Computacenter reassures on German costs Investors in Computacenter were relieved on Tuesday after the IT services and hardware company said there had been no worsening over the past month of the problems it is facing with a number of contracts in Germany. Last month the company issued a profits warning because it was having to spend an extra £7m on hiring 700 staff in order to deliver five big service contracts that it has won in Germany. The costs were expected to result in a more than 12 per cent drop in earnings before interest and tax this year. Mike Norris, chief executive, on Tuesday said the company had made "naive mistakes" with the contracts but was now much more aware of the issues and making good progress in addressing them. Mr Norris has spent most of the past month in Germany. Mr Norris was also clear that the problems it had experienced in Germany would not be repeated in other regions. "The margins in France are perhaps a little lower than I would like but it is nowhere near the issue we had in Germany," he said. Mr Norris added that the costs the company was taking now, in an effort to keep its big German clients happy, would benefit the company over the long term as it looked to gain more contracts in the region. Shares in Computacenter, which have lost about a third of their value over the past year, recovered by about 3 per cent to 320.9p on relief that the situation appeared to be stabilising. Computacenter, whose clients include Barclays, BMW and Daimler, has been transitioning the business over the past few years from mainly being a reseller of PCs and servers to offering services as well, such as running IT help desks for companies. The Hertfordshire-based business made good progress on this strategy, announcing a number of big service contract wins earlier this year, including five big clients in Germany. In order to deliver those contracts, however, Computacenter has had to hire many more people than it anticipated, wiping out a large portion of profits for the year. Tuesday's trading update showed that group revenues were up 4 per cent in the first half of the year, buoyed by strong growth in the UK. The company said that services revenues in the UK increased 18 per cent in the second quarter to the end of June as a number of its newly won contracts started smoothly. Revenues increased 7 per cent in Germany, after discounting currency effects, and were up 9 per cent in France, in part due to the acquisition of Top Info in 2011. Computacenter will report its interim results on August 31.