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SYNNEX income increased 10.7%

Staff writer ▼ | April 7, 2014
SYNNEX Corporation announced financial results for the fiscal first quarter ended February 28, 2014. Q1 2014 operating income was $62 million, compared to $55.9 million, an increased of 10.7 percent.
SYNNEX
SYNNEXSYNNEX Corporation announced financial results for the fiscal first quarter ended February 28, 2014. Q1 2014 operating income was $62 million, compared to $55.9 million, an increased of 10.7 percent.


Technology Solutions (formerly Distribution): Revenue was $2.90 billion, up 20.0% from the prior fiscal year quarter. Adjusting for the translation effect of foreign currencies, primarily the yen and the Canadian dollar, the Technology Solutions business grew approximately 24%.

Technology Solutions income before non-operating items, income taxes and non-controlling interest was $63.5 million, or 2.19% of segment revenue, compared with $53.5 million, or 2.21% of segment revenue, in the fiscal first quarter of 2013.

Concentrix (formerly GBS): Revenue was $127.0 million, an increase of 186% over the prior fiscal year quarter. Concentrix results include approximately $74.5 million of revenue from the recently acquired IBM customer relationship management (CRM) business.

Concentrix loss before non-operating items, income taxes and non-controlling interest was $1.8 million, or 1.40% of Concentrix revenue, compared with income of $2.4 million, or 5.47% of Concentrix revenue, in the prior fiscal year quarter. Non-GAAP Concentrix income before non-operating items, income taxes and non-controlling interest was $11.8 million, or 9.33% of Concentrix revenue, for fiscal first quarter of 2014, compared to $3.4 million, or 7.77% of Concentrix revenue, in the prior year period.

"Other income" includes a $2.9 million benefit from a class-action legal settlement. The trailing fiscal four quarter ROIC was 8.8% compared to 10.1% in the prior year first quarter. The current fiscal quarter ROIC includes the impact of acquisition and integration expenses. The cash conversion cycle was 44 days compared to 43 days in the prior year fiscal first quarter.

The debt to capitalization ratio was 33%, up from 18% in the prior year fiscal first quarter due to financing the acquisition of the IBM CRM business. Depreciation and amortization were each $5.7 million.

The following statements are based on the company's current expectations for the fiscal 2014 second quarter and do not include acquisition and integration expenses and amortization of intangibles. Revenue is expected to be in the range of $3.1 billion to $3.2 billion. Non-GAAP net income is expected to be in the range of $52.7 million to $54.0 million.

Non-GAAP diluted earnings per share are expected to be in the range of $1.34 to $1.38. After-tax amortization of intangibles is expected to be $8.7 million, or $0.22 per share. These estimates are based on the preliminary purchase price allocation of the IBM CRM acquisition and are subject to change.


 

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