Electrocomponents on track for cost savings as it reports mixed trading

10th Feb 2016 08:30

(ShareCast News) - Electrocomponents said underlying sales grew 2% in the four months to the end of January amid a mixed performance, and the company remains on track to deliver its targeted £25m annualised savings.In a trading update for 1 October 2015 to 31 January 2016, the electronic products distributor said UK revenues stabilised, while international sales growth slowed to 3%.Meanwhile, Continental Europe saw 10% growth, with all major markets in the region performing well.In North America, sales were down 6%, with continued weakness due to the well-publicised softness in manufacturing output.Electrocomponents said it saw some stabilisation in the gross margin in the period, with a reduction in the year-on-year decline to 0.6% points compared with 1.7% points in the first half of the year.Chief executive officer Lindsley Ruth said: "Our largest business, Continental Europe, continues to show double-digit growth trends, however this is set against the well documented slowdown in the North American industrial market and some near-term disruption in Asia Pacific."We are making good progress on our journey to transform the financial performance of this organisation. We are on track to deliver the targeted £25m annualised savings and work continues to identify further efficiencies. These actions mean we are well positioned to make progress in FY17 despite an uncertain and challenging global macroeconomic outlook."At 0844 GMT, Electrocomponents shares were up 0.7% to 207p.