Datatec Limited

The group said gross profit grew 9.6% year over year, with over 29% of gross profit converting to adjusted EBITDA versus 27% last year. Reported EBITDA grew 22% and included $15 million of settled tax litigation credits in Westcon, which were excluded from adjusted EBITDA. Net finance costs were significantly lower than the prior year, helped by lower interest rates and better working capital management. On dividends, the company declared a final dividend of about $0.14 per share, bringing the full-year ordinary dividend to about $0.24 per share, or approximately ZAR 4 per share. Forwardly, management did not give formal numeric guidance, but said the outlook for the industry remains very positive while the broader environment stays cautious, with vigilance on currency volatility, inflation, supply chain disruption, and trade arrangements.

Jens Montanana emphasized that AI is reshaping demand across networking, cybersecurity, cloud, and managed services, and said this should support a multi-year investment cycle. He described the company’s role as a digital channel organization as increasingly important because AI is forcing enterprises to retool IT environments and invest to stay competitive. His tone was upbeat on the business mix and profitability, but he repeatedly cautioned that the external environment remains abnormal and uncertain.

Ivan Dittrich highlighted a reporting change in FY26: underlying EPS now excludes IFRS 2 share-based payment charges, with comparatives recast. He said reported revenues remain affected by the shift toward net accounting for software and services, so the company now also discloses gross invoiced income to better show underlying growth; gross profit rose 9.6% year over year and adjusted EBITDA conversion improved to over 29% from 27%. He also noted a strong balance sheet, lower net debt overall, a $70 million debit cash flow hedge reserve in Westcon due to a weaker U.S. dollar, and improved cash generation that supported the higher dividend.

Analysts asked about the rationale for recent small acquisitions, and Jens said the company prefers tactical deals in adjacent geographies or strategic buys for skills and speed to market, citing a recent Balkans transaction in Westcon as an example. A question about Westcon restructuring was answered by Ivan, who said the charge was the finalization of restructuring the European business begun in FY25. On AI demand duration, Jens said nobody knows the exact trajectory but he views it as a multi-year theme, similar to early Internet adoption. When asked about memory shortages and supply chain issues, he said the impact has been limited so far: some delays and higher costs, but nothing material, and the company can generally pass those costs through.