(US$ in millions, except EPS and diluted shares) |
Third Quarter Ended |
|||||||
September 27, 2014 |
September 28, 2013 |
Change |
||||||
Net Sales |
$ |
11,238 |
$ |
10,151 |
11% |
|||
Non-GAAP operating income |
$ |
161 |
$ |
135 |
19% |
|||
Non-GAAP operating margin |
1.43% |
1.33% |
10 bps |
|||||
Operating income |
$ |
120 |
$ |
138 |
(13)% |
|||
Operating margin |
1.07% |
1.36% |
-29 bps |
|||||
Non-GAAP earnings per diluted share |
$ |
0.62 |
$ |
0.53 |
17% |
|||
Earnings per diluted share |
$ |
0.45 |
$ |
0.50 |
10% |
|||
Diluted shares outstanding (millions) |
159.5 |
157.1 |
A reconciliation of GAAP financial measures to non-GAAP financial measures is presented in the Supplementary Information section in this press release.
Alain Monié,
Worldwide sales increased by more than
Worldwide gross profit was
The company drove strong operating leverage, with non-GAAP operating income for the 2014 third quarter increasing 19 percent - nearly double the company's revenue growth - to
2014 third quarter non-GAAP net income also benefited from strong operating leverage, increasing 18 percent to
On a GAAP basis, operating income was
The company generated approximately
Key 2014 third quarter business highlights:
- The company signed a definitive share purchase agreement to acquire a majority interest in Armada, the largest value-add technology distributor in
Turkey . Ingram Micro expanded its relationship with IBM and now offers IBM SoftLayer cloud services - the foundation for IBM's cloud portfolio.- The company partnered with
Microsoft to rolloutMicrosoft's Cloud Service Provider, a new cloud service delivery platform forMicrosoft's cloud services. - CloudBlue, the company's IT asset disposal business, was awarded a contract with an existing Fortune 100 financial services company to provide IT asset disposal in
India . - The company went live with Shipwire's web-based logistics platform fully integrated into
Ingram Micro's Sydney warehouse. Ingram Micro expanded its device-recovery service operations at a key returns center in Plainfield, Ind. to help support the refurbishment or recycling of more than 40,000 mobile devices every day in North America.- The company added
Google's Chromebook to its portfolio line, reaching agreements with 65 channel partners to resell Google Chrome solutions into the K-12 student market in the U.S. Ingram Micro added Alcatel One Touch range of handsets to its offerings inIndia .
Outlook
The following statement is based on the Company's current expectations for the 2014 fourth quarter and excludes the amortization of intangible assets, charges associated with reorganization, integration and transition costs and other expense reduction programs and the impact of foreign exchange gains or losses related to the translation effect on Euro-based inventory purchases in
For the 2014 fourth quarter, the company currently expects worldwide revenue to increase between 8 to 12 percent over the 2013 fourth quarter, with non-GAAP earnings per diluted share of
Non-GAAP Disclosures
In addition to GAAP results,
The non-GAAP measures noted above are primary indicators that
Reconciliation of GAAP to non-GAAP financial measures for the periods presented are attached to the press release.
Conference Call and Webcast
Additional information about
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 (877) 660-6853, conference ID "13591022."
About
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 within the meaning of the Private Securities Litigation Reform Act, including statements relating to the expected benefits from new wins and market share and our ability to enhance earnings power, are based on current management expectations. Certain risks may cause such expectations to not be achieved and, in turn, may have a material adverse effect on
© 2014 Ingram Micro Inc. All rights reserved.
Ingram Micro Inc. |
|||
Consolidated Balance Sheet |
|||
(Amounts in 000s) |
|||
(Unaudited) |
|||
September 27, |
December 28, |
||
2014 |
2013 |
||
ASSETS |
|||
Current assets: |
|||
Cash and cash equivalents |
$ 497,820 |
$ 674,390 |
|
Trade accounts receivable, net |
4,858,259 |
5,454,832 |
|
Inventory |
4,253,181 |
3,724,447 |
|
Other current assets |
561,766 |
521,902 |
|
Total current assets |
10,171,026 |
10,375,571 |
|
Property and equipment, net |
472,609 |
488,699 |
|
Goodwill |
530,051 |
527,526 |
|
Intangible assets, net |
343,202 |
375,423 |
|
Other assets |
44,967 |
23,976 |
|
Total assets |
$ 11,561,855 |
$ 11,791,195 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||
Current liabilities: |
|||
Accounts payable |
$ 5,706,528 |
$ 6,175,604 |
|
Accrued expenses |
530,419 |
710,040 |
|
Short-term debt and current maturities of long-term debt |
143,558 |
48,772 |
|
Total current liabilities |
6,380,505 |
6,934,416 |
|
Long-term debt, less current maturities |
984,603 |
797,454 |
|
Other liabilities |
99,719 |
109,700 |
|
Total liabilities |
7,464,827 |
7,841,570 |
|
Stockholders' equity |
4,097,028 |
3,949,625 |
|
Total liabilities and stockholders' equity |
$ 11,561,855 |
$ 11,791,195 |
Ingram Micro Inc. |
|||
Consolidated Statement of Income |
|||
(Amounts in 000s, except per share data) |
|||
(Unaudited) |
|||
Thirteen Weeks Ended |
|||
September 27, 2014 |
September 28, 2013 |
||
Net sales |
$ 11,237,840 |
$ 10,150,615 |
|
Cost of sales |
10,591,751 |
9,551,782 |
|
Gross profit |
646,089 |
598,833 |
|
Operating expenses: |
|||
Selling, general and administrative |
494,507 |
442,756 |
|
Amortization of intangible assets |
14,567 |
11,638 |
|
Reorganization costs |
17,300 |
6,748 |
|
526,374 |
461,142 |
||
Income from operations |
119,715 |
137,691 |
|
Other expense (income): |
|||
Interest income |
(1,045) |
(2,031) |
|
Interest expense |
16,659 |
16,032 |
|
Net foreign currency exchange loss (gain) |
(3,323) |
8,117 |
|
Other |
4,467 |
2,070 |
|
16,758 |
24,188 |
||
Income before income taxes |
102,957 |
113,503 |
|
Provision for income taxes |
30,723 |
34,565 |
|
Net income |
$ 72,234 |
$ 78,938 |
|
Diluted earnings per share |
$ 0.45 |
$ 0.50 |
|
Diluted weighted average shares outstanding |
159,543 |
157,144 |
Ingram Micro Inc. |
|||
Consolidated Statement of Income |
|||
(Amounts in 000s, except per share data) |
|||
(Unaudited) |
|||
Thirty-nine Weeks Ended |
|||
September 27, 2014 |
September 28, 2013 |
||
Net sales |
$ 32,531,208 |
$ 30,721,074 |
|
Cost of sales |
30,640,794 |
28,941,182 |
|
Gross profit |
1,890,414 |
1,779,892 |
|
Operating expenses: |
|||
Selling, general and administrative |
1,481,743 |
1,382,159 |
|
Amortization of intangible assets |
43,140 |
35,400 |
|
Reorganization costs |
79,237 |
20,050 |
|
1,604,120 |
1,437,609 |
||
Income from operations |
286,294 |
342,283 |
|
Other expense (income): |
|||
Interest income |
(3,782) |
(5,886) |
|
Interest expense |
54,406 |
45,973 |
|
Net foreign currency exchange loss (gain) |
(1,153) |
9,865 |
|
Other |
13,011 |
9,150 |
|
62,482 |
59,102 |
||
Income before income taxes |
223,812 |
283,181 |
|
Provision for income taxes |
76,132 |
84,798 |
|
Net income |
$ 147,680 |
$ 198,383 |
|
Diluted earnings per share |
$ 0.93 |
$ 1.27 |
|
Diluted weighted average shares outstanding |
159,181 |
155,629 |
Ingram Micro Inc. |
|||||||
Consolidated Statement of Cash Flows |
|||||||
(Amounts in 000s) |
|||||||
(Unaudited) |
|||||||
Thirty-nine Weeks Ended |
|||||||
September 27, 2014 |
September 28, 2013 |
||||||
Cash flows from operating activities: |
|||||||
Net income |
$ 147,680 |
$ 198,383 |
|||||
Adjustments to reconcile net income to cash provided (used) by operating activities: |
|||||||
Depreciation and amortization |
108,202 |
94,359 |
|||||
Stock-based compensation |
24,761 |
21,649 |
|||||
Excess tax benefit from stock-based compensation |
(4,338) |
(1,787) |
|||||
Write-off of assets |
8,302 |
5,875 |
|||||
Gain on sale of land and building |
- |
(1,045) |
|||||
Noncash charges for interest and bond discount amortization |
1,769 |
1,842 |
|||||
Deferred income taxes |
(30,973) |
10,154 |
|||||
Changes in operating assets and liabilities, net of effects of acquisitions: |
|||||||
Trade accounts receivable |
566,097 |
1,010,692 |
|||||
Inventory |
(551,609) |
(199,279) |
|||||
Other current assets |
(30,350) |
(42,667) |
|||||
Accounts payable |
(603,481) |
(1,005,513) |
|||||
Change in book overdrafts |
166,361 |
53,840 |
|||||
Accrued expenses |
(196,364) |
(33,102) |
|||||
Cash provided (used) by operating activities |
(393,943) |
113,401 |
|||||
Cash flows from investing activities: |
|||||||
Capital expenditures |
(52,369) |
(66,423) |
|||||
Sale of marketable securities, net |
1,100 |
542 |
|||||
Proceeds from sale of land and building |
- |
1,169 |
|||||
Cost-based investment |
(10,000) |
- |
|||||
Acquisitions and earn-out payment, net of cash acquired |
(18,880) |
(14,408) |
|||||
Cash used by investing activities |
(80,149) |
(79,120) |
|||||
Cash flows from financing activities: |
|||||||
Proceeds from exercise of stock options |
16,943 |
39,517 |
|||||
Excess tax benefit from stock-based compensation |
4,338 |
1,787 |
|||||
Fees associated with the amendment and extension of credit facilities |
- |
(1,086) |
|||||
Net proceeds from (repayments of) revolving credit facilities |
283,133 |
(155,272) |
|||||
Cash provided (used) by financing activities |
304,414 |
(115,054) |
|||||
Effect of exchange rate changes on cash and cash equivalents |
(6,892) |
(12,748) |
|||||
Decrease in cash and cash equivalents |
(176,570) |
(93,521) |
|||||
Cash and cash equivalents, beginning of period |
674,390 |
595,147 |
|||||
Cash and cash equivalents, end of period |
$ 497,820 |
$ 501,626 |
Ingram Micro Inc. |
||||||||||||
Supplementary Information |
||||||||||||
Income from Operations - Reconciliation of GAAP to Non-GAAP Information |
||||||||||||
(Amounts in Millions) |
||||||||||||
(Unaudited) |
||||||||||||
Thirteen Weeks Ended September 27, 2014 |
||||||||||||
North America |
Europe |
Asia-Pacific |
Latin America |
Stock-based |
Consolidated |
|||||||
Net Sales |
$ 5,134.3 |
$3,200.4 |
$ 2,378.2 |
$ 524.9 |
$ - |
$ 11,237.8 |
||||||
GAAP Operating Income |
$ 85.7 |
$ 2.1 |
$ 31.0 |
$ 9.2 |
$ (8.3) |
$ 119.7 |
||||||
Reorganization, integration and transition costs |
9.9 |
15.4 |
0.7 |
0.5 |
- |
26.5 |
||||||
Amortization of intangible assets |
10.0 |
3.0 |
1.4 |
0.2 |
- |
14.6 |
||||||
Non-GAAP Operating Income |
$ 105.6 |
$ 20.5 |
$ 33.1 |
$ 9.9 |
$ (8.3) |
$ 160.8 |
||||||
GAAP Operating Margin |
1.67% |
0.07% |
1.30% |
1.75% |
1.07% |
|||||||
Non-GAAP Operating Margin |
2.06% |
0.64% |
1.39% |
1.89% |
1.43% |
|||||||
Thirteen Weeks Ended September 28, 2013 |
||||||||||||
North America |
Europe |
Asia-Pacific |
Latin America |
Stock-based |
Consolidated |
|||||||
Net Sales |
$ 4,305.3 |
$2,927.3 |
$ 2,469.4 |
$ 448.6 |
$ - |
$ 10,150.6 |
||||||
GAAP Operating Income |
$ 107.1 |
$ 6.2 |
$ 22.4 |
$ 9.6 |
$ (7.7) |
$ 137.7 |
||||||
Reorganization, integration and transition costs |
4.1 |
5.0 |
1.5 |
- |
- |
10.6 |
||||||
Amortization of intangible assets |
7.3 |
2.7 |
1.4 |
0.2 |
- |
11.6 |
||||||
LCD class action settlement |
(28.5) |
- |
- |
(1.0) |
- |
(29.5) |
||||||
European indirect tax declarations charge |
- |
5.0 |
- |
- |
- |
5.0 |
||||||
Non-GAAP Operating Income |
$ 90.0 |
$ 18.9 |
$ 25.3 |
$ 8.9 |
$ (7.7) |
$ 135.4 |
||||||
GAAP Operating Margin |
2.49% |
0.21% |
0.91% |
2.15% |
1.36% |
|||||||
Non-GAAP Operating Margin |
2.09% |
0.65% |
1.02% |
1.97% |
1.33% |
Ingram Micro Inc. |
||||||||||||
Supplementary Information |
||||||||||||
Income from Operations - Reconciliation of GAAP to Non-GAAP Information |
||||||||||||
(Amounts in Millions) |
||||||||||||
(Unaudited) |
||||||||||||
Thirty-nine Weeks Ended September 27, 2014 |
||||||||||||
North America |
Europe |
Asia-Pacific |
Latin America |
Stock-based |
Consolidated |
|||||||
Net Sales |
$ 13,887.4 |
$10,077.4 |
$ 7,026.4 |
$ 1,540.0 |
$ - |
$ 32,531.2 |
||||||
GAAP Operating Income |
$ 219.5 |
$ (6.0) |
$ 71.4 |
$ 26.2 |
$ (24.8) |
$ 286.3 |
||||||
Reorganization, integration and transition costs |
39.7 |
61.6 |
4.5 |
1.1 |
- |
106.9 |
||||||
Amortization of intangible assets |
29.6 |
8.7 |
4.3 |
0.6 |
- |
43.2 |
||||||
LCD class action settlement |
(6.6) |
- |
- |
- |
- |
(6.6) |
||||||
Non-GAAP Operating Income |
$ 282.2 |
$ 64.3 |
$ 80.2 |
$ 27.9 |
$ (24.8) |
$ 429.8 |
||||||
GAAP Operating Margin |
1.58% |
(0.06%) |
1.02% |
1.70% |
0.88% |
|||||||
Non-GAAP Operating Margin |
2.03% |
0.64% |
1.14% |
1.81% |
1.32% |
|||||||
Thirty-nine Weeks Ended September 28, 2013 |
||||||||||||
North America |
Europe |
Asia-Pacific |
Latin America |
Stock-based |
Consolidated |
|||||||
Net Sales |
$ 12,647.1 |
$ 9,137.2 |
$ 7,566.4 |
$ 1,370.4 |
$ - |
$ 30,721.1 |
||||||
GAAP Operating Income |
$ 243.8 |
$ 30.7 |
$ 64.7 |
$ 24.7 |
$ (21.6) |
$ 342.3 |
||||||
Reorganization, integration and transition costs |
15.2 |
12.4 |
6.8 |
- |
- |
34.4 |
||||||
Amortization of intangible assets |
21.9 |
8.5 |
4.4 |
0.7 |
- |
35.4 |
||||||
LCD class action settlement |
(28.5) |
- |
- |
(1.0) |
- |
(29.5) |
||||||
European indirect tax declarations charge |
- |
5.0 |
- |
- |
- |
5.0 |
||||||
Non-GAAP Operating Income |
$ 252.4 |
$ 56.6 |
$ 75.9 |
$ 24.3 |
$ (21.6) |
$ 387.6 |
||||||
GAAP Operating Margin |
1.93% |
0.34% |
0.86% |
1.80% |
1.11% |
|||||||
Non-GAAP Operating Margin |
2.00% |
0.62% |
1.00% |
1.78% |
1.26% |
Ingram Micro Inc. |
|||||
Supplementary Information |
|||||
Reconciliation of GAAP to Non-GAAP Financial Measures |
|||||
(Amounts in Millions, except per share data) |
|||||
(Unaudited) |
|||||
Thirteen Weeks Ended September 27, 2014 |
|||||
Diluted |
|||||
Net Income |
Earnings per Share (a) |
||||
As Reported Under GAAP |
$ 72.2 |
$ 0.45 |
|||
Reorganization, integration and transition costs |
20.3 |
0.13 |
|||
Amortization of intangible assets |
10.2 |
0.06 |
|||
Pan-Europe foreign exchange gain |
(4.4) |
(0.02) |
|||
Non-GAAP Financial Measure |
$ 98.3 |
$ 0.62 |
|||
Thirteen Weeks Ended September 28, 2013 |
|||||
Diluted |
|||||
Net Income |
Earnings per Share (a) |
||||
As Reported Under GAAP |
$ 78.9 |
$ 0.50 |
|||
Reorganization, integration and transition costs |
7.4 |
0.05 |
|||
Amortization of intangible assets |
8.1 |
0.05 |
|||
Pan-Europe foreign exchange loss |
3.2 |
0.02 |
|||
LCD class action settlement |
(18.0) |
(0.11) |
|||
European indirect tax declarations charge |
3.5 |
0.02 |
|||
Non-GAAP Financial Measure |
$ 83.1 |
$ 0.53 |
|||
(a) |
Per share impact is calculated by dividing net income amount by the diluted weighted average shares outstanding of 159.5 and 157.1 for the thirteen weeks ended September 27, 2014 and September 28, 2013, respectively. |
|||||
Ingram Micro Inc. |
|||||
Supplementary Information |
|||||
Reconciliation of GAAP to Non-GAAP Financial Measures |
|||||
(Amounts in Millions, except per share data) |
|||||
(Unaudited) |
|||||
Thirty-nine Weeks Ended September 27, 2014 |
|||||
Diluted |
|||||
Net Income |
Earnings per Share (a) |
||||
As Reported Under GAAP |
$ 147.7 |
$ 0.93 |
|||
Reorganization, integration and transition costs |
85.1 |
0.54 |
|||
Amortization of intangible assets |
30.6 |
0.19 |
|||
LCD class action settlement |
(4.7) |
(0.03) |
|||
Pan-Europe foreign exchange gain |
(6.1) |
(0.04) |
|||
Non-GAAP Financial Measure |
$ 252.6 |
$ 1.59 |
|||
Thirty-nine Weeks Ended September 28, 2013 |
|||||
Diluted |
|||||
Net Income |
Earnings per Share (a) |
||||
As Reported Under GAAP |
$ 198.4 |
$ 1.27 |
|||
Reorganization, integration and transition costs |
24.1 |
0.16 |
|||
Amortization of intangible assets |
24.8 |
0.16 |
|||
Pan-Europe foreign exchange loss |
0.7 |
0.00 |
|||
LCD class action settlement |
(18.0) |
(0.11) |
|||
European indirect tax declarations charge |
3.5 |
0.02 |
|||
Non-GAAP Financial Measure |
$ 233.5 |
$ 1.50 |
|||
(a) |
Per share impact is calculated by dividing net income amount by the diluted weighted average shares outstanding of 159.2 and 155.6 for the thirty-nine weeks ended September 27, 2014 and September 28, 2013, respectively. |
|||||
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SOURCE
Investors, Damon Wright, (714) 382-5013, damon.wright@ingrammicro.com