Systemax sales grow and profits too
Profits and sales up
Systemax's investigation into whistleblower allegations against former exec Gilbert Fiorentino added $7m to its Q2 pre-tax profits but the consumer slowdown dented sales growth.
The parent of US retailers Tiger Direct and CompUSA and reselllers Misco and WStore in Europe, has reported profits of $15.5m, up 64 per cent on the June ended quarter a year ago and sales of $872m, a rise of eight per cent.
The firm also revealed its settlement with former Technology Group's divisional CEO Fiorentino added $7m in special gains to the business - net of legal fees - following an investigation into claims made against him.
He was asked to resign in May, repaying $11m in salary and bonuses received from Systemax, and is now the subject of an SEC investigation, while his brothers – also former execs at the firm – are now the focus of a police investigation into a theft at the Miami operation.
During the quarter, B2B sales grew 10 per cent on a constant currency basis to $482.5m as consumer sales stalled, falling 1 per cent to $389.7m. On a like-for-like basis, same store sales fell 4 per cent.
"Our business operations continue to perform well...as customers update their IT infrastructure," said CEO Richard Leeds.
"Consumer channel sales were flat, reflecting a very competitive consumer technology market, particularly on the web," he added. ®