Mustek targets tablet growth

Mustek, a distributor of IT products and services, says it can become a key player in the local tablet market which is likely to drive revenue over the next few years.

On Thursday (21 February), the group reported a 10% rise in revenue from continuing operations to R1.8 billion for the six months ended 31 December 2012.

The revenue growth was supported mainly by the addition of the Acer and Lenovo product ranges.

Profit from operations grew to R50.48 million, from R40.18 million.

Mustek’s headline earnings from continuing operations increased to 29.52 cents per share, from 14.18 cents per share in 2011.

The group expanded its basket of products with the introduction of multiple additions to the product portfolio offering, including Huawei Enterprise Solutions.

Company outlook

Looking ahead, Mustek says it is focusing on increasing volumes as it remains a driver of performance across its operations.

“Considering vertical sector potential in 2013, significant growth opportunities lie in the education, health and security industries, as well as the solar energy space,” it said.

The group noted that for some time, skeptics have argued that the PC will be replaced with newer devices such as the tablet (mobile device).

And while Apple dominates this form factor, Mustek said it was excluded from this growth opportunity. “However, statistics indicate that the other brands are catching up and Apple is steadily losing its tablet dominance. We believe that Mustek will become a key player in the local tablet market for the other brands. Over the next few years, this is likely to be a positive revenue driver,” it said.

The group highlighted the increasing use of tablets in the role of education. “Whereas tablets are taking the education world by storm outside of South Africa (and Africa), locally there is still some work to be done to extol the value of tablets and how they can improve teaching and learning. 2013 presents a great platform to maximise this opportunity,” Mustek said.

“We have also experienced another year of strengthening our strategic partner network within the industry. Mustek was heavily involved with the Microsoft launch of Windows 8. 2013 is the year that players within this industry will be exploring possibilities within the framework of the devices and applications spaces,” it said.

Industry outlook

Mustek said that there is ongoing industry debate around the future of the desktop. Premised on its ongoing interactions with customers and this rapidly changing industry, the company believes that the desktop will continue to transition into different formats based on evolving market trends and customer requirements.

“A manifestation of this is the increasing uptake of the All-in-One format, proving popular in the banking and public sector markets due to its lower Total Cost of Ownership and security benefits for the large percentage of desk bound employees in these environments,” it said.

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Mustek targets tablet growth