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Datatec falters in fourth quarter

Datatec Systems Inc. (Nasdaq: DATC) came up shy in its fourth quarter Thursday, earning $369,000, or 1 cent a share, on sales of $23.7 million.

First Call consensus pegged it for a profit of 3 cents a share in the quarter.

The $23.7 million in sales represents a 14 percent improvement versus the year-ago quarter when the computer services provider lost $723,000, or 3 cents a share, on sales of $20.7 million.

For the year, Datatec lost $191,000, or a penny a share, on sales of $93.8 million. In fiscal 1998, it lost $1.2 million, or 5 cents a share, on sales of $76.8 million.

In the quarter, gross margins surged to 37.2 percent, up from 30.6 percent in the third quarter and 36.7 percent in the year-ago quarter.

Its shares closed off 1/32 to 2 7/8 ahead of the earnings report.

Datatec shares hit a 52-week high of 5 3/16 in December after falling to a low of 1 7/8 in October.

The lone analyst covering the stock rates it a "buy.">