Buoyed by strong results in the Americas region, Dimension Data, one of the leading global solution providers, reported revenues of $4.74 billion which is up close to 20 per cent from the previous year.
The Americas region, which includes Canada, grew revenues by 34 per cent in during this period sporting an operating profit of $22.1 million.
A large part of the success came from the Canadian operation. The NTT takeover was a non-factor said Jere Brown, CEO of Dimension Data Americas, as most of the revenue was “pretty much baked” before the July 15th announcement. “We were rolling along and business across the board in the Americas was great,” he said.
Canada supported the revenue gains to the tune of 41 per cent. What made Dimension Data Canada’s performance so astonishing is that it was done from scratch. It was all organic growth, according to Brown.
In the Americas region, the U.S. theatre is the obvious biggest market followed by Brazil and then Canada and Mexico. The difference for Brown is that the Brazil operations came from Dimension Data acquiring controlling interest in Datacraft Brazil in 2007. Datacraft was one of the largest IT services and solutions companies in the country.
Dimension Data Canada distinguished itself with its virtualization, unified communications, collaboration and video business along with its new professional services, according to Brown.
“Canada was all organic and Wendy Lucas and Darryl Wilson built it from the ground up. To compare the Canadian operation with Brazil is very hard to do. Each country is different and the cultures are different. The maturity of the market is different. Canada unlike Brazil does not support many multi-national clients. They have five large banks to Brazil’s 25. They have a different client base. In Sao Paulo you have 26 million people (almost the same population as Canada, which has 33.7 million) and that’s my point. I recognize the challenge the Canadian team has doing it from scratch and the way Wendy and Darryl did I have a great appreciation and respect for that,” Brown said.
Another key factor was managed services which grew 27.4 per cent. Brown said that clients are looking to a partner with managed services to help them off load core functionality that they used to do internally. Dimension Data’s approach was to provide everything for clients and provide a predictable spend. Brown said that some clients looked to managed services for help with assets off balance sheet, to shed employees or for the solution provider to take over the IT staff.
In the U.S., the country’s economic recovery was a boon for South African-based solution provider.
However, Brown was cautious to say that while the U.S. recovery was excellent from a Dimension Data standpoint it’s still not fully recovery from recession.
“It’s not back to business as usual. The clients I deal with, and I’m active with C-level clients, all those companies are having introspection on how they do business. We will never see business as usual again. The other part of that is the tight economy. Clients will look for new way to consume technology and the cloud became viable alternative rather than buying assets. For me the cloud is another consumption model. It’s like time sharing in the 70s. That was a cloud model and in my opinion and for me ‘business as usual’ no longer exists in the U.S., Canada and Mexico who are impacted by the U.S. economy.”