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Data#3 expects strong start to FY19

Data#3 expects strong start to FY19

Estimates pre-tax profit range between $7 million to $8.5 million

Laurence Baynham (Data#3)

Laurence Baynham (Data#3)

Credit: Maria Stefina

Data#3 has validated a strong start to the 2019 financial year (FY19) with the ASX-listed IT services provider expecting a pre-tax profit range of $7 million to $8.5 million.

During its Annual General Meeting (AGM), Data#3 CEO and managing director, Laurence Baynham, confirmed that the Brisbane-based business has made a strong start to FY19, significantly improving on last year’s first half pre-tax profit of $4.0 million.

“To what extent we can do this remains dependent on opportunities that need to be realised through November and December," Baynham said. "Our current first half projection is for pre-tax profit in the range of $7.0 million to $8.5 million.

"This is in line with our full year guidance to improve on FY18 results, and sees a return to more normal trading patterns, with a lesser second half skew than in FY18."

The first half results last year were put down to the decommissioning of Data#3’s cloud; a material shift of product profit to the second half due to delivery delays in December 2017 and the weak first half performance of Business Aspect.

“The move away from our cloud to alternate cloud platforms for our customers has involved additional cost and a distraction throughout FY18," Baynham said in his AGM address. "I am pleased to say that the decommissioning is now complete and our cloud future is lower risk with potentially higher returns."

Furthermore, Baynham said the provider was well positioned to capture growth in the market as customers increase spend in digital transformation and artificial intelligence, which usually translates into opportunity in areas such as cloud, security and mobility.

Specifically, he alluded to one example of its Business Aspect team working with the NSW government in developing a proof of concept involving developers, utilities, state and local government on the application of blockchain technology.

The aim is to help digitally transform lengthy processes associated with property development.

"Data# 3 remains well positioned to capitalise on new and existing markets," Baynham added. "Our strategic vendors include the likes of Microsoft, HP, Cisco and Dell are all predicting continued growth in Australia."

To further back this up, Data#3 has secured a string of customer wins the past few months.

In October, the business was selected to provide Azure migration services as part of Microsoft's Modernisation Factory in Australia, which was developed to support customers, including Federal and State Government departments, to migrate their on-premises infrastructure and workloads to Azure, with the model initially prioritising server migrations.

Meanwhile, Data#3 was also selected by The City of Fremantle in Perth to provide the full design, planning and deployment services using a combination of Microsoft Surface devices and HP desktops for the project.

Data#3 offered centralised procurement, management and implementation of the devices, including asset tagging, electronic tag and test, and imaging; as well as logistics services for a staged roll out.

In October, Data#3 also scored an integrated managed services project with real estate group McGrath Estate Agents.

The scope for the managed service included everything from service desk to server support, through to backup and recovery management.

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