Dicker Data share price falls on FY22 earnings and dividend decline

A hip young man with a beard and manbun sits thoughtfully at his laptop computer in a darkened room, staring at the screen with his chin resting on his hand in thought.

A hip young man with a beard and manbun sits thoughtfully at his laptop computer in a darkened room, staring at the screen with his chin resting on his hand in thought.

The Dicker Data Ltd (ASX: DDR) share price had a tough time on Monday.

The technology hardware, software, cloud, access control and surveillance distributor’s shares ended the day almost 3.5% lower at $8.00.

This followed the release of the company’s audited full-year results for FY 2022.

Dicker Data share price lower on results release

  • Total revenue up 25% to $3.1 billion
  • Earnings before interest, tax, depreciation and amortisation (EBITDA) up 9.4% to $129.8 million
  • Net profit after tax down 0.7% to $73 million
  • Full-year dividend down 1.2% to 41.5 cents per share

What happened during FY 2022?

Today’s results didn’t contain many surprises given that its unaudited numbers were released earlier this month.

For the 12 months ended 31 December, Dicker Data reported a 25% increase in revenue to $3.1 billion. This was driven by an 18.4% increase in Australian revenue to $2,554.7 million and a 68.1% jump in New Zealand revenue to $550.1 million.

From this, software recurring and subscription revenues across ANZ increased by 42.5% to $743.9 million. This represents approximately 24% of total revenue.

In respect to the company’s earnings, they weren’t as strong due to margin pressures. This was driven by lower-than-expected gross margins in the New Zealand business and higher operating costs. The latter was caused by its decision to invest in servicing the new customer and vendor relationships it obtained following the acquisition of the Exeed and Hills businesses.

This ultimately led to a 0.7% decline in net profit to $73 million and a 1.2% reduction in its dividend to 41.5 cents per share.

Management commentary

Dicker Data’s COO, Vlad Mitnovetski, commented:

Our performance throughout the FY22 period was strong, delivering a significant increase in revenue and delivering a gross margin of over 9.0%, in line with our guidance. Despite the one-off integration costs and significantly increased wages from onboarding hundreds of new staff, we delivered an outstanding result inside of the factors we can control.


Management appears optimistic on the year ahead and is expecting a “prosperous year.” Particularly now the headwinds that it has been facing are almost behind it. It added:

Market demand for some technologies, such as devices, is expected to soften in FY23. The disruption caused by the pandemic, the thirst for digital transformation and the need to support hybrid workforces spurred an unnatural level of demand that has remained constant. This demand is expected to continue in 2023 despite the market dynamics settling and become more predictable. Technology refresh cycles are expected to return to pre-pandemic intervals and we expect enterprise and government to drive market demand in 2023 as they embark on the next phases of their digital transformation, while SMB spending is expected to abate. These dynamics create a unique opportunity for the Company.

The post Dicker Data share price falls on FY22 earnings and dividend decline appeared first on The Motley Fool Australia.

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More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Dicker Data. The Motley Fool Australia has positions in and has recommended Dicker Data. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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