Lawrenceville, Ga. – SED International Holdings reported lower sales and loss in its first quarter ended Sept. 30.
This distributor reported net sales of $126.4 million, a decrease of 18.9 percent from the prior year’s first quarter. SED said sales were negatively impacted by the weak demand for our PC, notebooks and television products which reflects similar declines within the microcomputer industry
Gross margin increased to 5.6 percent, compared to 4.8 percent in the comparable period last year, due primarily to higher margins earned on small appliance, housewares and personal care products, as well as higher margins in Latin American subsidiaries due to Argentine governmental import restrictions causing tighter inventory supply which increased pricing and margins.
The first quarter net loss was $2.1 million, compared with a net loss of approximately $800,000 in the same period last year.
SED reported an operating loss of $1.6 million in the first quarter compared with an operating loss of $1.5 million in the prior-year first quarter.
“Our performance during the quarter was disappointing with revenue down particularly in our core PC and TV businesses and our delay in adding profitability through the integration of our Lehrhoff acquisition,” said Bob O’Malley, president and CEO of SED International.
“While we have some bright spots in our Latin America businesses, we are taking actions in the U.S. on several fronts this quarter to increase revenue through better selling and marketing alignment with our strategic vendors and to manage our operating expenses through the restructuring of operations and the implementation of selective outsourcing initiatives,” O’Malley said.
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