Computacenter has published a trading update for the first quarter ended 31 March 2020, after putting 10% of its staff under furlough. It has also confirmed it will not pay a dividend for the year ending 31 December 2019.
The pan-European IT services firm said trading across the group had been “pleasing” given the current pandemic conditions. It said however that revenue had “reduced slightly” compared to Q1 2019, but that profitability had “remained in-line” with the previous year.
Computacenter said “current trading has been more robust than we anticipated at the start of this crisis”. It added: “There has been a surge in demand from many of our customers to enable business continuity, particularly around homeworking and network resilience. “Conversely, particularly in the industrial sector, where a large number of our customers have had to cease production, our engineers and consultants are unable to work.”
To mitigate the cost of carrying these staff, but retaining them for the long term, around 10% of Computacenter's employees across Europe have been put on wage-subsidy programmes, using various governments' initiatives.
The majority of these employees are engineers, project managers and consultants. IT Europa previously reported the Computacenter furlough plan earlier this month, but at the time details of the numbers involved were scarce. Computacenter employs over 16,000 staff, so at least 1,500 have perhaps stopped working..
The company confirmed the axe to the annual dividend. It said: “The board recognises the importance of dividends to shareholders, and the company prides itself on a long track record of paying dividends and other special cash returns. The company will continue to monitor the current crisis and resume distributing cash to shareholders as soon as it is appropriate.”
So it's possible there may not be an interim dividend for the current year either. The company also said it may furlough even more staff in the UK. It said: “In the coming weeks we intend to reconsider the extent of our involvement in the UK government's Coronavirus Job Retention Scheme that has been enormously helpful in the early and very uncertain days of this crisis.”
