Profits down at Premier Farnell after a “difficult” year

PROFITS are down at Premier Farnell after a year of transition.

Chairperson Val Gooding said the business needed to “address a challenging period for Premier Farnell.”

For the 2015/16 year, revenue jumped to £903.9m for the Leeds-based electronics supplier, from £886.6m the year before.

However Premier Farnell were unable to capitalise on this hike, and reported pre-tax profits of £29.2m, down from £54.1m in the 2014/15 year.

Restructuring costs of £13.3m incurred in the year include £11.7m relating to the group’s operational review, involving severance payments, asset write offs, with £6.4m of additional resource to plan the programmes. There was also £1.6m for senior management exit costs.

Costs related to the closure of local operations in Brazil of £1.1m were included and a £1.9m provision was included relating to the successful conclusion of a potential legal action.

Premier Farnell also offloaded its fire safety equipment business Akron Brass on 16 March 2016, selling to the IDEX Corporation for £154m, to enable the business to focus on core activities.

Jos Opdeweegh will be joining as chief executive 11 April 2016 following an “extensive global search.”

Mark Whiteling, interim chief executive officer, commented:”Although we continued to face difficult trading conditions in our North America and UK markets, we are making good progress in achieving increased operating efficiency and are on track to deliver expected cost savings of £19 million in financial year 2017/2018.

“We believe that Premier Farnell is now better positioned to serve its customers and expect our business to make progress during the current financial year as we continue to focus on improving our operational and financial performance.”