Investor Relations

Press Release

Avnet Reports Fourth Quarter and Fiscal 2022 Financial Results

August 10, 2022 at 4:05 PM EDT

Fourth quarter sales of $6.4 billion and operating income margin of 4.5%

Fiscal 2022 sales of $24.3 billion and record diluted EPS of $6.94

Farnell achieves record revenues of $1.8 billion with operating margin over 13%

PHOENIX--(BUSINESS WIRE)--Aug. 10, 2022-- Avnet, Inc. (Nasdaq: AVT) today announced results for its fourth quarter and fiscal year ended July 2, 2022.

Commenting on the Company’s financial results, Avnet Chief Executive Officer Phil Gallagher stated, “We are pleased to end the fiscal year on a high note, delivering another strong quarter of year-over-year sales growth and operating margin expansion. Supported by solid execution across our businesses, Avnet continues to gain share and secure new opportunities in the markets in which we compete. Despite an evolving macro environment, we remain well-positioned to continue to grow our business profitably by helping our customers and suppliers navigate an increasingly complex market.”

Fiscal Fourth Quarter Key Financial Highlights:

  • Sales of $6.4 billion up 21.9% year over year from $5.2 billion.
    • On a constant currency basis, sales increased 28.2% year over year.
  • GAAP diluted earnings per share increased to $2.51, compared with $0.85 in the prior year quarter.
    • Non-GAAP adjusted diluted earnings per share of $2.07, compared with $1.12 in the prior year quarter.
  • GAAP operating income margin of 4.5%, increased 221 basis points year over year.
    • Adjusted operating income margin of 4.5%, increased 161 basis points year over year.
  • Electronic Components operating income margin of 4.3%, increased 122 basis points year over year.
  • Farnell operating income margin of 14.2% increased 597 basis points year over year.
  • Returned $25 million to shareholders in dividends during the quarter, an 18% per share increase year over year.
  • Returned $102 million to shareholders in the quarter from share repurchases, representing 2.4% of outstanding shares.

Fiscal 2022 Key Financial Highlights:

  • Sales of $24.3 billion up 24.5% year over year from $19.5 billion.
    • On a constant currency basis, sales increased 27.2% year over year.
  • GAAP diluted earnings per share increased to $6.94, compared with $1.93 in the prior year.
    • Non-GAAP adjusted diluted earnings per share of $6.93, compared with $2.71 in the prior year.
  • GAAP operating income margin of 3.9%, increased 242 basis points year over year.
    • Adjusted operating income margin of 4.1%, increased 197 basis points year over year.
  • Electronic Components operating income margin of 3.9%, increased 135 basis points year over year.
  • Farnell operating income margin of 13.4% increased 764 basis points year over year.
  • Returned $98 million to shareholders in dividends during the fiscal year.
  • Returned $193 million to shareholders in the fiscal year from share repurchases, representing 4.7% of outstanding shares.

Key Financial Metrics

($ in millions, except per share data)

Fourth Quarter Results (GAAP)

 

 

Jun – 22

 

Jun – 21

 

Change Y/Y

 

Mar – 22

 

Change Q/Q

Sales

 

$

6,372.7

 

 

$

5,226.7

 

 

21.9

%

 

$

6,488.1

 

 

(1.8

)%

Operating Income

 

 

284.7

 

 

 

118.0

 

 

141.3

%

 

 

274.4

 

 

3.8

%

Operating Income Margin

 

 

4.5

%

 

 

2.3

%

 

221

bps

 

 

4.2

%

 

24

bps

Diluted Earnings Per Share (EPS)

 

$

2.51

 

 

$

0.85

 

 

195.3

%

 

$

1.84

 

 

36.4

%

Fourth Quarter Results (Non-GAAP)(1)

 

 

Jun – 22

 

Jun – 21

 

Change Y/Y

 

Mar – 22

 

Change Q/Q

Sales

 

$

6,372.7

 

 

$

5,226.7

 

 

21.9

%

 

$

6,488.1

 

 

(1.8

)%

Adjusted Operating Income

 

 

287.6

 

 

 

151.8

 

 

89.5

%

 

 

303.7

 

 

(5.3

)%

Adjusted Operating Income Margin

 

 

4.5

%

 

 

2.9

%

 

161

bps

 

 

4.7

%

 

(17

)bps

Adjusted Diluted Earnings Per Share (EPS)

 

$

2.07

 

 

$

1.12

 

 

84.8

%

 

$

2.15

 

 

(3.7

)%

Segment and Geographical Mix

 

 

Jun – 22

 

Jun – 21

 

Change Y/Y

 

Mar – 22

 

Change Q/Q

Electronic Components (EC) Sales

 

$

5,930.4

 

 

$

4,785.3

 

 

23.9

%

 

$

6,019.1

 

 

(1.5

)%

EC Operating Income Margin

 

 

4.3

%

 

 

3.1

%

 

122

bps

 

 

4.4

%

 

(9

)bps

Farnell Sales

 

$

442.3

 

 

$

441.4

 

 

0.2

%

 

$

469.0

 

 

(5.7

)%

Farnell Operating Income Margin

 

 

14.2

%

 

 

8.3

%

 

597

bps

 

 

14.9

%

 

(65

)bps

Americas Sales

 

$

1,618.4

 

 

$

1,194.4

 

 

35.5

%

 

$

1,627.2

 

 

(0.5

)%

EMEA Sales

 

 

2,064.0

 

 

 

1,737.3

 

 

18.8

%

 

 

2,185.7

 

 

(5.6

)%

Asia Sales

 

 

2,690.3

 

 

 

2,295.0

 

 

17.2

%

 

 

2,675.2

 

 

0.6

%

______________________
(1)

A reconciliation of non-GAAP financial measures to GAAP financial measures is presented in the “Non-GAAP Financial Information” section of this press release.

Outlook for the First Quarter of Fiscal 2023 Ending on October 1, 2022

 

 

 

 

 

 

 

Guidance Range

 

Midpoint

Sales

 

$6.20B$6.50B

 

$6.35B

Adjusted Diluted EPS(1)

 

$1.85$1.95

 

$1.90

______________________
(1)

A reconciliation of non-GAAP guidance to GAAP guidance is presented in the “Non-GAAP Financial Information” section of this press release.

The above guidance is based upon current market conditions, including a $100 million negative impact on sales at mid-point of guidance from the recent strengthening of the U.S. Dollar as compared to the fourth quarter. This guidance implies a sequential growth rate range of down 1% to up 4% in constant currency, and assumes a typical seasonal shift in sales to Asia from the western regions.

The above guidance also excludes amortization of intangibles and certain income tax adjustments. The above guidance assumes an effective tax rate of between 21% and 25%. The above guidance assumes 96 million average diluted shares outstanding and average currency exchange rates as shown in the table below:

 

 

 

 

 

 

 

 

 

Q1 Fiscal

 

 

 

 

 

 

2023

 

Q4 Fiscal

 

Q1 Fiscal

 

 

Guidance

 

2022

 

2022

Euro to U.S. Dollar

 

$1.02

 

$1.06

 

$1.18

GBP to U.S. Dollar

 

$1.20

 

$1.26

 

$1.38

Today’s Conference Call and Webcast Details

Avnet will host a quarterly webcast and teleconference today at 1:30 p.m. PT and 4:30 p.m. ET to discuss its financial results and provide a corporate update. The webcast can be accessed via Avnet’s Investor Relations web page at: https://ir.avnet.com.

Those who would still like to participate in the live call can dial 877-407-8112 or 201-689-8840. A replay of the conference call will be available for 90 days, through November 8, 2022 at 5:00 p.m. ET, and can be accessed by dialing: 877-660-6853 or 201-612-7415 and using Conference ID: 13730217.

Forward-Looking Statements

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the financial condition, results of operations and business of the Company. You can find many of these statements by looking for words like “believes,” “projected”, “plans,” “expects,” “anticipates,” “should,” “will,” “may,” “estimates” or similar expressions. These forward-looking statements are subject to numerous assumptions, risks and uncertainties. The following important factors, in addition to those discussed elsewhere in the Company’s Annual Report on Form 10-K for the fiscal year ended July 3, 2021 and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, could affect the Company’s future results of operations, and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements: geopolitical events and military conflicts; pandemics and other health-related crises, including COVID-19; competitive pressures among distributors of electronic components; an industry down-cycle in semiconductors, including supply shortages; relationships with key suppliers and allocations of products by suppliers, including increased non-cancellable/non-returnable orders; accounts receivable defaults; risks relating to the Company’s international sales and operations, including risks relating to the ability to repatriate cash, foreign currency fluctuations, inflation, duties and taxes, sanctions and trade restrictions, and compliance with international and U.S. laws; risks relating to acquisitions, divestitures and investments; adverse effects on the Company’s supply chain, operations of its distribution centers, shipping costs, third-party service providers, customers and suppliers, including as a result of issues caused by military conflicts, terrorist attacks, natural and weather-related disasters, pandemics and health related crisis, warehouse modernization and relocation efforts; risks related to cyber security attacks, other privacy and security incidents and information systems failures, including related to current or future implementations, integrations or upgrades; general economic and business conditions (domestic, foreign and global) affecting the Company’s operations and financial performance and, indirectly, the Company’s credit ratings, debt covenant compliance, liquidity and access to financing; constraints on employee retention and hiring; and legislative or regulatory changes affecting the Company’s businesses.

Any forward-looking statement speaks only as of the date on which that statement is made. Except as required by law, the Company assumes no obligation to update any forward-looking statement to reflect events or circumstances that occur after the date on which the statement is made.

About Avnet

As a leading global technology distributor and solutions provider, Avnet has served customers’ evolving needs for an entire century. We support customers at each stage of a product’s lifecycle, from idea to design and from prototype to production. Our unique position at the center of the technology value chain enables us to accelerate the design and supply stages of product development so customers can realize revenue faster. Decade after decade, Avnet helps its customers and suppliers around the world realize the transformative possibilities of technology. Learn more about Avnet at www.avnet.com. (AVT_IR)

 

AVNET, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fourth Quarters Ended

 

Years Ended

 

 

July 2,

 

July 3,

 

July 2,

 

July 3,

 

 

2022

 

2021

 

2022

 

2021

 

 

(Thousands, except per share data)

Sales

 

$

6,372,653

 

 

$

5,226,734

 

 

$

24,310,708

 

 

$

19,534,679

 

Cost of sales

 

 

5,593,022

 

 

 

4,581,787

 

 

 

21,345,317

 

 

 

17,294,049

 

Gross profit

 

 

779,631

 

 

 

644,947

 

 

 

2,965,391

 

 

 

2,240,630

 

Selling, general and administrative expenses

 

 

494,943

 

 

 

498,497

 

 

 

1,994,847

 

 

 

1,874,831

 

Russian-Ukraine conflict related expenses

 

 

 

 

 

 

 

 

26,261

 

 

 

 

Restructuring, integration and other expenses

 

 

 

 

 

28,449

 

 

 

5,272

 

 

 

84,391

 

Operating income

 

 

284,688

 

 

 

118,001

 

 

 

939,011

 

 

 

281,408

 

Other expense, net

 

 

(6,160

)

 

 

(2,955

)

 

 

(5,302

)

 

 

(19,006

)

Interest and other financing expenses, net

 

 

(29,987

)

 

 

(23,345

)

 

 

(100,375

)

 

 

(89,473

)

Income before taxes

 

 

248,541

 

 

 

91,701

 

 

 

833,334

 

 

 

172,929

 

Income tax expense (benefit)

 

 

1,718

 

 

 

6,346

 

 

 

140,955

 

 

 

(20,185

)

Net income

 

$

246,823

 

 

$

85,355

 

 

$

692,379

 

 

$

193,114

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

2.54

 

 

$

0.86

 

 

$

7.02

 

 

$

1.95

 

Diluted

 

$

2.51

 

 

$

0.85

 

 

$

6.94

 

 

$

1.93

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used to compute earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

97,309

 

 

 

99,655

 

 

 

98,662

 

 

 

99,258

 

Diluted

 

 

98,387

 

 

 

100,630

 

 

 

99,819

 

 

 

100,168

 

Cash dividends paid per common share

 

$

0.26

 

 

$

0.22

 

 

$

1.00

 

 

$

0.85

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AVNET, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

 

 

 

 

 

 

 

 

July 2,

 

July 3,

 

 

2022

 

2021

 

 

(Thousands)

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

153,693

 

$

199,691

Receivables

 

 

4,301,002

 

 

3,576,130

Inventories

 

 

4,244,148

 

 

3,236,837

Prepaid and other current assets

 

 

177,783

 

 

150,763

Total current assets

 

 

8,876,626

 

 

7,163,421

Property, plant and equipment, net

 

 

315,204

 

 

368,452

Goodwill

 

 

758,833

 

 

838,105

Intangible assets, net

 

 

12,651

 

 

28,539

Operating lease assets

 

 

227,138

 

 

265,988

Other assets

 

 

198,080

 

 

260,917

Total assets

 

$

10,388,532

 

$

8,925,422

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Short-term debt

 

$

174,422

 

$

23,078

Accounts payable

 

 

3,431,683

 

 

2,401,357

Accrued expenses and other

 

 

591,020

 

 

572,457

Short-term operating lease liabilities

 

 

54,529

 

 

58,346

Total current liabilities

 

 

4,251,654

 

 

3,055,238

Long-term debt

 

 

1,437,400

 

 

1,191,329

Long-term operating lease liabilities

 

 

199,418

 

 

239,838

Other liabilities

 

 

307,300

 

 

354,833

Total liabilities

 

 

6,195,772

 

 

4,841,238

Shareholders’ equity

 

 

4,192,760

 

 

4,084,184

Total liabilities and shareholders’ equity

 

$

10,388,532

 

$

8,925,422

 

 

 

 

 

 

 

AVNET, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

 

 

 

 

 

 

 

 

Years Ended

 

 

July 2, 2022

 

July 3, 2021

 

 

(Thousands)

Cash flows from operating activities:

 

 

 

 

 

 

Net income

 

$

692,379

 

 

$

193,114

 

 

 

 

 

 

 

 

Non-cash and other reconciling items:

 

 

 

 

 

 

Depreciation

 

 

87,367

 

 

 

90,884

 

Amortization

 

 

14,959

 

 

 

41,033

 

Amortization of operating lease assets

 

 

52,881

 

 

 

56,782

 

Deferred income taxes

 

 

(52,513

)

 

 

14,650

 

Stock-based compensation

 

 

36,738

 

 

 

29,339

 

Impairments

 

 

 

 

 

15,166

 

Other, net

 

 

34,116

 

 

 

22,512

 

Changes in (net of effects from businesses acquired and divested):

 

 

 

 

 

 

Receivables

 

 

(1,132,039

)

 

 

(615,353

)

Inventories

 

 

(1,218,871

)

 

 

(409,075

)

Accounts payable

 

 

1,131,225

 

 

 

620,973

 

Accrued expenses and other, net

 

 

134,448

 

 

 

30,924

 

Net cash flows (used) provided by operating activities

 

 

(219,310

)

 

 

90,949

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

Issuance of notes, net of discounts

 

 

299,973

 

 

 

297,660

 

Repayments of public notes

 

 

(354,336

)

 

 

(305,077

)

Borrowings under accounts receivable securitization, net

 

 

274,900

 

 

 

22,900

 

Repayments under senior unsecured credit facility, net

 

 

 

 

 

(231,680

)

Borrowings (repayments) under bank credit facilities and other debt, net

 

 

235,047

 

 

 

(2,789

)

Repurchases of common stock

 

 

(184,382

)

 

 

 

Dividends paid on common stock

 

 

(98,490

)

 

 

(84,309

)

Other, net

 

 

(16,653

)

 

 

(10,718

)

Net cash flows provided (used) for financing activities

 

 

156,059

 

 

 

(314,013

)

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

Purchases of property, plant and equipment

 

 

(48,900

)

 

 

(50,363

)

Acquisitions of assets and businesses

 

 

 

 

 

(18,381

)

Proceeds from liquidation of Company owned life insurance policies

 

 

90,384

 

 

 

 

Other, net

 

 

9,815

 

 

 

7,548

 

Net cash flows provided (used) for investing activities

 

 

51,299

 

 

 

(61,196

)

Effect of currency exchange rate changes on cash and cash equivalents

 

 

(34,046

)

 

 

6,913

 

Cash and cash equivalents:

 

 

 

 

 

 

— decrease

 

 

(45,998

)

 

 

(277,347

)

— at beginning of period

 

 

199,691

 

 

 

477,038

 

— at end of period

 

$

153,693

 

 

$

199,691

 

 

 

 

 

 

 

 

Non-GAAP Financial Information

In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States (“GAAP”), the Company also discloses certain non-GAAP financial information including (i) adjusted operating income, (ii) adjusted operating expenses, (iii) adjusted other income (expense), (iv) adjusted income before income taxes, (v) adjusted income tax expense (benefit), (vi) adjusted diluted earnings per share, and (vii) sales adjusted for the impact of significant acquisitions and other items (as defined in the Organic Sales section of this document).

There are also references to the impact of foreign currency in the discussion of the Company’s results of operations. When the U.S. Dollar strengthens and the stronger exchange rates of the current year are used to translate the results of operations of Avnet’s subsidiaries denominated in foreign currencies, the resulting impact is a decrease in U.S. Dollars of reported results. Conversely, when the U.S. Dollar weakens and the weaker exchange rates of the current year are used to translate the results of operations of Avnet’s subsidiaries denominated in foreign currencies, the resulting impact is an increase in U.S. Dollars of reported results. In the discussion of the Company’s results of operations, results excluding this impact are referred to as “constant currency.” Management believes organic sales and sales in constant currency are useful measures for evaluating current period performance as compared with prior periods and for understanding underlying trends. In order to determine the translation impact of changes in foreign currency exchange rates on sales, income or expense items for subsidiaries reporting in currencies other than the U.S. Dollar, the Company adjusts the average exchange rates used in current periods to be consistent with the average exchange rates in effect during the comparative period.

Management believes that operating income and operating expenses adjusted for restructuring, integration and other expenses, Russian-Ukraine conflict related expenses and amortization of acquired intangible assets and other, are useful measures to help investors better assess and understand the Company’s operating performance. This is especially the case when comparing results with previous periods or forecasting performance for future periods, primarily because management views the excluded items to be outside of Avnet’s normal operating results or non-cash in nature. Management analyzes operating income and operating expenses without the impact of these items as an indicator of ongoing margin performance and underlying trends in the business. Management also uses these non-GAAP measures to establish operational goals and, in most cases, for measuring performance for compensation purposes. Management measures operating income for its reportable segments excluding restructuring, integration and other expenses, Russian-Ukraine conflict related expenses and amortization of acquired intangible assets and other.

Additional non-GAAP metrics management uses is adjusted operating income margin, which is defined as adjusted operating income (as defined above) divided by sales.

Management also believes income tax expense (benefit), net income and diluted earnings (loss) per share adjusted for the impact of the items described above and certain items impacting other income (expense) and income tax expense (benefit) are useful to investors because they provide a measure of the Company’s net profitability on a more comparable basis to historical periods and provide a more meaningful basis for forecasting future performance. Adjustments to income tax expense (benefit) and the effective income tax rate include the effect of changes in tax laws, certain changes in valuation allowances and unrecognized tax benefits, income tax audit settlements and adjustments to the adjusted interim effective tax rate based upon the expected annual adjusted effective tax rate. Additionally, because of management’s focus on generating shareholder value, of which net profitability is a primary driver, management believes net income (loss) and diluted earnings (loss) per share excluding the impact of these items provides an important measure of the Company’s net profitability for the investing public.

Any analysis of results and outlook on a non-GAAP basis should be used as a complement to, and in conjunction with, results presented in accordance with GAAP.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

 

 

 

Fiscal Year

 

July 2,

 

April 2,

 

January 1,

 

October 2,

 

 

2022*

 

2022*

 

2022*

 

2022*

 

2021*

 

 

($ in thousands, except per share amounts)

GAAP selling, general and administrative expenses

 

$

1,994,847

 

 

$

494,943

 

 

$

512,364

 

 

$

501,363

 

 

$

486,178

 

Amortization of intangible assets and other

 

 

(15,038

)

 

 

(2,929

)

 

 

(3,074

)

 

 

(3,796

)

 

 

(5,239

)

Adjusted operating expenses

 

 

1,979,809

 

 

 

492,014

 

 

 

509,290

 

 

 

497,567

 

 

 

480,939

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP operating income

 

$

939,011

 

 

$

284,688

 

 

$

274,408

 

 

$

211,672

 

 

$

168,243

 

Restructuring, integration and other expenses

 

 

5,272

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,272

 

Russian-Ukraine conflict related expenses

 

 

26,261

 

 

 

-

 

 

 

26,261

 

 

 

-

 

 

 

-

 

Amortization of intangible assets and other

 

 

15,038

 

 

 

2,929

 

 

 

3,074

 

 

 

3,796

 

 

 

5,239

 

Adjusted operating income

 

 

985,582

 

 

 

287,617

 

 

 

303,743

 

 

 

215,468

 

 

 

178,754

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP income before income taxes

 

$

833,334

 

 

$

248,541

 

 

$

248,025

 

 

$

191,779

 

 

$

144,990

 

Restructuring, integration and other expenses

 

 

5,272

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,272

 

Russian-Ukraine conflict related expenses

 

 

26,261

 

 

 

-

 

 

 

26,261

 

 

 

-

 

 

 

-

 

Amortization of intangible assets and other

 

 

15,038

 

 

 

2,929

 

 

 

3,074

 

 

 

3,796

 

 

 

5,239

 

Other expenses

 

 

4,935

 

 

 

4,494

 

 

 

-

 

 

 

-

 

 

 

441

 

Adjusted income before income taxes

 

 

884,840

 

 

 

255,964

 

 

 

277,360

 

 

 

195,575

 

 

 

155,942

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP income tax expense

 

$

140,955

 

 

$

1,718

 

 

$

64,608

 

 

$

40,958

 

 

$

33,672

 

Restructuring, integration and other expenses

 

 

1,012

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,012

 

Russian-Ukraine conflict related expenses

 

 

6,836

 

 

 

-

 

 

 

6,836

 

 

 

-

 

 

 

-

 

Amortization of intangible assets and other

 

 

3,080

 

 

 

711

 

 

 

667

 

 

 

704

 

 

 

998

 

Other expenses

 

 

1,092

 

 

 

956

 

 

 

-

 

 

 

-

 

 

 

136

 

Income tax benefit (expense) items, net

 

 

40,376

 

 

 

49,142

 

 

 

(8,613

)

 

 

2,917

 

 

 

(3,070

)

Adjusted income tax expense

 

 

193,351

 

 

 

52,527

 

 

 

63,498

 

 

 

44,579

 

 

 

32,748

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income

 

$

692,379

 

 

$

246,823

 

 

$

183,417

 

 

$

150,821

 

 

$

111,318

 

Restructuring, integration and other expenses (net of tax)

 

4,260

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,260

 

Russian-Ukraine conflict related expenses (net of tax)

 

 

19,425

 

 

 

-

 

 

 

19,425

 

 

 

-

 

 

 

-

 

Amortization of intangible assets and other (net of tax)

 

 

11,958

 

 

 

2,218

 

 

 

2,407

 

 

 

3,092

 

 

 

4,241

 

Other expenses (net of tax)

 

 

3,843

 

 

 

3,538

 

 

 

-

 

 

 

-

 

 

 

305

 

Income tax (benefit) expense items, net

 

 

(40,376

)

 

 

(49,142

)

 

 

8,613

 

 

 

(2,917

)

 

 

3,070

 

Adjusted net income

 

 

691,489

 

 

 

203,437

 

 

 

213,862

 

 

 

150,996

 

 

 

123,194

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP diluted earnings per share

 

$

6.94

 

 

$

2.51

 

 

$

1.84

 

 

$

1.50

 

 

$

1.10

 

Restructuring, integration and other expenses (net of tax)

 

0.04

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

0.04

 

Russian-Ukraine conflict related expenses (net of tax)

 

 

0.19

 

 

 

-

 

 

 

0.20

 

 

 

-

 

 

 

-

 

Amortization of intangible assets and other (net of tax)

 

 

0.12

 

 

 

0.02

 

 

 

0.02

 

 

 

0.03

 

 

 

0.04

 

Other expenses (net of tax)

 

 

0.04

 

 

 

0.04

 

 

 

-

 

 

 

-

 

 

 

0.00

 

Income tax (benefit) expense items, net

 

 

(0.40

)

 

 

(0.50

)

 

 

0.09

 

 

 

(0.03

)

 

 

0.03

 

Adjusted diluted EPS

 

 

6.93

 

 

 

2.07

 

 

 

2.15

 

 

 

1.51

 

 

 

1.22

 

______________________
* May not foot/cross due to rounding and differences in average diluted shares between quarterly periods compared to the fiscal year to date

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

Fiscal Year

 

July 3,

 

April 3,

 

January 2,

 

October 3,

 

2021*

 

2021

 

2021

 

2021

 

2020

 

($ in thousands, except per share amounts)

GAAP selling, general and administrative expenses

$

1,874,831

 

 

$

498,497

 

 

$

463,092

 

 

$

442,084

 

 

$

471,158

 

Amortization of intangible assets and other

 

(41,245

)

 

 

(5,370

)

 

 

(5,283

)

 

 

(10,417

)

 

 

(20,175

)

Adjusted operating expenses

 

1,833,586

 

 

 

493,127

 

 

 

457,809

 

 

 

431,667

 

 

 

450,983

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP operating income

$

281,408

 

 

$

118,001

 

 

$

87,684

 

 

$

57,221

 

 

$

18,502

 

Restructuring, integration and other expenses

 

84,391

 

 

 

28,449

 

 

 

17,574

 

 

 

11,948

 

 

 

26,420

 

Amortization of intangible assets and other

 

41,245

 

 

 

5,370

 

 

 

5,283

 

 

 

10,417

 

 

 

20,175

 

Adjusted operating income

 

407,044

 

 

 

151,820

 

 

 

110,541

 

 

 

79,586

 

 

 

65,097

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP income (loss) before income taxes

$

172,929

 

 

$

91,701

 

 

$

70,121

 

 

$

34,403

 

 

$

(23,297

)

Restructuring, integration and other expenses

 

84,391

 

 

 

28,449

 

 

 

17,574

 

 

 

11,948

 

 

 

26,420

 

Amortization of intangible assets and other

 

41,245

 

 

 

5,370

 

 

 

5,283

 

 

 

10,417

 

 

 

20,175

 

Other expenses - equity investment impairments and other

 

20,413

 

 

 

5,139

 

 

 

-

 

 

 

51

 

 

 

15,223

 

Adjusted income before income taxes

 

318,978

 

 

 

130,659

 

 

 

92,978

 

 

 

56,819

 

 

 

38,521

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP income tax expense (benefit)

$

(20,185

)

 

$

6,346

 

 

$

(37,363

)

 

$

15,240

 

 

$

(4,408

)

Restructuring, integration and other expenses

 

17,468

 

 

 

6,172

 

 

 

4,118

 

 

 

2,577

 

 

 

4,601

 

Amortization of intangible assets and other

 

9,099

 

 

 

1,025

 

 

 

1,008

 

 

 

2,037

 

 

 

5,029

 

Other expenses - equity investment impairments and other

 

90

 

 

 

38

 

 

 

-

 

 

 

26

 

 

 

26

 

Income tax benefit (expense) items, net

 

41,275

 

 

 

4,091

 

 

 

50,682

 

 

 

(10,788

)

 

 

(2,710

)

Adjusted income tax expense

 

47,747

 

 

 

17,672

 

 

 

18,445

 

 

 

9,092

 

 

 

2,538

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income (loss)

$

193,114

 

 

$

85,355

 

 

$

107,484

 

 

$

19,163

 

 

$

(18,889

)

Restructuring, integration and other expenses (net of tax)

 

66,923

 

 

 

22,277

 

 

 

13,456

 

 

 

9,371

 

 

 

21,819

 

Amortization of intangible assets and other (net of tax)

 

32,146

 

 

 

4,345

 

 

 

4,275

 

 

 

8,380

 

 

 

15,146

 

Other expenses - equity investment impairments and other (net of tax)

 

20,323

 

 

 

5,101

 

 

 

-

 

 

 

25

 

 

 

15,197

 

Income tax (benefit) expense items, net

 

(41,275

)

 

 

(4,091

)

 

 

(50,682

)

 

 

10,788

 

 

 

2,710

 

Adjusted net income

 

271,231

 

 

 

112,987

 

 

 

74,533

 

 

 

47,727

 

 

 

35,983

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP diluted earnings (loss) per share

$

1.93

 

 

$

0.85

 

 

$

1.07

 

 

$

0.19

 

 

$

(0.19

)

Restructuring, integration and other expenses (net of tax)

 

0.67

 

 

 

0.22

 

 

 

0.13

 

 

 

0.09

 

 

 

0.22

 

Amortization of intangible assets and other (net of tax)

 

0.32

 

 

 

0.04

 

 

 

0.04

 

 

 

0.09

 

 

 

0.15

 

Other expenses - equity investment impairments and other (net of tax)

 

0.20

 

 

 

0.05

 

 

 

-

 

 

 

0.00

 

 

 

0.15

 

Income tax (benefit) expense items, net

 

(0.41

)

 

 

(0.04

)

 

 

(0.50

)

 

 

0.11

 

 

 

0.03

 

Adjusted diluted EPS

 

2.71

 

 

 

1.12

 

 

 

0.74

 

 

 

0.48

 

 

 

0.36

 

______________________
* May not foot/cross due to rounding and differences in average diluted shares between quarterly periods compared to the fiscal year to date.

Organic Sales

Organic sales is defined as sales adjusted for the impact of significant acquisitions, divestitures and other items by adjusting Avnet’s prior and current periods (if necessary) to include the sales of acquired businesses and exclude the sales of divested businesses as if the acquisitions and divestitures had occurred at the beginning of the earliest period presented. Additionally, fiscal 2021 sales are adjusted for the estimated impact of the extra week of sales in the first quarter of fiscal 2021 due to the 14-week fiscal first quarter and the 53-week fiscal year. Organic sales in constant currency is defined as organic sales (as defined above) excluding the impact of changes in foreign currency exchange rates.

As a result of declining sales due to the termination of the TI distribution agreement in December 2020, organic sales growth rates have also been adjusted to exclude sales of TI products.

Reported sales were the same as organic sales for the fourth quarter and full year of fiscal 2022. Reported sales were the same as organic sales for the fourth quarter of fiscal 2021. The following table presents the reconciliation of reported sales to organic sales for fiscal 2021.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

Sales
As Reported
Q4-Fiscal
2021

 

Estimated
Extra
Week in
Fiscal
2021(2)

 

TI Sales
Q4-Fiscal
2021(1)

 

Organic
Sales
Adj for TI
Q4-Fiscal
2021(1)

 

 

(in millions)

Avnet

 

$

19,534.7

 

$

306.0

 

$

292.2

 

$

18,936.5

Avnet by region

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$

4,662.5

 

$

77.0

 

$

82.9

 

$

4,502.6

EMEA

 

 

6,149.9

 

 

97.0

 

 

124.2

 

 

5,928.7

Asia

 

 

8,722.3

 

 

132.0

 

 

85.1

 

 

8,505.2

Avnet by segment

 

 

 

 

 

 

 

 

 

 

 

EC

 

$

18,030.5

 

$

284.0

 

$

292.2

 

$

17,454.3

Farnell

 

 

1,504.2

 

 

22.0

 

 

 

 

1,482.2

______________________

(1)

Sales adjusted for the impact of the termination of the TI distribution agreement.

(2)

The impact of the additional week of sales in the first quarter of fiscal 2021 is estimated.

The following table presents reported and organic sales growth rates for the fourth quarter and full year of fiscal 2022 compared to fiscal 2021.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Year Ended

 

 

Sales
As Reported
and Organic
Year-Year
% Change

 

Sales
As Reported
and Organic
Year-Year %
Change in
Constant
Currency

 

Sales
As Reported
Year-Year
% Change

 

Sales
As Reported
Year-Year %
Change in
Constant
Currency

 

Organic
Sales
Year-Year
% Change

 

Organic
Sales
Year-Year %
Change in
Constant
Currency

 

Organic
Sales
Adj for TI
Year-Year %
Change in
Constant
Currency(1)

Avnet

 

21.9

%

 

28.2

%

 

24.5

%

 

27.2

%

 

26.4

%

 

29.2

%

 

31.2

%

Avnet by region

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

35.5

%

 

35.5

%

 

26.5

%

 

26.5

%

 

28.6

%

 

28.6

%

 

31.0

%

EMEA

 

18.8

 

 

34.0

 

 

27.5

 

 

34.6

 

 

29.5

 

 

36.8

 

 

39.6

 

Asia

 

17.2

 

 

19.7

 

 

21.3

 

 

22.4

 

 

23.1

 

 

24.3

 

 

25.5

 

Avnet by segment

 

 

 

 

 

 

 

 

 

 

 

 

EC

 

23.9

%

 

30.1

%

 

24.8

%

 

27.6

%

 

26.8

%

 

29.6

%

 

31.8

%

Farnell

 

0.2

 

 

6.8

 

 

20.2

 

 

22.2

 

 

21.9

 

 

24.0

 

 

24.0

 

______________________

(1)

Sales growth rates excluding the impact of the termination of the TI distribution agreement.

 

Historical Segment Financial Information

 

 

 

 

 

Fiscal Year 2022

 

 

 

 

 

 

 

Quarters Ended

 

 

 

 

 

 

 

Third Quarter

 

Third Quarter

 

Second Quarter

 

First Quarter

 

 

Fiscal Year

 

July 2,

 

April 2,

 

January 1,

 

October 2,

 

 

2022*

 

2022*

 

2022

 

2022

 

2021

 

 

(in millions)

Sales:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronic Components

 

$

22,503.3

 

 

$

5,930.4

 

 

$

6,019.1

 

 

$

5,424.3

 

 

$

5,129.5

 

Farnell

 

 

1,807.4

 

 

 

442.3

 

 

 

469.0

 

 

 

440.9

 

 

 

455.2

 

Avnet sales

 

$

24,310.7

 

 

$

6,372.7

 

 

$

6,488.1

 

 

$

5,865.2

 

 

$

5,584.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronic Components

 

$

872.0

 

 

$

255.6

 

 

$

265.0

 

 

$

188.9

 

 

$

162.4

 

Farnell

 

 

242.5

 

 

 

62.9

 

 

 

69.8

 

 

 

60.2

 

 

 

49.6

 

 

 

 

1,114.5

 

 

 

318.5

 

 

 

334.8

 

 

 

249.1

 

 

 

212.0

 

Corporate expenses

 

 

(128.9

)

 

 

(30.9

)

 

 

(31.1

)

 

 

(33.6

)

 

 

(33.3

)

Restructuring, integration and other expenses

 

 

(5.3

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(5.3

)

Russian-Ukraine conflict related expenses

 

 

(26.3

)

 

 

-

 

 

 

(26.3

)

 

 

-

 

 

 

-

 

Amortization of acquired intangible assets and other

 

 

(15.0

)

 

 

(2.9

)

 

 

(3.1

)

 

 

(3.8

)

 

 

(5.2

)

Avnet operating income

 

$

939.0

 

 

$

284.7

 

 

$

274.4

 

 

$

211.7

 

 

$

168.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales by geographic area:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$

5,896.0

 

 

$

1,618.4

 

 

$

1,627.2

 

 

$

1,391.5

 

 

$

1,258.8

 

EMEA

 

 

7,838.1

 

 

 

2,064.0

 

 

 

2,185.7

 

 

 

1,840.8

 

 

 

1,747.6

 

Asia

 

 

10,576.6

 

 

 

2,690.3

 

 

 

2,675.2

 

 

 

2,632.9

 

 

 

2,578.3

 

Avnet sales

 

$

24,310.7

 

 

$

6,372.7

 

 

$

6,488.1

 

 

$

5,865.2

 

 

$

5,584.7

 

______________________
* May not foot/cross due to rounding.

 

 

 

 

 

Fiscal Year 2021

 

 

 

 

Quarters Ended

 

 

 

 

Fourth Quarter

 

Third Quarter

 

Second Quarter

 

First Quarter

 

 

Fiscal Year

 

July 3,

 

April 3,

 

January 2,

 

October 3,

 

 

2021*

 

2021

 

2021

 

2021

 

2020

 

 

(in millions)

Sales:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronic Components

 

$

18,030.5

 

 

$

4,785.3

 

 

$

4,520.6

 

 

$

4,342.4

 

 

$

4,382.2

 

Farnell

 

 

1,504.2

 

 

 

441.4

 

 

 

396.1

 

 

 

325.8

 

 

 

340.9

 

Avnet

 

$

19,534.7

 

 

$

5,226.7

 

 

$

4,916.7

 

 

$

4,668.2

 

 

$

4,723.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronic Components

 

$

454.8

 

 

$

147.8

 

 

$

118.6

 

 

$

103.9

 

 

$

84.4

 

Farnell

 

 

86.9

 

 

 

36.5

 

 

 

23.9

 

 

 

14.6

 

 

 

12.0

 

 

 

 

541.7

 

 

 

184.3

 

 

 

142.5

 

 

 

118.5

 

 

 

96.4

 

Corporate expenses

 

 

(134.7

)

 

 

(32.5

)

 

 

(31.9

)

 

 

(39.0

)

 

 

(31.3

)

Restructuring, integration and other expenses

 

 

(84.4

)

 

 

(28.4

)

 

 

(17.6

)

 

 

(11.9

)

 

 

(26.4

)

Amortization of acquired intangible assets and other

 

 

(41.2

)

 

 

(5.4

)

 

 

(5.3

)

 

 

(10.4

)

 

 

(20.2

)

Avnet operating income

 

$

281.4

 

 

$

118.0

 

 

$

87.7

 

 

$

57.2

 

 

$

18.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales by geographic area:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$

4,662.5

 

 

$

1,194.4

 

 

$

1,161.0

 

 

$

1,101.5

 

 

$

1,205.7

 

EMEA

 

 

6,149.9

 

 

 

1,737.3

 

 

 

1,585.6

 

 

 

1,346.3

 

 

 

1,480.7

 

Asia

 

 

8,722.3

 

 

 

2,295.0

 

 

 

2,170.1

 

 

 

2,220.4

 

 

 

2,036.7

 

Avnet

 

$

19,534.7

 

 

$

5,226.7

 

 

$

4,916.7

 

 

$

4,668.2

 

 

$

4,723.1

 

______________________
* May not foot/cross due to rounding.

 

Guidance Reconciliation

The following table presents the reconciliation of non-GAAP adjusted diluted earnings per share guidance to the expected GAAP diluted earnings per share guidance for the first quarter of fiscal 2023.

 

 

Low End of

 

High End of

 

 

Guidance Range

 

Guidance Range

 

 

 

 

 

 

 

Adjusted diluted earnings per share guidance

 

$

1.80

 

 

$

1.90

 

Amortization of intangibles and other (net of tax)

 

 

(0.02

)

 

 

(0.02

)

Income tax expense adjustments

 

 

(0.03

)

 

 

0.03

 

GAAP diluted earnings per share guidance

 

$

1.75

 

 

$

1.91

 

 

Investor Relations Contacts
Joe Burke, 480-643-7431
Joseph.Burke@avnet.com

Media Relations Contact
Jeanne Forbis, 480-643-7499
Jeanne.Forbis@Avnet.com

Source: Avnet