Avnet has raised its head above the parapet and claimed an improved business environment as it posted its first quarter 2010 financials today.
The distributor reported Q1 turnover of $4.3bn (£2.6bn) – a 3.1 per cent drop on the same quarter in 2009.
Net profit for the quarter was $50.9m compared with net profit of $90.3m in Q1 2009.
Operating profit for the quarter was $889m, compared with $154.6m a year ago. Restructuring, integration and other items cost $18.1m which meant, without the charges, Q1 2010 profit would have been $107.1m.
Roy Vallee, chairman and chief executive of Avnet, said: “While the impact of the global economic slowdown remained evident in our year-over-year revenue decline, our better than expected sequential growth rates provides additional confidence that the business environment is improving.
“Both operating groups delivered revenue growth at a rate that was above normal seasonality, even excluding the estimated $400 million beneficial impact of the extra week in this fiscal period. This increased volume, combined with higher productivity and record asset velocity, drove a 399 basis point sequential improvement in return on working capital, demonstrating the operating leverage we have built into our model.”
Split into divisions – the overall Electronics Marketing (EM) business saw sales drop 9.8 per cent year on year and Technology Solutions (TS) saw sales increase 6.9 per cent year on year.
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