Data#3 Reports Strong Half-Year Growth with Gross Sales Reaching $1.5 Billion

Data#3 Achieves Significant Gross Sales Increase in First Half FY26

Brisbane, Australia – Data#3 Limited (ASX: DTL), a prominent Australian business technology solutions provider, today announced its financial results for the half year ended 31 December 2025 (1H FY26). The company reported a substantial 9.2% increase in gross sales, reaching $1.5 billion. This growth outpaced the broader Australian IT market's growth rate of 8.7% for the period.

The strong performance was underpinned by an 8.1% rise in statutory revenue, which reached $423.1 million. Net Profit After Tax (NPAT) saw a 3.7% increase to $23.2 million, while Net Profit Before Tax (NPBT) grew by 4.5% to $33.5 million, aligning with the company's guidance range of $32 million to $34 million.

Financial Highlights and Shareholder Returns

Data#3's financial report detailed several key metrics reflecting its continued operational strength:

• Gross Sales: Up 9.2% to $1.5 billion
• Statutory Revenue: Up 8.1% to $423.1 million
• Gross Profit: Increased by 0.3% to $144.0 million
• EBIT (Earnings Before Interest and Tax): Rose 6.2% to $27.6 million
• NPAT (Net Profit After Tax): Grew 3.7% to $23.2 million
• Basic EPS (Earnings Per Share): Increased 3.6% to 14.95 cents per share
• Interim Dividend: A fully franked dividend of 13.50 cents per share was declared, representing a 3.1% increase and a payout ratio of 90.3%.

The company also maintained a robust financial position with a strong balance sheet and no borrowings, reporting closing cash of $125.4 million.

Segment Performance and Growth Drivers

The growth was primarily driven by strong performances in specific business segments. Software Solutions achieved record gross sales of $1.1 billion, an increase of 8.9%, fueled by demand for security products and cloud subscriptions. However, the gross profit contribution from this segment was impacted by changes to Microsoft's incentive programs, which took effect from 1 January 2025, resulting in a 4.6% fall in gross profit for the segment.

In contrast, Infrastructure Solutions delivered exceptional growth, with gross sales surging 17.6% to $275.2 million and management profit more than doubling. This segment benefited from over 30% growth in end-user devices and robust data centre sales. The Services business experienced mixed results, with solid growth in Managed Services and Consulting, driven by significant contract renewals and new wins. However, Project Services and People Solutions (recruitment) faced challenging market conditions, leading to underperformance in those areas.

Management Outlook and Strategic Focus

Brad Colledge, Data#3's Managing Director and Chief Executive Officer, expressed satisfaction with the results, stating, 'We are pleased to report gross sales growth of 9.2% to $1.5 billion for the first half of FY26, and above the Australian IT market growth rate of 8.7%.' He acknowledged the anticipated impact of Microsoft incentive changes on Software Solutions but highlighted the strong growth from the Infrastructure business.

Looking ahead, Data#3 is 'well positioned to deliver sustainable growth through FY26,' supported by the resilience of its core business and strong customer relationships. The company anticipates a return to gross profit growth in the Software business in the second half of FY26, continued growth in Infrastructure, and a resumption of growth in Services. Management also identified Artificial Intelligence (AI) and Windows 11 refresh-driven infrastructure demand as key tailwinds for continued growth.