Premier Farnell has highlighted the very difficult trading conditions in the distribution market as it saw sales and profits fall in the first quarter following on from the weak fourth quarter of last year.
Despite some more positive numbers from the manufacturing sector in recent weeks, the distribution sector is still under pressure as company continue to remove excess inventory from the supply chain.
"Our results for the first quarter saw a further decline in sales as the market trends we saw in the fourth quarter continued into the current financial year, particularly the continuation of industrial and electronic destocking in the supply chain, as well as reduced activity," said company CEO Harriet Green.
Farnell saw pre-tax profit slump by more than 60% to £ 9m in the first quarter on sales of £204.3m
"We remain dissatisfied with our performance and are executing our detailed plans to ensure that we will emerge from this difficult period as a stronger, more agile organisation," said Green.
The catalogue and online distributor expects to make savings in its cost base as it sees more of its business move to web-based sales.
Web sales grew 5% in the first quarter. The result is that Farnell Europe now derives 53% of total sales via the internet.
There was sales growth in overseas markets with Eastern Europe sales up 56% and sales in India up 167%.