Farnell boosts profits despite dollar slump

Premier Farnell has published its results for the fourth quarter and the financial year ended 30th January 2005.

Premier Farnell has published its results for the fourth quarter and the financial year ended 30th January 2005.

Group sales in the year were up 6.4%, and up 4.7% in the fourth quarter.

Marketing and Distribution Division (MDD) sales up 6.3% in the year, with 9.8% increase in North America in the fourth quarter.

Profit before tax was GBP 60.3 million - up 10.0% despite an 11% year on year decline in the US dollar and the disappointing performance of BuckHickman InOne.

Group gross margin was a robust 40.7% in the fourth quarter, continuing the steady improvement during the year MDD e-commerce sales were up 56% in the year.

In the fourth quarter they accounted for 17% of MDD's sales with strong growth in both e-procurement and through websites.

Earnings per share for the year went up 22.2% to 11.0p.

Commenting on the results, John Hirst, Group Chief Executive said: "Premier Farnell continued to make good progress this year".

"We achieved solid growth in sales, and profit before tax rose by 10%, despite the continued weakness of the US dollar".

"After a strong first half, the rate of growth in the North American electronics market began to ease in the third quarter and was showing only very limited growth by the year-end".

"Nonetheless, the group's rate of sales growth in North America held steady in the fourth quarter and we continued to improve gross margin".

"Sales at Farnell InOne reached record levels this year, despite slowing European markets in the second half".

"These sales were helped by a particularly strong performance in mainland Europe".

"Sales at BuckHickman InOne in the fourth quarter were down marginally on the corresponding period last year, although monthly sales per day from November were up sequentially".

"The actions taken, and in hand, give us greater confidence for the recovery of this business in the coming year".

"We continue to make progress on our strategic priorities; developing corporate accounts, expanding our presence with smaller customers, improving product ranges and providing industry-leading service through e-commerce and traditional marketing channels".

"The significant operational improvements made to the business in recent years give us confidence that we can continue to improve our performance and our market share".

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