CEO Alain Monie: Ingram Micro Starts 2018 With Growth After "Distraction" Of Being Acquired
Ingram Micro reported Tuesday that strong demand for its products and services, combined with finally putting the distractions caused by its late 2016 acquisition by China-based Tianjin Tianhai behind it, gave it a strong fiscal first quarter 2018.
Ingram Micro, which became a private company after it was acquired, is not required by U.S. government regulations to report its quarterly fiscal condition.
The company, however, has to report because of obligations to its financial backers, said Ingram Micro CEO Alain Monie.
"The way we operate, we count on financing in a fairly important way," Monie told CRN. "We have lenders that are interested in knowing how we are doing. And so it's important to us. We also have bonds out there. So it's important to communicate with those stakeholders how we're doing."
Ingram Micro reported revenue for its first fiscal quarter of 2018, which ended March 31, of $11.76 billion, up about 13 percent over the $10.40 billion the company reported for the first quarter of 2017.
Net income on a GAAP basis for the first fiscal quarter of 2018 was $47 million, compared to $38 million in the prior year. On a non-GAAP basis, net income for the first quarter of 2018 was $82 million, up from last year's $56 million.
Tianjin Tianhai, a publicly-listed subsidiary of HNA Group, closed its acquisition of Ingram Micro in December of 2016. With its $6 billion purchase price, Ingram Micro was a significant addition to HNA Group, which is listed as No. 170 on the Fortune Global 500 with revenue of over $53 billion.
Monie said Ingram Micro had solid growth over the last year, but that came after a year when growth did not meet expectations.
"In 2016, we were kind of distracted with all the stuff going on because [the acquisition process] lasted for the whole year," he said. "We lost market share in 2016. So we decided we were going to regain our relevance, because it's important for vendors and customers to have a certain level of relevance. And if sometimes you have to choose between good deals and bad deals, OK, that's fine. But overall, you have to keep your balance."
Ingram Micro's growth resumed in 2017 after it rearranged its internal teams to focus on growth following the close of the acquisition, Monie said. And that rearrangement was made easier once Ingram Micro became a private company, he said.
"We gave [our teams] the tools to do that, which was not so much around pricing as it was more around the flexibility you have when you're in a private environment and you don't have to show at the end of the quarter that your working capital is here, and then two days later it is where you want it to be. … Having that flexibility allowed us to really recover our strength in the market, and that's what we did," he said. "So we were deliberate, and quite successful in that."