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Arrow Electronics Q4 Financials Beat Expectations

Arrow Electronics Q4 Financials Beat Expectations

CENTENNIAL, Colo. — Arrow Electronics, Inc. reported fourth-quarter 2015 net income of $158.5 million, or $1.69 per share on a diluted basis, compared with net income of $116.2 million, or $1.18 per share on a diluted basis, in the fourth quarter of 2014. Excluding certain items1, net income would have been $182.1 million, or $1.94 per share on a diluted basis, in the fourth quarter of 2015, compared with net income of $184.4 million, or $1.88 per share on a diluted basis, in the fourth quarter of 2014. Fourth-quarter sales of $6.75 billion increased 6 percent from sales of $6.4 billion in the prior year. Fourth-quarter sales, adjusted for the impact of acquisitions and changes in foreign currencies, increased 4 percent year over year. In the fourth quarter of 2015, changes in foreign currencies had negative impacts on growth of approximately $270 million on sales and $.11 or 6 percent on earnings per share on a diluted basis compared to the fourth quarter of 2014.

“Our strong execution during the fourth quarter drove record results. Both our global components and enterprise computing solutions businesses produced sales that were above the high end of our expectations resulting in earnings per share of $1.94 that was also above the high end of what we had anticipated,” said Michael J. Long, chairman, president, and chief executive officer. “We continue to differentiate our businesses with our focus on design and value-added services for global components, and our solution-selling approach for enterprise computing solutions.”

Global components fourth-quarter sales of $3.67 billion grew 2 percent year over year. Fourth-quarter sales, as adjusted, were flat year over year. Americas components sales declined 4 percent year over year. Europe components sales grew 8 percent year over year. Sales in the region, as adjusted, grew 12 percent year over year. Asia-Pacific components sales grew 6 percent year over year. Sales in the region, as adjusted, declined 4 percent year over year.

Global enterprise computing solutions fourth-quarter sales of $3.08 billion grew 10 percent year over year. Americas sales grew 11 percent year over year. Sales in the region, as adjusted, grew 5 percent year over year. Europe sales grew 7 percent year over year. Sales in the region, as adjusted, grew 22 percent year over year. “Enterprise computing solutions posted record fourth-quarter sales and operating income, and our software sales continued to contribute a greater percentage of our product mix,” added Mr. Long.

FULL-YEAR RESULTS

Arrow’s net income for 2015 was $497.7 million, or $5.20 per share on a diluted basis, compared with net income of $498 million, or $4.98 per share on a diluted basis, in 2014. Excluding certain items1, net income would have been $592.3 million, or $6.19 per share on a diluted basis, in 2015, compared with net income of $593 million, or $5.93 per share on a diluted basis, in 2014. 2015 sales of $23.28 billion increased 2 percent from sales of $22.77 billion in 2014. Sales, adjusted for acquisitions and changes in foreign currencies, increased 3 percent year over year. In 2015, changes in foreign currencies had negative impacts on growth of approximately $1.22 billion on sales and $.38 or 6 percent on earnings per share on a diluted basis compared to 2014.

“We delivered excellent growth in 2015 despite the challenging economic environment, with sales, as adjusted, up 3 percent year over year, and diluted earnings per share of $6.19 up 11 percent year over year adjusted for changes in foreign currencies,” said Mr. Long.

“Cash flow from operations was $655 million in 2015 as we continue to exceed our cash flow target,” said Paul J. Reilly, executive vice president, finance and operations, and chief financial officer. “The strong management of our balance sheet and cash flow provided the opportunity for Arrow to reduce leverage during the fourth quarter, and return approximately $341 million to shareholders through our stock repurchase program in 2015.”

 

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