Datatec, a leading technology and ICT solutions group based in Johannesburg and led by South African businessman Jens Montanana, reported a 14% increase in net profit to $67.5 million for the first half of its 2027 fiscal year, supported by stronger performances from Westcon International and Logicalis International.

The company’s results for the six months ended Aug. 31, 2026, showed revenue rising 13.9% to $2.02 billion from $1.78 billion in the same period last year. Gross invoiced income increased 18% to $4.84 billion, while gross profit climbed 5.8% to $511.2 million.

Despite the growth in revenue and net profit, operating profit declined 11.4% to $95.5 million, reflecting higher operating costs and weaker results from Logicalis Latin America.

Stronger earnings and shareholder returns

Datatec’s half-year financial results showed that adjusted EBITDA increased 16.6% to $150.7 million from $129.2 million a year earlier, while basic earnings per share rose 6.5% to 23.1 US cents. Underlying earnings per share increased 56.5% to 30.2 US cents, reflecting improvements in the group’s underlying earnings performance.

Net finance costs fell significantly to $6.9 million from $21 million in the prior-year period, helping lift profit before tax to $88.5 million from $86.4 million. The group’s effective tax rate declined to 23.7% from 31.5%, while profit attributable to equity holders of the parent rose 9% to $54.7 million.

Chief Executive Jens Montanana said the group’s financial performance reflected Westcon’s continued strength and record results from Logicalis International, although operating results in Logicalis Latin America remained weak. He added that sustained demand for artificial intelligence infrastructure supported a robust full-year outlook.

Datatec declared an interim dividend of 250 South African cents per ordinary share, equivalent to R2.5 ($0.15) a share. The company will distribute R843.94 million ($50.74 million) to shareholders, which will be in proportion to a Shareholder’s ordinary shareholding in Datatec at the close of business on the Record Date, being Friday, December 4, 2026. It has also declared a special dividend of R29 South African rand per share following a refinancing transaction involving its Westcon International business. The transaction returned approximately $438 million to shareholders, bringing cumulative shareholder returns since the company’s inception to $1.5 billion.

Westcon and Logicalis International drive growth

Westcon International, Datatec’s technology distribution business, recorded gross invoiced income of $3.37 billion, up 21.3% from $2.78 billion a year earlier. Gross profit increased 4.4% to $256.6 million, while adjusted EBITDA rose 13.5% to $86.7 million.

Logicalis International also delivered strong results, with gross invoiced income climbing 18.2% to $1.23 billion. Gross profit increased 15.3% to $210.5 million, while adjusted EBITDA surged 36.3% to $71.4 million, compared with $52.4 million in the prior-year period.

However, Logicalis Latin America faced mounting pressure. Gross invoiced income fell 16.2% to $218.7 million, while gross profit declined 24% to $39 million. The division recorded a $500,000 adjusted EBITDA loss, compared with a positive $11.8 million in the same period last year.

The contrasting performances underscore the importance of Westcon and Logicalis International to Datatec’s overall earnings growth, as weakness in Latin America offset part of the gains elsewhere.

Westcon refinancing unlocks $438 million dividend

On Aug. 4, 2026, Westcon completed a refinancing and minority investment transaction with funds associated with General Atlantic, establishing a standalone capital structure for the business while allowing Datatec to retain control.

The transaction included a new six-year, $375 million senior secured debt facility carrying a 9% interest rate. Together with $75 million drawn from Westcon’s existing financing facilities, the proceeds repaid a $450 million intercompany shareholder loan, alongside accrued interest.

General Atlantic also invested $25 million to acquire a 5% interest in Westcon International Group Holdings Limited, the intermediate holding company of the Westcon group. The arrangement included warrant shares and a restructuring of the management incentive plan to align management interests with the business’s post-refinancing capital structure.

Datatec said the transaction would strengthen Westcon’s financial independence, provide access to General Atlantic’s institutional capital and industry expertise, and support the division’s growth strategy.

Datatec maintains focus on global ICT demand

Founded in 1986, Datatec is a leading provider of ICT solutions, focusing on software and cloud services, including Infrastructure as a Service (IaaS) and Software as a Service (SaaS). Listed on the Johannesburg Stock Exchange since 1994, Datatec operates in more than 50 countries across North America, Latin America, Europe, Africa, the Middle East and Asia-Pacific. The group was also admitted to the OTCQX trading platform in the United States in 2025.

Datatec’s principal operations comprise technology distribution through Westcon International and integration and managed services through Logicalis International and Logicalis Latin America. Total assets increased 22.74% to $5.42 billion from $4.42 billion, reflecting an expansion in the group’s asset base. Retained earnings, however, fell 64.52% to $201.73 million from $568.66 million.

Datatec’s first-half results highlight the contribution of its technology distribution and international services operations, alongside the challenges facing its Latin American business. With demand for artificial intelligence infrastructure creating new growth opportunities and a significant capital return to shareholders, the group is looking to sustain its performance in the second half of the 2027 fiscal year.