There are two ways that foreign exchange movements can reduce profits of a company based in the UK. One is translational: the value of the currency in the country where you operate falls, so the amount of profit reported is reduced.
The other is transactional: a fall in the currency means operating there becomes more expensive, and lower margins mean lower profits.
It is Premier Farnell’s misfortune to be hit by both. Its first-quarter figures show the company moving forward strongly in revenue terms, perhaps better than its bigger rival in the distribution of electronic products, Electrocomponents, which at its last set of results last month admitted there was work to be done in improving its performance, even if sales were growing.
This is