Electronics maker posts 48pc drop in profits while inventory increases 42pc Tight competition in the United States and European markets hit IDT International's performance in the fourth quarter to March when it posted a net loss of $99.3 million. For the year to March, the consumer electronics product company made a net profit of $130 million, down 48.1 per cent from the previous year, while turnover grew 4.9 per cent to $2.89 billion. IDT's inventory surged 42 per cent to $734.5 million during the year, while net cash plunged 71.6 per cent to $183.5 million. The company attributed its deteriorating bottom line to price erosion in its digital media products such as MP3 players, raw material and labour costs, as well as tough competition in the US and European telecommunications markets. '[It] was a challenging year for IDT,' chairman Raymond Chan said. 'The European and US markets experienced some volatility. The increase of digital media products [in our product mix] diluted margins due to the competitive market situation.' Revenue declined in IDT's two biggest markets, Europe and the Americas, but this was offset by a 58 per cent rise in Asia-Pacific revenues to $721 million. The company's revenue from Europe dropped 9 per cent to $1.09 billion, while turnover from the Americas fell 2 per cent to $1.08 billion. Earnings were halved to six cents per share, and the final dividend was reduced to five cents per share from six. IDT shares closed 5.6 per cent lower at $1.18 yesterday in heavy trading.