Premier Farnell optimistic despite tumbling profits

ELECTRICAL components distributor Premier Farnell posted a 10 per cent drop in second-quarter profit yesterday although it said it saw signs of improvement in August sales.<br /><br />Premier Farnell distributes items from batteries to microchips to companies such as Philips and Microsoft and also counts Nokia and Eriksson among its customers.<br /><br />Profit before tax fell 10 per cent to &pound;16.2 m for the three months ended 2 August. Sales dropped 17 per cent to &pound;183.7m, accelerating a 15 per cent decline in the first quarter.<br /><br />The company said it was well positioned for a rebound and noted that revenue declines in Europe and Asia Pacific had abated.<br /><br />Electrocomponents, Premier Farnell's main rival, said its major markets were stabilising when it reported a fall in first-quarter sales of 17 per cent in July.<br /><br />Shares in the group closed the day down 9.8 per cent at 147p.