VIP profits fall again in ‘difficult year’

PC components distributor VIP Computer Centre has recorded a near 10% fall in profits in a year it called “the most difficult in the company’s history”.

The Warrington-based company, which employs 158 staff, reported a turnover of £159.7m, a 2.1% fall on the previous year.

The company said the fall in sales was down to a more pragmatic selection of business opportunities because of credit risks, as well as a general reduction in sector activity.

The company’s European division, VIP Benelux BV, contributed to more than 50% of total group turnover, with sales of £82.6m.

Pre-tax profits fell 9.3% to £2.04m, for the year to the end of June 2009, from £2.25m a year earlier.

A combination of lower sales and pressure on margins meant gross profit was reduced by £197,000, although the company offset this by reducing overheads by £204,000.

“Against this backdrop the directors are very pleased with the trading results and the overall performance as the company continues to report a healthy profit and a strengthening balance sheet,” the directors said in their report.

The group said that over this current financial year it plans to introduce new services to customers that will enhance its margin opportunities.

VIP paid a dividend of £150,000 for the year.