Northamber braces itself

The distributor has warned that the IT sector is set for more trying times.
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Following what it identified as a difficult period for the IT channel, according to Channel Register distributor Northamber has cashed in on investments and reigned in costs in order to stay out of trouble – and it is predicting some similarly turbulent conditions ahead.

For the six months ending 31 December 2006 Northamber’s profits were up very slightly, however its revenue fell from £116.03 million during the last six months of 2005, to £95.27 million for the same period in 2006.

Northamber’s chairman David Phillips said that heavy price deflation gave "little scope" to recover lost revenue. However the distributor managed to stem a profit loss by tightening up its sales costs and making sure its inventories were kept to a minimum.

"Previously disappointing sector trading conditions continued to constrain opportunities," Phillips said in a statement.

Northamber is predicting that this difficult market dynamic, for which a slow uptake of Windows Vista is also blamed, will continue as the year goes on. According to an outlook statement the firm’s stance is “necessarily cautious.”

"The slower than expected uptake for Microsoft's newly launched Vista and the unrewarding state of the market in which we operate is not encouraging," said the statement.

For the time being Northamber looks happy to defend its business through entrenchment, but says that it is well positioned to take advantage of the opportunities when they do eventually pick up.

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