Publicly listed distributor Dicker Data has revealed strong revenue growth for the first half of its financial year up 36 per cent to A$1.459 billion.
Earnings before tax, interest, depreciation and amortisation (EBITDA) also jumped 20 per cent to A$61 million while operating profit before tax moved up 11 per cent to A$51 million during the first half, in comparison to the same period last year.
Revenue contributed from the acquisition of the Exeed business across Australia and New Zealand made up A$192 million.
The first half result also included two months contribution from the Dicker Data Access and Surveillance (DAS) unit following its acquisition of Hills Security and IT division, accounting for A$18 million in revenue.
Excluding the contributions from Exeed and DAS, underlying organic revenue growth was about 17 per cent.
Supply chain disruptions have continued and along with the introduction of the Exeed retail business and increased freight costs - which mainly were attributed to volume of product shifted and increasing charges from freight suppliers, gross margins were at 8.8 per cent for the first half of FY22.
“Stock and logistical challenges remain constant and are forecast to continue into 2023,” CEO and chairman David Dicker said in an operational update. “However the company is fulfilling more orders and shipping more stock than in previous years, demonstrating a significant shift from supply-driven constraints to demand outstripping supply.
“The company has a wealth of knowledge in managing these challenges and is proactively working with its customers to manage expectations and reduce the impact of the supply chain on their businesses.”
Dicker pointed out advanced solutions such as infrastructure, networking, security and software had returned to high levels of growth as business confidence climbs.
It was also noted that demand for end user computing and devices had normalised while its professional audio visual (AV) division continued to grow above expectations. The distributor is anticipating a high level of growth in adoption of automation, machine learning, data capture and analysis tools as businesses and governments prioritise operational efficiency and productivity.
“The company delivered strong growth in H122 as a result of the continued digital transformation of the corporate, commercial and government sectors in Australia and New Zealand," Dicker continued.
“Demand remains strong across the company’s product portfolio highlighting IT distribution’s essential role in enabling access to technology and the appetite of the local market for technology services and products.
“This trend shows no signs of slowing as the digital transformation continues.”
In regards to the Exeed acquisition, both Dicker Data New Zealand and Exeed are now functioning out of one distribution centre location and have a city fringe office, with the integration expected to be completed in the second half of 2022.
Since creating the DAS unit and completing the acquisition of Hills Security and IT on 2 May, the distributor said it has transitioned more than 100 of the Hills team members and novated more than 50 vendor contracts. A final adjustment for net assets acquired was settled on 20 June, resulting in an additional payment of A$1.9 million, bringing the total purchase price up from A$19.4 million to A$21.3 million.
“The acquisition of the Hills SIT division provides access to a new market segment in access control and surveillance, such as security cameras, network video recorders (NVRs) and many more technologies that represent a significant untapped opportunity,” Dicker said.
“This market, similarly to Professional AV two years ago, is converging with the traditional IT channel that we service, presenting an opportunity to not only capture new customers in the access control and surveillance markets, but to open these security solutions to our extensive existing partner network across Australia and New Zealand and offer our partners a full range of security solutions.”