Ingram Micro says its UK sales were down in Q1 – partly as a result of it losing a unnamed retail customer – as its overall results for the period ending 2 April fell short of Wall Street expectations.
Global IT spending in the first two months of the year was "muted", Ingram CEO Alain Monié said as he introduced the results, which showed overall sales tumbling 12 per cent year on year to $9.3bn (£6.4bn).
Total net profits slumped from $43.3m to $1.9m as a European restructuring drive hit the bottom line hard.
Ingram incurred net reorganisation costs of $16.6m during the quarter, primarily in relation to employee termination costs in Europe. Headcount was cut by 358 staff during the three-month period.
In Europe, losses from operations reached $18.4m, compared with a profit of $6.92m a year previously.
European sales fell 13.4 per cent to $2.66bn, despite its recent acquisitions of Anovo, DocData and Dupaco boosting sales to the tune of three percentage points.
Changes to the way Ingram recognises revenues with some of its vendors in Europe hit local sales by eight percentage points, Ingram said, with the weakening euro robbing it of another two percentage points of sales.
Putting aside these anomalies, Ingram said its European sales decline was driven by Germany, the UK and France.
"UK revenues declined primarily due to continued weakness in demand for PCs and the loss of a large retail customer, which was partially offset by growth in smartphone, tablet, and networking sales," it said.
The world's largest distributor's results come a day after rival Avnet announced a $25m cost-cutting drive after reporting a fall in quarterly sales.
Monié said Ingram's planned merger with Chinese conglomerate HNA Group is on track to close in the second half of 2016.
"We saw stabilisation of global IT demand in March, which has continued into April. However, IT spending was muted in the first two months of the year, particularly for high-volume categories including PCs, smartphones, servers and storage," he said.
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