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• Management
• CIO Insights

By Joey Gardiner, 10 June 1999 18:09

NEWS Storage distributor Ideal Hardware has seen its share price halved today in the wake of a statement to the London Stock Exchange warning of redundancies and sharply falling profits. Talking to Silicon.com, James Wickes, managing director of Ideal's holding company, InterX, said the operational board had not reacted fast enough to changes in the market and had been disbanded. "We had a very bad month in May& we didn't have the right management in place, but that has been rectified today." An executive board headed by CEO, Ian French, will replace the operational board. InterX confirmed that Kevin Harper, sales director and co-founder of Ideal, resigned today, along with Ronan McDonald, managing director. Wickes explained that executives had been "too slow in chasing higher margin areas of business" in a market that was changing incredibly quickly. In addition to the disbanding of the operational board there will be "substantial" job losses across the company, for which £700,000 has been allotted to cover redundancy costs. The news of widespread job cuts was announced to staff at a specially convened meeting this morning. Ideal claimed the move would save the company £2m. Despite Wickes' assertion that management problems have been rectified, InterX's share price plummeted from 435p at opening to 237.5p at 4:00pm on Thursday. Industry analyst Richard Holway said all resellers were suffering with more and more firms opting to sell directly to customers. "This year will be very difficult for that side of the market," he said. He added that Ideal is not one of the strongest performers: "Clearly if they were ahead of the game then their share price wouldn't have halved in a day." But Wickes was upbeat in assessing InterX's prospects. He said the company will focus on the IT Network, an online product information service to be launched on the 28 June.