Datacraft posts strong earnings

Datacraft has reported strong earnings for the third quarter of the financial year 2008, driven by strong performance from both services and hardware sales.

Net profit from the Asia Pacific IT solutions and services company increased 23 percent to US$9 million, on the back of a 27 percent rise in revenue to US$187.3 million.

Services revenue grew 37 percent year-on-year to US$68.6 million, while hardware revenue grew 22 percent to US$118.7 million.

For the nine months to June 2008, group revenue rose 29 percent to US$541 million, while the profit-after-tax attributable to shareholders increased 32 percent to US$27.9 million. The group's balance sheet and cash flow remained strong with an ending cash balance of US$167.5 million.

Gross profit for the group at US$34.4 million was 24 percent higher year-on-year. The corresponding gross margin was 18.3 percent, compared with 18.8% for the same quarter last year, reflecting increased pricing pressure in the market place but was stable compared to the 18.2 percent in the prior quarter.

Datacraft very pleased

"I am very pleased with the third-quarter results which have seen the margin holding well and volume increasing," said Bill Padfield, chief executive officer of Datacraft Asia. "However, against the backdrop of global economic uncertainties, we are seeing increased caution and some budget tightening in the market place."

"There remains strong demand for solutions to reduce costs, improve efficiencies and optimize performance, which Datacraft is well-positioned to deliver. There is also growing interest in building in greater flexibility in the delivery of IT services," Padfield added.

Weak Korea and Japan results

From a geographic perspective, revenue contribution from East Asia declined 20 percent year-on-year due to weak results from South Korea and Japan. However, this was more than offset by strong performance in the regions of ASEAN, India, New Zealand and Greater China.

From a balance sheet perspective, the group's financials remained strong. The group generated US$10.7 million cash flow from operations in the third quarter, and a total of US$39.1 million over the nine-month period. The group's net cash and investments as at end of June 2008, stood at US$167.5 million.

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