Slide 1: Fourth Quarter and Full Year 2021 CFO Commentary
investor.arrow.com Fourth Quarter and Full Year 2021 CFO Commentary
Slide 2: CFO Commentary
2 2 CFO Commentary As reflected in our earnings release, there are a number of items that impact the comparability of our results with those in the trailing quarter and prior quarter of last year. The discussion of our results may exclude these items to give you a better sense of our operating resul
Slide 3: Fourth-Quarter Summary
3 3 Fourth-Quarter Summary Arrow Electronics experienced strong market demand for electronic components and associated design, engineering and supply chain services in the fourth quarter, leading to record quarterly sales that approached the high end of the prior expectation. Arrow is helping custom
Slide 4: Consolidated Overview Fourth Quarter 2021
4 Consolidated sales were $9.02 billion Near the higher end of the prior expectation of $8.55-$9.15 billion Changes in foreign currencies negatively impacted sales growth by $73 million year over year The prior sales expectation included an anticipated $15 million negative impact to growth; the stre
Slide 5: Effective tax rate and diluted earnings per share
5 5 Effective tax rate was 22.5%, and non-GAAP effective tax rate was 22.6% Non-GAAP effective tax rate was below the prior expectation of 23.5% and the target long-term target range of 23% - 25% due to timing of discrete tax items and mix of profits from lower tax jurisdictions Diluted shares outst
Slide 6: Components Global
6 6 Components Global Record quarterly sales, operating income, and operating margin Fourth-quarter sales increased 13% year over year Lead times increased year over year and compared to the third quarter Book-to-bill was above parity in all regions Backlog increased significantly year over year Ope
Slide 7: Components Americas
7 7 Components Fourth-quarter sales increased 31% year over year Sales increased 32% year over year adjusted for changes in foreign currencies Record sales for any quarter Strong growth in transportation, communications, industrial, and medical devices sales year over year Growth in consumer, altern
Slide 8: Components Asia
8 8 Components Fourth-quarter sales increased 0.5% year over year Sales were flat year over year adjusted for changes in foreign currencies Record fourth-quarter sales Growth in computing, industrial, and transportation sales year over year Consumer and medical devices sales decreased year over year
Slide 9: Components Europe
9 9 Components Fourth-quarter sales increased 17% year over year Sales increased 21% year over year adjusted for changes in foreign currencies Record fourth-quarter sales Strong growth in industrial, industrial automation, communications, computer/data processing, aerospace and defense, and lighting
Slide 10: Enterprise Computing Solutions Global
10 10 Enterprise Computing Solutions Global Fourth-quarter sales decreased 8% year over year Sales decreased 6% year over year adjusted for changes in foreign currencies Operating income decreased 1% year over year Non-GAAP operating income decreased 1% year over year Operating margin of 6.6% increa
Slide 11: Enterprise Computing Solutions Americas
11 11 Fourth-quarter sales decreased 9% year over year Growth in storage and proprietary servers year over year Networking and industry-standard servers were approximately flat year over year Sales ($ in millions) Americas Enterprise Computing Solutions Americas sales decreased 9% year over year $1,
Slide 12: Enterprise Computing Solutions Europe
12 12 Sales ($ in millions) Enterprise Computing Solutions Europe Record full-year Enterprise Computing Solutions Europe sales $1,047 $791 $785 $685 $980 Q4-'20 Q1-'21 Q2-'21 Q3-'21 Q4-'21 $200 $400 $600 $800 $1,000 $1,200 Fourth-quarter sales decreased 6% year over year Sales decreased 3% year over
Slide 13: Consolidated Overview Full-Year 2021
13 Gross margin increased 110 basis points year over year Gross margin increased in both global components and global enterprise computing solutions year over year Consolidated Overview Full-Year 2021 13 Record full-year sales, gross profit, operating income, and earnings per share Consolidated full
Slide 14: Cash Flow, Share Repurchases and Working Capital
14 14 Repurchased approximately $250 million of stock in the fourth quarter, bringing total cash returned to shareholders in 2021 to approximately $900 million. Cash Flow from Operations Cash flow from operating activities was $28 million in the fourth quarter and $419 million in 2021. Working Capit
Slide 15: Outlook: First Quarter 2022
15 15 Outlook: First Quarter 2022 We are expecting the average USD-to-Euro exchange rate for the first quarter of 2022 to be $1.13 to €1 compared to $1.20 to €1 in the first quarter of 2021. We estimate changes in foreign currencies to have negative impacts on growth of approximately $160 million on
Slide 16: Information Relating to Forward-Looking Statements
16 Information Relating to Forward-Looking Statements This presentation includes “forward-looking” statements, as the term is defined under the federal securities laws, including but not limited to statements regarding: Arrow’s future financial performance, including its outlook on financial results
Slide 17: Certain Non-GAAP Financial Information
17 The company believes that such non- GAAP financial information is useful to investors to assist in assessing and understanding the company’s operating performance. 17 Certain Non-GAAP Financial Information In addition to disclosing financial results that are determined in accordance with accounti
Slide 18: Earnings Reconciliation
($ in thousands, except per share data) Earnings Reconciliation (1) Other includes gain on investments, net. (2) The sum of the components for non-GAAP diluted EPS may not agree to totals, as presented, due to rounding. 18 Three months ended December 31, 2021 REPORTED GAAP MEASURE INTANGIBLE AMORTIZ
Slide 19: Return on Working Capital Reconciliation
19 19 Return on Working Capital Reconciliation (1) The year end balance is an average balance based on the addition of the account balance at the end of the five most recently-ended quarters and dividing by five. ($ in thousands) QUARTER ENDED YEAR ENDED December 31, 2021 December 31, 2020 December
Slide 20: Return on Invested Capital Reconciliation
20 20 Return on Invested Capital Reconciliation (1) Operating income, as reported, and non- GAAP operating income is adjusted for noncontrolling interest and equity in losses of affiliated companies to include the pro-rata ownership of non-wholly owned subsidiaries. (2) The tax effect is calculated