Lesley Stones
8 October 2008
Johannesburg — STAFF recruitment and retention has become a serious problem for technology company Datacentrix, with staffing costs spiking 20% as it pays higher wages and offers more advanced training for its top technicians.
The need to find top skills to offer more complicated services had also dented its empowerment profile, since top-tier technicians were still largely white, chairman Gary Morolo said yesterday as Datacentrix issued results for the six months to August .
Headline earnings per share rose 21% from 22,2c to 26,8c on a revenue almost flat at R699m. The operating margin nudged up from 9,6% to 10,5% as it offered more complex services around its products, and an interim dividend of 13c per share was declared.
Morolo said it now had to address the key issues of black staffing and shareholding, as its black profile had slipped a fraction. It also had to incentivise a new cadre of managers, probably by rewarding them with a greater stake in the company.
"People are very mobile because their skills are highly sought. Fighting to hold on to our management and talented staff has become a continuing battle. The cost of holding on to staff has risen quite significantly."
The company expected a better second-half performance as a number of contracts it expected to win had been delayed by its clients. "It's not quite the results we'd like to show but a lot of the deals we expected in the first half are materialising in the second half," Morolo said.
Areas where it expects most growth include technology outsourcing, data security and archiving and mobile computing technologies.
CEO Ahmed Mahomed said its focus was on expanding its offerings to existing clients and winning new clients, although that was tough as it meant winning business away from incumbent suppliers.
Government contracts accounted for about 40% of its work but that would rise if it won some tenders it was bidding for. That could offset the risk that the private sector was tightening its belt.
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