SANTA ANA, Calif., Oct 27, 2005 /PRNewswire-FirstCall via COMTEX News Network/ -- Ingram Micro Inc. (NYSE: IM), the world's largest technology distributor, today announced financial results for the third quarter of 2005 (ended Oct. 1, 2005).
Worldwide sales for the third quarter were $6.96 billion, a 16 percent increase over the $6.02 billion posted in the year-ago period.
Third-quarter net income based on generally accepted accounting principles (GAAP) was $48.4 million or $0.29 per diluted share. Net income includes major-program and integration costs of $7.2 million (approximately $5.6 million net of tax or $0.03 per diluted share) related to the company's outsourcing and optimization plan in North America and the integration of Tech Pacific, which the company acquired in November 2004, as described in the special items section below. Net income also includes a charge of $8.4 million ($6.0 million net of tax, or $0.04 per diluted share) related to the company's redemption of all its outstanding senior subordinated notes and termination of related interest-rate swap agreements.
Net income on a non-GAAP basis, which excludes the costs identified above, was $60.0 million, or $0.36 per diluted share. A reconciliation of these non- GAAP items to GAAP net income can be found in the tables attached to this press release. In addition, financial results for the quarter were favorably impacted by a reduction in the 2005 effective tax rate from 31 percent in the first six months of the year to 29 percent, as well as a net discreet benefit primarily related to the implementation of more efficient tax structures. This rate is currently expected to be the company's full-year effective tax rate. The effective tax rate in 2004 was 32 percent.
In the year-ago quarter, GAAP net income was $77.3 million, or $0.49 per diluted share, which includes benefits totaling $44.7 million, or $0.28 per diluted share, as described in the special items section below. Year-ago net income on a non-GAAP basis, which excludes these benefits, was $32.6 million, or $0.21 per diluted share.
"Over the last eight quarters we have consistently delivered solid sales growth, and this quarter we drove much of it to the bottom line," said Gregory M. Spierkel, chief executive officer, Ingram Micro Inc. "Every region's sales and operating income grew over last year. In North America, we exceeded our commitment of achieving a 150-basis-point operating margin (on a non-GAAP basis) through a broad set of margin initiatives and ongoing cost containment. Europe achieved double-digit growth in sales and operating income in the face of weak economies in that region. Latin America's operating margin hit a third-quarter record, while the Tech Pacific acquisition helped the Asia Pacific region improve operating margins by 92 basis points on a GAAP basis and 113 basis points on a non-GAAP basis. I am extremely proud of our teams around the world for the excellent performance."
Additional Third-Quarter Highlights
For more detail regarding the results outlined below, please refer to the financial statements and schedules attached to this news release or visit www.ingrammicro.com.
Regional Sales
* North American sales were $3.09 billion (44 percent of total
revenues), an increase of one percent versus the $3.05 billion
reported in the year-ago quarter.
* European sales were $2.34 billion (34 percent of total revenues),
an increase of 10 percent versus the $2.13 billion reported in the
year-ago quarter.
* Asia-Pacific sales were $1.21 billion (17 percent of total
revenues), an increase of 112 percent versus the $570 million
reported in the year-ago quarter.
* Latin American sales were $324 million (5 percent of total
revenues), an increase of 21 percent versus the $267 million
reported in the year-ago quarter.
Gross Margin
Gross margin in the 2005 third quarter was 5.49 percent, an improvement of 12 basis points versus the second quarter of 2005, and flat with the prior year quarter.
Operating Expenses
* Total operating expenses were $298.9 million, or 4.29 percent of
revenues, versus $269.4 million, or 4.48 percent of revenues, in the
year-ago quarter.
* Excluding major-program and integration costs, operating expenses
were $291.7 million, or 4.19 percent of revenues, versus
$272.1 million, or 4.52 percent of revenues, in the year-ago period.
Operating Income
Worldwide operating income was $82.9 million, or 1.19 percent of revenues versus $60.2 million or 1.00 percent of revenues in the year-ago quarter. Excluding major-program and integration costs, operating income on a non-GAAP basis was $90.1 million, or 1.30 percent of revenues. In the prior year, operating income on a non-GAAP basis was $57.5 million, or 0.96 percent, excluding the benefit related to the favorable resolution of lease termination costs.
* North American operating income on a GAAP basis was $43.7 million,
or 1.42 percent of revenues, versus $39.1 million, or 1.28 percent
of revenues, in the year-ago quarter. Excluding major-program and
reorganization costs, North American operating income on a non-GAAP
basis was $48.5 million, or 1.57 percent of revenues.
* European operating income was $21.0 million, or 0.90 percent of
revenues, versus $16.6 million, or 0.78 percent of revenues, in the
year-ago quarter.
* Asia-Pacific operating income was $13.9 million, or 1.15 percent of
revenues, versus $1.3 million, or 0.23 percent of revenues, in the
year-ago quarter. Excluding major-program and integration costs,
Asia-Pacific operating income on a non-GAAP basis was $16.4 million,
or 1.36 percent of revenues in 2005.
* Latin American operating income was $4.3 million, or 1.34 percent of
revenues, versus $3.3 million, or 1.22 percent of revenues in the
year-ago quarter.
- Other income and expenses for the quarter were $20.7 million, versus
$5.3 million in the year-ago period. Other expenses in the current
year included a loss of $8.4 million on the redemption of the
company's outstanding senior subordinated notes and termination of
related interest-rate swap agreements, while the prior year amount
includes a gain of $4.3 million related to currency hedging of the
company's Australian dollar-denominated purchase of Tech Pacific.
Excluding these charges, other income and expenses on a non-GAAP basis
were $12.2 million in 2005 compared to $9.6 million in 2004,
reflecting additional interest expense related to the Tech Pacific and
AVAD acquisitions, as well as higher sales and interest rates.
- Total depreciation was $12.5 million.
- Capital expenditures were approximately $9.7 million.
Balance Sheet
- The cash balance at the end of the third quarter was $429 million, an
increase of $31 million over the year-end 2004 balance.
- Inventory was $1.93 billion, or 27 days on hand, a decrease of one day
from the year-end balance. Inventory turns were 14.
- Total debt was $655 million, or 22 percent of total capitalization,
versus $515 million, or 19 percent of capitalization, at the end of
last year, primarily due to the acquisition of AVAD.
"The superior execution of our regional operations drove our strong results in the quarter," said William D. Humes, executive vice president and chief financial officer, Ingram Micro Inc. "The demand and competitive environments remained relatively stable with the prior quarter. Our emphasis on superior customer service, process improvements and higher margin growth markets continues to pay dividends and differentiates Ingram Micro from our competitors. We continued our focus on profitability, delivering our highest third-quarter operating margin in seven years."
Nine-Month Period
For the nine months ended Oct. 1, 2005, worldwide sales were $20.85 billion, a 16 percent increase over the $18.01 billion reported a year ago. Regional sales were $8.94 billion for North America (a 4 percent increase versus the prior-year period); $7.41 billion for Europe, (an increase of 8 percent in U.S. dollars, of which the translation impact of the strengthening European currencies contributed approximately 3 percentage points); $3.59 billion for Asia-Pacific (an increase of 105 percent); and $904 million for Latin America (an increase of 18 percent).
Worldwide operating income for the nine-month period was $230.5 million, or 1.11 percent of revenues, versus $174.6 million, or 0.97 percent of revenues, reported a year ago. For comparison purposes, operating income on a non-GAAP basis excluding major-program costs was $261.5 million, or 1.25 percent of revenues, versus $172.2 million, or 0.96 percent of revenues, in the prior-year period.
Nine-month net income on a GAAP basis was $132.5 million, or $0.81 per diluted share, compared to $140.7 million, or $0.89 per diluted share, a year ago. For comparison purposes, nine-month net income excluding major-program costs, integration costs and special items was $158.3 million, or $0.97 per diluted share compared to $96.1 million, or $0.61 per diluted share, a year ago.
Details on Special Items
As indicated above, third-quarter results were affected by special items of $15.6 million, or approximately $11.6 million net of tax. This includes: major-program costs of $4.7 million primarily related to severance, including consulting, retention and other transition expenses, associated with the company's previously announced North American outsourcing and optimization plan; and integration costs of $2.5 million, primarily associated with closing redundant facilities, workforce reductions, consulting, relocation and other integration actions related to the acquisition of Tech Pacific in November 2004. Also reflected in third quarter results is a charge of $8.4 million, or approximately $6.0 million net of tax, related to the redemption of the company's senior subordinated notes and termination of related interest-rate swap agreements.
Last year's third-quarter results were affected by benefits that included: $40.0 million for the reversal of previously accrued income taxes related to gains realized on the sale of securities; a foreign-exchange gain of $4.3 million (approximately $2.9 million net of tax) related to currency hedging of the company's Australian dollar-denominated purchase of Tech Pacific; and $2.7 million (approximately $1.8 million net of tax) related to the favorable resolution of lease termination costs associated with the 2003 profit-enhancement program.
Outlook for the Fourth Quarter
The following statements are based on the company's current expectations and internal forecasts. These statements are forward-looking and actual results may differ materially, as outlined in the company's periodic filings with the Securities and Exchange Commission.
The company's guidance for the fourth quarter ending Dec. 31, 2005:
* Sales are expected to range from $7.75 billion to $8.00 billion.
* Net income excluding special items is expected to range from $78
million to $84 million, or $0.47 to $0.50 per diluted share, based
on approximately 167 million shares outstanding and a 29-percent
effective tax rate.
Net income and earnings guidance excludes any reorganization costs, major program costs or integration expenses, which the company is unable to reasonably estimate on a quarterly basis at this time.
"Our fourth quarter guidance reflects a seasonal increase in line with historical norms, along with our continued emphasis on strong execution," said Spierkel. "Year-over-year sales comparisons in U.S. dollars are expected to be tempered by the translation impact of a softer Euro, which has weakened approximately seven percent since last year. Our focus on profitability has positioned us well and we expect to benefit from growth in new categories such as AIDC/POS, consumer electronics, and mobility. In addition, our diversification strategy continues to bear fruit, helping us perform consistently in challenging markets while developing expertise in promising new areas such as services and logistics. The strength and stability of our management team continues to be a key component of our success."
Conference Call and Webcast
Additional information about Ingram Micro's financial results will be presented in a conference call with presentation slides today at 5 p.m. EDT. To listen to the conference call webcast and view the accompanying presentation slides, visit the company's Web site at www.ingrammicro.com (Investor Relations section). The conference call is also accessible by telephone at (888) 455-0750 (toll-free within the United States and Canada) or (517) 308-9002 (other countries).
The replay of the conference call with presentation slides will be available for one week at www.ingrammicro.com (Investor Relations section) or by calling (800) 678-3180 or (402) 220-3063 outside the United States and Canada.
Cautionary Statement for the Purpose of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995
The matters in this press release that are forward-looking statements, including but not limited to statements about future revenues, sales levels, operating income, margins, integration costs, cost synergies, operating efficiencies, profitability, market share and rates of return, are based on current management expectations that involve certain risks which, if realized, in whole or in part, could cause such expectations to fail to be achieved and have a material adverse effect on Ingram Micro's business, financial condition and results of operations, including, without limitation: (1) intense competition, regionally and internationally, including competition from alternative business models, such as manufacturer-to-end-user selling, which may lead to reduced prices, lower sales or reduced sales growth, lower gross margins, extended payment terms with customers, increased capital investment and interest costs, bad debt risks and product supply shortages; (2) integration of our acquired businesses and similar transactions involve various risks and difficulties -- our operations may be adversely impacted by an acquisition that (i) is not suited for us, (ii) is improperly executed, or (iii) substantially increases our debt; (3) foreign exchange rate fluctuations, devaluation of a foreign currency, adverse governmental controls or actions, political or economic instability, or disruption of a foreign market, and other related risks of our international operations may adversely impact our operations in that country or globally; (4) we may not achieve the objectives of our process improvement efforts or be able to adequately adjust our cost structure in a timely fashion to remain competitive, which may cause our profitability to suffer; (5) our failure to attract new sources of profitable business from expansion of products or services or entry into new markets could negatively impact our future operating results; (6) an interruption or failure of our information systems or subversion of access or other system controls may result in a significant loss of business, assets, or competitive information; (7) significant changes in supplier terms, such as higher thresholds on sales volume before distributors may qualify for discounts and/or rebates, the overall reduction in the amount of incentives available, reduction or termination of price protection, return levels, or other inventory management programs, or reductions in payment terms, may adversely impact our results of operations or financial condition; (8) termination of a supply or services agreement with a major supplier or product supply shortages may adversely impact our results of operations; (9) changes in, or interpretations of, tax rules and regulations may adversely affect our effective tax rates or we may be required to pay additional tax assessments; (10) we cannot predict with certainty, outcome of the SEC and U.S. Attorney's inquiries; (11) if there is a downturn in economic conditions for an extended period of time, it will likely have an adverse impact on our business; (12) we may experience loss of business from one or more significant customers, and an increased risk of credit loss as a result of reseller customers' businesses being negatively impacted by dramatic changes in the information technology products and services industry as well as intense competition among resellers -- increased losses, if any, may not be covered by credit insurance or we may not be able to obtain credit insurance at reasonable rates or at all; (13) rapid product improvement and technological change resulting in inventory obsolescence or changes in demand may result in a decline in value of a portion of our inventory; (14) future terrorist or military actions could result in disruption to our operations or loss of assets, in certain markets or globally; (15) the loss of a key executive officer or other key employees, or changes affecting the work force such as government regulations, collective bargaining agreements or the limited availability of qualified personnel, could disrupt operations or increase our cost structure; (16) changes in our credit rating or other market factors may increase our interest expense or other costs of capital, or capital may not be available to us on acceptable terms to fund our working capital needs; (17) our failure to adequately adapt to industry changes and to manage potential growth and/or contractions could negatively impact our future operating results; (18) future periodic assessments required by current or new accounting standards such as those relating to long-lived assets, goodwill and other intangible assets and expensing of stock options may result in additional non-cash charges; (19) seasonal variations in the demand for products and services, as well as the introduction of new products, may cause variations in our quarterly results; and (20) the failure of certain shipping companies to deliver product to us, or from us to our customers, may adversely impact our results of operations.
Ingram Micro has instituted in the past and continues to institute changes to its strategies, operations and processes to address these risk factors and to mitigate their impact on Ingram Micro's results of operations and financial condition. However, no assurances can be given that Ingram Micro will be successful in these efforts. For a further discussion of significant factors to consider in connection with forward-looking statements concerning Ingram Micro, reference is made to Exhibit 99.01 of Ingram Micro's Annual Report on Form 10-K for the year ended January 1, 2005; other risks or uncertainties may be detailed from time to time in Ingram Micro's future SEC filings. Ingram Micro disclaims any duty to update any forward-looking statements.
About Ingram Micro Inc.
As a vital link in the technology value chain, Ingram Micro creates sales and profitability opportunities for vendors and resellers through unique marketing programs, outsourced logistics services, technical support, financial services, and product aggregation and distribution. The company serves 100 countries and is the only global IT distributor with operations in Asia. Visit www.ingrammicro.com.
(C) 2005 Ingram Micro Inc. All rights reserved. Ingram Micro and the
registered Ingram Micro logo are trademarks used under license by Ingram Micro
Inc.
Ingram Micro Inc.
Consolidated Balance Sheet
(Dollars in 000s)
(Unaudited)
October 1, January 1,
2005 2005
ASSETS
Current assets:
Cash $429,221 $398,423
Trade accounts receivable, net 2,785,792 3,037,417
Inventories 1,933,718 2,175,185
Other current assets 339,115 471,137
Total current assets 5,487,846 6,082,162
Goodwill and other non-current assets 938,425 844,575
Total assets $6,426,271 $6,926,737
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $2,951,366 $3,536,880
Accrued expenses 440,121 607,684
Current maturities of long-term debt 168,985 168,649
Total current liabilities 3,560,472 4,313,213
Long-term debt, less current
maturities 486,290 346,183
Other liabilities 33,247 26,531
Total liabilities 4,080,009 4,685,927
Stockholders' equity 2,346,262 2,240,810
Total liabilities and stockholders'
equity $6,426,271 $6,926,737
Ingram Micro Inc.
Consolidated Statement of Income
(Dollars in 000s, except per share data)
(Unaudited)
Thirteen Weeks Ended October 1, 2005
As Reported Special Non-GAAP
Under GAAP Items Financial
(a) Measure
Net sales $6,959,334 $-- $6,959,334
Costs of sales 6,577,531 -- 6,577,531
Gross profit 381,803 -- 381,803
Operating expenses:
Selling, general and
administrative 296,888 (5,234) 291,654
Reorganization costs 1,981 (1,981) --
298,869 (7,215) 291,654
Income from operations 82,934 7,215 90,149
Interest and other 20,661 (8,413) 12,248
Income before income taxes 62,273 15,628 77,901
Provision for income taxes 13,873 4,056 17,929
Net income $48,400 $11,572 $59,972
Diluted earnings per share:
Net income $0.29 $0.07 $0.36
Diluted weighted average
shares outstanding 164,405,056 164,405,056 164,405,056
Thirteen Weeks Ended October 2, 2004
As Reported Special Non-GAAP
Under GAAP Items Financial
(b) Measure
Net sales $6,016,389 $-- $6,016,389
Costs of sales 5,686,798 -- 5,686,798
Gross profit 329,591 -- 329,591
Operating expenses:
Selling, general and
administrative 272,064 -- 272,064
Reorganization costs (2,652) 2,652 --
269,412 2,652 272,064
Income from operations 60,179 (2,652) 57,527
Interest and other 5,323 4,277 9,600
Income before income taxes 54,856 (6,929) 47,927
Provision for income taxes (22,424) 37,761 15,337
Net income $77,280 $(44,690) $32,590
Diluted earnings per share:
Net income $0.49 $(0.28) $0.21
Diluted weighted average
shares outstanding 158,210,613 158,210,613 158,210,613
(a) Special items in 2005 represent reorganization costs of $1,981
primarily related to employee termination benefits for workforce
reductions in North America and Asia-Pacific and facility
consolidations in Asia-Pacific; $5,234 charged to selling, general
and administrative expenses, primarily comprised of consulting,
retention, and other transition costs related to the Company's
outsourcing and optimization plan in North America and integration
of Tech Pacific in Asia-Pacific; and a loss of $8,413 on the
redemption of the Company's senior subordinated notes and
termination of related interest-rate swap agreements.
(b) Special items in 2004 represent adjustments to reorganization
costs of $2,652 for lower than expected lease obligation costs
related to actions taken in North America and Europe in previous
years, a foreign-exchange gain of $4,277 related to currency hedging
of the Company's Australian-dollar denominated purchase of Tech
Pacific in November 2004, and an income tax benefit of $39,978 for
the reversal of previously accrued federal and state income taxes
related to the gain on the sale of securities in 1999 and 2000.
Ingram Micro Inc.
Consolidated Statement of Income
(Dollars in 000s, except per share data)
(Unaudited)
Thirty-nine Weeks Ended October 1, 2005
As Reported Special Non-GAAP
Under GAAP Items Financial
(a) Measure
Net sales $20,851,812 $-- $20,851,812
Costs of sales 19,722,994 -- 19,722,994
Gross profit 1,128,818 -- 1,128,818
Operating expenses:
Selling, general and
administrative 887,397 (20,062) 867,335
Reorganization costs 10,959 (10,959) --
898,356 (31,021) 867,335
Income from operations 230,462 31,021 261,483
Interest and other 49,424 (8,413) 41,011
Income before income taxes 181,038 39,434 220,472
Provision for income taxes 48,489 13,637 62,126
Net income $132,549 $25,797 $158,346
Diluted earnings per share:
Net income $0.81 $0.16 $0.97
Diluted weighted average
shares outstanding 163,584,100 163,584,100 163,584,100
Thirty-nine Weeks Ended October 2, 2004
As Reported Special Non-GAAP
Under GAAP Items Financial
(b) Measure
Net sales $18,008,648 $-- $18,008,648
Costs of sales 17,026,129 -- 17,026,129
Gross profit 982,519 -- 982,519
Operating expenses:
Selling, general and
administrative 810,342 -- 810,342
Reorganization costs (2,456) 2,456 --
807,886 2,456 810,342
Income from operations 174,633 (2,456) 172,177
Interest and other 26,507 4,277 30,784
Income before income taxes 148,126 (6,733) 141,393
Provision for income taxes 7,423 37,823 45,246
Net income $140,703 $(44,556) $96,147
Diluted earnings per share:
Net income $0.89 $(0.28) $0.61
Diluted weighted average
shares outstanding 158,510,907 158,510,907 158,510,907
(a) Special items in 2005 represent reorganization costs of $10,959
primarily related to employee termination benefits for workforce
reductions in North America and Asia-Pacific and facility
consolidations in Asia-Pacific; $20,062 charged to selling, general
and administrative expenses, primarily comprised of consulting,
retention, and other transition costs related to the Company's
outsourcing and optimization plan in North America and integration
of Tech Pacific in Asia-Pacific, primarily comprised of consulting,
accelerated depreciation of fixed assets associated with facility
closures, and other costs related to the acquisition of Tech
Pacific; a loss of $8,413 on the redemption of the Company's senior
subordinated notes and termination of related interest-rate swap
agreements; and a benefit of $2,201 for the reversal of previously
accrued state income taxes related to gains on the sale of
securities in 1999 and 2000.
(b) Special items in 2004 represent a net credit adjustment to
reorganization costs of $2,456 primarily for lower than expected
lease obligation costs related to actions taken in North America and
Europe in previous years, a foreign-exchange gain of $4,277 related
to currency hedging of the Company's Australian-dollar denominated
purchase of Tech Pacific, and an income tax benefit of $39,978 for
the reversal of previously accrued federal and state income taxes
related to the gain on the sale of securities in 1999 and 2000.
Ingram Micro Inc.
Supplementary Information
(Dollars in 000s)
(Unaudited)
Thirteen Weeks Ended October 1, 2005
Income from operations
As Reported Special Non-GAAP
Under Items Financial
Net Sales GAAP (a) Measure
North America $3,086,104 $43,749 $4,717 $48,466
Europe 2,341,826 20,970 (14) 20,956
Asia-Pacific 1,207,845 13,884 2,512 16,396
Latin America 323,559 4,331 -- 4,331
$6,959,334 $82,934 $7,215 $90,149
Thirteen Weeks Ended October 2, 2004
Income from operations
As Reported Special Non-GAAP
Under Items Financial
Net Sales GAAP (b) Measure
North America $3,051,027 $39,072 $(2,585) $36,487
Europe 2,128,386 16,562 (67) 16,495
Asia-Pacific 569,810 1,287 -- 1,287
Latin America 267,166 3,258 -- 3,258
$6,016,389 $60,179 $(2,652) $57,527
(a) Special items in 2005 represent reorganization costs of $1,981,
consisting of $709 in North America, primarily related to employee
termination benefits for workforce reductions; $1,286 in
Asia-Pacific, primarily related to employee termination benefits for
workforce reductions and facility consolidations; partially offset
by net credit adjustments of $14 in Europe for lower than expected
costs to settle obligations related to previous actions; and $5,234
charged to selling, general and administrative expenses ($4,008 in
North America and $1,226 in Asia-Pacific), primarily comprised of
consulting, retention, and other transition costs related to the
Company's outsourcing and optimization plan in North America and
integration of Tech Pacific in Asia-Pacific.
(b) Special items in 2004 represent credit adjustments to reorganization
costs of $2,652 ($2,585 in North America and $67 in Europe) for
lower than expected lease obligation costs related to actions taken
in previous years.
Ingram Micro Inc.
Supplementary Information
(Dollars in 000s)
(Unaudited)
Thirty-nine Weeks Ended October 1, 2005
Income from operations
As Reported Special Non-GAAP
Under Items Financial
Net Sales GAAP (a) Measure
North America $8,943,314 $102,548 $21,001 $123,549
Europe 7,411,515 86,271 (35) 86,236
Asia-Pacific 3,592,986 30,887 10,055 40,942
Latin America 903,997 10,756 -- 10,756
$20,851,812 $230,462 $31,021 $261,483
Thirty-nine Weeks Ended October 2, 2004
Income from operations
As Reported Special Non-GAAP
Under Items Financial
Net Sales GAAP (b) Measure
North America $8,635,773 $92,430 $(2,493) $89,937
Europe 6,850,041 71,887 (279) 71,608
Asia-Pacific 1,755,432 2,581 316 2,897
Latin America 767,402 7,735 -- 7,735
$18,008,648 $174,633 $(2,456) $172,177
(a) Special items in 2005 represent reorganization costs of $10,959,
consisting of $6,319 in North America, primarily related to employee
termination benefits for workforce reductions; $4,675 in
Asia-Pacific, primarily related to employee termination benefits for
workforce reductions and facility consolidations; partially offset
by net credit adjustments of $35 in Europe for lower than expected
costs to settle obligations related to previous actions; and $20,062
charged to selling, general and administrative expenses ($14,682 in
North America and $5,380 in Asia-Pacific), primarily comprised of
consulting, retention, and other transition costs related to the
Company's outsourcing and optimization plan in North America and
integration of Tech Pacific in Asia-Pacific, primarily comprised of
consulting, accelerated depreciation of fixed assets associated with
facility closures, and other costs related to the acquisition of
Tech Pacific.
(b) Special items in 2004 represent a net adjustment to reorganization
costs of $2,456 which consisted of a charge of $316 related to
employee termination benefits for workforce reductions in
Asia-Pacific and $2,772 of net credit adjustments ($2,493 in North
America and $279 in Europe) for lower than expected lease obligation
costs and lower than expected employee termination benefits related
to detailed actions taken in previous quarters.
SOURCE Ingram Micro Inc.
Media, Jennifer Baier, +1-714-382-2692, jennifer.baier@ingrammicro.com, or Chris Kelly, +1-714-382-3355, chris.kelly@ingrammicro.com, or Investors, Ria Marie Carlson, +1-714-382-4400, ria.carlson@ingrammicro.com, or Kay Leyba, +1-714-382-4175, kay.leyba@ingrammicro.com, all of Ingram Micro Inc.