Home » Industrial Distribution Group 1Q Sales Down 5.7%
Industrial Distribution Group 1Q Sales Down 5.7%
May 16, 2008
Atlanta, GA-based Industrial Distribution Group, Inc. reported first-quarter revenues of $127.3 million, compared with $135.1 million in the year-ago period, a decline of 5.7%. Profit was $0.9 million, compared with $1.5 million last year.
For the first quarter, revenues from Flexible Procurement Solutions, IDG's services-based supply offerings that include storeroom management, were $78.6 million, a decline of $2.5 million or 3% compared to the first quarter 2007.
New sites implemented since the first quarter of 2007 generated incremental revenue in the first quarter of 2008; however, these new site revenues were more than offset by the non-renewal of certain sites in the fourth quarter of 2007, for which the company said it did not seek renewal because of unfavorable pricing.
FPS revenues were 61.8% of IDG's total first quarter 2008 revenues compared to 60% reported for the 2007 first quarter. As of March 31, 2008, the company had 307 total FPS sites, including 97 storeroom management arrangements.
General MROP sales declined 10% in the 2008 first quarter to $48.6 million, or 10%.
During the first quarter, we experienced the effects of a generally weakening economy," said Charles A. Lingenfelter, IDG's president and CEO. "This general economic weakness adds to the industry-specific challenges we've been experiencing in the domestic automotive industry, including suppliers to the automotive and truck manufacturers and in the recreational vehicle and manufactured housing markets.
"These general conditions, however, present an opportunity for us to more effectively sell our value proposition, as customers are looking even more intensely to reduce the total cost of procurement. We will continue to work closely with our suppliers to identify advantages and solutions that we can bring to current and prospective customers. At the same time, we are reducing our cost structure to appropriately reflect current business conditions."
IDG recently agreed to be acquired by Luther King Capital Management.