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Dicker Data Posts Sales Of $2.48B In Record Year

IT hardware and software distributor Dicker Data has enjoy a banner year, with sales jumping 24 per cent to $2.48 billion, for 2021.

The company posted a net profit of $73.6 million, up 29 per cent.

This growth was driven by acquisition, with the company shelling out $68 million to buy IT distributor Exeed, and $20 million for Hills Ltd’s Security and Information Technology business.

During 2021, Dicker Data borrowed almost twice as much as in 2020, adding $230.2 million in debt for the acquisition.

“The idea that you use equity to do an acquisition is just a fundamental mistake, simple as that,” Dicker told AFR. “They should teach that on every MBA course, because the financial system exists to lend money.

“I’m not going to do any acquisitions other than 100 per cent debt. So we borrow money to do the deal, make it work, then issue shares to pay down the debt.”

David Dicker, Dicker Data.

Operating costs for 2021 grew by 15.2 per cent to $2.4 billion, but fell to 4.7 per cent of revenue (from 5.1 in 2020, a sign that, as Dicker said, “the company continues to benefit from scale”.

The group declared a final dividend of US15, fully franked, on total earnings of 42.6 per share.

“Our FY21 result represents over 43 years of experience and a significant growth trajectory,” Dicker said.

“Since being listed on the ASX on 24 January 2011 at an initial market cap of $25 million, today shares have recently traded around $14 with a market cap of just under $2.5 billion.

“This solidifies the company’s status as a true Australian success story and a fast growing and high-returning stock. The commitment of our people and the focus of the company over the last twelve months has demonstrated the flexibility of our business.

“We continue to excel in a challenging environment and deliver a service to our vendors and reseller partner community that they value and is unmatched in the local market.”

Dicker did not provide guidance for 2022, simply saying ““I’m not a forecaster because the forecasts are always wrong.”

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