10th Feb 2016 08:02
LONDON (Alliance News) - Electrocomponents PLC said Wednesday it is on track to deliver its targeted GBP25 million in yearly cost savings, as it recorded underlying sales growth of 2% in its four months to end-January.
Electrocomponents' underlying sales growth is adjusted for the number of trading days and at constant currency.
The company noted that UK revenue had "stabilised" during the four months, compared to 1% underlying declines in its first and second quarters, and was flat in the four months to end-January.
It suffered declines in the North American and Asia Pacific regions in the four months, whilst Continental Europe saw 10% growth as all major markets in the region performed well.
The electronic and maintenance products distributor said that in the four month period it saw some stabilisation in gross margin, although its year-to-date gross margin is around 1.3% below the previous year, partly as a result of a hit from currency exchange rates.
Electrocomponents said it remains on track for its GBP25 million of cost savings, of which it expects to deliver GBP6 million in the fourth quarter of its current financial year to end-March.
"Our largest business, Continental Europe, continues to show double-digit growth trends, however this is set against the well documented slowdown in the North American industrial market and some near-term disruption in Asia Pacific," said Chief Executive Officer Lindsley Ruth in a statement.
"We are making good progress on our journey to transform the financial performance of this organisation. We are on track to deliver the targeted GBP25 million annualised savings and work continues to identify further efficiencies. These actions mean we are well positioned to make progress in FY17 despite an uncertain and challenging global macroeconomic outlook," Ruth added.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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