Despite a 32% sequential drop in operating profits, Dimension Data says the adverse trading conditions in the first half of its financial year have allowed it to accelerate its service and solutions model.
"In an environment of depressed margins, we have focused further on our services and solutions capabilities, and have invested significant time and effort into fine-tuning our positioning, skills, delivery capabilities and internal measurement criteria," says DiData chairman Jeremy Ord.
"The adverse trading environment has therefore had the positive effect of allowing us to accelerate the transition of going to market with a services- and solutions-led approach."
Due to what it describes as the "dramatic downturn in industry trading conditions" at the beginning of the second half of the 2001 financial year, DiData has opted for a sequential comparison of its figures rather than comparing the 2002 interim period with the same of period in 2001.
Total turnover for the six months to March 2002 declined by 11% from $1.24 billion to $1.1 billion.
The company says turnover in Asia dropped 17%, Australia dropped 26%, and Africa dropped by $54 million. The group blamed the severe decline of the rand against the dollar for the drop in African revenue.
Total operating profit before goodwill amortisation and exceptional items declined 32% from $58.8 million to $40.3 million.
Gross margins also dropped from 22.6% to 22.4%, and the operating margin fell to 3.7% compared with 4.8%.
The group turned in interim headline earnings of $0.02 per share, slightly ahead of what the market expected.
However, DiData`s Asian subsidiary, Datacraft Asia, announced today that it would take an additional debtors provision of between $19 million and $23 million for the period ending 30 September 2002. This arose over uncertainty as to whether certain Chinese debts would be recovered.
This resulted in the share taking a knock of nearly 8% when the market opened this morning. It was trading at 942c by mid-morning.
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