Ingram Micro Results Improve Amid Stronger Tech Spending

Ingram Micro Inc., the world’s largest distributor of computers and equipment, reported higher fiscal fourth-quarter sales and profit on Tuesday thanks to stronger corporate technology spending and a weak dollar.

Revenue at the Santa Ana company rose 15% to $6.76 billion from $5.89 billion in the same period a year earlier. Net income was $46.4 million, or 30 cents a share, compared with a net loss of $10.3 million, or 7 cents, in the year-earlier quarter.

“This is another piece of evidence that the spending environment is improving,” said Robert Anastasi, director of equity research for Raymond James & Associates in St. Petersburg, Fla.

Ingram Micro, which distributes products for companies such as Microsoft Corp., IBM Corp. and Cisco Systems Inc., also benefited from a weak dollar that boosted European sales by 19%. The company derived 41% of its quarterly sales from Europe.

Not counting one-time charges, Ingram Micro’s net income was $52.3 million, or 34 cents a share, well above the 23 cents a share expected by analysts surveyed by Thomson First Call. The company’s stock jumped 12% to $18 in after-hours trading. Before the results were released, the shares dipped 8 cents to $16.06 in regular trading on the New York Stock Exchange.

The results included charges of $8.7 million for the latest quarter, which ended Jan. 3, and $62.7 million in the year-earlier quarter for expenses stemming from a cost-cutting effort. Ingram Micro has trimmed its headcount by 11% to 11,300 full-time employees over two years and consolidated its distribution facilities and administrative buildings.

Company executives forecast fiscal first-quarter sales of $6.1 billion to $6.3 billion, up 15% from the previous year. Analysts had forecast revenue of $5.46 billion, according to Thomson First Call.

But Ingram Micro Chief Executive Kent B. Foster cautioned that much of that gain would come from strong European currencies. “If you normalize the currency effect, the growth will be modest,” he said, putting real sales growth into the “single digits.”

Analysts are forecasting a rebound in technology spending in 2004 as the nation’s economic picture improves.

“For somebody like Ingram, that will provide a nice boost,” said George Shiffler, a computer analyst for Gartner Inc.

For the full year, Ingram Micro’s sales grew slightly to $22.6 billion from $22.5 billion in 2002. Net income was $149 million, or 98 cents a share, compared with a loss of $275 million, or $1.81, in 2002.