Systemax Inc. is winding down its former focus on North American retail sales of computers and consumer electronics and recording steady gains in industrial sales in North America and abroad.
Still, the second quarter ended June 30 was not an easy one in revenue terms. The company, which does much of its sales through 18 e-commerce sites—six in North America and about 10 across Europe—reported a 7.3% drop in total revenue for the quarter, to $420.8 million from $454.1 million.
Most of the drop in sales came from the EMEA Technology Products Group for the Europe, Mideast and Africa region, where net sales declined 5.7% to $238.1 million from $252.6 million in the second quarter of last year.
In contrast, the Industrial Products Group inched up 0.5% to net sales of $181.8 million from $180.9 million. The Industrial Products Group’s flagship site is GlobalIndustrial.com, which was named a finalist for the B2B E-Commerce Player of the Year award in this year’s Internet Retailer Excellence Awards program at IRCE 2016. The Player of the Year award category recognized companies with innovative B2B e-commerce sites that set examples for others to follow.
Although Systemax doesn’t break out e-commerce sales, it has noted that self-service e-commerce sales account for a large share of total revenue. It adds that nearly all sales, including those placed directly with sales reps, are supported in one way or another by e-commerce, such as when sales reps use the company’s websites to help customers research and place orders.
CEO Larry Reinhold said in a statement yesterday that the Industrial Products Group reported its 26th consecutive quarter of revenue growth, despite a downturn in demand for maintenance, repair and operations, or MRO, products that companies use to manage their equipment and facilities. He added that the company’s total net loss for the second quarter narrowed from a year earlier, thanks in part to cutting $4 million in spending from the company’s distribution network and other operations.
Systemax closed out its United States-based TigerDirect.com retail operations over the past year, including the last of its TigerDirect stores and e-commerce sites including TigerDirect.com. It sold the TigerDirect business last year for $14 million to PCM Inc. TigerDirect had operated as a main unit of Systemax’s North American Technology Group, for which the company shuttered some remaining offices in the second quarter.
Last month, Systemax agreed to sell off its Germany-based operations of electronics supplier Misco, including e-commerce sited Misco.de, while retaining several Misco e-commerce sites in the United Kingdom, France and other European countries.
Systemax is No. 41 in the B2B E-Commerce 300, which ranks companies on their annual web sales. With TigerDirect still under its wing, Systemax ranked No. 32 in the Internet Retailer Top 500.
Systemax also reported for the second quarter ended June 30:
Gross profit declined 5.8% to $81.5 million from $86.5 million a year earlier;
Net loss improved to $7.4 million from $28.4 million.
For the six months ended June 30:
Total net sales fell 12.0% to $850.6 million from $966.2 million a year earlier;
Gross profit decreased 5.0% to $164.9 million from $173.6 million;
Net loss improved to $24.7 million from $57.0 million.
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