Synnex Q2 Earnings Up On North American Distribution, Acquisition Integration

The Fremont, Calif.-based distributor, earned $31.4 million, or 85 cents per diluted share, on sales of $2.50 billion. The results compare to earnings of $24.8 million, 70 cents per share, on $2.03 billion in sales in the year-ago quarter. Analysts had predicted earnings of 80 cents per share on sales of $2.51 billion.

“The SYNNEX team delivered another quarter of solid results with strong organic revenue growth in all regions led by our North American commercial distribution business,” Kevin Murai, Synnex president and CEO, said in a statement. “In the second quarter, we also tracked well towards completing the integration of our recent acquisitions and in the third quarter, our main focus turns to revenue growth for these newly acquired businesses.”

For the current, or third, fiscal quarter, Synnex expects earnings per share between 88 cents and 92 cents and sales between $2.54 billion and $2.64 billion. Analysts had forecasted earnings 94 cents per share on $2.65 billion in revenue for the current quarter.

“Our third quarter profit outlook reflects investment in ramping new business that we won in [Global Business Services] during the second quarter,” Murai said.

“Demand in North American distribution remains solid and market growth is returning to the more pre-recession historical norms," he added. "In Japan we are on a good path of profit growth even with the earthquake’s impact to the Japanese economy."

Synnex's distribution revenue from continuing operations in the quarter was $2.46 billion, up 22.5 percent from the prior-year period. Global Business Services revenue was $38.8 million, up 40 percent.

Synnex shares closed Tuesday at $31.46, up 64 cents or 2 percent.