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Services shift sees Data#3 profit surge

Services shift sees Data#3 profit surge

Revenue rose 1.8 per cent to $406.4 million and net profit after tax was also up 39.2 per cent to $3.6 million

Data#3's John Grant

Data#3's John Grant

A strategic shift towards a services centric-business model has seen ASX-listed technology solutions provider, Data#3 (ASX:DTL) return to profit growth in the first half of 2015 financial year ending December 31.

Revenue rose 1.8 per cent to $406.4 million and net profit after tax was also up 39.2 per cent to $3.6 million compared to the previous corresponding period of $2.6 million.

An improvement in margins and solid services growth were the main drivers behind its net profit hike.

“We’re also seeing early evidence of our strategic shift to an increasingly service-centric business in the company’s return to growth over the past six months. Overall, this solid first half result underpins our full year guidance to improve on last year’s net profit of $10.9 million,” Data#3 outgoing managing director, John Grant, said.

In the first half, product revenue was slightly down 0.9 per cent to $329.7 million, however services revenue was up 16.4 per cent to $75.8 million.

“With the changes we’re seeing in the way our customers are choosing to consume and pay for technology, our strategic shift from primarily product-centric to increasingly services-centric is the right strategy to underpin sustainable growth in long-term shareholder returns,” recently appointed Data#3 CEO, Laurence Baynham, said.

In the past six months, Data#3 purchased a 42.5 per cent stake of Wi-Fi analytics company, Discovery Technology and acquired technology consultant, Business Aspect. Both acquisitions will expand Data#3’s services and applications capability.

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Tags Laurence BaynhamData#3John Grantfinancial results

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