LONDON and JOHANNESBURG, November 18 /PRNewswire/ -- London and JSE-listed Dimension Data Holdings plc today announced its results for the year to end-September 2009. The Group's robust performance for the year to 30 September 2009 has resulted in improved returns and strong growth in profitability.
Given the extremely challenging economic conditions that prevailed over the period the Group did well to report flat revenues overall in constant currency. Strong growth of 13.0% in services revenues drove an improvement in the gross margin and this, when combined with tight cost management, resulted in operating profit growth of 25.4%. The Group operating margin grew to 4.9%, an excellent increase on FY2008's 4.0% operating margin. A further highlight of the results is good working capital management and strong cash generation, which resulted in a closing cash balance of $600 million.
Dimension Data Group CEO, Brett Dawson said: The results are testament to further success in the execution of our 'Profitable Growth' strategy which we embarked on in 2005. Since then we have grown revenues ahead of the market, achieving a four year compound annual growth rate of 12.3%. Improved gross margins and careful management of our cost base has driven operating leverage with the Group operating margin widening to 4.9% from to 2.1% in FY2005. Our operating profit has more than tripled to $194.4 million and over the past five years have generated over a $1 billion in cash from operations.
A key feature of this year's results is the excellent growth in services revenues. This was driven primarily by 19.3% growth in managed services in the Group's Systems Integration (SI) business and by revenue growth of 27.9% in Internet Solutions. Professional services revenues within SI, which tend to be more closely correlated with product revenues, increased 2.3%. Growth in services revenues offset a decline of 7.5% in product revenues, a commendable achievement in a tough market where demand was impacted by sharp cuts in capital expenditure in several of our traditional client segments.
The effective tax rate, excluding exceptional items, was 26.7% (2008: 25.9%). The Group recorded a $11.0 million exceptional tax credit (and a $1.5 million exceptional operating expense) flowing from the restructuring of the funding facility associated with the Campus land and buildings in South Africa.
Earnings per share before exceptional items were 7.6 cents, compared to 7.4 cents last year.
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Hilary King Global PR and Analyst Relations Manager Dimension Data Office : +27-11-575-6728 email : hilary.king(at)za.didata.com
for more information about Dimension Data, please go to http://www.dimensiondata.com
SOURCE: Dimension Data
CONTACT: Hilary King: Global PR and Analyst Relations Manager, DimensionData, Office : +27-11-575-6728, email : hilary.king(at)za.didata.com