Technology firm Datatec said earnings in the first half of its current financial year will be as much as four times higher than a year earlier as demand for networking software, driven by the switch to remote working, offset the effects of the global microchip shortage.
The company, whose operations span more than 50 countries, has two main divisions, Logicalis and Westcon International, which distribute security and networking technology products.
Earnings per share is forecast at 6.1 US cents to 6.4 US cents compared with to 1.6 US cents previously, the group said in a trading update. Headline earnings per share — a measure that strips out the effects of one-off items — is also forecast at 6.1 US cents to 6.4 US cents, up from 1.6 US cents in the previous comparative period.
In a trading update last month the group said that despite having grown in the first half of the financial year, microchip shortages had negatively affected its hardware business. But demand for networking software to enable more staff to work remotely during the coronavirus pandemic helped offset the effect of the shortages.
At R37.89, the stock is 77% higher than a year ago, but that is still a far cry from the R137 at the turn of the millennium and R77 in 2015.
Datatec shares were 0.29% lower on the day in afternoon trade on the JSE.
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