Despite pandemic and chip shortage disruptions, publicly listed distributor Dicker Data has seen revenue increase six per cent to A$1.069 billion for the first half of the financial year ending June 30.
Net profit after tax also grew 9.2 per cent to A$32 million, gross profit grew 3.3 per cent to A$99.6 million and gross margin finalised at 9.3 per cent.
The distributor told shareholders it has maintained its strong revenue growth trajectory on what was a positively disrupted HY20 and despite the supply constraints experienced in HY21.
Dicker Data CEO and chairman David Dicker said despite ongoing challenges in the current environment, it will continue to focus on executing strategic decisions to continue to grow, meet challenging requirements and deliver value-added services to vendors and reseller partners.
“The recent Exeed acquisition further demonstrates the commitment to take on new opportunities, deliver results for our people, investors, resellers and uphold our value proposition. Our recent record share price further consolidates our place as Australia’s leading distributor and a fast-growing and high returning tech stock," he said.
The distributor saw growth across most sectors in the first half, with hardware and virtual services sales at A$803.7 million, up 7.6 per cent, and software sales at A$258 million, up 1.8 per cent.
Services revenue took a slight hit down 13.1 per cent to A$4.9 million, as a number of larger enterprise projects were deferred and a key customer undergoing a restructure.
Within the software unit, the distributor maintained strong growth in perpetual software sales was up by 10.7 per cent and subscription software business was up 14.8 per cent.
This was offset by a decline in renewable software products after a surge in these products due to the large work-from-home (WFH) migration that took place in the second quarter of the 2020 financial year.
Since the Exeed acquisition, Dicker is expecting the New Zealand operation to more than double in size to over NZ$500 million in annual revenue with the introduction of several tier-one vendor partnerships with brands such as HP, Apple and Hewlett Packard Enterprise.
Furthermore, the acquisition brought 1,200 resellers under one roof, growth in market share and revenue, plus the immediate gain of skilled and specialist experts and cultural synergy between the two companies.
For the first time, Dicker Data will also have operational expertise in servicing the retail sector across Australia and New Zealand, a significant untapped revenue opportunity.
Dicker Data COO and executive director Vladimir Mitnovetski highlighted the greatest opportunity in the next 12 months was in supporting reseller partners who are building and delivering return-to-work solutions and strategies that are compliant with evolving government guidelines.
“The commercialisation of edge technologies will accelerate as home offices become office sub-branches that require connectivity, security and device management solutions,” he said.
“Furthermore, the proliferation of 5G technology and solutions continues as the work-from-anywhere movement shows no signs of slowing. The revolutionary bandwidth 5G connectivity provides is enabling businesses to unlock the full potential of artificial intelligence (AI) and machine learning technologies whilst also assisting them to cope with the exponential growth in their data.
“Demand for cloud solutions also remains strong as businesses look for scalability to accommodate their changing needs amidst the disruption caused by the pandemic. Public and hybrid cloud solutions are the major growth drivers in the cloud segment, particularly as the technology and our partners' skillsets in delivering these solutions are maturing.”
The distributor told shareholders the demand for technology and value-added services offered remains strong, particularly as many companies continue to ramp up their digital transformation agenda.
As the global chip shortage is expected to continue, Dicker said during the course of the first half of 2021, it has demonstrated the ability to pivot its strategy, manage the changing supply chain challenges and improve its ability to forecast and work with vendors to secure stock allocations while managing customer expectations.
Despite current chip shortages, the distributor said it was experiencing strong demand with a backlog of orders to fulfil and as supply improves, it expects to continue to meet this demand in the second half of 2021.
“We’ve been in shortage now since late last year. We are well placed and continue to successfully operate, plan and forecast under these circumstances. Orders are still being placed with no cancellations,” Dicker Data stated.
“We are also identifying significant opportunities within the technology sector as digital transformation continues to accelerate and the evolving hybrid and modern workforce are becoming dependent on more intelligent, faster and collaborative technology solutions.”
The distributor also increased its number of staff from 454 to 540 as part of its continued investment in growth portfolios with the addition of five new vendors and new segments in HY21.
To date, Dicker works with over 6900 resellers and managed service providers across A/NZ.