The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: Avnet’s ability to retain and grow market share and to generate additional cash flow, risks associated with any acquisition activities and the successful integration of acquired companies, implementing and maintaining IT systems, supplier losses and changes to supplier programs, an industry down-cycle in semiconductors, declines in sales, changes in business conditions and the economy in general, changes in market demand and pricing pressures, any material changes in the allocation of product or price discounts by suppliers, and other competitive and/or regulatory factors affecting the businesses of Avnet generally.
More detailed information about these and other factors is set forth in Avnet’s filings with the Securities and Exchange Commission, including Avnet’s reports on Form 10-K, Form 10-Q and Form 8-K. Except as required by law, Avnet is under no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
About Avnet
Avnet is a global technology solutions provider with an extensive ecosystem delivering design, product, marketing and supply chain expertise for customers at every stage of the product lifecycle. We transform ideas into intelligent solutions, reducing the time, cost and complexities of bringing products to market. For nearly a century, Avnet has helped its customers and suppliers around the world realize the transformative possibilities of technology. Learn more about Avnet at www.avnet.com. (AVT_IR)
| AVNET, INC. | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (UNAUDITED) | ||||||||||||||||
| Second Quarters Ended | Six Months Ended | |||||||||||||||
| December 29, | December 30, | December 29, | December 30, | |||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (Thousands, except per share data) | ||||||||||||||||
| Sales | $ | 5,048,980 | $ | 4,521,636 | $ | 10,138,859 | $ | 9,182,578 | ||||||||
| Cost of sales | 4,418,947 | 3,919,175 | 8,872,077 | 7,967,563 | ||||||||||||
| Gross profit | 630,033 | 602,461 | 1,266,782 | 1,215,015 | ||||||||||||
| Selling, general and administrative expenses | 471,723 | 484,082 | 946,868 | 985,674 | ||||||||||||
| Restructuring, integration and other expenses | 62,260 | 36,762 | 77,048 | 83,156 | ||||||||||||
| Operating income | 96,050 | 81,617 | 242,866 | 146,185 | ||||||||||||
| Other income, net | 2,584 | 3,349 | 692 | 22,270 | ||||||||||||
| Interest and other financing expenses, net | (33,718 | ) | (22,826 | ) | (63,811 | ) | (44,841 | ) | ||||||||
| Income from continuing operations before taxes | 64,916 | 62,140 | 179,747 | 123,614 | ||||||||||||
| Income tax expense | 28,141 | 5,346 | 59,443 | 8,638 | ||||||||||||
| Income from continuing operations, net of tax | 36,775 | 56,794 | 120,304 | 114,976 | ||||||||||||
| Loss from discontinued operations, net of tax | (374 | ) | (10,070 | ) | (179 | ) | (9,949 | ) | ||||||||
| Net income | $ | 36,401 | $ | 46,724 | $ | 120,125 | $ | 105,027 | ||||||||
| Earnings (loss) per share - basic: | ||||||||||||||||
| Continuing operations | $ | 0.33 | $ | 0.47 | $ | 1.07 | $ | 0.94 | ||||||||
| Discontinued operations | 0.00 | (0.08 | ) | (0.01 | ) | (0.08 | ) | |||||||||
| Net income per share basic | $ | 0.33 | $ | 0.39 | $ | 1.06 | $ | 0.86 | ||||||||
| Earnings (loss) per share - diluted: | ||||||||||||||||
| Continuing operations | $ | 0.33 | $ | 0.47 | $ | 1.06 | $ | 0.93 | ||||||||
| Discontinued operations | 0.00 | (0.08 | ) | (0.01 | ) | (0.08 | ) | |||||||||
| Net income per share diluted | $ | 0.33 | $ | 0.39 | $ | 1.05 | $ | 0.85 | ||||||||
| Shares used to compute earnings per share: | ||||||||||||||||
| Basic | 110,332 | 120,400 | 112,796 | 121,543 | ||||||||||||
| Diluted | 111,462 | 121,749 | 113,967 | 122,867 | ||||||||||||
| Cash dividends paid per common share | $ | 0.20 | $ | 0.18 | $ | 0.40 | $ | 0.36 | ||||||||
| AVNET, INC. | ||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
| (UNAUDITED) | ||||||
| December 29, | June 30, | |||||
| 2018 | 2018 | |||||
| (Thousands) | ||||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 482,166 | $ | 621,125 | ||
| Receivables, net | 3,445,807 | 3,641,139 | ||||
| Inventories | 3,306,299 | 3,141,822 | ||||
| Prepaid and other current assets | 156,451 | 206,513 | ||||
| Total current assets | 7,390,723 | 7,610,599 | ||||
| Property, plant and equipment, net | 462,914 | 522,909 | ||||
| Goodwill | 1,010,568 | 980,872 | ||||
| Intangible assets, net | 184,979 | 219,913 | ||||
| Other assets | 185,515 | 262,552 | ||||
| Total assets | $ | 9,234,699 | $ | 9,596,845 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
| Current liabilities: | ||||||
| Short-term debt | $ | 1,845 | $ | 165,380 | ||
| Accounts payable | 2,046,571 | 2,269,478 | ||||
| Accrued expenses and other | 424,350 | 534,603 | ||||
| Total current liabilities | 2,472,766 | 2,969,461 | ||||
| Long-term debt | 1,961,467 | 1,489,219 | ||||
| Other liabilities | 391,729 | 453,084 | ||||
| Total liabilities | 4,825,962 | 4,911,764 | ||||
| Shareholders’ equity | 4,408,737 | 4,685,081 | ||||
| Total liabilities and shareholders’ equity | $ | 9,234,699 | $ | 9,596,845 | ||
| AVNET, INC. | ||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| (UNAUDITED) | ||||||||
| Six Months Ended | ||||||||
| December 29, 2018 | December 30, 2017 | |||||||
| (Thousands) | ||||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 120,125 | $ | 105,027 | ||||
| Less: Loss from discontinued operations, net of tax | (179 | ) | (9,949 | ) | ||||
| Income from continuing operations | 120,304 | 114,976 | ||||||
| Non-cash and other reconciling items: | ||||||||
| Depreciation | 48,124 | 77,510 | ||||||
| Amortization | 41,220 | 47,256 | ||||||
| Deferred income taxes | 44,857 | (55,921 | ) | |||||
| Stock-based compensation | 17,077 | 17,090 | ||||||
| Other, net | 77,437 | 22,386 | ||||||
| Changes in (net of effects from businesses acquired and divested): | ||||||||
| Receivables | 193,520 | 108,459 | ||||||
| Inventories | (209,582 | ) | (410,361 | ) | ||||
| Accounts payable | (205,254 | ) | 75,342 | |||||
| Accrued expenses and other, net | (140,495 | ) | (55,955 | ) | ||||
| Net cash flows used for operating activities - continuing operations | (12,792 | ) | (59,218 | ) | ||||
| Net cash flows used for operating activities - discontinued operations | (56,284 | ) | — | |||||
| Net cash flows used for operating activities | (69,076 | ) | (59,218 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Borrowings under accounts receivable securitization, net | 366,000 | 78,000 | ||||||
| Repayments under senior unsecured credit facility, net | (59,420 | ) | (99,971 | ) | ||||
| Repayments under bank credit facilities and other debt, net | (595 | ) | (27,381 | ) | ||||
| Repurchases of common stock | (335,404 | ) | (135,458 | ) | ||||
| Dividends paid on common stock | (44,701 | ) | (43,572 | ) | ||||
| Other, net | 15,200 | (1,214 | ) | |||||
| Net cash flows used for financing activities - continuing operations | (58,920 | ) | (229,596 | ) | ||||
| Net cash flows used for financing activities | (58,920 | ) | (229,596 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchases of property, plant and equipment | (70,186 | ) | (67,397 | ) | ||||
| Acquisitions of businesses, net of cash acquired | (62,514 | ) | (14,661 | ) | ||||
| Other, net | 963 | 2,402 | ||||||
| Net cash flows used for investing activities - continuing operations | (131,737 | ) | (79,656 | ) | ||||
| Net cash flows provided by investing activities - discontinued operations | 123,473 | 112,664 | ||||||
| Net cash flows (used) provided by investing activities | (8,264 | ) | 33,008 | |||||
| Effect of currency exchange rate changes on cash and cash equivalents | (2,699 | ) | 8,940 | |||||
| Cash and cash equivalents: | ||||||||
| — decrease | (138,959 | ) | (246,866 | ) | ||||
| — at beginning of period | 621,125 | 836,384 | ||||||
| — at end of period | $ | 482,166 | $ | 589,518 | ||||
Non-GAAP Financial Information
