Dicker Data (DDR) H2 2024 earnings summary

Executive summary

• FY2024 gross revenue rose 2.9% year-over-year to AUD 3.4 billion, driven by subscription and software sales growth, with recurring software sales up 7.5% and comprising up to 29% of total sales.

• EBITDA was flat at AUD 150.4 million, while net profit before tax declined 2.8% to AUD 113.2 million; net profit after tax fell 4.2% to AUD 78.7 million.

• Q4 2024 saw a strong rebound, with gross sales up 9.9% and profit before tax up 21% compared to Q4 2023, and early 2025 showing continued strong momentum.

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

• Total dividends paid for FY2024 were 44 cents per share, with a continued quarterly dividend policy.

Financial highlights

• Gross profit increased 2.8% 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, mainly due to higher bad debt provisioning and write-offs.

• Cash at year-end was AUD 45.8 million, up from AUD 11.6 million, reflecting strong liquidity.

• Inventory levels increased to AUD 286.7 million, with inventory days rising to 34.

• Aggregate fully-franked FY24 dividend was 44.0 cps, down 12.2% from FY23.

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, and increased SMB and retail activity.