Exertis hit by 'weak' tablet market

Trading was behind budget and behind the prior year during the quarter ending June 30th
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Distributor Exertis' parent company DCC has published an interim management statement to coincide with the company's annual general meeting today (Friday July 17th).

For the first quarter ending June 30th 2015, DCC said that overall group operating profit was in line with budget overall, with strong growth across DCC Energy, DCC Healthcare and DCC Environmental "being somewhat offset by a weaker performance from DCC Technology".

DCC said in a statement: "Trading in DCC Technology [which trades as Exertis] was behind budget and the prior year.

"As anticipated, the business in the UK continues to be impacted by the weak tablet market and by reduced sales of mobile computing and smartphone products of one large supplier.

"The UK business was also impacted by weaker demand and increased competition across a number of product sectors."

Yesterday Dixons Carphone's chief exec Sebastian James admitted to PCR that the tablets category is in "fairly rapid decline".

"This is partly because there’s not much new technology," he said. "But we think Windows 10 will be helpful so we’re expecting a good back to school period."

However, DCC reiterated its guidance of "very significant" growth overall for the year to March 31st 2016.

"DCC's profits are significantly weighted towards the second half of its financial year," the company added. "At what is still a very early stage in the financial year, the group continues to anticipate that operating profit and adjusted earnings per share, on a continuing basis, will be very significantly ahead of the prior year.

"DCC remains ambitious to continue the growth and development of its business. The recent successful equity placing further enhances DCC's strong equity base, and together with a strong and liquid balance sheet, leaves it well placed to continue the development of its business in existing and new geographies."

Exertis acquired consumer electronics distributor Computers Unlimited back in May.

Check out PCR's interview with CU's James Sanson about life with Exertis here.

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