Companies: ACL   

'To use a yachting metaphor, we are through the storm, but there is no following wind as yet,' muses John Curry, chairman of technology distribution group Acal, as he announces declining profits and sales for the year to March. The figures reflect tough conditions in the company's markets, with profits before tax and goodwill down £700,000 to £16.2m on turnover falling £25 million to £272.1m. With goodwill included, profits fell £900,000 to £13.4m. But there are some positive signals. Curry says there are signs customers are looking to invest in newer technologies and Acal is no longer seeing the deterioration in bookings levels it saw 12 months ago, although electronic components' orders are still weak in continental Europe. Sales in this division fell 19% to £93.3m. However, gross margins were either sustained or increased in all divisions, improving from 22.7% to 24.8%. The IT Parts Services arm showed 19% sales growth, thanks to the May 2002 acquisition of ATM Parts Co. Acal is showing confidence in the future by proposing a 1.1p final dividend increase to 13.4p a share, for a 9.8% rise in the total payout to 20.1p. Broker Arbuthnot has reined in forecasts for 2004, predicting pre-tax and goodwill profits of £15.6m, for earnings of 30.1p a share. Profits could reach £17.6m for 2005. A good recovery punt.