Computer wholesaler Ingram Micro will continue to cut costs as sales of technology products fall, company officials said Tuesday while announcing a $13.3 million quarterly loss.
"Our work is not done," President Michael J. Grainger said in a teleconference with analysts. "Although we have reduced costs . . . sales have continued to decline at a more rapid rate."
The Santa Ana, Calif.-based company has cut 32 jobs at its Amherst sales center this month, on top of a 71-job cut in June. Company-wide, jobs are down 22 percent over the past year.
Barriers between operating units in the U.S. and Canada will fall early next year, combining operations into one North American region, officials said. Ingram has large operations in Toronto, but officials didn't say whether there might be consolidation between that and the Amherst sales site, which has about 1,600 jobs.
Sales fell 22 percent to $5.8 billion, as spending on technology declined in the U.S. and Europe. The $13.3 million loss for the quarter ended Sept. 29 compares to a profit of $38.9 million a year ago. Without one-time special costs, the company would have posted a profit of $5.4 million.
In the fourth quarter, sales may continue to fall slightly instead of swinging upward with the Christmas season, Chairman Kent B. Foster said. The company usually sees a 6 percent sales gain from the third to fourth quarter.
The company is positioned well to weather the downturn, he said. It has cut debts, leaving the debt-to-equity ratio at 25 percent, down from 44 percent a year ago.
"Despite the economic environment, Ingram Micro continues to carefully manage the business and tighten controls," he said.
Among the best prospects for future sales growth is last week's launch of Microsoft's latest operating system, Windows XP. Ingram Micro has bundled packages of related technology tailored to work with XP for its customer base of 175,000 technology resellers.
However, the uncertain environment makes it difficult to predict future results, Foster said, citing Tuesday's warning of renewed terrorist attacks. "Those kinds of things continue to hit consumer confidence and have an impact on demand," he said.
Ingram Micro's shares fell 47 cents Tuesday on the New York Stock Exchange, to $12.40.