Feeds

Distie giant Tech Data's profits collapse amid beancounter probe

Wholesaling titan files delayed numbers for part of fiscal '14

Business security measures using SSL

Fresh from restating P&L accounts for fiscal 11', '12 and '13, box-flinging demon distie Tech Data has released some delayed numbers for the nine months to 31 October and they make for happy reading… if you are a rival.

The world's second largest tech wholesaler earlier this month published a report on the embarrassing accounting debacle that cost it tens of millions of dollars in reduced profits and auditor fees, and wiped out billions in sales over a three-year period.

And it seems the 11-month accounting probe hogged managements' attention during fiscal '14: sales for the nine months to the end of October rose five per cent year-on-year to $18.8bn, but exclude the $1.6bn contribution from acquired SDG and turnover actually declined five per cent.

Unusually for a US-headquartered biz, Tech Data derives 40 per cent of its sales from the Americas, and these were up four per cent to $7.5bn. In Europe, revenues edged up six per cent in constant currency to $11.3bn but removing the positive impact of SDG, they dropped nine per cent.

"The decrease in net sales excluding SDG is primarily attributable to weak economic conditions in certain countries, as well as a decline in market share in several countries resulting from competitive pressures and a focus on gross margin percentage," said Tech Data in a canned statement.

Gross margin for the group in the first three quarters of fiscal '14 slid to 5.12 per cent from 5.2 per cent due to "the product mix and the competitive environment in the Americas, and higher inventory costs in Europe", it said.

Sales, general and admin costs bounced to $828.5m from $727.5m, in part due to overheads associated with the SDG buy, but also because of "a lack of leverage resulting from lower sales in the legacy business in Europe". Tech Data also factored $15m worth of restatement expenses into the P&L.

This all took a rather nasty toll on operating profits, which tumbled 37 per cent to $129.8m from $206.4m for the same nine month period a year earlier. Net profit fell to $70.2m versus $139m.

Preliminary numbers for Q4 '14 ended 31 January indicate consolidated sales of $8bn, representing a mid-single digit gain on the year-ago period, but final results will be filed in an Annual Report 10-K form.

The company has until 30 June to get this lodged with the SEC, after it was granted an extension by the NASDAQ hearings panel to get its financial filings up to date, after falling out of compliance with stock market regulations. ®

Reducing the cost and complexity of web vulnerability management

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
JINGS! Microsoft Bing called Scots indyref RIGHT!
Redmond sporran metrics get one in the ten ring
Driving with an Apple Watch could land you with a £100 FINE
Bad news for tech-addicted fanbois behind the wheel
Murdoch to Europe: Inflict MORE PAIN on Google, please
'Platform for piracy' must be punished, or it'll kill us in FIVE YEARS
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Sony says year's losses will be FOUR TIMES DEEPER than thought
Losses of more than $2 BILLION loom over troubled Japanese corp
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
Protecting users from Firesheep and other Sidejacking attacks with SSL
Discussing the vulnerabilities inherent in Wi-Fi networks, and how using TLS/SSL for your entire site will assure security.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.