The full effect of the winter downturn is demonstrated in the starkest possible way by Premier Farnell's first quarter results.
Total profit to Jan 31 plummeted 63 per cent to £9m against £24m in the corresponding quarter last year. Revenues were off 15 per cent at £199.3m from £204.3m the previous year.
Chief executive officer Harriet Green (pictured) pulled no punches. "We remain dissatisfied with our performance and are executing our detailed plans to ensure that we will emerge from this difficult period as a stronger, more agile organisation," she commented.
"Through decisive actions to further embed the strategy and strong management of costs, the board believes the company is improving its posityion to seize the opportunities for growth that exist in our chosen segments, now and into the future, " she added.
On the upside Green reported year on year sales performance in April and May showed an improvement over March.
And she argued that the company's strategic assumptions are being validated in the market place.
"Sales to electronic design engineers are outperforming maintenance, repair and operations sales globally and are less impacted by declining global markets," Green observed. "Our growing portfolio of products and services to meet the demands of this segment is attracting new customers and the demand for web excellence continues as increasing levels of business are transacted via e-commerce channels."
Web sales for the distribution business grew five per cent in the first quarter and Farnell Europe achieved 53 per cent of sales via e-Channels. Other bright spots were east Europe where sales grew 56 per cent and india where sales shot up 167 per cent.
Cost actions continues at the company, and the target is to achieve a permanent two percentage point reduction in operating expenses as a percentage of sales.
The company's strong cash performance will at least cheer the City folk. It represented 149 per cent of underlying profit compared with 91 per cent in the first quarter last year.
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