Slide 1: 2017 Full Year Results
2017 FULL YEAR RESULTS Full year results to 31 December 2017 13 March 2018 1
Slide 2: 2017 Financial Highlights
2017 FINANCIAL HIGHLIGHTS ►Group revenue increased 16.9 per cent to £3.79 billion (2017: £3.25 billion) and by 12.0 per cent in constant currency2 ►Group adjusted1 profit before tax increased by 22.9 per cent to £106.2 million (2016: £86.4 million) and by 18.4 per cent in constant currency2 ►Adjuste
Slide 3: 2017 Financial Highlights
2017 FINANCIAL HIGHLIGHTS 2013 2014 2015 2016 2017 2017 vs 2016 Revenue (£m) 3,072.1 3,107.8 3,057.6 3,245.4 3,793.4 16.9% Adjusted1 profit before tax (£m) 81.7 85.9 87.2 86.4 106.2 22.9% 1 43.3 46.8 53.6 54.0 65.1 20.6% Adjusted diluted EPS (pence) Dividend per share (pence) 17.5 19.0 21.4 22.2 26.
Slide 4: Operating Highlights
2017: OPERATING HIGHLIGHTS ►Record adjusted1 EPS of 65.1 pence (2016: 54.0 pence), an increase of 20.6 per cent ►The Group's total revenues grew £548 million during the year, £408 million in constant currency2 ►Germany delivers another record performance with full year revenue growth of 15.5 per cen
Slide 5: Financial Review
FINANCIAL REVIEW Tony Conophy 13 March 2018 5
Slide 6: Group Adjusted Financial Results
2017: GROUP ADJUSTED1 FINANCIAL RESULTS 2017 2016 Constant Performance headlines Change £m £m currency2 • Revenue up 16.9 per cent, and by 12.0 per cent in constant currency2 3,793.4 3,245.4 16.9% 12.0% • Adjusted1 operating profit up 22.4 per cent, 18.0 per cent in constant currency2 Revenue 1 Adju
Slide 7: Reconciliation to Statutory Results
2017: RECONCILIATION TO STATUTORY RESULTS Exceptional Utilisation of 2017 Statutory and other 2017 Adjusted 1 2016 Adjusted 1 CSF interest DE deferred Change results adjusting results results tax asset items £m £m £m £m £m £m % Revenue 3,793.4 - - - 3,793.4 3,245.4 16.9% Cost of sales (3,297.1) (0.2
Slide 8: Exceptional and Other Adjusting Items
2017: EXCEPTIONAL AND OTHER ADJUSTING ITEMS A net gain of £5.5 million was recorded, resulting from exceptional and other adjusting items (2016: gain of £1.4 million). Exceptional items The remaining provisions for the last two onerous contracts in Germany were released, for an exceptional gain of
Slide 9: Revenue by Segment
2017: REVENUE BY SEGMENT Supply Chain revenue The UK Supply Chain performance finished the year well, beating a difficult H2 2016 compare, with pleasing top-line growth tracking 2017 2016 2017 2016 Constant across the portfolio of offerings and customers. A large increase in Change Software sales ha
Slide 10: Revenue & Adjusted Operating Profit by Segment
2017: REVENUE & ADJUSTED1 OPERATING PROFIT BY SEGMENT 2017 2016 2017 2016 Constant UK performance saw slight improvements in Services Change 2 margins driven by several large projects in the £m £m £m/€m £m/€m currency Professional Services practice. Supply Chain margins Revenue fell due to continuin
Slide 11: UK Adjusted Operating Profit Decline
2017: UK ADJUSTED1 OPERATING PROFIT DECLINE 1,2 Refer to the glossary for definitions. Note that European Segments in constant currency2 are shown in €m 11 © Computacenter 2018 11
Slide 12: Group Adjusted Operating Profit Walk
2017: GROUP ADJUSTED1 OPERATING PROFIT WALK (£M) (CONSTANT CURRENCY2) 8.0 4.9 16.2 35.0 3.2 31.8 105.5 86.2 89.4 2016 Currency 2016 Supply Supply Services Services SG&A 2017 EBIT* EBIT* Chain Chain Volume GP % EBIT* (constant Volume GP % * EBIT refers to adjusted1 operating profit currency2) 1 Refer
Slide 13: Closing Net Funds for the Year
2017: CLOSING NET FUNDS3 FOR THE YEAR Net funds3 have increased £46.7 million £m to £191.2 million as at 31 December 2017 Committed facility extended in February 43 2018 for a further three years and increased 73 from £40 million to £60 million and remains 196 149 unutilised 129 127 90 Net borrow
Slide 14: Cashflow Since December 2016
Current asset investment of 2017: CASHFLOW SINCE DECEMBER 2016 (£M) £30 million matured during the year returning to cash Free cashflow of circa £76 million during the year 28 Depreciation / Amortisation / SBP 112 1 and Other includes a 106 -19 11 88 £4.3 million reduction for gain on -15 14 7
Slide 15: Net Revenue Strong
2017: NET REVENUE STRONG (AS ADJUSTED) Adjusted1 operating profit increased from 2.7 per cent of Adjusted1 operating profit margin - Gross v Net revenue to 2.8 per cent. Adjusted1 operating profit margin percentage is always diluted by Supply Chain revenues, 8.0% which are typically ‘pass-through’
Slide 16: Financial Returns Strong
2017: FINANCIAL RETURNS STRONG Return on capital employed* 37.1% 36.0% 33.3% 30.8% 29.7% Return on capital employed has increased from the level seen in 2016 as adjusted1 operating profit increased from £86.2 million to 13.4% £105.5 million and capital 10.2% 11.0% 9.9% 9.0% employed grew from £279.6
Slide 17: 2018: Modelling Considerations
2018: MODELLING CONSIDERATIONS Tax Capital expenditure Dependent on mix of earnings as we utilise losses in European operations. Whilst France Typically capex is circa £20-£25 million per annum with approximately 50 per cent run-rate continues to show a material improvement in profitability in 2017,
Slide 18: IFRS 15 Revenue with Customers
2017: IFRS 15 REVENUE WITH CUSTOMERS Final Analysis On transition, the Group plans to adopt IFRS 15 using the cumulative effect method, with the effect of initially applying this standard recognised at the date of initial application (i.e. 1 January 2018). As a result, the Group will not apply the r
Slide 19: Operating Review
OPERATING REVIEW Mike Norris 13 March 2018 19
Slide 20: Leading the Growth: Services Contract Base
LEADING THE GROWTH Encouraging UK growth, whilst Germany consolidated previous wins TO LEAD WITH AND GROW OUR SERVICES BUSINESS and France suffered the loss of a significant contract with a major 800 utility customer. Growth in 2018 is expected to be flat overall as 5 per cent targeted growth broadl
Slide 21: Driving Efficiency
DRIVING EFFICIENCY TO IMPROVE OUR SERVICES PRODUCTIVITY AND ENHANCE OUR COMPETITIVENESS Group UK Germany France Professional Services have seen Difficulties on several Managed Services Significant Managed Services wins in Increasing Managed Services volumes in volumes increase significantly as proje
Slide 22: At the Heart of Our Business
AT THE HEART OF OUR BUSINESS TO RETAIN AND MAXIMISE THE RELATIONSHIP WITH OUR CUSTOMERS OVER THE LONG TERM GROUP Our customers with over £1 million of contribution are a 95 102 107 Strategic Key Performance Indicator for Group performance. 86 90 13 FY 14 FY 15 FY 16 FY 17 FY UK GERMANY FRANCE The UK
Slide 23: UK
2017: UK Share of 2017 Revenue Profile FINANCIAL HIGHLIGHTS Revenue up by 8.8% Adjusted1 operating profit down by 18.2% 24% Supply Chain revenue up by 10.1% Services revenue up by 6.2% OPERATIONAL HIGHLIGHTS 10% Supply Chain Services 66% Professional Services Supply Chain margins remain de
Slide 24: Germany
2017: GERMANY Share of 2017 Revenue Profile FINANCIAL HIGHLIGHTS Strong revenue growth of 15.5% Adjusted1 operating profit up by 57.0% 22% Supply Chain revenue up by 19.7% Services revenue growth of 6.8% 9% Supply Chain Services OPERATIONAL HIGHLIGHTS 69% Professional Services Managed Servic
Slide 25: France
2017: FRANCE Share of 2017 Revenue Profile FINANCIAL HIGHLIGHTS Revenue up by 13.0% Adjusted1 operating profit up 80.0% to €6.3 million 17% Supply Chain revenue up by 12.4% 4% Services revenue up by 15.3% Supply Chain Services OPERATIONAL HIGHLIGHTS Professional Services 79% Managed Services
Slide 26: Belgium
2017: BELGIUM Share of 2017 Revenue Profile FINANCIAL HIGHLIGHTS Revenue up by 2.0% Adjusted1 operating profit up 25.0% to €1.5 million Supply Chain revenue down by 2.4% 33% Services revenue up by 10.8% Supply Chain Services Professional Services OPERATIONAL HIGHLIGHTS 3% 64% Managed Service
Slide 27: Death, Tax and Microsoft Upgrades
DEATH, TAX AND MICROSOFT UPGRADES (THE THREE THINGS THAT ARE CERTAIN IN LIFE!) 2017 • End of Extended support • No more monthly security patches • DOING NOTHING IS NOT AN OPTION 2018 2019 JAN 2020 27 26 © Computacenter 2018 27
Slide 28: Outlook
OUTLOOK The growth rates we recorded in 2017 meant we renewals and we will not have the benefit of a particularly achieved record Group revenues, adjusted1 profit before successful project that finished at the end of 2017. We tax and adjusted1 diluted EPS, and set ourselves a high are hopeful that w
Slide 29: Top Line Growth Drivers
TOP LINE GROWTH DRIVERS 29 © Computacenter 2018 29
Slide 30: Profit Growth Drivers
PROFIT GROWTH DRIVERS 30 © Computacenter 2018 30
Slide 31: Draft Agenda for Analyst Presentation – 27 April 2018
DRAFT AGENDA FOR ANALYST PRESENTATION – 27 APRIL 2018 • 09:30 Introduction and Strategic KPIs Mike Norris • 09:45 Driving Growth and Competitiveness Andy Stafford • 10:15 Computacenter and the Cloud Nat Ives • 10:45 Break • 11:00 Our Growth in Networking Gerald Feiler • 11:30 Windows 10 – The Opport
Slide 32: Appendix
APPENDIX 32
Slide 33: Glossary
GLOSSARY 1. Adjusted measures The Group uses a number of non-Generally Accepted Accounting Practice (non-GAAP) financial measures in addition to those reported in accordance with IFRS. Adjusted operating profit or loss, adjusted profit or loss before tax, adjusted tax, adjusted profit or loss for th
Slide 34: Glossary (continued)
GLOSSARY (CONTINUED) 2. Constant currency We evaluate the long-term performance and trends within our strategic key performance indicators (KPIs) on a constant currency basis. Further, the performance of the Group and its overseas segments are shown, where indicated, in constant currency. The consta
Slide 35: Glossary (continued)
GLOSSARY (CONTINUED) 3. Net funds Net funds includes cash and cash equivalents, CSF, other short or long-term borrowings and current asset investments. Net funds are monitored internally by the Group as a key measure. Customer-specific financing (CSF) Finance costs for CSF are charged after operatin
Slide 36: IFRS 15 Revenue with Customers Further Detail
2017: IFRS 15 REVENUE WITH CUSTOMERS FURTHER DETAIL Background International Financial Reporting Standard IFRS 15, Revenue from Contracts with In our 2017 Interim Report, we also reported that an adjustment was expected in Customers, becomes effective for the Group on 1 January 2018. The guidance re
Slide 37: Sources of Revenue: % Change by Revenue Type
SOURCES OF REVENUE: % CHANGE BY REVENUE TYPE Group UK 24.5% 19.4% 16.4% 16.9% 14.3% 11.7% 11.5% 12.0% 9.7% 10.1% 7.3% 8.8% 5.7% 6.2% 0.2% Supply Chain Professional Managed Services Total Services Total revenue Supply Chain Professional Managed Services Total Services Total revenue revenue Services r
Slide 38: UK: Adjusted Income Statement
UK: ADJUSTED1 INCOME STATEMENT 2017 2016 Change £m £m % Revenue 1,496.4 1,375.9 8.8% 1 Adjusted gross profit 214.6 202.5 6.0% 14.3% 14.7% (0.4% ) Administrative expenses (176.3) (155.7) 13.2% (11.8% ) (11.3% ) (0.5% ) 1 Adjusted operating profit 38.3 46.8 (18.2%) 2.6% 3.4% (0.8% ) Headcount*: Direct
Slide 39: UK: Adjusted Operating Profit Walk
UK: ADJUSTED1 OPERATING PROFIT WALK (£M) 9.0 4.9 8.9 7.3 20.6 46.8 38.3 2016 Supply Chain Supply Chain Services Services SG&A 2017 EBIT* Volume GP % Volume GP % EBIT* * Headcount average throughout the year. 1 Refer to the glossary for definitions. 39 © Computacenter 2018 39
Slide 40: Germany: Adjusted Income Statement
GERMANY: ADJUSTED1 INCOME STATEMENT 2017 2016 2017 2016 Constant Change £m £m €m €m currency2 Revenue 1,725.0 1,392.2 23.9% 1,965.9 1,702.6 15.5% 1 Adjusted gross profit 219.1 175.3 25.0% 249.6 214.4 16.4% 12.7% 12.6% 0.1% 12.7% 12.6% 0.1% Administrative expenses (158.8) (139.8) 13.6% (181.3) (170.9
Slide 41: Germany: Adjusted Operating Profit Walk
GERMANY: ADJUSTED1 OPERATING PROFIT WALK (£M) CONSTANT CURRENCY2 1.3 6.1 8.8 4.6 18.5 60.3 3.1 35.5 38.6 2016 Currency 2016 Supply Supply Services Services SG&A 2017 EBIT* EBIT* Chain Chain Volume GP % EBIT* (constant Volume GP % currency2) * Headcount average throughout the year. 1 Refer to the glo
Slide 42: France: Adjusted Income Statement
FRANCE: ADJUSTED1 INCOME STATEMENT 2017 2016 2017 2016 Constant Change £m £m €m €m currency2 Revenue 509.9 420.5 21.3% 581.3 514.3 13.0% 1 Adjusted gross profit 53.5 42.5 25.9% 60.9 52.0 17.1% 10.5% 10.1% 0.4% 10.5% 10.1% 0.4% Administrative expenses (47.9) (39.6) 21.0% (54.6) (48.5) 12.6% (9.4%) (9
Slide 43: France: Adjusted Operating Profit Walk
FRANCE: ADJUSTED1 OPERATING PROFIT WALK (£M) CONSTANT CURRENCY 2.6 0.9 1.6 5.2 0.2 4.4 5.6 2.9 3.1 2016 Currency 2016 Supply Supply Services Services SG&A 2017 EBIT* EBIT* Chain Chain Volume GP % EBIT* (constant Volume GP % currency2) * Headcount average throughout the year. 1 Refer to the glossary
Slide 44: Net Funds
NET FUNDS One of the Group’s primary 3 Dec 17 Dec 16 Change measures when managing the Analysis of Net funds £m £m £m business is Net funds3 Cash and cash equivalents 206.6 118.7 87.9 Net funds3 have increased £46.7 million since 31 December 2016 Current asset investment - 30.0 (30.0) Operatin
Slide 45: Group Cash Flow
GROUP CASH FLOW Operating net cash inflow of £106.1 million (2016: £68.2 million) Working capital outflow increased by £16.1 million to £19.3 million during the year (2016: £35.4 million) Current asset investment of £30 million as at 31 December 2016 matured and returned to cash The disposal
Slide 46: Group Balance Sheet
GROUP BALANCE SHEET 2017 2016 Change £m £m £m Non-current assets Property, plant and equipment 77.9 63.0 14.9 Investment property - 10.0 (10.0) Goodwill & Intangibles 80.3 76.3 4.1 Investments in associates 0.1 0.1 0.0 Deferred income tax asset 9.1 10.5 (1.5) 167.4 159.9 7.4 Current assets The dis
Slide 47: Thank You
THANK YOU 47 © Computacenter 2018 47