Buhrmann has forecast a bleak outlook for the rest of the year and has said it will further assess its paper merchanting and office products businesses once second quarter results are known.


The firm issued the warning after lower than expected sales in North America and ongoing low demand in paper merchanting.


"The impact of the US market is now starting to be felt in Europe particularly Scandinavia, Germany and the UK," said company secretary Pieter Barbas.


He said that once the figures were known, cost levels would again be looked at, which would impact on European merchanting.


"There is still low de-mand in the paper merchanting sector and we do not expect to see any improvement before the end of the year," he said.


Barbas felt that any improvement in demand would result from the effects of the introduction of the euro, but they would be only slight.


The company announced a cost reduction programme of more than 61m (E100m) following its first quarter results earlier this year.


Story by Andy Scott