Northamber said it would be "wrong to be optimistic" as it weighs the chances of an upturn in the economy after the first six months of its financial year saw revenues slump 30 per cent.
The veteran distributor turned in revenues of £68m for the six months ending December 31, compared to £97m a year ago, while last year's £453,000 pre-tax profit morphed into a £304,000 loss this time around.
Despite the massive sales slump, the firm did not see that it was out of step with the market, saying, "The trend over our first half-year with turnover almost 30 per cent lower, also reflected UK sector statistics for sales of commercial hardware I.T. equipment....The general and continuing uncertainty within the economy, and the market as a whole, remains the dominant feature of our marketplace."
At the same time, it said, "Because of our financial strength and being able to offer both our suppliers and our customer's opportunities, the rate of gross margin is slightly better at 6.9 per cent than when compared with 6.5 per cent a year ago."
Northamber emphasised its policy of conserving cash and keeping a firm balance sheet. Unsurprisingly the firm decided to cut its dividend to 0.6p per share, half what it paid out last year.
Making virtue out of a necessity, it said that "With our strengths in distribution, together with what is becoming an essential re-engineering of the current model, we are well placed to evolve better trading practices with our partners in the trading cycle."
But, the firm doesn't expect the cycle to rev up anytime soon, with chairman David Phillips, concluding, "There seems little doubt that it may take some time before there is any noticeable upturn in the sector, therefore it would be wrong of me to be optimistic."®