2009 Ingram Corp Overview
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Ingram Micro is the world's largest technology distributor, providing products and services to customers in over 150 countries. In the first quarter of 2009, Ingram Micro saw worldwide sales decline 21% to $6.75 billion due to macroeconomic softness. However, the company improved working capital management and ended the quarter with over $1 billion in cash. Looking ahead, Ingram Micro is focused on competitive costs, higher margin businesses, and profitability.
2009 Ingram Corp Overview
- 1. Ingram Micro BuildsYour BusinessCorporate OverviewFirst Quarter 2009
- 2. Forward - Looking StatementCertain comments made in this presentation may be characterized as forward looking under the Private Securities Litigation Reform Act of 1995.Those statements involve a number of factors that could cause actual results to differ materially.Additional information concerning these factors may be found in the Company’s 2008 Annual Report on Form 10-K under “Item 1A” and in future filings with the SEC. Copies are available from the SEC, the company Web site, or Ingram Micro Investor Relations.
- 3. Ingram Micro: A World Leader In ITThe world's largest provider of technology products and servicesA Fortune 2009 "Most Admired Company"2008 annual revenues: $34.4 billion
- 4. Approx. 14,500 associates worldwide
- 5. Customers in more than 150 countries
- 6. Only global broad-based distributor in Asia
- 7. 108 distribution centers worldwide
- 8. Local sales offices and/or representatives in 35 countriesIngram MicroNo. 67 on 2009 Fortune 500 listWith 30 years experience in IT Distribution* All information as of fiscal year 2008 unless indicated
- 9. The World's Largest IT DistributorNo. 2 in Europe,Middle East & Africa34% of RevenuesNo. 1 in North America41%of RevenuesNo. 1 in Latin America5% of RevenuesNo. 1 in Asia-Pacific20% of RevenuesExpanded into Africa through joint venture in 2007
- 10. A Vital Link In The IT Value Chain…More than 170,000 ResellersMore than 1,500 VendorsSales and MarketingFinancingTechnical SupportInventory ManagementVendor RelationsVARsManaged ServicesCombining a wide array of technologies and products to create the optimum solution
- 11. …With The Broadest Product OfferingA Stable, Diversified MixNetworking: 10-15%Systems: 25-30%3Com, Cisco, D-Link, Juniper, NortelAcer, Apple, Fujitsu-Siemens, HP, IBM, Lenovo, Sony, ToshibaSoftware: 15-20%Adobe, CA, Intuit Microsoft, SymantecIT Peripherals/CE/DC/POS/Mobility and Others: 40-45%Adaptec, AMD, Canon, Epson, HP, Intel, Kodak, Lexmark, Maxtor, NEC, Polycom, Seagate, Sony, Western Digital, Xerox Source: Company reports and information
- 12. …Serving The Global IT IndustrySMB To EnterpriseNumber of companiesFortune 10001,000Large Business (1,000+ employees)8,000106,000Mid-size Business (100–999 employees)Mid-size Business (100–999 employees)7.8 million37.4 millionSmall Business (<100 employees)Small Business (<100 employees)75.0 millionHome OfficeConsumer Households(Non-Home Office)Ingram Micro’s VAR customers target SMB markets, the sweet spot of the IT industrySource: U.S. Market Pyramid - IDC, 2008 Year-End
- 13. Ingram Micro Delivers More
- 14. Our Value PropositionWe help customers and vendors build their businesses and become more profitableIdentify and bring new market opportunities to our partners
- 15. Enable our partners to focus on their core businesses and leverage ourvast capabilities
- 16. Provide customers with the resources for success
- 17. Understand today’s market challenges and offer relevant solutionsWe’re Focused On Your Success!
- 18. Services That Solution Providers NeedOne-stop sourcingTechnology supportFinancing / credit servicesBroad IT product mix and service solutionsHigh-end storage, enterprise solutions, networking, peripherals, security, software, supplies and systems
- 19. Emerging technologiesAutomated Identification and Data Capture/Point-of-Sale (AIDC/POS)Digital Convergence (Consumer Electronics)Virtualization (ITS Division)Managed ServicesDelivering Value To IT VendorsLower shipping, handling and warehousing costsExceptional service levels to SMB customersReach a broader market at a lower costEfficient collection processesManaging of warranty and returnsIngram Micro is an indispensable business partner – the most valued bridge between our vendors and customers.
- 20. Customer BenefitsTargeted marketing programs
- 22. Business services and tools for successBuilding Communities Vendor BenefitsMarket intelligenceMarket reachBusiness developmentIngram Financial Services Co. Ingram Micro Service Division Ingram Micro Service NetworkGovEd AllianceVentureTech NetworkIngram Micro builds your success.
- 23. Integrated Go-To-Market ServicesLogistics Service OfferingsWarehousing and Fulfillment Transportation Management Customer Service Billing and CollectionsSupply-Chain AnalysisMerchandising and Assembly Reverse Logistics Information TechnologyLeveraging Ingram Micro’sscale and experience
- 24. Looking Ahead: IT DistributionInnovation and diversification continueCost management increasingly importantEconomic conditions cloud current outlook
- 25. Geographic diversification creates growth opportunitiesIT Distribution: Industry Insight & Outlook, GTDC, May 2008
- 26. The New View Of Distribution"Our distribution partners are integral to our business and doing a terrific job.”Ken BadoEVP of Worldwide Sales Autodesk"Without our distribution partners' significant contributions and a strong joint strategy, we would not be where we are today in the channel.” Dean DarwinVice President, North America Channels F5“Distributors help us reach mission-critical mobile and wireless users in every environment, from the extreme to the mainstream.” Rance M. PoehlerPresidentPanasonic Computer Solutions Company2007 GTDC Poll of Leading Vendor Executives
- 27. An invaluable vital component of our business80% of vendor execs polled described their IT distribution partnerships as either …Vendors' Views On DistributionORA strategic alliance that helps guide our decisions2007 GTDC Poll of Leading Vendor Executives
- 28. Financial Review
- 29. Q1 2009 Financial ResultsSalesQ1 ’09 worldwide sales of $6.75 billion
- 30. YOY decline of 21% includes negative FX impact of 8 percentage points
- 31. Continued macro-economic softness dampening sales
- 32. Excellent working capital management
- 33. Working capital days improved 4 days YoY
- 34. Record cash balance exceeding $1 billion at quarter-end
- 35. Expense-reduction actions progressing in all regionsOperational HighlightsRecord annual sales of $35.0 B Net IncomeNet income and EPS
- 36. Net income of $27.5 million, EPS of $0.17
- 37. Includes restructuring costs of $0.06 per shareGross margin remains strong at 5.65 percent
- 38. Worldwide Sales20072005 20062008North AmericaAsia-PacificEMEALatin America($U.S. Billions)$35.0$34.4$31.4$8.58$28.8$6.75 13% 9% 12% (2%)4% (21%)Q1 08Q1 09Note: Annual growth rate of total revenues indicated at base of bars.
- 39. Summary Balance SheetDebt/Capitalization Ratio is equal to Total Debt/Total Capitalization (Debt plus Equity). In Q4 ‘08, the goodwill impairment charge required by SFAS 142 reduced book equity by $659.8 million net of taxes.
- 40. Focus On The FuturePriority AreasCompetitive Cost Structure
- 41. Optimal Mix of Products and End-user markets
- 42. Growth in Higher Margin businesses
- 43. Bias toward Profitability and Return on Invested Capital (ROIC)Tapping IntoTechnology Trends
- 44. New OpportunitiesConverging TechnologiesMobile and WirelessEnterprise SolutionsServices
- 45. The Rise Of ConvergenceBlurring Lines Between Home And OfficeDigital SignageInformation TechnologyConsumer Electronics
- 46. All Things MobileDriving Greater ProductivityOffering complete mobility solutions from one sourceNotebooksSmart HandheldsPoint-of-Sale Data Capture / RFIDDigital SignageNetworkingServers/StorageSecurityHardware and SoftwareTechnical SupportMarketing ServicesThe only global distributor of Data Capture and Point-of-Sale products
- 47. Enterprise SolutionsSophisticated Technology For SMBThe world is creating more information than it has the capability to store.Servers and software applications are becoming standardized and less costly, making them more accessible to small- and medium-sized businesses.
- 48. Ingram Micro is ahead of this trend, offering resellers serving SMBs the technology solutions once reserved for mega-corporations – from mid-market servers to virtualization software.Examples of digital information not stored today: digital TV Signals, digital telephone calls"The biggest growth potential for server virtualization solutions in the next 12-18 months lies with the small- and mid-market customers, which together make up 70 percent of possible sales.“ - Joseph Kovar, CRN, March 2008Source: IDC White Paper, “The Expanding Digital Universe,” sponsored by EMC – March 2007
- 49. Services Create Solutions A Competitive Advantage®Unique offerings that provide sales and profitability opportunities for resellers and vendorsIngram Micro noted as a service innovator for enhancing customer engagement through social networking forum– BusinessWeekDecember 2007End-to-end order management, fulfillment and supply-chain solutions for a set fee Helping resellers reach the SMB market in new ways: remote system management, IT staffing and demand generation services
- 50. 30 Years Of Experience Makes A DifferenceConsistently leading the way:First to establish successful fee-for-service logistics businessFirst to offer high-end consumer electronicsFirst broad-based distributor in Asia-PacificFirst broad-based ITDC/POS distributorFirst to develop comprehensive services suiteCommitment to Profitability and Shareholder Value