Tech Data profits evaporate
Computer 2000's parent, Tech Data saw its shares rise slightly yesterday, despite the company posting a big fall in first quarter profits.
The distie watched turnover fall by 2.4 per cent to $4.9bn for the first quarter of 2007, ended 31 April 2006.
Profits also fell sharply - from $33.5m in the first quarter of 2005 to $12.9m this year. The company blamed restructuring costs for the shortfall. During the period it sold off its European training business Azlan Training to Global Knowledge for an undisclosed amount.
Gross margins also declined from 5.22 per cent a year ago to 4.8 per cent.
In Europe the firm spent $4.9m sacking staff and $1.6m writing off fixed assets. It espects the total cost to reach or exceed the high end of estimates.
Looking forward, Tech Data forecasts restructuring costs in Europe of between $11m and $13m in the current quarter. It predicts net sales of between $4.95bn and $5.1bn and profits of $17m and $20m.
See all the figures on Tech Data's website here. ®