Edison Investment Research - Datatec Ltd. (10BN) Datatec - FY21 underlying EPS expected to rise by over 35%

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Edison Investment Research

Richard Williamson

Datatec - FY21 underlying EPS expected to rise by over 35%

In a trading update for the financial year ended 28 February 2021 (FY21), Datatec highlighted that it expected to report a 35–39% y-o-y rise in underlying EPS to 13.4–13.8c (FY20: 9.9c). Edison’s FY21 forecast conservatively reflects a slight fall in EPS year-on-year, due to uncertainties around the pandemic. Despite the impact of COVID-19, all the group’s divisions continued to perform strongly in H221, driven by the strength of the technology sector. Management also indicated the group’s strong operating cash flows and a ‘significant reduction’ in net debt (Edison’s estimates indicate only a small fall to US$127m at FY21 year end). This looks like a very positive trading update in an uncertain global environment. We will review our forecasts after the FY21 results, expected on 25 May 2021.

13/05/2021 1 EN

Underlying

Datatec Ltd.

Datatec is an international information and communications technology (ICT) business with operations in over 60 countries across North America, Latin America, Europe, Africa, Middle East and Asia-Pacific. Co.'s segmental include: Westcon, which is engaged in the distribution of networking, security, and unified communications products and data center solutions; Logicalis, which is engaged in ICT infrastructure solutions and services; Consulting Services, which is engaged in strategic and technical consulting; Corporate, which is comprised of head office companies including Datatec Financial Services, a new capital/leasing business under development and consolidation adjustments.

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ZAE000017745 Johannesburg Stock Exchange South Africa

Provider

Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Richard Williamson

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Datatec - FY21 underlying EPS expected to rise by over 35%

Datatec - FY24 revenue growth of 5.8%

Datatec - On track for better performance in FY24

Datatec - Solid H124 performance supports FY24 outlook

Norcros - Sale of Johnson Tiles UK agreed

Henderson Far East Income - Repositioning to raise total returns

Freelancer - AI to drive return to growth

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