The downturn in the economy and an upswing in the number of reseller casualties have taken a toll on Surrey-based distributor Northamber which this morning posted results for fiscal 2008.
Revenues for the year to 30 June 2008 showed a 1.4% decline to £179.7m compared to the same period a year earlier as profits rose from £592,000 to £627,000. Profits after tax was £405,000.
However its investment revenues - £567,000 interest received from £13.3m cash in the bank and £35,000 rental income - helped Northamber boost profits to £602,000. Profits from operations fell from £42,000 to £25,000 - a 0.014% operating margin.
"After having shown improvement over the first three quarters, the downturn in the general economic climate during our fourth quarter, resulted in a comparative 1.4% fall in revenue against the prior year," said chairman David Phillips in a statement.
Administrative charges rose albeit marginally to cover credit insurance "costs to provide for customer defaults in the deteriorating economic climate," he added.
Working capital, the lifeblood of all companies, showed "small but favourable movements" said the firm, inventory turns increased from 14.5 days to 16.5, while debtor days fell from 44 to 39 days. Logistics costs were slashed 8% to £6.2m.
However, Phillips' usual forecast for the market were absent in this year chairman's statement. "The expressions of quiet confidence in my statement of prior years, within the present economic uncertainty, are not easily given".
"Within an area of largely discretionary expenditure and a lack lustre start to the year, it is simply not possible to provide any guidance, beyond our determination to continue to manage the balance sheet tightly,"