Dicker Data (DDR) H2 2024 earnings summary

Executive summary

• FY2024 gross revenue reached AUD 3.4 billion, up 2.9% year-over-year, with recurring software sales rising 7.5% and now comprising up to 29% of total sales.

• EBITDA was AUD 150.4 million, down 0.2% year-over-year; net profit before tax fell 2.8% to AUD 113.2 million; net profit after tax declined 4.2% to AUD 78.7 million.

• The company maintained strong market share in IT distribution, pivoting to enterprise and retail as SMB spending declined.

• Q4 marked a return to growth across key segments, with January and February 2025 showing continued strong momentum.

• Earnings per share for FY2024 was 45.66 cents, down 4.4% year-over-year.

Financial highlights

• Statutory revenue increased 0.7% to AUD 2,283.0 million; gross profit rose 2.7% to AUD 324.2 million, with gross margin steady at 9.6%.

• Operating costs (excluding one-offs) increased 6.0%, now 5.4% of revenue.

• Aggregate fully-franked FY2024 dividend was 44 cents per share, down 12.2% from FY2023, with a continued quarterly dividend policy.

• Cash at year-end was AUD 45.8 million, up from AUD 11.6 million, supported by EBITDA and additional funding.

• Debt to equity ratio rose to 1.41x from 1.18x; debt service cover ratio at 6.11.

Outlook and guidance

• Management expects a much stronger FY2025, with early 2025 sales growth tracking at 10% year-on-year in January and February.

• Full-year 2025 sales growth is targeted in the high single digits, with 6%-8% expected for the remainder of the first half due to tougher comps.

• Gross margin is expected to remain in the 9.5%-10% range, with potential upside from SMB recovery and high-margin retail and software segments.

• PBT margin guidance is around 3.5% for FY2025.

• Anticipated tailwinds include the Windows 10 refresh cycle, AI-related deals, cybersecurity, and increased SMB and retail activity.