Ingram Micro to Outline Plans for Continued Profitable Growth at Investor Conference
June 06 2007 - 10:14PM
PR Newswire (US)
Initiatives to expand the company's portfolio of products and
services, geographic footprint and customer relationships
throughout the world will be shared with investment community SANTA
ANA, Calif., June 6 /PRNewswire-FirstCall/ -- Ingram Micro Inc.
(NYSE:IM), the world's largest technology distributor, expects to
re-emphasize its continued focus on profitable growth at its
investor conference tomorrow by outlining a series of initiatives
designed to drive sales, enhance profitability and build
shareholder value. According to Chief Executive Officer Gregory M.
Spierkel, who will lead the meeting with members of the financial
community at Ingram Micro's corporate headquarters, "There is no
structural reason why the company cannot grow to at least $40
billion in sales and 150 basis points of annual operating margin in
three years." Spierkel said he plans to reach these targets with a
combination of core- business enhancements and expansion into
adjacencies that will further position the company as the
preeminent technology distributor. These initiatives include: * A
broader reach into higher-margin technology segments with the
launch of an Infrastructure Technology Solutions (ITS) Division in
North America. This stand-alone unit offers dedicated resources for
sales, marketing, configuration and order management, designed to
help resellers and IT manufacturers grow their server and storage
solutions businesses. The company is authorized by respected
vendors in this space -- such as IBM, HP, Hitachi Data Systems and
Quantum -- and appointed Scott Look, an enterprise-solutions expert
and former vice president at Avnet Technology Solutions, as general
manager of the division. * Geographic expansion into Argentina and
South Africa. Operations in Argentina are scheduled to launch next
month, providing a timely entry into a country with a stabilized
economy and an information technology market that is expected to
grow greater than nine percent annually through 2010. In South
Africa, a new office in Johannesburg will open in conjunction with
the recent joint venture with MB Technologies, a distributor of
technology components to VARs, system integrators and manufacturers
throughout sub-Saharan Africa. To better reflect the company's
expanded reach into a new continent, the European business unit
will be renamed the "Europe, Middle East and Africa" (EMEA) Region.
* Further expansion in China to take advantage of the country's
double- digit economic growth. The company plans to add 100
employees to serve customers in the networking space and in new
Chinese markets. * International expansion of AVAD, the company's
specialized distributor of high-end entertainment and automation
products for the home market, with outlets planned to open later
this year in Toronto and Vancouver. According to Spierkel, these
initiatives, along with further growth and optimization of the
existing business, will drive the company's operating performance
to the following targets: * Annual revenue growth of seven to 10
percent * Operating income growth outpacing the rate of sales
growth * A longer-term goal of 15 percent ROIC through continuous
annual improvement "Our growth strategy is aggressive yet
attainable," said Spierkel. "The company's expansions over the past
three years have positioned us well ahead of our chief competitors
with a portfolio unmatched in the industry. I fully expect our
actions over the next three years to be at least as active, with a
focus on improving top-line growth and profitability by optimizing
our core distribution business while developing opportunities in
specialty areas outside our traditional core." In preparation for
the investor conference, the company re-affirmed sales and income
guidance for the second quarter (ending June 30, 2007). This
guidance, based on the company's current expectations and internal
forecasts, is forward-looking and actual results may differ
materially, as outlined in the company's periodic filings with the
Securities and Exchange Commission. * Sales are expected to range
from $8 billion to $8.25 billion * Net income is expected to range
from $59 million to $65 million, or $0.34 to $0.37 per diluted
share * The weighted average shares outstanding is expected to be
approximately 176 million and an effective tax rate of 28 percent
is estimated for the second quarter Ingram Micro's Investor and
Analyst Day will include presentations by corporate and regional
management, a panel discussion by the specialty-unit leaders and a
tour of the AVAD showroom and distribution facility in Irvine,
Calif. The event will be Webcast live from 8:30 a.m. - 1:00 p.m.
Pacific Time tomorrow on the company's Web site at
http://www.ingrammicro.com/ (Investor Relations section). An
archived version of the Webcast will be available on the site for
approximately one week after the conclusion of the meeting.
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,
including but not limited to statements about future revenues,
sales levels, operating income, margins, stock-based compensation
expense, integration costs, cost synergies, operating efficiencies,
profitability, market share and rates of return, are based on
current management expectations that involve certain risks which,
if realized, in whole or in part, could cause such expectations to
fail to be achieved and have a material adverse effect on Ingram
Micro's business, financial condition and results of operations,
including, without limitation: (1) intense competition, regionally
and internationally, including competition from alternative
business models, such as manufacturer-to-end-user selling, which
may lead to reduced prices, lower sales or reduced sales growth,
lower gross margins, extended payment terms with customers,
increased capital investment and interest costs, bad debt risks and
product supply shortages; (2) integration of our acquired
businesses and similar transactions involve various risks and
difficulties -- our operations may be adversely impacted by an
acquisition that (i) is not suited for us, (ii) is improperly
executed, or (iii) substantially increases our debt; (3) foreign
exchange rate fluctuations, devaluation of a foreign currency,
adverse governmental controls or actions, political or economic
instability, or disruption of a foreign market, and other related
risks of our international operations may adversely impact our
operations in that country or globally; (4) we may not achieve the
objectives of our process improvement efforts or be able to
adequately adjust our cost structure in a timely fashion to remain
competitive, which may cause our profitability to suffer; (5) our
failure to attract new sources of profitable business from
expansion of products or services or risks associated with entry
into new markets, including geographies, products and services,
could negatively impact our future operating results; (6) an
interruption or failure of or disruptions due to changes to our
information systems or subversion of access or other system
controls may result in a significant loss of business, assets, or
competitive information and may adversely impact our results of
operations; (7) significant changes in supplier terms, such as
higher thresholds on sales volume before distributors may qualify
for discounts and/or rebates, the overall reduction in the amount
of incentives available, reduction or termination of price
protection, return levels, or other inventory management programs,
or reductions in payment terms, may adversely impact our results of
operations or financial condition; (8) termination of a supply or
services agreement with a major supplier or product supply
shortages may adversely impact our results of operations; (9)
changes in, or interpretations of, tax rules and regulations may
adversely affect our effective tax rates or we may be required to
pay additional tax assessments; (10) we cannot predict with
certainty, the outcome of the SEC and U.S. Attorney's inquiries or
assessments by Brazilian taxing authorities; (11) if there is a
downturn in economic conditions for an extended period of time, it
will likely have an adverse impact on our business; (12) we may
experience loss of business from one or more significant customers,
and an increased risk of credit loss as a result of reseller
customers' businesses being negatively impacted by dramatic changes
in the information technology products and services industry as
well as intense competition among resellers -- increased losses, if
any, may not be covered by credit insurance or we may not be able
to obtain credit insurance at reasonable rates or at all; (13)
rapid product improvement and technological change resulting in
inventory obsolescence or changes in demand may result in a decline
in value of a portion of our inventory; (14) future terrorist or
military actions could result in disruption to our operations or
loss of assets, in certain markets or globally; (15) the loss of a
key executive officer or other key employees, or changes affecting
the work force such as government regulations, collective
bargaining agreements or the limited availability of qualified
personnel, could disrupt operations or increase our cost structure;
(16) changes in our credit rating or other market factors may
increase our interest expense or other costs of capital, or capital
may not be available to us on acceptable terms to fund our working
capital needs; (17) our failure to adequately adapt to industry
changes and to manage potential growth and/or contractions could
negatively impact our future operating results; (18) future
periodic assessments required by current or new accounting
standards such as those relating to long-lived assets, goodwill and
other intangible assets and expensing of stock options may result
in additional non-cash charges; (19) seasonal variations in the
demand for products and services, as well as the introduction of
new products, may cause variations in our quarterly results; and
(20) the failure of certain shipping companies to deliver product
to us, or from us to our customers, may adversely impact our
results of operations. Ingram Micro has instituted in the past and
continues to institute changes to its strategies, operations and
processes to address these risk factors and to mitigate their
impact on Ingram Micro's results of operations and financial
condition. However, no assurances can be given that Ingram Micro
will be successful in these efforts. For a further discussion of
significant factors to consider in connection with forward-looking
statements concerning Ingram Micro, reference is made to Item 1A
Risk Factors of Ingram Micro's Annual Report on Form 10-K for the
year ended December 30, 2006; other risks or uncertainties may be
detailed from time to time in Ingram Micro's future SEC filings.
Ingram Micro disclaims any duty to update any forward-looking
statements. About Ingram Micro Inc. As a vital link in the
technology value chain, Ingram Micro creates sales and
profitability opportunities for vendors and resellers through
unique marketing programs, outsourced logistics services, technical
support, financial services, and product aggregation and
distribution. The company serves more than 150 countries and is the
only global broadline IT distributor with operations in Asia. Visit
http://www.ingrammicro.com/. 2007 Ingram Micro Inc. All rights
reserved. Ingram Micro and the registered Ingram Micro logo are
trademarks used under license by Ingram Micro Inc. DATASOURCE:
Ingram Micro Inc. CONTACT: Media, Jim Trainor, +1-714-382-2378, ,
or Rekha Parthasarathy, +1-714-382-1319, , or Investors, Ria Marie
Carlson, +1-714-382-4400, , or Kay Leyba, +1-714-382-4175, , all of
Ingram Micro Inc. Web site: http://www.ingrammicro.com/
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