Dimension Data Holdings has continued to exhibit strong financial performance for the three months to 30 June 2009, extending the gains it made on the six months to 31 March, with good services growth leading to improved gross and operating margins.
Overall reported revenues declined for the quarter relative to the third quarter of 2008 by approximately 12%. Adjusting for the impact of exchange rate movements, constant currency revenues declined on the prior period by approximately 4%, with services up by approximately 12% (supported in particular by managed services) and product declining by approximately 14%.
Gross margins for the quarter improved over the prior period, due mainly to the change in mix in favour of services. This, together with the Group’s continued focus on managing its fixed cost base, resulted in improved operating margin and operating profit relative to the prior period.
From a geographic perspective, Europe, Australia and Middle East and Africa recorded revenue growth and operating profit expansion. In the Americas, revenues and profits were lower than the prior period, although recent improvements in the monthly order intake in that region have been encouraging. In Asia, profitability improved on the back of services growth and cost management, despite product revenue declines. While Middle East and Africa performed well in aggregate, Plessey’s revenues declined as mobile operators on the continent reduced infrastructure spend.
The group’s order intake for the quarter reflected a year on year decrease at the revenue level but an increase at the gross profit level. On a sequential basis, order intake for the quarter at the revenue and gross profit levels improved on the previous three months.
Working capital was well controlled throughout the period, and the group maintains a robust balance sheet and a strong net cash balance.