Datatec

JP: DTCJ

ZAR4393.6m market cap

ZAR21.81 last close

Datatec is a South Africa-based multinational ICT business, serving clients globally, predominantly in the networking and telecoms sectors. The group operates through three main divisions: Westcon International (distribution); Logicalis (IT services); and Analysys Mason (consulting).

Investment summary

Datatec is a global IT services group that has successfully operated a buy-and-build model throughout its 34-year history. The group operates in over 50 countries and is a global partner to Cisco, which represents c 40% of group revenues. After a challenging past few years, having finally bedded down a group-wide SAP implementation, the streamlined business returned to profitability in FY19, with both its major divisions, Westcon and Logicalis, profitable in FY20. In its latest trading update, cost-cutting led to improved year-on-year EBITDA, despite a slight fall in year-on-year revenues. Supported by a weakening US dollar and positive operating leverage, if this trend continues it will demonstrate the resilience of the business.

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Price performance
%
1m
3m
12m
Actual (4.8) (14.5) (35.3)
Relative* (1.9) (12.5) (33.7)
52-week high/low ZAR37.3/ZAR18.2
*% relative to local index
Key management
Ivan Dittrich Finance Director