Profit warning shock at Premier

THERE was a short circuit at electronics specialist Premier Farnell yesterday when it revealed half-year profit will be well below expectations.

The distributor of small electronics and electronic parts said it had launched a wholesale review of its operations and its shares tumbled more than 15pc.

It warned of a 10pc reduction in first-half operating profit after a sales slowdown in the second quarter. The company, formerly run by ex Thomas Cook boss Harriet Green, said a sales dip in its North American and UK markets since its first-quarter update in June had led to its problems.

Chief executive Laurence Bain ( pictured) said: ‘In light of these challenging trading conditions, the board has recently commenced a review of the group’s operations and will provide an update on this review in September.’

Premier makes and sells the mini low-cost computer Raspberry Pi. It had already embarked on a merger of its marketing and distribution businesses, which accounted for about 80pc of its total turnover last year.

Bain added that the company will ‘continue to focus on delivering the cost savings identified in our global operating model’.

Premier has been the focus of activist investor GO Investment Partners. The firm increased its stake to more than 4pc last month and some analysts expect it to push Premier into a merger with rival Electrocomponents.

Premier’s shares tumbled 26.6p to 140p and Electrocomponents slipped 2.8p to 205.8p.