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By | Paul Kunert 10th August 2012 09:22

BrightPoint bosses steer biz to Q2 losses

Subject of Ingram Micro's $850m bid hit by one-off charges

BrightPoint recorded significant losses for calendar Q2 just as Ingram Micro was preparing to table an offer of $850m for the wireless device and services distie.

In results filed last night, the firm turned over $1.27bn (£814m), up three per cent year-on-year for the period ended 30 June. This included $1.14bn from product wholesaling and $125.7m from logistics services.

In spite of the sales split, the device distribution biz made a gross profit of $34m and the services unit made $44.7m, leaving it with a group gross profits of $78.7m, down 15 per cent year-on-year.

This compares to Ingram's recent Q2 gross margin of 5.16 per cent. So it looks like the logistics services arm was the shiniest unit in the group, during Q2 at least.

But strip out £62.5m for selling, general and admin expenses, $6.7m for merger and acquisition costs, a $6.4m write down of goodwill and $2.1m restructuring charges and BrightPoint made an operating profit of $802,000 down from $13.8m a year earlier.

Then extract tax, miscellaneous overheads costs and the loss from continuing operations stood at $4.7m compared to a loss of $1.6m in Q2 a year earlier.

BrightPoint spokespeople didn't have much to say about the numbers - company folk seldom do when they have an offer on the table.

But it did reveal certain pressure points - the gross profit was down largely due to the "current competitive and economic environment in EMEA" in which it cut prices to reduce inventory levels.

Average sales prices in Asia were also under pressure due to intense rivalry between the distribution protagonists and in North America it simply sold fewer devices due to heightened competition.

BrightPoint said the total amount Ingram is expected to pay is now closer to $820m based on common stock including the assumption of $165m in outstanding debts. ®

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