Arrow Electronics Reports Third-Quarter 2020 Results

-- Third-Quarter Earnings Per Share of $2.13; Non-GAAP Earnings Per Share of $2.08 --

-- Cash Provided by Operating Activities of $275 Million --

CENTENNIAL, Colo.--(BUSINESS WIRE)--Arrow Electronics, Inc. (NYSE:ARW) today reported third-quarter 2020 sales of $7.23 billion, an increase of 2 percent from sales of $7.08 billion in the third quarter of 2019. Third-quarter net income was $166 million, or $2.13 per share on a diluted basis, compared with a net income of $92 million, or $1.10 per share on a diluted basis, in the third quarter of 2019. Non-GAAP net income1 was $162 million, or $2.08 per share on a diluted basis, in the third quarter of 2020, compared with non-GAAP net income of $155 million, or $1.86 per share on a diluted basis, in the third quarter of 2019.


“Our strong financial performance this quarter is a testament to the strength of our business model,” said Michael J. Long, chairman, president, and chief executive officer. “Arrow is a trusted provider of critical technology solutions, and we believe strong demand for the products and solutions we provide will endure and increase beyond the COVID-19 pandemic. Customers and suppliers are choosing to do more business with Arrow because of our growing engineering, design, supply chain management and hybrid cloud solution capabilities. The hard work of our talented team and their unwavering focus on providing customers with the products and solutions they need, when they need them, has allowed us to capitalize on opportunities leading to financial performance that was above our expectations.”

Global components third-quarter sales of $5.31 billion increased 5 percent year over year. Asia-Pacific components sales increased 29 percent year over year. Americas components sales decreased 13 percent year over year. Non-GAAP sales in the region decreased 10 percent year over year. Europe components sales decreased 8 percent year over year. Non-GAAP sales in the region decreased 12 percent year over year. Global components third-quarter operating income was $204 million. Third-quarter non-GAAP operating income was $208 million.

“Robust third-quarter global components sales demonstrate the vital role we play in the supply chains of manufacturing customers around the world,” continued Mr. Long. “Sales were above the high-end of our expectations driven by tremendous growth in Asia, where our business has doubled in size over the last five years due to our consistent investments in the region to support innovation and invention.”

Global enterprise computing solutions third-quarter sales of $1.92 billion decreased 5 percent year over year. Non-GAAP sales decreased 7 percent year over year. Europe enterprise computing solutions sales increased 6 percent year over year. Non-GAAP sales in the region increased 1 percent year over year. Americas enterprise computing solutions sales decreased 10 percent year over year. Global enterprise computing solutions third-quarter operating income was $83 million. Third-quarter non-GAAP operating income was $85 million.

“Third-quarter global enterprise computing solutions sales were near the high-end of our prior outlook, led by the cloud and security solutions that enable business continuity and remote working,” said Mr. Long. “We continue to be a source of stability for our customers and suppliers facing challenging market conditions.”

“Our financial results demonstrated the resilience of Arrow’s business model,” said Chris Stansbury, senior vice president and chief financial officer. “Third-quarter cash flow from operations was $275 million, driven by disciplined working capital management and healthy profitability from our leading positions in the markets we serve. As always, we remain committed to returning excess cash to shareholders. During the third quarter, we returned approximately $150 million to shareholders through our stock repurchase program, ending the quarter with approximately $563 million of remaining authorization under our share repurchase program. Our balance sheet and liquidity position remain strong, and we are pleased to report that return on invested capital increased year over year for the second straight quarter.”

1 A reconciliation of non-GAAP financial measures, including sales, gross profit, operating income, net income attributable to shareholders, and net income per share, to GAAP financial measures is presented in the reconciliation tables included herein.

FOURTH-QUARTER 2020 OUTLOOK

  • Consolidated sales of $7.45 billion to $8.05 billion, with global components sales of $5.1 billion to $5.4 billion, and global enterprise computing solutions sales of $2.35 billion to $2.65 billion
  • Net income per share on a diluted basis of $2.42 to $2.58, and non-GAAP net income per share on a diluted basis1 of $2.57 to $2.73
  • Average tax rate of approximately 23.5 percent compared to the long-term range of 23 to 25 percent
  • Average diluted shares outstanding of 77 million
  • Interest expense of approximately $33 million
  • Expecting average USD-to-Euro exchange rate of $1.16 to €1; changes in foreign currencies to increase sales by approximately $110 million, and earnings per share on a diluted basis by $.07 compared to the fourth quarter of 2019

Fourth-Quarter 2020 Outlook

 

Reported GAAP measure

Intangible amortization expense

Restructuring & integration charges

Non-GAAP measure

Net income per diluted share

$2.42 - $2.58

$.10

$.05

$2.57 - $2.73

 

Please refer to the CFO commentary, which can be found at investor.arrow.com, as a supplement to the company’s earnings release.

Arrow Electronics guides innovation forward for over 175,000 leading technology manufacturers and service providers. With 2019 sales of $29 billion, Arrow develops technology solutions that improve business and daily life. Learn more at fiveyearsout.com.

Information Relating to Forward-Looking Statements

This press release includes “forward-looking” statements, as the term is defined under the federal securities laws, including but not limited to statements regarding: Arrow’s future financial performance, including its outlook on financial results for the fourth quarter of fiscal 2020, such as sales, net income per diluted share, non-GAAP net income per diluted share, average tax rate, average diluted shares outstanding, interest expense, average USD-to-Euro exchange rate, impact to sales due to changes in foreign currencies, intangible amortization expense per diluted share, restructuring & integration charges per diluted share, and expectation regarding market demand. These forward-looking statements are subject to numerous assumptions, risks, and uncertainties, which could cause actual results or facts to differ materially from such statements for a variety of reasons, including, but not limited to: potential adverse effects of the ongoing global coronavirus pandemic, including actions taken to contain or treat the coronavirus, industry conditions, changes in product supply, pricing and customer demand, competition, other vagaries in the global components and global enterprise computing solutions markets, changes in relationships with key suppliers, increased profit margin pressure, changes in legal and regulatory matters, non-compliance with certain regulations, such as export, anti-trust, and anti-corruption laws, foreign tax and other loss contingencies, and the company's ability to generate cash flow. For a further discussion of these and other factors that could cause the company’s future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the company's periodic reports on Form 10-K, the Form 10-Q and subsequent filings made with the Securities and Exchange Commission. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. The company undertakes no obligation to update publicly or revise any of the forward-looking statements.

Certain Non-GAAP Financial Information

In addition to disclosing financial results that are determined in accordance with accounting principles generally accepted in the United States (“GAAP”), the company also provides certain non-GAAP financial information relating to sales, operating income, net income attributable to shareholders, and net income per basic and diluted share.

The company provides non-GAAP sales, gross profit, operating income, income before income taxes, provision for income taxes, net income, and net income per share on a diluted basis which are adjusted GAAP measures for the impact of changes in foreign currencies (referred to as "changes in foreign currencies") by re-translating prior period results at current period foreign exchange rates, the impact of dispositions by adjusting the company’s operating results for businesses disposed, as if the dispositions had occurred at the beginning of the earliest period presented (referred to as "dispositions"), the impact of the company’s personal computer and mobility asset disposition business (referred to as "wind down"), the impact of inventory write-downs and recoveries related to the digital business (referred to as “digital inventory write-downs and recoveries”), and the impact of notes receivable reserves and recoveries and inventory write-downs and recoveries related to the AFS business (referred to as “AFS notes receivable reserves and recoveries” and “AFS inventory write-downs and recoveries,” respectively). Non-GAAP operating income excludes identifiable intangible asset amortization, restructuring, integration, and other charges, loss on disposition of businesses, net, AFS notes receivable reserves and recoveries and inventory write-downs and recoveries, digital inventory write-downs and recoveries, the impact of non-cash charges related to goodwill, trade names, and long-lived assets, and the impact of wind down. Net income attributable to shareholders, and net income per basic and diluted share as adjusted to exclude identifiable intangible asset amortization, restructuring, integration, and other charges, loss on disposition of businesses, net, AFS notes receivable reserves and recoveries and inventory write-downs and recoveries, digital inventory write-downs and recoveries, net gains and losses on investments, the impact of non-cash charges related to goodwill, trade names, and long-lived assets, certain tax adjustments, pension settlement gain, and the impact of wind down. A reconciliation of the company’s non-GAAP financial information to GAAP is set forth in the tables below.

The company believes that such non-GAAP financial information is useful to investors to assist in assessing and understanding the company’s operating performance and underlying trends in the company’s business because management considers these items referred to above to be outside the company’s core operating results. This non-GAAP financial information is among the primary indicators management uses as a basis for evaluating the company’s financial and operating performance. In addition, the company’s Board of Directors may use this non-GAAP financial information in evaluating management performance and setting management compensation.

The presentation of this additional non-GAAP financial information is not meant to be considered in isolation or as a substitute for, or alternative to, sales, operating income, net income and net income per basic and diluted share determined in accordance with GAAP. Analysis of results and outlook on a non-GAAP basis should be used as a complement to, and in conjunction with, data presented in accordance with GAAP.

ARROW ELECTRONICS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands except per share data)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Nine Months Ended

 

 

September 26, 2020

 

September 28, 2019

 

September 26, 2020

 

September 28, 2019

 

 

 

 

 

 

 

 

 

Sales

 

$

7,231,260

 

 

$

7,078,118

 

 

$

20,219,171

 

 

$

21,578,657

 

Cost of sales

 

6,442,670

 

 

6,279,277

 

 

17,951,727

 

 

19,103,219

 

Gross profit

 

788,590

 

 

798,841

 

 

2,267,444

 

 

2,475,438

 

Operating expenses:

 

 

 

 

 

 

 

 

Selling, general, and administrative expenses

 

504,211

 

 

522,446

 

 

1,539,520

 

 

1,677,734

 

Depreciation and amortization

 

46,732

 

 

45,231

 

 

140,654

 

 

139,739

 

Loss on disposition of businesses, net

 

 

 

14,573

 

 

 

 

15,439

 

Impairments

 

2,305

 

 

253

 

 

7,223

 

 

698,246

 

Restructuring, integration, and other charges (credits)

 

(2,840)

 

 

43,120

 

 

6,948

 

 

74,692

 

 

 

550,408

 

 

625,623

 

 

1,694,345

 

 

2,605,850

 

Operating income (loss)

 

238,182

 

 

173,218

 

 

573,099

 

 

(130,412)

 

Equity in earnings (losses) of affiliated companies

 

61

 

 

(1,070)

 

 

308

 

 

(2,155)

 

Gain (loss) on investments, net

 

2,726

 

 

1,126

 

 

(3,183)

 

 

7,864

 

Employee benefit plan (expense) credit

 

595

 

 

(1,071)

 

 

(1,687)

 

 

(3,349)

 

Interest and other financing expense, net

 

(30,461)

 

 

(49,882)

 

 

(105,596)

 

 

(153,426)

 

Income (loss) before income taxes

 

211,103

 

 

122,321

 

 

462,941

 

 

(281,478)

 

Provision for income taxes

 

44,707

 

 

29,340

 

 

113,453

 

 

30,878

 

Consolidated net income (loss)

 

166,396

 

 

92,981

 

 

349,488

 

 

(312,356)

 

Noncontrolling interests

 

336

 

 

850

 

 

1,121

 

 

3,744

 

Net income (loss) attributable to shareholders

 

$

166,060

 

 

$

92,131

 

 

$

348,367

 

 

$

(316,100)

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share:

 

 

 

 

 

 

 

 

Basic

 

$

2.15

 

 

$

1.11

 

 

$

4.42

 

 

$

(3.75)

 

Diluted

 

$

2.13

 

 

$

1.10

 

 

$

4.39

 

 

$

(3.75)

 

 

 

 

 

 

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

77,390

 

 

82,711

 

 

78,807

 

 

84,246

 

Diluted

 

78,086

 

 

83,397

 

 

79,404

 

 

84,246

 

ARROW ELECTRONICS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands except par value)

(Unaudited)

 

 

 

 

 

September 26, 2020

 

December 31, 2019

 

 

 

 

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

227,019

 

 

$

300,103

 

Accounts receivable, net

7,958,675

 

 

8,482,687

 

Inventories

3,235,802

 

 

3,477,120

 

Other current assets

238,403

 

 

266,249

 

Total current assets

11,659,899

 

 

12,526,159

 

Property, plant, and equipment, at cost:

 

 

 

Land

7,818

 

 

7,793

 

Buildings and improvements

196,258

 

 

173,370

 

Machinery and equipment

1,528,735

 

 

1,481,525

 

 

1,732,811

 

 

1,662,688

 

Less: Accumulated depreciation and amortization

(938,956)

 

 

(859,578)

 

Property, plant, and equipment, net

793,855

 

 

803,110

 

Investments in affiliated companies

76,355

 

 

86,942

 

Intangible assets, net

241,293

 

 

271,903

 

Goodwill

2,074,282

 

 

2,061,322

 

Other assets

650,949

 

 

651,360

 

Total assets

$

15,496,633

 

 

$

16,400,796

 

LIABILITIES AND EQUITY

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

6,849,252

 

 

$

7,046,221

 

Accrued expenses

899,326

 

 

880,507

 

Short-term borrowings, including current portion of long-term debt

166,128

 

 

331,431

 

Total current liabilities

7,914,706

 

 

8,258,159

 

Long-term debt

2,097,741

 

 

2,640,129

 

Other liabilities

646,414

 

 

636,115

 

Commitments and contingencies

 

 

 

Equity:

 

 

 

Shareholders’ equity:

 

 

 

Common stock, par value $1:

 

 

 

Authorized - 160,000 shares in both 2020 and 2019, respectively

 

 

 

Issued - 125,424 shares in both 2020 and 2019, respectively

125,424

 

 

125,424

 

Capital in excess of par value

1,157,149

 

 

1,150,006

 

Treasury stock (49,696 and 44,804 shares in 2020 and 2019, respectively), at cost

(2,689,876)

 

 

(2,332,548)

 

Retained earnings

6,443,680

 

 

6,131,248

 

Accumulated other comprehensive loss

(255,313)

 

 

(262,211)

 

Total shareholders’ equity

4,781,064

 

 

4,811,919

 

Noncontrolling interests

56,708

 

 

54,474

 

Total equity

4,837,772

 

 

4,866,393

 

Total liabilities and equity

$

15,496,633

 

 

$

16,400,796

 

ARROW ELECTRONICS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

 

Quarter Ended

 

September 26, 2020

 

September 28, 2019

Cash flows from operating activities:

 

 

 

Consolidated net income

$

166,396

 

 

$

92,981

 

Adjustments to reconcile consolidated net income to net cash provided by operations:

 

 

 

Depreciation and amortization

46,732

 

 

45,231

 

Amortization of stock-based compensation

6,285

 

 

7,120

 

Equity in (earnings) losses of affiliated companies

(61)

 

 

1,070

 

Deferred income taxes

(7,369)

 

 

6,362

 

Impairments

2,305

 

 

253

 

Loss on disposition of businesses, net

 

 

14,573

 

Gain on investments, net

(2,727)

 

 

(884)

 

Other

3,995

 

 

(276)

 

Change in assets and liabilities, net of effects of acquired and disposed businesses:

 

 

 

Accounts receivable, net

87,402

 

 

21,355

 

Inventories

207,646

 

 

64,468

 

Accounts payable

(176,973)

 

 

(3,013)

 

Accrued expenses

(41,889)

 

 

270

 

Other assets and liabilities

(17,015)

 

 

37,264

 

Net cash provided by operating activities

274,727

 

 

286,774

 

Cash flows from investing activities:

 

 

 

Cash paid on disposition of businesses

 

 

(10,785)

 

Acquisition of property, plant, and equipment

(30,013)

 

 

(31,444)

 

Other

(9,116)

 

 

(8,495)

 

Net cash used for investing activities

(39,129)

 

 

(50,724)

 

Cash flows from financing activities:

 

 

 

Change in short-term and other borrowings

(78,966)

 

 

80,227

 

Proceeds from (repayments of) long-term bank borrowings, net

328

 

 

(215,937)

 

Proceeds from exercise of stock options

2,233

 

 

2,088

 

Repurchases of common stock

(153,011)

 

 

(103,270)

 

Net cash used for financing activities

(229,416)

 

 

(236,892)

 

Effect of exchange rate changes on cash

15,009

 

 

(6,893)

 

Net increase (decrease) in cash and cash equivalents

21,191

 

 

(7,735)

 

Cash and cash equivalents at beginning of period

205,828

 

 

269,989

 

Cash and cash equivalents at end of period

$

227,019

 

 

$

262,254

  

ARROW ELECTRONICS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

 

Nine Months Ended

 

September 26, 2020

 

September 28, 2019

Cash flows from operating activities:

 

 

 

Consolidated net income (loss)

$

349,488

 

 

$

(312,356)

 

Adjustments to reconcile consolidated net income (loss) to net cash provided by operations:

 

 

 

Depreciation and amortization

140,654

 

 

139,739

 

Amortization of stock-based compensation

28,602

 

 

34,749

 

Equity in (earnings) losses of affiliated companies

(308)

 

 

2,155

 

Deferred income taxes

38,976

 

 

(65,484)

 

Impairments

7,223

 

 

698,246

 

Loss on disposition of businesses, net

 

 

15,439

 

Loss (gain) on investments, net

3,198

 

 

(7,622)

 

Other

4,043

 

 

10,814

 

Change in assets and liabilities, net of effects of acquired and disposed businesses:

 

 

 

Accounts receivable, net

533,570

 

 

916,908

 

Inventories

260,573

 

 

342,610

 

Accounts payable

(228,000)

 

 

(1,349,189)

 

Accrued expenses

29,154

 

 

(71,124)

 

Other assets and liabilities

(7,336)

 

 

8,308

 

Net cash provided by operating activities

1,159,837

 

 

363,193

 

Cash flows from investing activities:

 

 

 

Cash paid on disposition of businesses

 

 

(1,325)

 

Acquisition of property, plant, and equipment

(89,555)

 

 

(113,080)

 

Other

(14,582)

 

 

(5,555)

 

Net cash used for investing activities

(104,137)

 

 

(119,960)

 

Cash flows from financing activities:

 

 

 

Change in short-term and other borrowings

(86,155)

 

 

(93,129)

 

Repayments of long-term bank borrowings, net

(411,362)

 

 

(96,960)

 

Redemption of notes

(209,366)

 

 

 

Proceeds from exercise of stock options

5,963

 

 

11,710

 

Repurchases of common stock

(384,750)

 

 

(304,194)

 

Settlement of forward-starting interest rate swap

(48,378)

 

 

 

Other

(141)

 

 

(147)

 

Net cash used for financing activities

(1,134,189)

 

 

(482,720)

 

Effect of exchange rate changes on cash

5,405

 

 

(7,586)

 

Net decrease in cash and cash equivalents

(73,084)

 

 

(247,073)

 

Cash and cash equivalents at beginning of period

300,103

 

 

509,327

 

Cash and cash equivalents at end of period

$

227,019

 

 

$

262,254

 

ARROW ELECTRONICS, INC.

NON-GAAP SALES RECONCILIATION

(In thousands)

(Unaudited)

 

Quarter Ended

 

 

 

September 26, 2020

 

September 28, 2019

 

% Change

 

 

 

 

 

 

Consolidated sales, as reported

$

7,231,260

 

 

$

7,078,118

 

 

2.2

%

Impact of changes in foreign currencies

 

 

96,749

 

 

 

Impact of wind down

 

 

(60,130)

 

 

 

Non-GAAP consolidated sales

$

7,231,260

 

 

$

7,114,737

 

 

1.6

%

 

 

 

 

 

 

Global components sales, as reported

$

5,307,737

 

 

$

5,048,880

 

 

5.1

%

Impact of changes in foreign currencies

 

 

67,317

 

 

 

Impact of wind down

 

 

(60,130)

 

 

 

Non-GAAP global components sales

$

5,307,737

 

 

$

5,056,067

 

 

5.0

%

 

 

 

 

 

 

Americas Components sales, as reported

$

1,515,962

 

 

$

1,738,710

 

 

(12.8)

%

Impact of changes in foreign currencies

 

 

(409)

 

 

 

Impact of wind down

 

 

(46,998)

 

 

 

Non-GAAP Americas Components sales

$

1,515,962

 

 

$

1,691,303

 

 

(10.4)

%

 

 

 

 

 

 

Europe components sales, as reported

$

1,196,672

 

 

$

1,304,109

 

 

(8.2)

%

Impact of changes in foreign currencies

 

 

64,000

 

 

 

Impact of wind down

 

 

(13,132)

 

 

 

Non-GAAP Europe components sales

$

1,196,672

 

 

$

1,354,977

 

 

(11.7)

%

 

 

 

 

 

 

Asia components sales, as reported

$

2,595,103

 

 

$

2,006,061

 

 

29.4

%

Impact of changes in foreign currencies

 

 

3,726

 

 

 

Non-GAAP Asia components sales

$

2,595,103

 

 

$

2,009,787

 

 

29.1

%

 

 

 

 

 

 

Global ECS sales, as reported

$

1,923,523

 

 

$

2,029,238

 

 

(5.2)

%

Impact of changes in foreign currencies

 

 

29,432

 

 

 

Non-GAAP global ECS sales

$

1,923,523

 

 

$

2,058,670

 

 

(6.6)

%

 

 

 

 

 

 

Europe ECS sales, as reported

$

649,732

 

 

$

610,324

 

 

6.5

%

Impact of changes in foreign currencies

 

 

30,545

 

 

 

Non-GAAP Europe ECS sales

$

649,732

 

 

$

640,869

 

 

1.4

%

 

 

 

 

 

 

Americas ECS sales, as reported

$

1,273,791

 

 

$

1,418,914

 

 

(10.2)

%

Impact of changes in foreign currencies

 

 

(1,113)

 

 

 

Non-GAAP Americas ECS sales

$

1,273,791

 

 

$

1,417,801

 

 

(10.2)

%

ARROW ELECTRONICS, INC.

NON-GAAP SALES RECONCILIATION

(In thousands)

(Unaudited)

 

Nine Months Ended

 

 

 

September 26, 2020

 

September 28, 2019

 

% Change

 

 

 

 

 

 

Consolidated sales, as reported

$

20,219,171

 

 

$

21,578,657

 

 

(6.3)

%

Impact of changes in foreign currencies

 

 

(41,938)

 

 

 

Impact of wind down and dispositions

 

 

(232,239)

 

 

 

Non-GAAP consolidated sales

$

20,219,171

 

 

$

21,304,480

 

 

(5.1)

%

 

 

 

 

 

 

Global components sales, as reported

$

14,579,593

 

 

$

15,511,742

 

 

(6.0)

%

Impact of changes in foreign currencies

 

 

(21,453)

 

 

 

Impact of wind down

 

 

(221,098)

 

 

 

Non-GAAP global components sales

$

14,579,593

 

 

$

15,269,191

 

 

(4.5)

%

 

 

 

 

 

 

Americas Components sales, as reported

$

4,557,661

 

 

$

5,522,538

 

 

(17.5)

%

Impact of changes in foreign currencies

 

 

(4,169)

 

 

 

Impact of wind down

 

 

(170,724)

 

 

 

Non-GAAP Americas Components sales

$

4,557,661

 

 

$

5,347,645

 

 

(14.8)

%

 

 

 

 

 

 

Europe components sales, as reported

$

3,625,079

 

 

$

4,223,363

 

 

(14.2)

%

Impact of changes in foreign currencies

 

 

(5,049)

 

 

 

Impact of wind down

 

 

(50,374)

 

 

 

Non-GAAP Europe components sales

$

3,625,079

 

 

$

4,167,940

 

 

(13.0)

%

 

 

 

 

 

 

Asia components sales, as reported

$

6,396,853

 

 

$

5,765,841

 

 

10.9

%

Impact of changes in foreign currencies

 

 

(12,235)

 

 

 

Non-GAAP Asia components sales

$

6,396,853

 

 

$

5,753,606

 

 

11.2

%

 

 

 

 

 

 

Global ECS sales, as reported

$

5,639,578

 

 

$

6,066,915

 

 

(7.0)

%

Impact of changes in foreign currencies

 

 

(20,485)

 

 

 

Impact of dispositions

 

 

(11,141)

 

 

 

Non-GAAP global ECS sales

$

5,639,578

 

 

$

6,035,289

 

 

(6.6)

%

 

 

 

 

 

 

Europe ECS sales, as reported

$

2,013,843

 

 

$

2,074,638

 

 

(2.9)

%

Impact of changes in foreign currencies

 

 

(3,117)

 

 

 

Impact of dispositions

 

 

(11,141)

 

 

 

Non-GAAP Europe ECS sales

$

2,013,843

 

 

$

2,060,380

 

 

(2.3)

%

 

 

 

 

 

 

Americas ECS sales, as reported

$

3,625,735

 

 

$

3,992,277

 

 

(9.2)

%

Impact of changes in foreign currencies

 

 

(17,368)

 

 

 

Non-GAAP Americas ECS sales

$

3,625,735

 

 

$

3,974,909

 

 

(8.8)

%

 

 

 

 

 

 

 

 

 

 

 

 

ARROW ELECTRONICS, INC.

NON-GAAP EARNINGS RECONCILIATION

(In thousands except per share data)

(Unaudited)

 

Three months ended September 26, 2020

 

Reported

GAAP

measure

Intangible

amortization

expense

Restructuring

& Integration

charges

AFS Reserves & Recoveries

Digital Write Downs & Recoveries

Impairments(1)

Impact of Wind Down

Non-recurring tax items

Other(2)

Non-GAAP

measure

Sales

$

7,231,260

 

$

 

$

 

$

 

$

 

$

 

$

 

$

 

$

 

$

7,231,260

 

Gross Profit

788,590

 

 

 

 

 

 

(475)

 

 

 

788,115

 

Operating income

238,182

 

9,352

 

(2,840)

 

(233)

 

 

2,305

 

(2,487)

 

 

 

244,279

 

Income before income taxes

211,103

 

9,352

 

(2,840)

 

(233)

 

 

2,305

 

(2,478)

 

 

(4,495)

 

212,714

 

Provision for income taxes

44,707

 

2,396

 

(665)

 

(56)

 

 

556

 

(583)

 

4,887

 

(1,090)

 

50,152

 

Consolidated net income

166,396

 

6,956

 

(2,175)

 

(177)

 

 

1,749

 

(1,895)

 

(4,887)

 

(3,405)

 

162,562

 

Noncontrolling interests

336

 

146

 

 

 

 

 

 

 

 

482

 

Net income attributable to shareholders

$

166,060

 

$

6,810

 

$

(2,175)

 

$

(177)

 

$

 

$

1,749

 

$

(1,895)

 

$

(4,887)

 

$

(3,405)

 

162,080

 

Net income per diluted share(7)

$

2.13

 

$

0.09

 

$

(0.03)

 

$

 

$

 

$

0.02

 

$

(0.02)

 

$

(0.06)

 

$

(0.04)

 

$

2.08

 

Effective tax rate

21.2

%

 

 

 

 

 

 

 

 

23.6

%

 

 

 

 

 

 

 

 

 

 

 

Three months ended September 28, 2019

 

Reported

GAAP

measure

Intangible

amortization

expense(3)

Restructuring

& Integration

charges(3)

AFS Reserves & Recoveries

Digital Write Downs & Recoveries

Impairments

Impact of Wind Down(3)

Non-recurring tax items

Other(4)

Non-GAAP

measure

Sales

$

7,078,118

 

$

 

$

 

$

 

$

 

$

 

$

(60,130)

 

$

 

$

 

$

7,017,988

 

Gross Profit

798,841

 

 

 

 

1,101

 

 

(3,541)

 

 

 

796,401

 

Operating income

173,218

 

10,265

 

31,087

 

(664)

 

1,101

 

711

 

36,917

 

 

 

252,635

 

Income before income taxes

122,321

 

10,265

 

31,087

 

(664)

 

1,101

 

711

 

36,842

 

 

(1,126)

 

200,537

 

Provision for income taxes

29,340

 

2,860

 

8,922

 

(178)

 

272

 

 

3,753

 

 

(249)

 

44,720

 

Consolidated net income

92,981

 

7,405

 

22,165

 

(486)

 

829

 

711

 

33,089

 

 

(877)

 

155,817

 

Noncontrolling interests

850

 

138

 

 

 

 

 

 

 

 

988

 

Net income attributable to shareholders

$

92,131

 

$

7,267

 

$

22,165

 

$

(486)

 

$

829

 

$

711

 

$

33,089

 

$

 

$

(877)

 

$

154,829

 

Net income per diluted share(7)

$

1.10

 

$

0.09

 

$

0.27

 

$

(0.01)

 

$

0.01

 

$

0.01

 

$

0.40

 

$

 

$

(0.01)

 

$

1.86

 

Effective tax rate

24.0

%

 

 

 

 

 

 

 

 

22.3

%

 

 

 

 

 

 

 

 

 

 

 


Contacts

Steven O’Brien
Vice President, Investor Relations
303-824-4544

Media Contact:
John Hourigan
Vice President, Global Communications
303-824-4586


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