Datatec has blamed Hurricane Sandy and “weak conditions” in Europe for its two percent dip in shares on the Johannesburg Stock Exchange (JSE) after subsidiary Westcon experienced a weak financial quarter.
Technology distributor Westcon experienced a weak third financial quarter, which caused Datatec, the global ICT solutions and services group, to trade off at more than two percent on the JSE on Monday.
Datatec told shareholders in a statement published by the JSE: “Westcon’s performance in the third quarter has been weaker than expected and the board now considers it unlikely that the group will reach its published forecasts.”
Datatec added that since it made public its half year results on October 17, Westcon’s trading is slower than expected and “comparatively lower than the same period last year.”
“Continued weak conditions in Europe, business disruption in North America due to Hurricane Sandy, and lower than expected (government) business have negatively affected trading so far in the second half,” says Datatec.
Datatec added that Logicalis, its other major subsidiary, continued to trade in line with expectation but demand in the consulting services division had weakened.
For the financial year, which ends on February 28 next year, Datatec’s published forecasts indicate revenues of between US$5.5 billion and $5.8 billion and headline earnings per share of US$0.50.
Despite experiencing a decrease, its share price has added almost 40 percent in the past twelve months, year-on-year.
Datatec will issue an updated forecast for the 2013 financial year when the company issues its next interim management statement in January.