Slide 1: Q1 FY 2015 Financial Results Conference Call
Q1 FY 2015 FINANCIAL RESULTS CONFERENCE CALL October 30, 2014 at 5:00 pm ET
Slide 2: Safe Harbor
SAFE HARBOR This presentation may contain certain comments, which are ScanSource disclaims any intentions or obligation to update “forward-looking” statements that involve plans, strategies, or revise any forward-looking statements, whether as a result economic performance and trends, projections, e
Slide 3: Highlights – Q1 FY15
HIGHLIGHTS – Q1 FY15 Record net sales for first quarter 2015 of $792 million, up 8% Y/Y, and non-GAAP diluted EPS of $0.75*; both above our expected range Record sales quarter for Worldwide Barcode & Security, up 11% Y/Y Worldwide Communications & Services sales increased 3% Y/Y First quarte
Slide 4: Highlights – Q1 FY15
HIGHLIGHTS – Q1 FY15 Q1 FY15 Q1 FY14 Non- Non- In millions, except EPS GAAP GAAP Y/Y Change (non-GAAP): GAAP* GAAP* Net sales $791.7 $791.7 $731.9 $731.9 8.2% increase Gross profit 77.6 77.6 76.5 76.5 1.5% increase Gross profit margin % (of net sales) 9.8% 9.8% 10.5% 10.5% 64 bp margin decreas
Slide 5: Q1 FY15 Sales Mix
Q1 FY15 SALES MIX By Technology By Geography 37% 25% Communications International & Services 63% 75% Barcode & North Security America* Barcode & Security = Worldwide Barcode and Security Communications & Services = Worldwide Communications and Services As a % of Q1 FY15 net sales of $791.7 million *
Slide 6: WW Barcode & Security
WW BARCODE & SECURITY Net Sales, $ in millions Q1 FY15 Q1 FY14 $ in millions Up 11.2% Net sales $501.0 $450.6 Excluding FX, Up 11.1% $501 Gross profit $43.0 $40.7 $451 Gross margin 8.6% 9.0% Operating income $12.5 $12.0 Operating income % 2.5% 2.7% Non-GAAP operating income $13.6 $13.3 Non-GAAP oper
Slide 7: WW Communications & Services
WW COMMUNICATIONS & SERVICES Net Sales, $ in millions Q1 FY15 Q1 FY14 $ in millions Up 3.4% Excluding FX, Up 3.4% Net sales $290.8 $281.3 Gross profit $34.6 $35.8 $281 $291 Gross margin 11.9% 12.7% Operating income $17.8 $16.3 Operating income % 6.1% 5.8% Non-GAAP operating income $18.2 $16.6 Non-GA
Slide 8: Q1 FY15 Key Measures
Q1 FY15 KEY MEASURES Q1 FY15 Q4 FY14 Q1 FY14 $ in millions Return on invested capital (“ROIC”)* 16.2% 14.0% 17.4% Cash and cash equivalents (Q/E) $139.9 $194.9 $193.8 Operating cash flow, trailing 12-months $2.7 $47.7 $172.7 Days sales outstanding in receivables 55** 55 55 Inventory (Q/E) $495.1 $50
Slide 9: Q2 FY15 Outlook
Q2 FY15 OUTLOOK* For the quarter ending December 31, 2014, excluding planned acquisition of Network 1 and other adjustments for non-GAAP measures: Range from $780 million to $800 million Net Sales Range midpoint: $790 million Non-GAAP Diluted Range from $0.64 to $0.66 per share Earnings Per Sh
Slide 10: WW Barcode & Security Highlights
WW BARCODE & SECURITY HIGHLIGHTS Net Sales, $ in millions 63% of overall sales Up 11.2% Excluding FX, Up 11.1% Record sales quarter for the segment $501 $451 Record quarters for North America POS & Barcode, Brazil and Mexico Strong growth from international POS & Barcode units Strong big d
Slide 11: WW Communications & Services Highlights
WW COMMUNICATIONS & SERVICES HIGHLIGHTS Net Sales, $ in millions 37% of overall sales Up 3.4% Excluding FX, Up 3.4% Increased 9% sequentially with Q/Q increases for all Communications $291 $281 business units Record sales quarter for ScanSource Communications in North America ScanSource Serv
Slide 12: Appendix: Non-GAAP Financial Information
APPENDIX: NON-GAAP FINANCIAL INFORMATION ($ in thousands) Quarter Ended September 30, 2014 Operating Pre-tax Net Diluted Income income income EPS GAAP measure $ 28,977 $ 29,236 $ 19,208 $ 0.67 Adjustment: Amortization of intangible assets 992 992 660 0.02 Change in fair value of contingent considera
Slide 13: Appendix: Non-GAAP Financial Information
APPENDIX: NON-GAAP FINANCIAL INFORMATION ($ in thousands) Quarter Ended September 30, 2014 WW Barcode & WW Comms. Security & Services Corporate Consolidated Net sales $ 500,960 $ 290,760 $ - $ 791,720 GAAP operating income $ 12,541 $ 17,786 $ (1,350) $ 28,977 Adjustments: Amortization of intangible
Slide 14: Appendix: Non-GAAP Financial Information
APPENDIX: NON-GAAP FINANCIAL INFORMATION ($ in thousands) Q1 FY15 Q4 FY14 Q1 FY14 Return on invested capital (ROIC), annualized (a) 16.2% 14.0% 17.4% Reconciliation of Net Income to EBITDA Net income - GAAP $ 19,208 $ 27,105 $ 19,437 Plus: Income taxes 10,028 13,774 9,002 Plus: Interest expense 190
Slide 15: Appendix: Non-GAAP Financial Information
APPENDIX: NON-GAAP FINANCIAL INFORMATION ($ in millions) Worldwide Barcode & Security Net sales, excluding impact of foreign exchange (FX) - Y/Y Change: Q1 2015 net sales $ 501.0 Foreign exchange impact (0.2) Q1 2015 net sales, excluding FX impact $ 500.8 Q1 2014 sales $ 450.6 % Change 11.1% Worldwi