Creativa - Fotolia
The acquisition of Avnet Technology Solutions (ATS) has given Tech Data's sales a significant boost with the distributor delivering solid third quarter numbers.
Net sales of $9.1bn were up by 41% year-on-year with Europe, which contributes 53% of total sales, also enjoying an increase of 25% to $4.8bn, for the three months ended 31 October. Net income of $37.3m was just slightly ahead of the $36.5m experienced in Q3 last year.
The sales numbers were record breaking for the distributor, which has not made $9bn in a quarter before and were used as evidence from the chairman and CEO Robert Dutkowsky as a sign its strategy was paying off.
"We are pleased to report Q3 results that were in line with our expectations and that continue to highlight the enhanced earnings power and cash flow profile of the new Tech Data," he said.
"For the first time in Tech Data's history, quarterly sales surpassed $9 billion, and through pricing discipline and strong cost controls, we delivered solid non-GAAP earnings per share. In addition, we generated $70 million of cash from operations, paid down $350 million of our debt, reflecting our strong commitment to deleverage the company, and earned an adjusted return on invested capital for the trailing twelve-month period well in excess of our weighted average cost of capital," he added.
Looking ahead to the end of its fiscal year the firm is expecting to go slightly better and bring in net sales of $10bn plus.
"We continue on our path to building the IT distributor of the future, one with breadth, specialized skills and extensive capabilities to help our customers and vendor partners capitalize on growth opportunities across the computing continuum," said Dutkowsky.
Tech Data completed the $2.6bn acquisition of ATS back in February and during the quarter finished the integration of the Avnet business.