Increasing its staff in a down market is paying off for Nu Horizons Electronics Corp., which reported an uptick in both sales and earnings for its second fiscal quarter.
While the Melville, N.Y.-based distributor continues to balance low margins against "higher than desired" expenses, earnings for the period increased on both a sequential and year-over-year basis.
Net income for the quarter ended Aug. 31 reached $1.23 million, compared with $1.07 million the prior year and $1.21 million the prior quarter.
Sales reached a record $62.8 million from $56.8 million a year ago.
"While we continue to suffer from a combination of margin pressure and higher than desired selling and general expenses as a percentage of sales, we are again encouraged by the fact that earnings increased slightly on a sequential basis, as well as compared to the prior year's second quarter," said Arthur Nadata, president and chief executive.
"We see that our increased levels of staffing in a down market have given us a distinct advantage as evidenced by our current record sales performance," he added.
Over the past year the semiconductor speciality distributor has increased its staff by about 8% across the board in marketing, sales and engineering, according to Dave Bowers, vice president of marketing. "More than anything it's our increased focus," he said, with little help from the market.
Nu Horizons has been honing its focus on its key markets and key product areas: programmable logic , the communications market, the analog and power management businesses and high-end processors, Bowers said. Although the company doesn't see an market upturn in sight, buyers may begin to see spot shortages as cutbacks on supplier side begin to catch up with inventory levels, he said.
Results for the period include Nu Visions Manufacturing Inc., Nu Horizons' contract manufacturing company based in Springfield, Mass. Nu Horizons does not break out Nu Visions sales.