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Ingram Micro posts loss but tops estimates

IT product distributor Ingram Micro announced a net loss of $265.4m (£182m) or $1.74 per share for the first quarter, attributing the loss primarily to a $280.9m (£193.3m) charge against earnings in accordance with a new accounting rule.

Not including one-time gains, charges and restructuring costs, Ingram Micro earned $13.5m (£9.3m) or nine cents per share, beating the six cents per share consensus estimate of analysts polled by Thomson Financial/First Call.

Ingram Micro reported revenue of $5.62bn (£3.9bn) for the first quarter, which ended 30 March, down from $7.19bn in revenue in the same quarter last year.

The market for computer equipment remains difficult to predict, and the company does not expect strong demand to return in the second quarter, said Kent Foster, chairman and chief executive officer.

Ingram Micro guided investors to expect a sequential decline in sales of 4% to 7%, to a range of $5.25bn (£3.6bn) to $5.4bn (£3.7bn). Ingram Micro expects a profit before special items of $6m (£4.1m) to $9m (£6.2m) for the second quarter.

Foster said he did not expect to see major changes in the company's gross margins given the economic environment.

"I can only say that we have significant opportunities to lower our operating expenses," he said. "But these changes are driven by business process improvements. We're not going to stop until we're the most cost-effective distributor in the industry."

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