Ideal sees profit fall

InterX has completed a year marked by staff and contract cuts at itsdistribution subsidiary Ideal Hardware to post a pre-tax profit of £2.09million, well down on last year's figure of £8.7 million, despite a 38 percentrise in turnover to £318 million.

The company's shares rose 7.5 pence to £2.87 on the results; a figure which remains well below its year high of £4.35.

The InterX accounts for the year to 30 July include exceptional costs of £4.5million.

Some of this expense related to a rationalisation program in June, in whichIdeal slashed staff numbers from 442 to 345 and axed 30 unprofitabledistribution contracts.

The move followed an industry-wide downturn in margins this year which has seenrival components distributor Osmosis go to the wall and CHS Technologies callfor voluntary redundancies from 10 per cent of its 450-strong UK workforce.

Ideal also invested £3.6 million to establish the IT Network, an interactive website, during the period.

Richard Jewson, chairman of InterX, said the company did not expect margins to return to their previous levels. Ideal was now focused on developing more profitable service based business, he said.

Earnings per share after exceptional items were 21.31 pence, and annual dividendwas 14 pence.