Electrocomponents posted a 76 percent rise in first-half pre-tax profit on Friday, following a raise in cost-saving targets.
The UK-based electronics distributor announced that it has raised its cost-savings targets to £18 million pounds ($22.3 million) for the year ending March 2017, up from initial projections of £15 million pounds.
In addition, the company said it expects to see £30 million pounds in annual savings by March 2018, compared with initial predictions of around £25 million.
According to its Friday reporting, headline pretax profit rose to £55.1 million in the six months until end of September, which marks a slight improvement upon initial forecasts of £54 million, and a considerable increase from the £31.3 million pounds previously reported in 2015.
In a statement, the company detailed the cost saving projects, noting that:
“We have raised our cost savings guidance to £18m of net savings in 2017 and total annualised net savings of £30 million by March 2018. Work continues to identify further efficiencies and simplify the way we operate. All these actions mean that we are well positioned to make strong progress in the year to March 2017.”
Chief executive Lindsley Ruth commented on the promising set of earnings, stating that he was:
“Extremely pleased by the progress we are making [via the firm’s Performance Improvement Plan] to put the customer back at the heart of this business, increase accountability and operate for less.”
“While we have taken a major step forward, we are only just at the beginning of this journey and still a long way from best in class” he continued, reiterating that he expects the company to go from strength to strength in terms of revenue potential.
Furthermore, the company noted that it expected to benefit from the weakening pound sterling and boosting second-half earnings. This would in turn encourage lower costs relating to business in Europe and Asian markets, which would ultimately mitigate that the negative impact of higher costs in its UK divisions.
Electrocomponents is a UK based electronic distributor with headquarters located in Oxford. The company is a constituent of the FTSE-250 index and currently employs around 6,000 employees.
