April 24 Computacenter Plc said it
expects to make only a modest progress in performance this year
due to the impact of ongoing contractual issues in Germany and a
weak French business, sending the company's shares down nearly
The stock was trading at 470 pence at 0747 GMT on Wednesday,
making it the biggest percentage loser on the FTSE 250 Midcap
The company that supplies and services IT equipment and
advises customers on IT strategy, said revenue from Germany -
its second largest market - declined 7 percent to 280.6 million
pounds ($428.9 million).
Computacenter said three contracts in Germany "remain
stubbornly financially and operationally challenging" and may
result in an increased provision this year for costs in future
The company said revenue from France grew 2 percent to 107.4
million pounds, but warned that 2013 would be a tough year for
Computacenter in the country.
"The challenging economic environment in France has resulted
in a distinct lack of professional services projects which
affects our services margin and our performance on the bottom
line. We see very little prospect of this abating this year,"
the company said.
Investec analyst Julian Yates said he cut his 2013 earnings
estimates for the company, as he previously expected the worst
of the 2012 contract issues were factored into the numbers and
had viewed the French business as being stable.
"The progress in the UK is being hindered by these headwinds
... Progress has been made, but we were too early in drawing a
line under 2012 issues."
($1 = 0.6542 British pounds)
(Reporting by Abhirup Roy and Brenton Cordeiro in Bangalore;
Editing by Roshni Menon)