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Despite scandal, LI retailer Systemax reports profits

Port Washington-based Systemax's brands include TigerDirect

Port Washington-based Systemax's brands include TigerDirect Credit: TigerDirect.com

Despite a scandal involving the reported theft of $17 million in electronics equipment, and a federal government investigation into the forced resignation of a top executive, Port Washington-based computer retailer Systemax Inc., reports increases in both sales and profits for its most recent quarter.

Systemax owns the CompUSA retail chain and the Circuit City and TigerDirect websites,

It said net income for the quarter ended June 30 was $15.55 million on sales of $872.2 million, up from $9.45 million profit on $805.9 million sales in the comparable year-ago quarter. The financial report came in a Wednesday news release.

Flat consumer spending was offset by sales to businesses and 27 percent growth in the Systemax Industrial Products group, Richard Leeds, chairman and chief executive, said in a prepared statement.

Leeds did not comment directly on the forced resignation of Gilbert Fiorentino, the ousted CompUSA chief executive, but said, “our senior management team recently completed an extensive review of our North American technology business and is implementing a number of operating changes and best management practices, which we believe will improve its operating performance.“

Systemax on June 21 publicly disclosed that it was cooperating fully with a Securities and Exchange Commission formal investigation “into certain matters discovered by the company during its internal investigation of its Miami Florida operations.“

The Miami Herald reported on the Systemax investigation July 9, with a story  “CompUSA scandal deepens.“

The newspaper said, “CompUSA executives this week reported a $17 million theft of electronics equipment to the Miami-Dade Police Department, the latest fallout in a scandal that has already claimed the company’s chief executive and recently led to an investigation by the Securities and Exchange Commission.“

The Herald reported, “The police report names Gilbert’s brothers, Carl and Patrick Fiorentino, both of whom were relieved of their duties in April and escorted out of company headquarters the same day as their brother."

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