Frontline?s status as the number one UK distributor was called into question after the company reported modest profitability and turnover figures for the year to 30 September 1996.
According to the latest figures filed at Companies House, the Basingstoke-based distributor achieved a turnover of #461.8 million and made a pre-tax profit of #2.4 million. This compares with the previous year?s figures of #430.3 million and #6.3 million respectively. Computer 2000, Frontline?s parent company, also collected a dividend of #1.5 million.
Frontline MD Graeme Watt said: ?1995/96 was another profitable year. Although profits were lower than 1994/95, they compare favourably with the main competition.
?A number of changes reduced short-term profitability. The introduction of the SAP computer systems, reduction in vendor portfolio and the cost-reduction programme all impacted on profits in 1995/96. These measures are now delivering increased profitability.?
But observers questioned whether Frontline?s position as the largest distributor meant it could expect to hit high profit levels this year. ?There is a real question whether being the largest in volume will generate the most in value,? said one source.
He added that it would be interesting to see Frontline?s figures for the current financial year, because the results for its high-margin operation, Datech 2000, would be separated from Frontline?s numbers as they trade as two separate subsidiaries.
Watt denied that Frontline?s status as the number one distributor was at risk. He said 1996/97 was proving a much stronger year with significant growth in profit.
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