Data#3 turns to Telstra, Microsoft and the cloud in 2011

Cloud services and a supply chain overhaul to drive growth for the listed IT services provider

Listed ICT services provider Data#3 (ASX:DTL) has flagged cloud services as a major adjunct to its services and hardware offering in 2011.

Speaking to Computerworld Australia Data#3 managing director, John Grant, said the company was currently concluding a deal with Telstra which will see it provide its national customer base with Microsoft’s Business Productivity Online Services (BPOS) software hosted on the Telstra’s cloud.

The BPOS suite includes cloud-based version of Microsoft Exchange, SharePoint, Office Live Meeting, and Office Communications and will help the company target customers who no longer wanted on-premise software.

“Customers are looking at different ways of absorbing technology and one of those ways is through the cloud,” Grant said. “Our view of the cloud is that it is real, but at the conversation stage primarily. However, over time there is undoubtedly going to be services provided to our customers in the form of the cloud and we want to be a part of that.”

In light of this, Data#3 would also be shortly launching a consultancy business to help define where cloud-based services could assist customers, and as a driver of sales of its own cloud offerings, Grant said.

Despite the demand for cloud-based services, Grant said the company was expecting growth in hardware-based sales, particularly around HP, IBM and Cisco kit and in its on-premise software sales, largely around Microsoft.

As a result, Data#3 was currently carrying out a multi-million dollar supply chain refresh aimed at improving the way the company processed orders, deliveries and invoices as well as logistics issues such as where the company warehoused stock and located its configuration centres. It also includes developing new services to better integrate the company's supply chain with customers.

“We are now a very significant provider of products into the market… so we have traditional supply chain issues and supply chain opportunities,” Grant said. “…Our business has grown to the point where we have needed to refresh that whole area and that is why we are making a significant investment.

“We think it is an investment that very few of our competitors have been making and that’s why we see it as a competitive advantage.”

In keeping with growth off the back of the mining boom, Grant also signalled plans to expand the company’s WA-based operations through leveraging its success in software licensing solutions to begin providing IT infrastructure-based services and hardware.

As reported by Computerworld Australia Data#3 in August recorded its ‘best ever’ year, bringing in a net profit after tax of $10.9 million for the year to 30 June 2010, up 11 per cent on 2009.

Revenues also grew during the year to $599.2 million, up 13 per cent, while earnings per share grew to 70.88 cents, up 11 per cent. Earnings before interest, tax depreciation and amortisation (EBITDA) were $16.3 million, up 12.4 per cent.

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