Datacom profit drops 46% despite revenue rise
Privately-held IT company Datacom has reported a 46% profit decline for the financial year ended March 31 as capital expenditure jumped 53% over the previous year.
Datacom, which is 39% owned by the NZ Superannuation Fund and 60% by Wellington businessman John Holdsworth, announced net profit after tax of $23.5 million, down from $43.7m.
Datacom Group chief executive Greg Davidson says capital expenditure increased to $55.4m while operating expenditure on major investments increased by 35% to $19.1m.
“These investment increases support the company’s strategy to build its capabilities and global footprint and support new lines of business and solutions using Datacom’s own intellectual property,” he said in a written statement. He was unavailable for interview.
Mr Davidson says Datacom took up new projects with existing customers such as Transport for NSW, The Department of Premier and Cabinet in Queensland, and the Accident Compensation Corporation (ACC) in Wellington.
It also opened new offices in Auckland, Adelaide, Singapore and secured a new partnership with Australian data centre provider AirTrunk.
Revenue continues to grow
The company increased its overall revenue by 9.3% to $1.27 billion.
Revenue rose 8.8% in Australia and Asia, and 9.8% in New Zealand, driven by deals with the Department of Home Affairs in Australia, and Auckland Airport, the NZ Lotteries Commission and Vector Energy in New Zealand, the company says.
Mr Davidson says the company’s strategy and new organisational structure positions it to meet current and future client needs and future growth across markets.
“We’re confident of our ability to capitalise on strategic growth areas such as cybersecurity and customer experience, and our ability to deliver high-value solutions consistently to our customers,” he says.
The Datacom Systems business generated the largest percentage of revenue for the group while datacentres, networks, and public cloud consultation and implementation projects continued to perform strongly, Mr Davidson says.
Employee numbers increased to 5332, up 9.3% from the year before. Datacom operates from 36 locations in Australia, New Zealand, Asia, Europe, and the US.