WASHINGTON (08/09/2000) - Slower sales following the Year 2000 rollover and delayed purchases of enterprise software at many agencies are being blamed for GTSI Corp.'s revenues dropping more than US$12 million from the same period last year.
GTSI's second-quarter financial results were announced Tuesday, and the bellwether company among federal resellers reported revenues of $136.6 million, compared with $148.8 million in the same period last year. The business-to-government solutions provider's net income increased from $69,000 in the second quarter of 1999 to $273,000 for this year's second quarter.
GTSI chairman and chief executive officer Dendy Young said the second quarter has traditionally "been weak due to the seasonal purchasing pattern of the federal government," but the company did show a profit improvement over the same quarter in 1999 on lower revenue.
Larry Allen, executive director of the Coalition for Government Procurement, said that despite GTSI's revenues being down, they are "still making a profit at the same time that some other resellers are not, and some have abandoned federal business all together." The first quarter is always the slowest for federal purchasing and continually picks up as the year progresses, Allen said, commending GTSI for continuing to show a recovery with the current "razor-thin margins for resellers." "The good news is that PCs and other products see a blistering year end," Allen said. "It would be more troubling to me if these numbers were in August." For the six-month period ending June 30, Chantilly, Va.-based GTSI's revenues were down nearly $10 million compared with the same period in 1999, dropping from $274.3 million to $265.9 million.