DDR Provided A Dividend Update And The Guidance For FY2019

Dicker Data Limited

Dicker Data Limited (ASX: DDR), a specialist IT hardware distributor of various prominent brands from the Technology Hardware & Equipment Industry group, has announced that it is going to retain the current dividend policy of paying a quarterly dividend. Following the last financial year, the company will be providing consistency and certainty for investors. The company proposed that the interim dividend in FY2019 will be at an equal rate.

The company proposed that fully franked dividend for the FY2019 will be 5 cents per share. By the end of FY2019, the total proposed dividend for the period will be 22 cents which is up by 22.2% as compared to FY2018 which was 18 cents per share. 

Although the board of the company has considered the projected earnings to determine the proposed quarterly dividend, however, the quantum of dividend will depend on the board’s approval in each quarter. In case of any changes in the circumstances, there is a possibility that the projected earnings may vary to forecast. As a result, there will be changes in the dividend amount that need to be paid which will be updated to the market.

In FY2019, the company expects its group revenue to be $1.65 billion and a net profit after tax of $51.4 million. This data represents a growth of 10% in revenue as well as the profit.

In 2017, the company witnessed a loss of its Cisco business in New Zealand. Now, the focus of the New Zealand business will be towards the expansion of the vendor alliance. It will be underpinning for the segment to produce strong growth metrics for FY2019. The strategy of strong growth metrics in NZ is being supported by the appointment of the sole distributor for Lenovo DCG in NZ.

By the end of FY2018, Dicker Data Limited reported an increase in the revenue from the ordinary activities increased by 14.4% to $1,493.561 million as compared to the previous corresponding period (pcp). The net operating profit before tax went up by 16.0% to $46.607 million on pcp. The net profit after tax attributable to members increased by 20.5% to $32.467 million on pcp.

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On 20 February 2019, the company appointed DataCentre Group as the sole distributor of Lenovo DCG in NZ market.

On 22 January 2019, the company announced that it has entered into the partnership agreement with the National Narrowband Network Co (NNN Co), for a wider distribution of NNN Co’s Enterprise IoT solutions which included the globally certified devices as well as the award-winning N2N-DL Data platform.

On 11 February 2019, the company declared the final dividend of FY2018 to be 7 cents per share which will be fully franked. During the period, there were three interim dividends as well bringing the total to be 20.20 cents per share.

Again, on 30 January 2019, the company provided an update regarding the distribution agreement between Dicker Data Limited and NNN Co, where it was highlighted that LoRaWAN technologies would be providing support with the market characteristics requirement.

On 29 January 2019, the company announced its unaudited results for FY2018 for the period ended 31 December 2018.

In the last six months, the stock generated a positive return of 11.07%. By the end of the trading session on 4 March 2019, the closing price of the stock was A$3.550, up by 4.106% with respect to previous trading day’s closing price. The company has a market cap of A$548.04 million and approximately 160.71 million outstanding shares and a PE ratio of 18.37x.


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