Softcat PLC (LON:SCT) shares rose on Wednesday after the IT infrastructure group said it expects its results for the full year will now be “ahead of expectations” following a strong third quarter.
In an update for the three months to April 30, the FTSE 250 firm said it had “continued to trade” well and had built upon its “exceptional first half performance”.
READ: Softcat says full-year results to significantly top expectations
Softcat said it had delivered double-digit year-on-year growth in revenue, gross profit and operating profit in the third quarter, adding that its run-rate transaction volumes had also strengthened while cash collections and conversion “remained good”.
Looking beyond the year, the group said it expects cost savings relating to the Coronavirus pandemic to reverse as it entered its next financial year as travelling to customers and internal events becomes possible again, while also highlighting that in the current year the company has seen some of its largest deals ever transacted, significant elements of which were “one-off in nature”.
As a result, Softcat said these two factors contributed around £12mln to earnings (EBIT) in its current financial year, and while it remained confident of the road ahead and expected to see further growth on normalised EBIT in its 2022 financial year, earnings for the coming year will likely be “broadly in line with the upgraded performance now anticipated for [2021]”.
The forecast upgrade sent the shares up 4.2% to 1,880p in early trading.