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Dicker Data net profit down 43 per cent in full year results

Dicker Data net profit down 43 per cent in full year results

"We are off to a smooth and strong start": Dicker Data chairman and CEO, David Dicker

Distributor, Dicker Data, has posted a net profit of $5.2 million in its full year results - down 43 per cent - in a year which included the acquisition of competitor Express Data Group.

Excluding one-off acquisition and integration costs operating profit before tax increased to $14.3m, up by 7.9 per cent on the previous year.

But taking into account into account $6.5m of one-off acquisition and integration costs net profit before tax decreased to $7.8m down by 41.2 per cent on the previous year.

Net profit after tax decreased to $5.2m (2013: $9.2m), down by 43.9 per cent, while earnings per share decreased to $0.0406 per share, down by 44.2 per cent.

Gross profit for the full year was $54.2m, an increase of 45.1 per cent, of which $15m was contributed by Express Data group for the three months to June.

"Despite higher revenues in the current year, gross profits for Dicker Data Ltd were only marginally better than previous year ($39m v $37m)," according to a company statement.

"In the first half of FY14, we saw lower upfront margins due to competition and lower sell price on clearing some of our larger stock holdings, this was offset by benefits in higher vendor rebate on Lenovo (due to higher sales volume in FY14) and higher discounts received on HP purchases with finance facility with Macquarie Bank in place for the whole of the financial year.

"However as stated above, in order to facilitate and execute the acquisition of Express Data some margin costs were incurred as we underwent some strategic vendor reorganisation in the second half of the financial year."

The revenue for the full year was $662.8m, up by 46.8 per cent on the same period last year.

On April 1, Dicker Data acquired the Express Data group.

The increase in revenue includes $186m contributed by Express Data for the three months to June.

Excluding those revenues from Express Data, revenues from ordinary activities by Dicker Data Ltd finalised at $476m, up by $24.4m ( up 5.4 per cent) compared to same time last year.

"At the end of June 2013 we were offered the full range of HP printing and supplies product helping our product revenues, up by $16m in FY14," according to a company statement.

"We also experienced strong growth in the second half of FY14 on Lenovo, up by $15m from previous year in servicing the small-medium sized businesses and education sectors.

"This has helped recover some of the shortfall on other product revenues due to a declining PC market and exit on some of these vendors, down by $9.3m in FY14.

"Also to facilitate and execute the acquisition of Express Data there were some strategic vendor reorganisation costs that impacted revenue and forgone margin.

"Had we not undertaken the acquisition of Express Data, these would not have been incurred and Dicker Data revenue on standalone basis should have exceeded $476m."

"With the acquisition of the Express Data business together with the extension of the company's warehouse and expansion of offices we expect to be well placed for continued revenue growth in the coming year."

Total dividend paid for the year ended 30 June 2014 was $0.0445 per share, down of 28.8 per cent.

Dicker Data chairman, David Dicker, said the integration of Express Data had been a massive task in his chairman's letter.

"Our sales for the first four months of operation of the combined Dicker Data and Express Data entities were $421 million," he said.

"While it would be unwise to extrapolate these for a 12 month period, we are off to a smooth and strong start.

"Despite having to make some strategic sacrifices to aid in the Express Data deal, Dicker Data Group alone posted better revenue than previous year.

"All in all, an exceptionally satisfying year."


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Tags Express Data groupDavid DickerDicker Data chairman and CEO

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