Computacenter enjoys ‘astonishingly strong finish’ to 2022

Computacenter has talked of enjoying a strong finish to the year as it delivered a robust set of results for 2022.

The channel player produced a 28.5% increase in revenues to £6.4bn in the year ended 31 December. Pre-tax profits improved by 3.2% to reach £263.7m.

Services revenue increased by 8.3% and the technology sourcing side of the business delivered a 36.7% improvement year on year (YoY).

Other highlights of the year included the 10.7% increase in the number of customer accounts with gross profit of more than £1m per annum. The group has also topped the 20,000 headcount globally. The channel player was able to share its progress on the sustainability front, achieving carbon neutral status for Scope 1 and 2 emissions in 2022.

In terms of the UK, the business devolved 12.6% growth in gross invoiced income, with the firm stating that it enjoyed “an astonishingly strong finish to the year”. The business has seen a shift in demand away from hardware sales, with software and services increasing.

On the US front, gross profit improved by 18% with a focus on integrating the acquisitions that were sealed in the past couple of years, but the firm indicated that it would be prepared to dip back into the M&A market if the right opportunity emerged.

The firm is going through an internal IT upgrade process that should take three years and warned that it could have some marginal impact, but the long-term benefits will be worth the short-term pain.

Mike Norris, chief executive of Computacenter, said that the business had navigated challenges through the period and the foundations were in place to keep that momentum going.

“Demand from most of our largest customers remains solid, particularly for IT infrastructure on which their businesses rely. We have seen top-line revenue extremely buoyant so far this year and expect this trend to continue,” he said.

“Our challenges for the coming year include, to a small extent, technology sourcing margins, due to the fact it is the largest customers, which are dilutive to margins, that are spending most, and – more significantly – services margins due to price pressure in the market and salary inflation,” he added.

Norris said that supply constraints that had blighted the market were easing and it was now “operating at close to normal market conditions”.

“Aligned with this, our inventory levels started to fall at the start of the fourth quarter of last year and we expect further reduction this year, which will continue to decrease the working capital required in the business,” he added.

The Computacenter numbers come just a few days after Softcat also shared its preliminary half-year numbers, and should provide further comfort to channel watchers looking for signs of confidence among those at the coalface.

Norris shared a sense of optimism about the prospects for its fiscal year 2023, noting that there were good prospects for growth even in the face of economic headwinds.

“We remain positive about the outlook in the short, medium and long term. While there are plenty of challenges due to the macroeconomic environment, we continue to expect 2023 to be a year of progress,” he said.