Positive outlook; on track to improve on FY16’s result
Mr Baynham added: “We are confident that we have the right strategy to underpin sustainable growth in long term shareholder returns. Our first half performance and pipeline of opportunities provides a solid foundation to achieve our objective of improving on the company’s 2016 full year profit.”