The interim results released today by Datatec show the ICT group’s ability to produce good growth even in a difficult economic environment. Due to the group’s geographic and business diversity, Frost & Sullivan anticipates that Datatec will continue to grow even through the current global crisis. <\/p>\n
The group’s results for the six month’s to 31 August show an increase in group revenue of 18%. While Logicalis, which provides integrated ICT services, showed the most positive increase over the period, there was a disappointing return from Analysys Mason, the group’s consulting arm. <\/p>\n
In US Dollar terms, Analysys Mason showed a drop in revenue of 3% from the comparable period last year. This is mainly attributable to a tightening of discretionary spending by large enterprises. <\/p>\n
While Datatec’s revenue generated in the US may well shrink due to the current economic situation, Frost & Sullivan anticipates that the group’s broad presence in emerging markets will help to shield it from whatever drops in performance there may be in the developed markets of Europe and America. <\/p>\n
“This is not to say that Africa and other emerging markets are immune to global developments, but because they are in an accelerated high growth phase, demand is still going to be higher,” says Frost & Sullivan ICT analyst Spiwe Chireka. <\/p>\n
“The company’s move to Latin America is expected to contribute significantly to the Logicalis operations. The company is big with a wide footprint in Latin America and therefore we would not expect anything but stellar performance from that area for the group.” <\/p>\n
While Chireka notes that profitability in a number of emerging markets may have been relatively low for Datatec, she believes that this will not be a long-term problem. She is certain that the risk the group took in going into these regions is going to pay off as most developed markets now face a downturn in their economies. <\/p>\n
Chireka adds that the group is continually looking for new opportunities and there are good prospects for growth in a number of areas. <\/p>\n
“Expansion into India, which is one of the fastest growing markets in ICT, through the acquisition of Inflow Technologies is a sure plus,” she says. <\/p>\n
“Furthermore, the client list that Datatec has inherited from this acquisition is most impressive. Inflow has alliances with 22 global technology vendors including CheckPoint, Nokia, McAfee Ironport, Websense, Radware, NetApp and Quantum. This could also be the starting point of a rapid expansion into Asia Pacific.<\/p>\n
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