Dicker Data has seen its pre-tax profits flatline for its most recent quarter following a period of rising costs and interest rates.
The publicly listed distributor posted a net profit before tax of $76.7 million for the third quarter that ended 30 September 2022, a 0.1 per cent increase year-on-year.
Nonetheless, Dicker Data said it was pleased with the unaudited result given the previous Q3’s “higher-than-normal" growth rate of 26 per cent year to date.
Explaining the profit flatline, the distributor told shareholders that its costs were impacted by rising interest rates, freight costs and increased depreciation and amortisation as a result of recent acquisitions, including the Hills security and IT division and New Zealand's Exeed.
The acquisitions also saw salary costs increase on the prior corresponding period, although Dicker Data noted that they have remained stable at 4.8 per cent of revenue
Meanwhile, unaudited revenue for Q3 came in at $775.5 million, representing an increase of 19 per cent year-on-year.
Commenting on the results, CEO and chairman David Dicker said the company had seen a “very pleasing increase in sales year on year”.
“Profit didn’t do as well, remaining flat, but that [is] in comparison to ... what was a very big previous year,” he said. “Almost feels like a gain. With all the increases in costs, and other factors navigated, we have a very good platform for the future.”
The Australian market contributed 82 per cent of Dicker Data’s overall revenue, while New Zealand delivered the remaining 18 per cent.
According to Dicker Data, increased revenue growth was attributable to a surge in demand for existing lines of business and new vendor partnerships, including Carbonite and Webroot, Armis and Veritas.
In addition, Q3 marked the first full quarter to include Dicker Data’s recently launched Access and Surveillance (DAS), which formed out of its acquisition of Hills.