Acal component sales grow 9% but IT products provide black spot - Embedded.com

Acal component sales grow 9% but IT products provide black spot

LONDON — Overall sales at Acal fell 3% to £261million whilst operating profit before goodwill amortisation at £13.3million was down 8% in the year to the end of March.

Staff numbers were reduced and a reorganisation implemented in the UK Electronic Components and IT Product businesses.

According to Chairman, Richard Moon who took over the post on April 1 following the retirement of John Curry, the group will continue to review its strategy and expects further consolidation in the Electronics Components sector and Acal expects to play an active part in this process.

The Electronic Components Division produced an increase in sales of 9% to £100.1million with a 6% improvement in EBITA up from £3.4million to £3.6million. Acal says the improvement has come not from an increase in the available market, which grew at less than half its growth rate, but from a combination of factors which lie at the heart of its electronic components strategy. These comprise the continued focus on demand creation, which it believes not only differentiates Acal from most of its competitors but also provides enhanced margins, greater customer loyalty, increased supplier support and superior staff satisfaction.

As a result it has been able to expand our product coverage, particularly in the key area of niche semiconductors where historically it have not been sufficiently represented. This has had a two-fold effect – firstly of course that of expanding sales – but almost as importantly it provides an important rationale for new customers to consider Acal as their preferred supplier. With consolidation taking place in the component distribution market Acal anticipate that its supplier portfolio and the geographical coverage of its existing suppliers will continue to grow.

The Industrial Controls Division had sales up 10% to £20.6million and EBITA up 14% from to £1.6m. Sales in Russia, India, the Asia Pacific region and via the medical instrumentation business have been good.

Sales of IT Products declined 10% in the year from a restated to £88.7million with EBITA down 33% to £2.9million. The major part of the profit reductions are as a result of price and margin erosion in our storage networking business in the UK and Germany. Volumes steadily increased but not sufficiently to offset this erosion.

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