Black Box's Stock Falls After Centralization, ERP Implementation, Commercial Services Woes
The stock of Black Box Network Services plummeted $3.46 (46.64%) Friday to $4.02 per share after CEO E.C. Sykes revealed a slew of problems to Wall Street analysts.
First, the Lawrence, Penn.-based company, No. 40 on the 2017 CRN Solution Provider 500, ran into issues centralizing its European supply chain and back office efforts, with country-specific legacy processes impacting order management and supply chain.
Additionally, a delay around Black Box's Enterprise Resource Planning integration service provider resulted in the project remaining in the planning stage longer than expected, which took a bite out of earnings.
Finally, Black Box's equipment shipments and short-term project revenue in its commercial services business were below historic levels, with the team continuing to deal with legacy cost issues from the branch model.