Harris Technology surges as profit upgraded by more than 50%

By Trevor Hoey. Published at Jun 24, 2020, in Technology

Shares in diversified tech enterprise and personal protective equipment distributor, Harris Technology Group (ASX:HT8) opened 35% higher on Wednesday morning after the company upgraded its profit guidance.

In May, the company forecast revenues of $13 million and a pre-tax profit of $700,000 for fiscal 2020.

However, just one week out from year-end, management has been able to substantially upgrade profit guidance to $1.1 million.

Importantly, this is a significant turnaround from the fiscal 2019 pre-tax loss of $732,000.

Year-on-year comparative figures also highlight the impressive top-line growth that the company is achieving with revenues up from $9 million in fiscal 2019 to a projected $13.5 million in fiscal 2020.

The revised profit and revenue forecasts come on the back of confirmation of strong sales in the month of May and June 2020 to date.

Commenting on the key drivers behind the group’s improvement, managing director Garrison Huang said, “We are pleased by the substantial profit turnaround for FY2020, which has been further upgraded since our previous forecast announced on 26 May 2020.

‘’Strong sales growth continues in our IT division, driven by our strategy of product diversification including mobile accessories, IT consumable products such as inks and toners and gaming products.

“We are also looking to further build on the success of our personal protective equipment (PPE) division, Pro-Hygiene, in the year ahead.”

Anti-virus software emerging as a key source of growth in 2021

Of note, sales of antivirus software have increased as a result of HT8 undertaking a number of marketing campaigns with ESET Australia.

These campaigns included free offers to customers designed to assist them during the COVID-19 pandemic.

Harris subsidiary, APCA Trading, is a platinum partner of ESET Australia, one of the leading antivirus end point vendors in the world.

The company expects that sales of ESET internet security and anti-virus software will increase in coming months.

Harris Technology's broader range of technology products includes HP, Microsoft, Adobe, Lenovo, Brother, Toshiba, Samsung, Asus and Sony, highlighting its strong and trusted relationships with leading brands in the field.

The company has successfully established its own e-commerce site, as well as having a presence on Amazon Australia, Catch, Kogan and eBay.

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

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S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

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