Strong IT spending in UK boosts Computacenter in spite of euro

IT FIRM Computacenter said yesterday strong demand for services in the UK had propelled rising revenues, even as a weak euro threatened to hit turnover.

The company, which operates in more than 100 countries, said in constant currency terms its revenues had increased six per cent last year, but accounting for currency fluctuations, this was decreased to a two per cent rise. This performance was far better than expected, and sent shares in the FTSE 250 company up around seven per cent.

The UK was Computacenter’s best market, with total revenues up nine per cent, driven by customers including Morrisons. The other key markets, France and Germany, saw revenues increase on a constant currency basis.

Computacenter said that trading in Germany, where the firm has been hit by unexpected costs, had improved in the fourth quarter.

“We expect to make further progress in improving the performance of our problem contracts in Germany, where we will focus primarily on margin improvement,” the company said.

Investec analyst Julian Yates said: “The update details results marginally ahead of expectations, a strong cash balance, but most importantly highlights a base has been set for improving German contract margins into 2013.”