Ideal Hardware was forced to issue a statement last week warning of further gloomy conditions in the storage market, which saw the distributor's share price plunge over 17 per cent in one day.
The share drop followed a statement released by the distributor on 11 June, which stated: '(The market) continues to experience significant product oversupply. This has led to unprecedentedly difficult market conditions.
Trading in the third quarter, historically the strongest period for the company, was significantly below the comparable period last year.'
Despite assurances from Ideal that conditions are expected to improve towards the end of the year, the company's share price immediately plummeted, finishing down 40p to 235p by the close of play on 11 June.
James Wickes, Ideal managing director, said: 'It doesn't look like the stock market took the news too well, but it's silly to be outright bullish.
The stock market is nervous about computer distributors in general at the moment, so we anticipated this reaction.'
Ideal Hardware maintained that the market for data storage will continue to grow at a rapid rate and insisted that it should achieve full-year results in line with expectations.
'Ideal has nevertheless continued to invest in the development of its business, and trading in the fourth quarter to date is well above the comparable period,' claimed the statement. Wickes added that the market was presently much better than it was a few months ago.
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