Falling prices dent CCM figures
The continuing saga of the squeezing of the distribution channel...
CCM Distribution saw profit and sales fall for the six months ended 31 March, due to falling component prices. The Cheshire-based distributor recorded pre-tax profit of £600,000, down on last year's £800,000. This included an exceptional item of £100,000, which resulted from legal proceedings settled out of court with Microsoft. Turnover dropped to £11.08 million, against £12.66 the year before, according to a company statement. Earnings per share were 19 pence from 35 pence. Brent Cutler, CCM Distribution MD said: "In line with our competitors, the half year was affected by falling component prices." CCM chairman Robert Durston blamed growing competition over the last six months, which had hit the industry by forcing down prices and challenging margins. "It is unlikely that the pace of change in this sector will slow but there are still opportunities... Many companies are presently reviewing their computer needs and a significant number of computers are being replaced in anticipation of the year 2000 and with the expansion of the Internet," he said. The group, which floated last July, aims to increase the number of its account managers to 32 by the end of September. CCM said it had so far hired 26 managers, and was confident of hitting its target by the end of its financial year. The company also said it was reviewing acquisition opportunities where it could use its marketing and distribution skills. ®
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