Ingram Micro (IM), a provider of technology and supply chain services, has reported a 27.37 percent increase in profit for the quarter ended Jun. 30, 2014. The company earned $50.61 million or $0.32 a share in the second-quarter compared with $69.69 million or $0.45 a share a year ago. Adjusted earnings per share came in at $0.54, when analysts expected $0.51.
Revenue during the second-quarter rose 5.83 percent to $10909.38 million from $10308.02 million in the last year period.
Gross margin expanded by 3 basis points over the last year period to 5.81 percent. Total expenses as a percentage of revenues increased to 99.10 percent from 98.90 percent in the same period last year. That has resulted in contraction of 20 basis points in operating margins to 0.90 percent.
The company posted operating income of $98.22 million compared with $113.80 million in the previous year period.
Alain MoniƩ, Ingram Micro CEO, commented, "Worldwide revenue increased by $600 million, or 6 percent, to a second quarter record. Revenue growth was driven by new mobility wins, robust networking sales and solid systems revenue in North America, which benefited from the PC refresh cycle; strengthening retail and consumer markets in Europe; and better demand in much of Latin America. Non-GAAP operating margin expanded year-over-year for the fifth quarter in a row and we delivered non-GAAP EPS of 54 cents, which was also up after excluding one-time discrete tax items that benefited the 2013 second quarter."
The company currently expects 2014 third quarter worldwide revenue to increase year-over-year in the high single digits. Gross margin is expected to improve solidly over the 2014 second quarter, and be relatively flat with the prior year third quarter, it said.
2014 third quarter non-GAAP operating expense as a percentage of revenue is expected to continue to benefit sequentially over the 2014 second quarter from incremental cost savings related to implementation of the company's global organizational effectiveness program, and year-over-year from revenue leverage, it added.
Cash Position
As on Jun. 30, 2014, the company's cash balance stood at $470.69 million, down 35.25 percent or $256.20 million from Jun. 29, 2013.
Working Capital
Ingram Micro has witnessed an increase in the working capital over the last one year. The company's working capital stood at $3788.41 million as at Jun. 30, 2014, up $448.23 million or 13.42 percent from $3340.18 million on Jun. 29, 2013. It registered an increase in current ratio to 1.60 as at Jun. 30, 2014 from 1.56 on Jun. 29, 2013.
Debt Position
Ingram Micro has witnessed an increase in the total debt over the last one year. As on Jun. 30, 2014, total debt stood at $1160.22 million, up 31.16 percent or $275.64 million, from Jun. 29, 2013.
The company's total debt was 10.04 percent of total assets as on Jun. 30, 2014, compared with 8.35 percent on Jun. 29, 2013.
Interest coverage ratio, which determines how easily a company can pay interest expenses on outstanding debt, has declined to 5.33 from 7.96 in the same period last year.