Tech Firm Cites Record Net Income

By John Gittelsohn, The Orange County Register, Calif.

Feb. 16–Ingram Micro Inc., the world’s largest computer products distributor, reported record revenue and net income for 2006 on Thursday.

The Santa Ana company’s net income was $91.7 million or 53 cents a share for the quarter ending Dec. 30, up from $84.4 million or 51 cents a share the same quarter a year earlier.

The report was in line with analysts’ expectations of 53 cents a share, according to a poll by Thomson Financial, although total sales exceeded projections.

Fourth-quarter sales jumped 11 percent to $8.85 billion from $7.96 billion.

Revenue for all of 2006 hit $31.4 billion, up from $28.8 billion in 2005.

Net income for the year was $265.8 million, up from $216.9 million in 2005.

Greg Spierkel, chief executive officer of Ingram, said he expects solid growth of 7 to 10 percent in the first quarter of 2007. Here are excerpts from Spierkel’s interview with the Orange County Register.

QUESTION: What was the biggest surprise in your results?

ANSWER: We may have to take a charge for a tax situation in Brazil on software imports. It’s a law that’s up for President Lula (Luiz Inacio Lula da Silva) to sign in the next two or three weeks. It would be a charge of $33 million or 19 cents per share for this past quarter or the first quarter, in the likelihood it gets signed.

Q: Where do you expect to see the most growth regionally and product-wise?

A: We’ve had good momentum out of North America and Asia in our revenue growth and I expect that to continue. From a product point of view, I’d say broad categories doing well are in mobility, navigation and GPS, and there’s healthy growth in storage products. We’re also investing in consumer products and point-of-sale products.

Q: Will there be any work-force growth in your Santa Ana offices?

A: We are hiring and have a need for people with IT skills, product management, finance skills, but the numbers are going to be incremental.

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