12th Feb 2021 10:20
(Alliance News) - Northamber PLC on Friday posted a reduction in its profit for the first half of its current financial year but said it remains optimistic steps taken will result in a positive trading performance for the full year.
Shares in the audio-visual and information technology distributor were trading 1.4% lower at 63.11 pence each on Friday morning in London.
For the six months ended December 31, Northamber posted pretax profit of GBP230,000, a sharp drop from GBP10 million posted the year prior. This was despite revenue rising 13% year-on-year to GBP29.7 million from GBP26.3 million.
During the first half, distribution costs rose 53% to GBP2.3 million from GBP1.5 million and administrative costs rose 8.3% to GBP1.3 million from GBP1.2 million. Additionally, the company didn't record a gain on disposal of property compared to an exceptional gain of GBP10.2 million reported for the first half of financial 2020.
Gross margin increased to 13% from 8.8% as result of its product mix evolving towards higher margin, more technical products.
An interim dividend of 0.3p was declared, unchanged from the year prior.
Looking ahead, Chessington, Surrey-based Northamber said it remains "cautiously optimistic" that investments made in supporting its partners, in addition to removing one-off costs tied to moving warehouse investments, will reflect positively in its results for the full year.
"We necessarily remain cautious due to the economic uncertainty, Brexit and the potential further impact of Covid on demand and the supply chain, but feel strongly that our continued focus on strategic higher margin value categories provides a solid road map for the future with profitable growth opportunities and the ability to unlock long term value for shareholders," added Chair Colin Thompson.
As at December 31, 2020, Northamber had cash of GBP10.8 million, down from GBP14.7 million on the same date in 2019.
By Ife Taiwo; [email protected]
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