Data#3 Limited (ASX:DTL) Outperforms ASX 200 with Sales and Decent Dividend Growth

2 min read | August 21, 2024 02:39 PM AEST | By Team Kalkine Media

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Data#3 Limited (ASX:DTL) Outperforms ASX 200 with Sales and Decent Dividend Growth — Image source: shutterstock

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Data#3 Limited (ASX:DTL), a prominent player in the business technology solutions sector, has significantly outperformed the broader market today. While the S&P/ASX 200 Index (ASX:XJO) has posted a modest 0.5% loss, Data#3’s shares have surged by 5.8%, trading at AU$9.15, up from yesterday’s closing price of AU$8.64.

This impressive performance follows the release of Data#3’s full-year financial results for the year ending 30 June 2024 (FY 2024), which have delighted investors.

Data#3 reported record gross sales of AU$2.8 billion, marking a 7.6% increase from FY 2023. This robust growth underscores the company’s strong market position and ability to capture significant revenue despite challenging economic conditions. Statutory revenue edged up by 0.4% to AU$815.7 million, while gross profit rose by 7.8% to AU$270.1 million.

The company has also delivered a final fully franked dividend of 12.9 cents per share, which is an 8.4% increase from the prior final dividend. For the fiscal year, Data#3 has paid out a total of 25.5 cents per share in fully franked dividends, reflecting a 16.4% rise and a payout ratio of 91.1%.

CEO Brad Colledge highlighted the achievement of sales and earnings growth as particularly significant given the challenging economic environment. He praised the performance of Data#3’s Software Solutions and Services segments, which grew by 11.0% and 9.6% respectively, with recurring gross sales increasing to 67%.

Colledge acknowledged that sales growth could have been even stronger had it not been for delayed customer decision-making and a 3.6% decline in the Infrastructure Solutions segment. Nevertheless, the overall growth in this area, including related maintenance services, was a positive sign.

Looking ahead, Data#3 did not provide specific guidance for FY 2025 but remains optimistic about its growth prospects. Colledge expressed confidence in the company’s ability to leverage the adoption of Generative AI and other emerging technologies. With a strong sales pipeline and increasing activity, Data#3 is well-positioned to capitalize on market opportunities, particularly in security, cloud, and data center sectors.

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