Datatec increases final dividend after strong annual financial performance

DATATEC, the international information and communications technology (ICT) group, lifted its final dividend to 200 cents for the year ended February 28 versus 130 cents at the same time last year after solid profit improvements in its biggest subsidiaries.

- EDWARD WEST

The dividend policy was being changed to a more shareholder-accommodative two times dividend cover ratio, versus three times cover previously, due to a management incentive plan in some of the divisions that has resulted in upstreaming of cash to the parent company in the form of returns on fixed return equity instruments, resulting in more cash at the parent company.

"I am pleased to report a very strong operating and financial performance across all regions and metrics for the group," chief executive Jens Montanana said in the results.

He said the improving profitability and cash generation of the group's divisions enabled them to increase their dividend payout policy to 50% of underlying earnings per share.

Earnings before interest, tax, depreciation, and amortisation (Ebitda) increased 24.6% to $221.3 million (R4 billion) from $177.6m. Revenue fell 8.8% to $3.99bn. Headline earnings per share increased 79.6% to 25.5 US cents, from 14.2 US cents. Net debt fell to $62.1m from $123.1m previously.