By Paul Kunert
21 July 2008
Bell Microproducts has ground out three per cent growth in revenues according to preliminary data for the second quarter but the enterprise distributor gave no indication that market conditions will improve this year.
For the three months ended 30 June, Bell said revenue would be between $960m (£481m) to $970m.
“We generated modest year-over-year revenue growth in the second quarter despite the economy and slower technology spending,” said Don Bell, president and CEO at the distributor.
Turnover in Europe, approximately 43 per cent of the company’s total sales, grew three per cent compared to a year ago with the enterprise Solutions product category growing at the same pace, buoyed by 27 per growth of storage sub-systems.
Revenue in North America, which accounts for 41 pr cent of total revenues, declined two per cent year-on-year. Sales in the distribution business fell 15 per cent but ProSys, Bell’s mid-market and public sector integrator arm grew 32 per cent.
“Disk drive sales in North America and Europe were disappointing due to market conditions in both geographies, which led to lower volumes and resulting rebates,” Bell said
As a result of shifting to higher margin product sales in its Solutions business, Bell said he anticipated a modest improvement in gross margins in the second quarter but warned market conditions would continue to be tough in 2008.
“Although the economic environment is expected to remain challenging, our focus will continue to be on solid execution through the balance of 2008,” he said.
Revenue in Latin America grew 16 per cent with a 68 and 6 per cent increase in sales from the Solutions and Components divisions.
