Electrocomponents’ profit slides to £160 million in fiscal 2021

Electrocomponents plc (LON: ECM) reported a decline in its profit for fiscal 2021 despite an increase in the revenue. The company also increased its final dividend on Tuesday.

Electrocomponents plc opened at £10.42 per share on Tuesday and slid to an intraday low of £10.20 per share in the next hour. The stock, however, recovered the entire loss to trade at £10.53 per share later on. In comparison, Electrocomponents had started the year 2021 at £9.06 per share after recovering from a low of £4.71 per share in March 2020 when the impact of the health emergency was at its peak.

Electrocomponents reports £2.0 billion of revenue

Electrocomponents reported £160.6 million of pre-tax profit for the year that concluded on 31^st March. In fiscal 2020, its profit before tax stood at a higher £199.6 million. The industrial and electronics products distributor attributed the decline to increased costs related to sales, distribution, and marketing.

The FTSE 250 company recorded £2.0 billion in revenue for fiscal 2021 versus the year-ago figure of £1.95 billion. The increase, as per Electrocomponents, was due to improved trading momentum in H2 as COVID-19 restrictions eased.

The news comes only days after the British postal and courier delivery company, Royal Mail plc, reported an increase in its full-year pre-tax profit.

The board proposed 9.8 pence per share of a final dividend

The board proposed 9.8 pence per share of a final dividend on Tuesday that pushed the total payment up, to 15.9 pence per share, compared to last year’s 15.4 pence per share.

Electrocomponents expressed confidence that its revenue to date showed resilience even when compared to the levels seen in 2019 (pre-pandemic). Expectations for fiscal 2022, the London-based company said, were unchanged. According to CEO Lindsley Ruth:

“While we remain mindful of external pressures including ongoing cost inflation and potential supply chain shortages, we are confident that we are well-positioned for a rapidly changing world.”

Electrocomponents plc performed largely upbeat in the stock market last year with an annual gain of more than 30%. At the time of writing, the British company is valued at £4.93 billion and has a price to earnings ratio of 36.36.

In separate news from the United Kingdom, the real estate investment trust Shaftesbury plc said its pre-tax loss widened in the fiscal first half but expressed confidence that recovery from the COVID-19 hit is underway.