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Ingram Micro reports third quarter figures

by Stuart Wilson, Thursday 1 November 2012

Global distribution giant Ingram Micro’s worldwide sales were up 1% year-on-year at US$9.03 billion for the third quarter of 2012 ending September 29th. Net profits more than doubled year-on-year to hit US$53.3m. Gross profits rose slightly driven primarily by sales growth in Ingram Micro’s North American high margin business and logistics operations. This increase was tempered by a negative impact created by the fulfilment model used to supply tablet devices.

Ingram Micro explained: “2012 third quarter gross profit continues to be negatively impacted by significant sales growth in tablets and other personal devices, the majority of which are delivered to the market in a high velocity, yet lower cost to serve, fulfilment model, as well as a continued competitive selling environment, particularly in more commoditised product lines.”

Latin America delivered all-time record third quarter sales up 11% year-on-year. Asia Pacific performed well, as the two largest contributors – China and India – each delivered double-digit growth in local currencies. Total sales for the region were up 6% year-on-year.

Sales in Latin America hit US$467.1m with an operating margin of 1.98%. Asia-Pacific revenues totalled US$2.17 billion with an operating margin of just 0.42%. Sales in Europe hit US$2.42 billion with an operating margin of 0.6%.

In Europe, Ingram Micro’s three anchor countries of Germany, the UK and France all experienced solid year-over-year sales growth in local currencies, offset somewhat by continued weakness in other countries as the region as a whole continues to experience challenging economic conditions. European sales were down 9% year-on-year in dollar terms.

Ingram Micro also completed the acquisitions of Aptec and Brightpoint in support of its long-term growth strategy to expand the company’s business in high growth markets, while increasing its services and solutions capabilities:

"It is clear that the macroeconomic environment and mid-term perspective are difficult, however, we executed well during the quarter, with every region growing revenues in local currencies," said Alain Monie, president and CEO at Ingram Micro. "We also experienced excellent leverage in the model with overall operating income increasing by more than 8% on 1% revenue growth."

"Our position as the world’s largest technology distributor provides valuable differentiation, giving us the ability to execute on our financial objectives despite challenging conditions," Monie said. "Our industry-leading reach covers more than 145 countries with the world’s most comprehensive portfolio of IT products and services, which enable us to capture revenue opportunities in better performing regions such as Asia Pacific and Latin America and in markets including SMB and certain retail and e-tail segments that many others cannot serve. This global reach and broad portfolio of IT products and services make us a highly attractive partner for vendors and customer alike."

"In addition to our financial execution we are also executing on several of our stated strategic initiatives: building out our mobility business through adding scale and high value services with BrightPoint, while also expanding our reach into the Middle East and Africa with Aptec, all of which provide our vendor partners and customers even broader integrated IT and mobility offerings and a truly global platform," he added.

Bill Humes, COO and CFO, commented: "We believe the combination of our recent acquisitions and our ongoing organic investments back into the business will ultimately benefit the company through a higher mix of faster growing markets – both geographic and product related – and the ability to offer higher margin products and services. To help facilitate these strategic initiatives, we continue to take what we believe are prudent and appropriate steps to provide a solid capital structure through a combination of cash, public debt and bank facilities. Our primary goal is to drive sustainable, long-term shareholder value, and we are taking the appropriate steps to do so."

DISTREE EMEA 2013

Top distributors, retailers and e-tailers from across the EMEA region are invited to attend DISTREE EMEA 2013, the premier event for the regional ICT and CE channel, from February 19-22nd in Monaco.

DISTREE EMEA gathers hundreds of senior executives from EMEA’s Information Communications Technologies (ICT) & Consumer Electronics (CE) volume channel. DISTREE EMEA is a powerful business platform for vendors looking to manage, build or launch routes-to-market within EMEA. From A-brand vendors to start-ups, the DISTREE EMEA structure and reach offers business benefits and powerful return on investment.

During the course of the three-day event, delegates take part in thousands of pre-scheduled one-on-one meetings with hundreds of vendors. Each year, hundreds of new distribution agreements are struck across the region as a result of business relationships initiated at DISTREE EMEA.

DISTREE EMEA 2013 will also build on successful initiatives launched at last year’s sold out event including a regional awards ceremony. The ‘EMEA Channel Academy: 2013 Awards’ will include more than 20 categories for vendors and distributors from across the region.

www.distree-emea.com

For more information on attending DISTREE EMEA 2013 please contact fhemraj@distree.com quoting code DEMEA13

DISTREE_Events

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