“We are hostages of the environment”

Supply chain problems and softer consumer demand have led Exertis’ UK business to declining revenue and profits in the last financial year, according to MD MD Griffin, who spoke to CRN after the publication of its financial results this week.

Although Exertis faced challenges in the UK, it reported total revenue of £ 4.6 billion for the year – a 3.6% increase over the previous year – and an operating profit of £ 81.7 million, up 12 8% more than the previous 12 months.

Despite good overall performance, the UK distributor’s business declined in both revenue and profit due to a “significant level” of supply constraints and reduced demand from UK consumers.

Tim Griffin, Dr. Exertis, said CRN that the pandemic created supply problems as the consumer business became more challenging with easing Covid’s constraints.

He said: “I think most people are aware of the challenges posed by the pandemic in China, which have a component element, a production element and in fact a transport element. So all this is added to a cocktail that has been mixed in the UK because of Brexit.

“In terms of the consumer element, we obviously have a very strong consumer business that performed very well in the early days of Covid.

“But as this withdraws, returning to work items and people who spend less time at home and the opportunity to go out and spend more time having fun and so on really challenges the user space.”

Although it is now operating effectively, the business was also affected during the year by the implementation of a new warehouse management system.

Asked how the problems in the UK could be overcome, Griffin felt “confident” that Exertis was well positioned, even though it was a “hostage” to the environment.

He said: “We have made significant infrastructure investments that really allow us to provide better service to our customers.

“So we are very optimistic about the implementation of these systems and processes that allow us to do everything – from shipping and more timely deliveries to the end customer. We are confident that this makes us well positioned.

“Obviously we are like everyone else and to some extent we are hostages to the environment.”

Exertis, a brand of DCC Technology, says growth is driven by the contribution of acquisitions completed during the year, with strong North American performance.

The distributor said it also generates “good organic growth” in continental Europe.

“Some of them are related to specific suppliers,” Griffin said.

“We have a different composition of suppliers beyond the water. Some of them are related to the market there, which is a bit more stable.

“One of the fascinating things about 22 countries is the domino effect, because you don’t really see everyone doing the same thing from an economic point of view.

“So even now, Ireland is doing quite well, despite the latest economic challenges that are coming, so each geography is performing differently.

Griffin added that Exertis expects “very strong growth next year” with “a good portion” coming from acquisitions.

Asked if profits are expected for the last financial year, he said: “We are almost slightly ahead of our budgets for the year, which was really good to achieve given the macroeconomic environment, so I think we did well in the circumstances. . “