Data#3 is poised to post 25 percent profit growth during the 2016 financial year, as the IT solution provider’s performance continues to strengthen.
In figures revealed via the ASX, the technology firm expects its consolidated net profit after tax (NPAT) for the past twelve months to be in the $13-$13.5 million range.
According to Data#3 CEO, Laurence Baynham, this pre-audit estimate represents strong performance by the company’s business and solid growth in services, compared to FY15’s NPAT of $10.6 million.
With strong cloud growth high on the agenda for Baynham and his team, the company’s expected financial results follows an encouraging first half of FY16, as the business continues its shift towards services.
After recently quizzing Brisbane-based IT service providers on the main issues impacting business in 2016, concerns range from the impact of the decline in the resource sector, to the rising threat of cybersecurity, to the ongoing roll out of the National Broadband Network.
Yet despite acknowledging “challenging economic and market factors in 2016”, Baynham told ARN that the global economic downturn and geopolitical instability will not directly impact Data#3, but will influence business confidence in the Australian market.
“The continued decline in the resource sector will see the need for a strategy which capitalises on growth sectors such as health and education, and can offset the slowdown,” he explained.
"Government departments will be challenged with constrained spending, ‘Cloud first’ policies, and increased service delivery expectations, which will pose budgetary challenges. The technology sector however, will deliver new opportunities.”
For Baynham, the number of connected devices will continue to grow exponentially and this growth will bring increased risks.
"Companies will need to carefully plan and implement security solutions leveraging partnerships with trusted organisations, like Data#3,” he added.
As reported by ARN, for the first half of FY16 ending December 31, revenue rose 12.6 per cent to $457.5 million and net profit was up 19.2 per cent to $4.3 million on the previous half-year.
“We continue to see a trend to move to cloud-based solutions and I am confident that we are well positioned to fulfil our customers’ current and future requirements,” said Baynham in February.
“We are confident that we have the right strategy to underpin sustainable growth in long term shareholder returns.”
As explained Baynham at the time, Data#3’s first half performance and pipeline of opportunities has helped to provide a solid foundation to achieve the company’s objective of improving on its 2015 full year profit.
The board intends to announce the audited full year results and the final dividend on 22 August 2016.