Datatec to divest India venture

·19 Mar 2013

Listed ICT group, Datatec, says that following a review of subsidiary, Westcon‘s participation in India, it has decided to divest from its current venture.

“Discussions with the local partners have commenced. The investment to date is not significant to the group,” Datatec said.

Westcon is a specialty distributor in networking, the secure datacenter, mobility, security and convergence.

On Tuesday (19 March), Datatec published its year-end trading statement for the financial year ended February 2013.

The group said it expects revenues in the range of $5.2 – $5.3 billion, lower than a previous forecast of approximately $5.4 billion.

It said it expects profit after tax in the range of $83.0 – $88.0 million, with a previous forecast in the range of $80.0 – $90.0 million.

Datatec forecasts underlying earnings per share in the range of 40.0 – 45.0 US cents, from a prior range of 40.0 – 47.9 US cents.

The group said it expects earnings per share to be between 38.0 – 43.0 US cents, from 35.0 – 43.5 US cents previously; while headline earnings per share are in the range of 38.0 – 43.0 US cents, from 35.0 – 43.1 US cents before.

The group said it expects to maintain its distribution to shareholders, at 9 US cents (2012: 9 US cents), making a distribution of approximately 17 US cents per share in total for the year ended February 2013, up from 16 US cents in 2012.

“Westcon has continued to report performance below expectations especially in the US and Europe. In contrast Logicalis continues to perform strongly and slightly above plan. The group´s gross margin expansion has continued throughout FY13 and overall Latin America has again proved to be its strongest market,” Datatec said.