ASBIS grows by double digits in Q1 2017

ASBIS Enterprises, a distributor of IT products operating in Europe, the Middle East and Africa, has significantly improved its results in Q1 2017. According to the statement released, the Group continued its strategy to improve margins, while keeping expenses under control.

While revenues in Q1 2017 grew by 16.50 percent y-o-y, gross profit margin reached 5.22 percent. As a result, gross profit grew by 13.81 percent to $15,139 from $13,302.

Expenses remained under control and only grew to the extent of investments in new business, said the distributor. EBITDA grew by 18.80 percent to $4.517 in Q1 2017 as compared to $3,802 in Q1 2016. Net profit after tax in Q1 2017 amounted to $551 thousand as compared to $401 in Q1 2016 showing a 37.40 percent improvement.

Having seen a significant growth in revenues and opportunities in its major markets, the company fully sustains its financial forecast for the year 2017.

Siarhei Kostevitch, CEO and Chairman, ASBISc Enterprises Plc, said, “In Q1 2017, we started to benefit from improved position in our major markets, that we won by supporting our customers in tough times. We have also noticed some improvement in overall consumer sentiment. As a result, our revenues in Former Soviet Union (FSU) regions almost doubled after a strong growth in all major countries of the region. Having seen this growth, we have decided to invest more in these markets and benefit from market revival. This has triggered a growth in expenses though. However, the pace of this growth was slower than the pace of growth in revenues and gross profit. As a result, profitability grew at all levels.”

According to Kostevitch, the firm expects the positive trend to continue over the next few quarters.

“Although, we need to remember that Q2 usually is the slowest period of the year,” he added. “We expect to realise the majority of our forecasted profits, as usual, in the second half of the year. Meanwhile, we work on keeping gross profit margins high enough so we benefit from any improvement in demand in our major markets.”

Focus on the FSU region allowed the company to continue its good sales performance and show an impressive 89.02 percent growth year-on-year. Following that, the FSU share in its total revenues grew to 48.15 percent from 29.68 percent in Q1 2016 (and 42.23 percent in Q4 2016).

Sales in the Central and Eastern Europe region have decreased by 8.15 percent in Q1 2017 as compared to Q1 2016. Sales in Western Europe in Q1 2017 decreased by 7.17 percent compared to Q1 2016.

Sales in MEA region have decreased by 17.03 percent in Q1 2017 as compared to Q1 2016.

Growth in FSU has arisen from a continuous improvement in Russia, Ukraine, Kazakhstan and Belarus that in Q1 2017 grew by 87.25 percent, 85.71 percent, 163.84 percent and 36.48 percent respectively. In the same time the 26.68 percent decrease in Slovakia has been partially compensated by a 20.81 percent increase in the Czech Republic, 16.38 percent increase in Romania and 6.81 percent increase in Hungary.

“The decrease in MEA region of 17.03 percent is mainly attributed to the slow-down in the North Africa region where last year we have serviced large projects,” said Kostevitch.

In Q1 2017 revenues from CPUs and HDDs decreased by 6.33 percent and 8.90 percent respectively as compared to Q1 2016. However, decrease in HDDs sales was compensated with 185.49 percent growth in sales of SSDs. Laptops sales increased by 15.66 percent and sales of tablets grew by 32.47 percent.

He said, “What is even more important, we increased sales of smartphones in Q1 2017 by 44.97 percent year-on-year (mostly following an improvement in iPhone sales). As a result, smartphones were again top segment in our product portfolio for Q1 2017.”

From other product lines, the distributor has noticed a positive trend for Q1 2017 in mainboards and VGA cards (+34.26 percent), PC desktop (+22.87 percent), peripherals (+65.77 percent), display products (+38.89 percent), memory modules (+102.48 percent), accessories and multimedia (+74.87 percent) and flash memory (+13.49 percent).