Dicker Data embarks on $50M capital raise amid results surge

Dicker Data embarks on $50M capital raise amid results surge

Revenue growth came from Exeed and Hills acquisitions

David Dicker (Dicker Data)

David Dicker (Dicker Data)

Credit: Dicker Data

ASX- listed distributor Dicker Data has seen revenue jump 36.5 per cent to $1.45 billion for its 2022 half year as it seeks to raise $50 million to expand its Kurnell warehouse and increase balance sheet flexibility.

During the first half of 2022, Dicker Data’s earnings before tax (EBITDA) rose 19.5 per cent to $61.2 million and net profit also crept up 7 per cent to $34.3 million. 

The increase in revenue was partly attributed to Dicker’s acquisition of New Zealand's Exeed, which added $192 million in revenue for the first half. 

“We continue to perform above expectations, despite the headwinds caused by supply-chain and  logistical  disruptions,” chairman and CEO David Dicker said. 

“It is pleasing to see our  recent acquisitions translating into positive results for our shareholders and I am confident that the benefit to our shareholders will continue to grow as we further bed down the operations and as these new divisions leverage the scale of the wider business.”

The first-half results also feature two months’ contributed from the Dicker Data Access and Surveillance (DAS) business following the acquisition of Hills security and IT division, accounting for $18 million in revenue. 

Excluding the contribution from Exeed and DAS, underlying organic revenue was 16.8 per cent up. Following the two acquisitions, Dicker Data staff numbers jumped up from 540 to 824. 

Hardware and virtual services sales were finalised at $1.08 billion -- up 35 per cent for the half-year. Meanwhile, software sales came in at $365.5 million, a rise of 41 per cent and representing a quarter of total revenue.

Within its software business, $344 million was delivered via recurring subscription and renewable revenue streams, a model which increased by 47 per cent over the same period last year. 

Services revenue reached $6.5 million, a rise of 34 per cent due to converting several previously deferred enterprise projects. 

Dicker Data told shareholders that demand continued to outstrip supply as it continues to fulfill more orders than pre-pandemic, with its current open order value sitting at $393 million. 

“Demand remains strong across the company’s product portfolio and the appetite of the local economies for technology products shows no signs of slowing,” the distributor informed shareholders. 

“Advanced solutions, such as infrastructure, networking, security and software have returned to high levels of growth as business confidence also edges higher. 

“Demand for end-user computing and devices has normalised, however the company’s Professional AV division continues to grow above expectation.”

Dicker forecasts stock and logistical challenges to continue into next year, and assured it has a wealth of knowledge in managing these challenges and is proactively working with customers. 

Almost $150 million in revenue came from the consumer retail segment in H122, which Dicker believes there was a significant opportunity ahead to  scale its operations and seek access to distribute the retail product lines from many of its existing technology vendors. 

The new digs are expected to add more than 70 per cent extra warehouse capacity. 

About $20 million will also be applied towards working capital to increase its balance sheet flexibility. 

“Our business continues to grow rapidly, both as a result of our recent acquisitions, but also organically,” Dicker said. 

“With each year that passes, an increasing number of channel partners are choosing us as their distribution partner and as a result we’re holding more inventory and providing more trade credit than at any other point in the company’s history.”

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