Datacom revenue tops $1 billion as IT goes through 'hyper-change'

By Fiona Rotherham

Datacom provides contact centre technology for enterprises and government. Photo / Natalie Slade
Datacom provides contact centre technology for enterprises and government. Photo / Natalie Slade

Australasian IT services provider Datacom Group has boosted 2016 full-year revenue over the $1 billion mark, in a sector experiencing what chief executive Jonathan Ladd dubbed "a phase of hyper-change".

The private New Zealand-owned company, whose primary shareholders are the Holdsworth family's Evander Management, with 52.4 per cent, and the New Zealand Superannuation Fund, with 37.64 per cent, reported a revenue increase of 13 per cent to $1.058 billion for the year ended March 31, it said in a statement.

That pushed its 10-year compound annual growth rate to 11.5 per cent.

After-tax profit rose to A$27.2 million, up from $24.3 million the prior year, despite a 35 per cent increase to $40.6 million in capital expenditure to cope with demand for existing and new IT services.

Ladd said it was a great result in today's turbulent times where a lot of organisations were facing disruption.

In New Zealand, revenue was up 13.1 per cent, following a trend of continuous growth over the last decade while the operations in Australia and Asia had a 12.9 per cent revenue rise from the previous year.

Capital expenditure included more than $30 million on research and development, predominantly its own intellectual property, which specialises in payroll services and the local government and healthcare sectors.

Datacom announced earlier this month it had completed a national network in Australia to connect its nine inter-state data centres to allow access to digital assets and public cloud resources, including Amazon Web Services and Microsoft Azure.

Ladd said the group was expanding significantly to ensure it can bring to market new technologies and was also extending beyond its home markets of New Zealand and Australia.

The company opened four new offices over the year and now operates across 29 locations in New Zealand, Australia, Malaysia, the Philippines, the UK and the US while Ladd said it had also been doing work "all over the place", including Bhutan, India and Mexico.

We're also seeing sharp growth for cloud application transformation services and demand for WAN, LAN and wireless networks.

Datacom is expanding its expertise in digital practices, data analytics, enterprise, and industrial mobility.

"We're also seeing sharp growth for cloud application transformation services and demand for WAN, LAN and wireless networks," Ladd said.

Contact centre business was up 60 per cent over the year in Australia and New Zealand. Datacom provides contact centre technology for enterprises and government.

There was a significant uplift in the cyber security market, with Datacom investing in a purpose-built Cyber Security Incident Response Centre in Canberra, which due to open later this year.

Employee numbers now total nearly 4,700, including 2,700 in New Zealand. Ladd said finding the right people was a continual challenge due to the industry-wide skills shortage, particularly for cyber security expertise.

The company hadn't resorted to the signing-on bonuses some other IT companies are offering, Ladd said, and he claimed Datacom's stable record of growth attracted many applicants with a wide range of experience.

- BusinessDesk

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