Achieves Strong Cash Flow and Disciplined
Capital Allocation
ScanSource, Inc. (NASDAQ: SCSC), a leading hybrid distributor
connecting devices to the cloud, today announced financial results
for the fourth quarter and fiscal year ended June 30, 2024. All
results in this release reflect continuing operations only unless
otherwise noted.
Fourth Quarter Summary
Fiscal Year Summary
Q4 FY24
Q4 FY23
Change
FY24
FY23
Change
(in thousands, except
percentages and per share data)
Select reported measures:
Net sales
$
746,113
$
947,149
-21.2%
$
3,259,809
$
3,787,721
-13.9%
Gross profit
$
97,315
$
108,659
-10.4%
$
399,052
$
449,239
-11.2%
Gross profit margin %
13.04
%
11.47
%
157bp
12.24
%
11.86
%
38bp
Operating income
$
21,871
$
27,289
-19.9%
$
90,324
$
135,886
-33.5%
GAAP net income
$
16,097
$
17,095
-5.8%
$
77,060
$
88,092
-12.5%
GAAP diluted EPS
$
0.64
$
0.68
-5.9%
$
3.06
$
3.47
-11.8%
Operating cash flow
$
54,738
$
(15,261
)
n/m
$
371,647
$
(35,769
)
n/m
Select Non-GAAP measures*:
Adjusted EBITDA
$
34,181
$
40,199
-15.0%
$
140,654
$
179,943
-21.8%
Adjusted EBITDA margin %
4.58
%
4.24
%
34bp
4.31
%
4.75
%
-44bp
Non-GAAP net income
$
19,921
$
19,213
3.7%
$
77,670
$
97,688
-20.5%
Non-GAAP diluted EPS
$
0.80
$
0.76
5.3%
$
3.08
$
3.85
-20.0%
Free cash flow
$
53,468
$
(18,692
)
n/m
$
363,092
$
(45,748
)
n/m
n/m - not meaningful
* Represents non-GAAP financial measures.
For more information and a reconciliation to the most directly
comparable GAAP financial measure, see "Non-GAAP Financial
Information" below as well as the accompanying Supplementary
Information.
"Our results for the year reflect a soft demand environment;
however, we delivered strong margins and robust cash flow," said
Mike Baur, Chair and CEO, ScanSource, Inc. "We are executing well
on our capital allocation plan to invest in strategic acquisitions
and share repurchases. Earlier this month, we announced two
acquisitions of higher margin, recurring revenue businesses and are
excited to welcome the Resourcive and Advantix teams to
ScanSource."
Quarterly Results
Net sales for the fourth quarter of fiscal year 2024 totaled
$746.1 million, down 21.2% year-over-year. Specialty Technology
Solutions net sales for the fourth quarter decreased 13.7%
year-over-year to $484.7 million from softer demand in a more
cautious technology spending environment. Modern Communications
& Cloud net sales for the fourth quarter decreased 32.2%
year-over-year to $261.4 million from lower sales volumes in
communications hardware and Cisco products. Intelisys net sales for
the fourth quarter increased 6.2% year-over-year.
Gross profit for the fourth quarter of fiscal year 2024
decreased 10.4% year-over-year to $97.3 million with a gross profit
margin of 13.04% versus 11.47% in the prior-year quarter. The gross
profit margin reflects a higher contribution of Intelisys revenue
in our overall revenue mix, which is recorded on a net basis and
therefore contributes to a higher gross profit margin.
For the fourth quarter of fiscal year 2024, operating income was
$21.9 million compared to $27.3 million in the prior-year quarter.
Fourth quarter fiscal year 2024 non-GAAP operating income decreased
to $26.0 million, down from $32.8 million for the prior-year
quarter.
On a GAAP basis, net income for the fourth quarter of fiscal
year 2024 totaled $16.1 million, or $0.64 per diluted share,
compared to net income of $17.1 million, or $0.68 per diluted
share, for the prior-year quarter. Fourth quarter fiscal year 2024
non-GAAP net income totaled $19.9 million, or $0.80 per diluted
share, up from $19.2 million, or $0.76 per diluted share, for the
prior-year quarter. Interest expense for the quarter decreased to
$2.1 million, down from $5.6 million for the prior-year quarter,
reflecting lower borrowings.
On a non-GAAP basis, adjusted EBITDA for the fourth quarter of
fiscal year 2024 decreased 15.0% to $34.2 million, or 4.58% of net
sales, compared to $40.2 million, or 4.24% of net sales, for the
prior-year quarter.
Full-Year Results
For fiscal year 2024, net sales decreased 13.9% to $3.3 billion.
Fiscal year 2024 net sales in the Specialty Technology Solutions
segment decreased 14.3% to $2.0 billion from softer demand in a
more cautious technology spending environment. Fiscal year 2024 net
sales in the Modern Communications & Cloud segment decreased
13.4% year-over-year to $1.3 billion from lower sales volumes in
communications hardware and Cisco products. The fiscal year 2024
net billings attributable to Intelisys increased to approximately
$2.67 billion, and Intelisys net sales for fiscal 2024 increased
6.6% over the prior year.
Gross profit for fiscal year 2024 totaled $399.1 million, down
11.2% year-over-year. The decrease is primarily due to lower sales
volume compared to the prior year. Gross profit margin increased to
12.2%, up from 11.9% in the prior year. The gross profit margin
reflects a higher contribution of Intelisys revenue in our overall
revenue mix, which is recorded on a net basis and therefore
contributes to a higher gross profit margin.
For the fiscal year ended June 30, 2024, operating income
decreased to $90.3 million from $135.9 million in the prior year.
Fiscal year 2024 non-GAAP operating income decreased to $110.4
million down from $151.1 million for the prior year.
On a GAAP basis, net income for the fiscal year ended June 30,
2024 totaled $77.1 million, or $3.06 per diluted share, compared to
net income of $88.1 million, or $3.47 per diluted share for the
prior year. Fiscal year 2024 non-GAAP net income totaled $77.7
million, or $3.08 per diluted share, compared to $97.7 million, or
$3.85 per diluted share for the prior year. Interest expense
decreased to $13.0 million, down from $19.8 million for the prior
year, reflecting lower borrowings.
Adjusted EBITDA for the fiscal year ended June 30, 2024
decreased to $140.7 million, or 4.31% of net sales, compared to
$179.9 million, or 4.75% of net sales, for the prior year.
ScanSource generated $371.6 million of operating cash flow and
$363.1 million of free cash flow (non-GAAP) for fiscal year
2024.
Acquisition of Resourcive
On August 8, 2024, ScanSource announced the acquisition of
Resourcive, a leading technology advisor. Founded in 2001 in
Pelham, NY, Resourcive delivers strategic IT sourcing solutions to
the mid-market and enterprise, advising clients on value creation
strategies that are enabled by technology. Starting with the
acquisition of Resourcive, ScanSource is creating the advisory
channel model of the future. This business is separate from
ScanSource’s Intelisys business, the industry’s leading technology
services distributor. The acquisition closed on August 8, 2024, and
the terms of the agreement were not disclosed.
Acquisition of Advantix
On August 15, 2024, ScanSource announced the acquisition of
Advantix, a VAR-focused, managed connectivity experience provider
specializing in wireless enablement solutions. Founded in 2001 in
Frisco, Texas, Advantix allows hardware VARs to expand their
mobility solutions and build their recurring revenue business. The
Advantix acquisition is the launching point for ScanSource’s new
Integrated Solutions Group (ISG). The ISG is focused on developing
solutions and services that provide hardware VARs the opportunity
to wrap additional value around their hardware offerings. The
acquisition closed on August 15, 2024, and the terms of the
agreement were not disclosed.
Annual Financial Outlook for Fiscal Year 2025
The following guidance is based on ScanSource's current
expectations for the full fiscal year ended June 30, 2025.
FY25 Annual Outlook
Net sales
$3.1 billion to $3.5
billion
Adjusted EBITDA (non-GAAP)
$140 million to $160
million
Free cash flow (non-GAAP)
At least $70 million
Adjusted EBITDA is a non-GAAP measure, which excludes estimates
for amortization of intangible assets, depreciation expense, and
non-cash shared-based compensation expense. Free cash flow is a
non-GAAP measure, which excludes the effect of estimated capital
expenditures from estimated operating cash flow. ScanSource’s
outlook does not include the potential impact of any business
combinations, asset acquisitions, divestitures, strategic
investments, or other significant transactions that may be
completed after the date hereof. These statements are
forward-looking, and actual results may differ materially.
ScanSource does not provide a reconciliation for its non-GAAP
outlook on a forward-looking basis where it is unable to provide a
meaningful or accurate calculation or estimation of reconciling
items and the information is not available without unreasonable
effort.
Webcast Details and Earnings Infographic
At approximately 8:45 a.m. ET today, an Earnings Infographic, as
a supplement to this press release and the earnings conference
call, will be available on ScanSource's website, www.scansource.com
(Investor Relations section). ScanSource will present additional
information about its financial results and business in a
conference call today, August 27, 2024, at 10:30 a.m. ET. A webcast
of the call will be available for all interested parties and can be
accessed at www.scansource.com (Investor Relations section). The
webcast will be available for replay for 60 days.
Safe Harbor Statement
This press release contains “forward-looking” statements,
including ScanSource's FY25 annual outlook, which involve risks and
uncertainties, many of which are beyond ScanSource's control. No
undue reliance should be placed on such statements, as any number
of factors could cause actual results to differ materially from
anticipated or forecasted results, including, but not limited to,
the following factors, which are neither presented in order of
importance nor weighted: macroeconomic conditions, including
potential prolonged economic weakness, inflation, the failure to
manage and implement ScanSource's growth strategy, credit risks
involving ScanSource's larger customers and suppliers, changes in
interest and exchange rates and regulatory regimes impacting
ScanSource's international operations, risk to the business from a
cyberattack, a failure of IT systems, failure to hire and retain
quality employees, loss of ScanSource's major customers,
relationships with key suppliers and customers or a termination or
a modification of the terms under which it operates with these key
suppliers and customers, changes in ScanSource's operating
strategy, and other factors set forth in the "Risk Factors"
contained in ScanSource's annual report on Form 10-K for the year
ended June 30, 2024. Except as may be required by law, ScanSource
expressly disclaims any obligation to update these forward-looking
statements to reflect events or circumstances after the date of
this press release or otherwise.
Non-GAAP Financial Information
In addition to disclosing results that are determined in
accordance with United States Generally Accepted Accounting
Principles ("GAAP"), ScanSource also discloses certain non-GAAP
financial measures, which are summarized below. Non-GAAP financial
measures are used to understand and evaluate performance, including
comparisons from period to period. Non-GAAP results exclude items
such as amortization of intangible assets related to acquisitions,
acquisition and divestiture costs, gain on sale of business, and
restructuring costs and include other non-GAAP adjustments.
Net sales on a constant currency basis excluding acquisitions
and divestitures to calculate organic growth ("non-GAAP net
sales"): ScanSource discloses the percentage change in net sales
excluding the translation impact from changes in foreign currency
exchange rates between reporting periods and excluding the net
sales from acquisitions and divestitures prior to the first full
year from the transaction date. This measure enhances the
comparability between periods to help analyze underlying trends on
an organic basis.
Adjusted earnings before interest expense, income taxes,
depreciation, and amortization (“Adjusted EBITDA”): Adjusted EBITDA
starts with net income and adds back interest expense, income tax
expense, depreciation expense, amortization of intangible assets,
changes in fair value of contingent considerations, and other
non-GAAP adjustments, including acquisition and divestiture costs,
gain/loss on sale of business, restructuring costs, cyberattack
restoration costs, tax recovery, and non-cash share-based
compensation expense. Since Adjusted EBITDA excludes some non-cash
costs of investing in ScanSource’s business and people, management
believes that Adjusted EBITDA shows the profitability from the
business operations more clearly. The presentation for Adjusted
EBITDA for all periods presented has been recast to reflect this
change to enhance comparability between periods. The Adjusted
EBITDA margin is calculated as Adjusted EBITDA as a percentage of
net sales.
Adjusted return on invested capital ("Adjusted ROIC"): Adjusted
ROIC assists management in comparing ScanSource's performance over
various reporting periods on a consistent basis because it removes
from operating results the impact of items that do not reflect core
operating performance. Management believes the calculation of
Adjusted ROIC provides useful information to investors and is an
additional relevant comparison of its performance. Adjusted ROIC is
calculated as Adjusted EBITDA over invested capital. Invested
capital is defined as average equity plus average daily funded
interest-bearing debt for the period. Management believes the
calculation of Adjusted ROIC provides useful information to
investors and is an additional relevant comparison of ScanSource's
performance during the year.
Free cash flow: ScanSource presents free cash flow as it is a
measure used by management to measure our business. ScanSource
believes this measure provides more information regarding liquidity
and capital resources. Free cash flow is defined as cash flows from
operating activities less capital expenditures.
Net debt: Net debt includes total balance sheet debt less cash
and cash equivalents. ScanSource believes this measure is useful in
assessing its borrowing capacity.
Additional Non-GAAP Metrics: To evaluate current period
performance on a more consistent basis with prior periods,
ScanSource discloses non-GAAP SG&A expenses, non-GAAP operating
income, non-GAAP pre-tax income, non-GAAP net income, and non-GAAP
diluted earnings per share (non-GAAP diluted EPS). These non-GAAP
results exclude amortization of intangible assets related to
acquisitions, acquisition and divestiture costs, gain on sale of
business, restructuring costs, and other non-GAAP adjustments.
These metrics include the translation impact of changes in foreign
currency exchange rates. Non-GAAP metrics are useful in assessing
and understanding ScanSource's performance especially when
comparing results with previous periods or forecasting performance
for future periods.
These non-GAAP financial measures have limitations as analytical
tools, and the non-GAAP financial measures that ScanSource reports
may not be comparable to similarly titled amounts reported by other
companies. Analysis of results and outlook on a non-GAAP basis
should be considered in addition to, and not in substitution for or
as superior to, measurements of financial performance prepared in
accordance with GAAP. A reconciliation of ScanSource's non-GAAP
financial information to GAAP is set forth in the Supplementary
Information (Unaudited) below.
About ScanSource, Inc.
ScanSource, Inc. (NASDAQ: SCSC) is a leading hybrid distributor
connecting devices to the cloud and accelerating growth for
customers across hardware, software as a service (SaaS),
connectivity and cloud. ScanSource enables customers to deliver
solutions for their end users to address changing buying and
consumption patterns. ScanSource sells through multiple,
specialized routes-to-market with hardware, SaaS, connectivity and
cloud services offerings from the world’s leading suppliers of
mobility and barcode, point-of-sale (POS), payments, networking,
physical security, unified communications and collaboration,
telecom and cloud services. Founded in 1992 and headquartered in
Greenville, South Carolina, ScanSource was named one of the 2024
Best Places to Work in South Carolina and on FORTUNE magazine’s
2024 List of World’s Most Admired Companies. ScanSource ranks #817
on the Fortune 1000. For more information, visit
www.scansource.com.
ScanSource, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets (Unaudited)
(in thousands, except share
data)
June 30, 2024*
June 30, 2023*
Assets
Current assets:
Cash and cash equivalents
$
185,460
$
36,178
Accounts receivable, less allowance of
$20,684 at June 30, 2024 and $15,480 at June 30, 2023
581,523
753,236
Inventories
512,634
757,574
Prepaid expenses and other current
assets
125,082
110,087
Total current assets
1,404,699
1,657,075
Property and equipment, net
33,501
37,379
Goodwill
206,301
216,706
Identifiable intangible assets, net
37,634
68,495
Deferred income taxes
19,902
17,764
Other non-current assets
76,995
70,750
Total assets
$
1,779,032
$
2,068,169
Liabilities and
Shareholders’ Equity
Current liabilities:
Accounts payable
$
587,984
$
691,119
Accrued expenses and other current
liabilities
65,616
78,892
Income taxes payable
7,895
9,875
Current portion of long-term debt
7,857
6,915
Total current liabilities
669,352
786,801
Deferred income taxes
—
3,816
Long-term debt, net of current portion
136,149
144,006
Borrowings under revolving credit
facility
50
178,980
Other long-term liabilities
49,226
49,268
Total liabilities
854,777
1,162,871
Commitments and contingencies
Shareholders’ equity:
Preferred stock, no par value; 3,000,000
shares authorized, none issued
—
—
Common stock, no par value; 45,000,000
shares authorized, 24,243,848 and 24,844,203 shares issued and
outstanding at June 30, 2024 and June 30, 2023, respectively
26,370
58,241
Retained earnings
1,013,738
936,678
Accumulated other comprehensive loss
(115,853
)
(89,621
)
Total shareholders’ equity
924,255
905,298
Total liabilities and shareholders’
equity
$
1,779,032
$
2,068,169
*Derived from audited financial
statements.
ScanSource, Inc. and
Subsidiaries
Condensed Consolidated Income
Statements (Unaudited)
(in thousands, except per
share data)
Quarter ended June 30,
2024
Fiscal Year Ended June
30,
2024
2023
2024*
2023*
Net sales
$
746,113
$
947,149
$
3,259,809
$
3,787,721
Cost of goods sold
648,798
838,490
2,860,757
3,338,482
Gross profit
97,315
108,659
399,052
449,239
Selling, general and administrative
expenses
68,498
74,358
277,428
285,695
Depreciation expense
2,770
2,827
11,219
10,912
Intangible amortization expense
3,741
4,185
15,723
16,746
Restructuring and other charges
435
—
4,358
—
Operating income
21,871
27,289
90,324
135,886
Interest expense
2,084
5,564
13,031
19,786
Interest income
(3,285
)
(2,085
)
(9,381
)
(7,414
)
Loss (gain) on sale of business
378
—
(14,155
)
—
Other expense, net
(3
)
348
988
1,664
Income before income taxes
22,697
23,462
99,841
121,850
Provision for income taxes
6,600
6,367
22,781
33,758
Net income from continuing operations
16,097
17,095
77,060
88,092
Net income from discontinued
operations
—
1,717
—
1,717
Net income
$
16,097
$
18,812
$
77,060
$
89,809
Per share data:
Net income from continuing operations per
common share, basic
$
0.66
$
0.69
$
3.10
$
3.50
Net income from discontinued operations
per common share, basic
—
0.07
—
0.07
Net income per common share, basic
$
0.66
$
0.76
$
3.10
$
3.57
Weighted-average shares outstanding,
basic
24,524
24,883
24,868
25,142
Net income from continuing operations per
common share, diluted
$
0.64
$
0.68
$
3.06
$
3.47
Net income from discontinued operations
per common share, diluted
—
0.07
—
0.07
Net income per common share, diluted
$
0.64
$
0.75
$
3.06
$
3.54
Weighted-average shares outstanding,
diluted
25,046
25,139
25,222
25,362
*Derived from audited financial
statements.
ScanSource, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows (Unaudited)
(in thousands)
Quarter ended June 30,
Fiscal Year Ended June
30,
2024
2023
2024*
2023*
Cash flows from operating activities:
Net income
$
16,097
$
17,095
$
77,060
$
88,092
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Gain on sale of business
378
—
(14,155
)
—
Depreciation and amortization
6,792
7,256
28,009
28,614
Amortization of debt issue costs
96
96
386
577
Provision for doubtful accounts
2,454
933
8,317
2,785
Share-based compensation
1,808
2,586
9,537
11,219
Deferred income taxes
(907
)
(2,905
)
(2,472
)
(1,496
)
Finance lease interest
30
12
101
44
Changes in operating assets and
liabilities, net of acquisitions:
Accounts receivable
(5,510
)
(64,020
)
138,264
(17,368
)
Inventories
12,279
(2,057
)
239,157
(138,313
)
Prepaid expenses and other assets
10,359
(6,526
)
(17,804
)
32,653
Other non-current assets
(16,711
)
(5,810
)
(10,689
)
(7,582
)
Accounts payable
39,693
30,061
(78,167
)
(30,656
)
Accrued expenses and other liabilities
(15,210
)
2,587
(3,872
)
(14,195
)
Income taxes payable
3,090
5,431
(2,025
)
9,857
Net cash provided by (used in) operating
activities
54,738
(15,261
)
371,647
(35,769
)
Cash flows from investing activities:
Capital expenditures
(1,270
)
(3,431
)
(8,555
)
(9,979
)
Proceeds from sale of business, net of
cash transferred
(378
)
1,717
17,600
1,717
Net cash provided by (used in) investing
activities
(1,648
)
(1,714
)
9,045
(8,262
)
Cash flows from financing activities:
Borrowings on revolving credit, net of
expenses
16,813
627,257
1,259,728
2,499,166
Repayments on revolving credit, net of
expenses
(16,763
)
(607,470
)
(1,438,658
)
(2,456,025
)
Repayments on long-term debt, net
(1,875
)
(938
)
(6,915
)
15,590
Borrowings (repayments) on finance lease
obligation
(379
)
23
(964
)
(589
)
Debt issuance costs
—
—
—
(1,407
)
Exercise of stock options
186
57
4,813
910
Taxes paid on settlement of equity
awards
(81
)
(30
)
(2,876
)
(2,463
)
Common stock repurchased
(21,727
)
(4,933
)
(42,895
)
(15,651
)
Net cash (used in) provided by financing
activities
(23,826
)
13,966
(227,767
)
39,531
Effect of exchange rate changes on cash
and cash equivalents
(2,854
)
1,813
(3,643
)
2,691
Increase in cash and cash equivalents
26,410
(1,196
)
149,282
(1,809
)
Cash and cash equivalents at beginning of
period
159,050
37,374
36,178
37,987
Cash and cash equivalents at period
end
$
185,460
$
36,178
$
185,460
$
36,178
*Derived from audited financial
statements.
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
(in thousands, except
percentages)
Non-GAAP Financial Information:
Quarter ended June 30,
Fiscal Year Ended June
30,
2024
2023
2024
2023
Adjusted return on invested capital ratio
(Adjusted ROIC), annualized(a)
12.7
%
12.9
%
12.4
%
14.6
%
Reconciliation of Net Income to
Adjusted EBITDA:
Net income (GAAP)
$
16,097
$
17,095
$
77,060
$
88,092
Plus: Interest expense
2,084
5,564
13,031
19,786
Plus: Income taxes
6,600
6,367
22,781
33,758
Plus: Depreciation and amortization
6,792
7,255
28,009
28,614
EBITDA (non-GAAP)
31,573
36,281
140,881
170,250
Plus: Tax recovery (b)
(657
)
(128
)
(2,558
)
(2,986
)
Plus: Share-based compensation
1,808
2,586
9,537
11,219
Plus: Cyberattack restoration costs
141
1,460
874
1,460
Plus: Acquisition and divestiture
costs
503
—
1,717
—
Plus: Restructuring costs
435
—
4,358
—
Plus: Gain on sale of business
378
—
(14,155
)
—
Adjusted EBITDA (numerator for Adjusted
ROIC) (non-GAAP)
$
34,181
$
40,199
$
140,654
$
179,943
Invested Capital Calculations:
Equity – beginning of the period
$
944,053
$
878,895
$
905,298
$
806,528
Equity – end of the period
924,255
905,298
924,255
905,298
Plus: Share-based compensation, net
1,350
1,921
7,120
8,326
Plus: Cyberattack restoration costs,
net
106
1,092
655
1,092
Plus: Acquisition and divestiture
costs
503
—
1,717
—
Plus: Restructuring, net of tax
327
—
3,262
—
Plus: Discontinued operations net
income
—
(1,717
)
—
(1,717
)
Plus: Tax recovery, net
(278
)
(2,100
)
(2,566
)
(3,985
)
Plus: Gain on sale of business
378
—
(14,155
)
—
Average equity
935,347
891,695
912,793
857,771
Average funded debt (c)
146,121
361,792
220,528
372,235
Invested capital (denominator for Adjusted
ROIC) (non-GAAP)
$
1,081,468
$
1,253,487
$
1,133,321
$
1,230,006
(a) The annualized adjusted EBITDA amount
is divided by days in the quarter times 365 days per year, or 366
days for leap year. There were 91 days in the current and
prior-year quarter.
(b) Recovery of prior period withholding
taxes in Brazil.
(c) Average funded debt is calculated as
the average daily amounts outstanding on short-term and long-term
interest-bearing debt.
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
Net Sales by Segment:
Quarter ended June 30,
2024
2023
% Change
Specialty Technology Solutions:
(in thousands)
Net sales, reported
$
484,710
$
561,501
(13.7
)%
Foreign exchange impact (a)
1,099
—
Non-GAAP net sales
$
485,809
$
561,501
(13.5
)%
Modern Communications &
Cloud:
Net sales, reported
$
261,403
$
385,648
(32.2
)%
Foreign exchange impact (a)
3,635
—
Less: Divestitures
—
(2,403
)
Non-GAAP net sales
$
265,038
$
383,245
(30.8
)%
Consolidated:
Net sales, reported
$
746,113
$
947,149
(21.2
)%
Foreign exchange impact (a)
4,734
—
Less: Divestitures
—
(2,403
)
Non-GAAP net sales
$
750,847
$
944,746
(20.5
)%
(a) Year-over-year net sales growth rate
excluding the translation impact of changes in foreign currency
exchange rates. Calculated by translating the net sales for the
quarter ended June 30, 2024 into U.S. dollars using the average
foreign exchange rates for the quarter ended June 30, 2023.
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
Net Sales by Segment:
Fiscal year ended June
30,
2024
2023
% Change
Specialty Technology Solutions:
(in thousands)
Net sales, reported
$
1,998,636
$
2,331,030
(14.3
)%
Foreign exchange impact (a)
(1,341
)
—
Non-GAAP net sales
$
1,997,295
$
2,331,030
(14.3
)%
Modern Communications &
Cloud:
Net sales, reported
$
1,261,173
$
1,456,691
(13.4
)%
Foreign exchange impact (a)
(8,542
)
—
Less: Divestitures
(3,747
)
(9,140
)
Non-GAAP net sales
$
1,248,884
$
1,447,551
(13.7
)%
Consolidated:
Net sales, reported
$
3,259,809
$
3,787,721
(13.9
)%
Foreign exchange impact (a)
(9,883
)
—
Less: Divestitures
(3,747
)
(9,140
)
Non-GAAP net sales
$
3,246,179
$
3,778,581
(14.1
)%
(a) Year-over-year net sales growth rate
excluding the translation impact of changes in foreign currency
exchange rates. Calculated by translating the net sales for the
fiscal year ended June 30, 2024 into U.S. dollars using the average
foreign exchange rates for the fiscal year ended June 30, 2023.
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
Net Sales by Geography:
Quarter ended June 30,
2024
2023
% Change
United States and Canada:
(in thousands)
Net sales, as reported
$
663,542
$
854,521
(22.3
)%
International:
Net sales, reported
$
82,571
$
92,628
(10.9
)%
Foreign exchange impact(a)
4,734
—
Less: Divestitures
—
(2,403
)
Non-GAAP net sales
$
87,305
$
90,225
(3.2
)%
Consolidated:
Net sales, reported
$
746,113
$
947,149
(21.2
)%
Foreign exchange impact(a)
4,734
—
Less: Divestitures
—
(2,403
)
Non-GAAP net sales
$
750,847
$
944,746
(20.5
)%
(a) Year-over-year net sales growth rate
excluding the translation impact of changes in foreign currency
exchange rates. Calculated by translating the net sales for the
quarter ended June 30, 2024 into U.S. dollars using the average
foreign exchange rates for the quarter ended June 30, 2023.
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
Net Sales by Geography:
Fiscal year ended June
30,
2024
2023
% Change
United States and Canada:
(in thousands)
Net sales, as reported
$
2,921,172
$
3,432,074
(14.9
)%
International:
Net sales, reported
$
338,637
$
355,647
(4.8
)%
Foreign exchange impact(a)
(9,883
)
—
Less: Divestitures
(3,747
)
(9,140
)
Non-GAAP net sales
$
325,007
346,507
(6.2
)%
Consolidated:
Net sales, reported
$
3,259,809
$
3,787,721
(13.9
)%
Foreign exchange impact(a)
(9,883
)
—
Less: Divestitures
(3,747
)
(9,140
)
Non-GAAP net sales
$
3,246,179
$
3,778,581
(14.1
)%
(a) Year-over-year net sales growth rate
excluding the translation impact of changes in foreign currency
exchange rates. Calculated by translating the net sales for the
fiscal year ended June 30, 2024 into U.S. dollars using the average
foreign exchange rates for the fiscal year ended June 30, 2023.
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
(in thousands)
Free Cash Flow:
Quarter ended June 30,
Fiscal year ended June
30,
2024
2023
2024
2023
GAAP operating cash flow
$
54,738
$
(15,261
)
$
371,647
$
(35,769
)
Less: Capital Expenditures
(1,270
)
(3,431
)
(8,555
)
(9,979
)
Free cash flow (non-GAAP)
$
53,468
$
(18,692
)
$
363,092
$
(45,748
)
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
(in thousands, except per
share data)
Non-GAAP Financial Information:
Quarter ended June 30,
2024
GAAP Measure
Intangible amortization
expense
Acquisition & divestiture
costs(a)
Restructuring costs
Tax recovery
Cyberattack restoration
costs
Gain on sale of
business(b)
Non-GAAP measure
(in thousands, except per
share data)
SG&A expenses
$68,498
$—
$(503)
$(435)
$657
$(141)
$—
$68,076
Operating income
21,871
3,741
503
435
(657)
141
—
26,034
Pre-tax income
22,697
3,741
503
435
(657)
141
378
27,238
Net income
16,097
2,788
503
327
(278)
106
378
19,921
Diluted EPS
$0.64
$0.11
$0.02
$0.01
$(0.01)
$—
$0.02
$0.80
Quarter ended June 30,
2023
GAAP Measure
Intangible amortization
expense
Acquisition & divestiture
costs
Restructuring costs
Tax recovery
Cyberattack restoration
costs
Gain on sale of
business
Non-GAAP measure
(in thousands, except per
share data)
SG&A expense
$74,358
$—
$—
$—
$128
$(1,460)
$—
$73,026
Operating income
27,289
4,185
—
—
(128)
1,460
—
32,806
Pre-tax income
23,462
4,185
—
—
(128)
1,460
—
28,979
Net income
17,095
3,126
—
—
(2,100)
1,092
—
19,213
Diluted EPS
$0.68
$0.12
$—
$—
$(0.08)
$0.04
$—
$0.76
(a) Acquisition and divestiture costs for
the fiscal year ended June 30, 2024 are generally nondeductible for
tax purposes.
(b) Reflects adjustment to the gain on the
sale of the UK-based intY business.
ScanSource, Inc. and
Subsidiaries
Supplementary Information
(Unaudited)
(in thousands, except per
share data)
Non-GAAP Financial Information:
Year ended June 30,
2024
GAAP Measure
Intangible amortization
expense
Acquisition & divestiture
costs(a)
Restructuring costs
Tax recovery
Cyberattack restoration
costs
Gain on sale of
business(b)
Non-GAAP measure
(in thousands, except per
share data)
SG&A expenses
$277,428
$—
$(1,717)
$—
$2,558
$(874)
$—
$277,395
Operating income
90,324
15,723
1,717
4,358
(2,558)
874
—
110,438
Pre-tax income
99,841
15,723
1,717
4,358
(2,558)
874
(14,155)
105,800
Net income
77,060
11,697
1,717
3,262
(2,566)
655
(14,155)
77,670
Diluted EPS
$3.06
$0.46
$0.07
$0.13
$(0.10)
$0.03
$(0.56)
$3.08
Year ended June 30,
2023
GAAP Measure
Intangible amortization
expense
Acquisition & divestiture
costs
Restructuring costs
Tax recovery
Cyberattack restoration
costs
Gain on sale of
business
Non-GAAP measure
(in thousands, except per
share data)
SG&A expense
$285,695
$—
$—
$—
$2,986
$(1,460)
$—
$287,221
Operating income
135,886
16,746
—
—
(2,986)
1,460
—
151,106
Pre-tax income
121,850
16,746
—
—
(2,986)
1,460
—
137,070
Net income
88,092
12,489
—
—
(3,985)
1,092
—
97,688
Diluted EPS
$3.47
$0.49
$—
$—
$(0.16)
$0.04
$—
$3.85
(a) Acquisition and divestiture costs for
the fiscal year ended June 30, 2024 are generally nondeductible for
tax purposes.
(b) Reflects gain on the sale of the
UK-based intY business. This transaction resulted in a capital loss
for tax purposes. The Company did not record a tax provision on the
capital loss since there were no offsetting capital gains.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240827350261/en/
Steve Jones Senior EVP, Chief Financial Officer ScanSource, Inc.
(864) 286-4302
Mary M. Gentry SVP, Treasurer and Investor Relations ScanSource,
Inc. (864) 286-4892
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