Distributor Tech Data, parent company of Computer 2000 in the UK, has posted a massive slump in profit in its third quarter fiscal 2007 results.
The company recorded net profit for the quarter of $9.6m, based upon Generally Accepted Accounting Principles. This compared with $23m in net profit for the same period last year.
Turnover for Tech Data was $5.4bn for the third quarter of its fiscal 2007, a seven per cent rise from the $5.1bn achieved in the same quarter of fiscal 2006. Sales in EMEA totaled $2.83bn, accounting for 52 per cent of worldwide turnover and an 8.2 per cent increase year on year and a 15 per cent increase from Q2 fiscal 2007.
The distribution giant blamed the completion of its EMEA restructuring programme, which was launched in May 2005, for the crash in profit. The firm said that the restructuring programme cost $6.1m in charges; comprising $4.8m in workforce reductions and $1.3m in facility costs. Since May when the restructuring programme started, it has cost the firm a total of $54.7m in charges.
Robert Dutkowsky, chief executive of Tech Data, said: "The third quarter results exceeded our expectations, driven by revenue growth in EMEA and solid performance in the Americas. The conclusion of our EMEA restructuring programme will allow us to focus more intently on new opportunities with our business partners and customers."
Further reading
Tech
Data appoints new CEO
reader comments