Slide 1: Fourth Quarter and Full Year 2017 Earnings Conference Call and Webcast
Insight Enteprises, Inc. Fourth Quarter and Full Year 2017 Earnings Conference Call and Webcast Insight Presentation Insight’s Tagline Would Go Here Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2017 Insight Direct USA, Inc. All Rights Reserved. 1
Slide 2: Agenda
Agenda Opening comments CEO commentary • Fourth Quarter and YTD 2017 Results • Consolidated • Segments • 2018 Operating Priorities CFO commentary • Product and Services Income Statement Presentation • 2017 Cash Flow Performance • 2017 Tax Cuts and Jobs Act • ASC 606 – Revenue Recognition Closing com
Slide 3: Disclosures
Disclosures Safe harbor statement This presentation includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 related to Insight’s plans and expectations. Statements that are not historical facts, including statements about future trends in the
Slide 4: Strong Financial Results
Strong Financial Results Three Months Ended December 31, Years Ended December 31, 2017 2016 change 2017 2016 change Insight Enterprises, Inc. Net sales: Products $ 1,612,338 $ 1,344,024 20% $ 6,038,744 $ 4,997,263 21% Services $ 171,737 $ 123,559 39% $ 664,879 $ 488,253 36% Total net sales $ 1,784,0
Slide 5: Insight North America | Financial Results
Insight North America | Financial Results 2017 2016 change 2017 2016 change North America Net sales: Products $ 1,249,420 $ 969,487 29% $ 4,662,473 $ 3,601,697 29% Services $ 128,971 $ 87,866 47% $ 519,261 $ 370,131 40% Total net sales $ 1,378,391 $ 1,057,353 30% $ 5,181,734 $ 3,971,828 30% Gross pr
Slide 6: Insight EMEA | Financial Results
Insight EMEA | Financial Results Three Months Ended December 31, Years Ended December 31, 2017 2016 change 2017 2016 change EMEA Net sales: Products $ 333,540 $ 335,149 -1% $ 1,246,952 $ 1,243,932 0% Services $ 33,267 $ 26,611 25% $ 108,464 $ 94,628 15% Total net sales $ 366,807 $ 361,760 1% $ 1,355
Slide 7: Insight APAC | Financial Results
Insight APAC | Financial Results Three Months Ended December 31, Years Ended December 31, 2017 2016 change 2017 2016 change APAC Net sales: Products $ 29,378 $ 39,388 -25% $ 129,319 $ 151,634 -15% Services $ 9,499 $ 9,082 5% $ 37,154 $ 23,493 58% Total net sales $ 38,877 $ 48,470 -20% $ 166,473 $ 17
Slide 8: Go-to-Market Solution Areas
Go-to-Market Solution Areas Supply Chain Connected Optimization Workforce Invest smarter Work smarter Cloud & Data Center Digital Transformation Innovation Run workloads smarter Innovate smarter Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2017 Insight Direct USA, Inc. All Rights
Slide 9: 2018 Operating Priorities
2018 Operating Priorities Leverage Solution areas to optimize growth in our core offerings, the cloud, security and services Supply Chain Connected Cloud & Data Center Digital Optimization Workforce Transformation Innovation Grow the Core Accelerate Lead hybrid cloud Transform client Business consum
Slide 10: Agenda
Agenda CFO commentary • Product and Services Income Statement Presentation • 2017 Cash Flow Performance • 2017 Tax Cuts and Jobs Act • ASC 606 – Revenue Recognition Insight Presentation Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2017 Insight Direct USA, Inc. All Rights Reserved
Slide 11: Product & Services Presentation
Product & Services Presentation Years Ended December 31, 2017 % 2016 % 2016 change Insight Enterprises, Inc. (000's) (New) (Old) (New to Old) Hardware $ 3,916,762 58% $ 2,955,310 54% $ 2,955,589 $ (279) Software $ 2,121,982 32% $ 2,041,953 37% $ 2,189,514 $ (147,561) Services $ 664,879 10% $ 488,252
Slide 12: Cash Flows & Cash Cycle
Cash Flows & Cash Cycle Years Ended December 31, 2017 2016 change Statement of cash flows Management comments. “2016 and 2017 cash flow results reflect the collection of a Net cash provided by operating activities $ (305,426) $ 96,128 $ (401,554) single large receivable, of approximately $160 millio
Slide 13: 2017 Taxes | Tax Cuts & Jobs Act
2017 Taxes | Tax Cuts & Jobs Act 2017 Effective Tax Rate ETR Reconciliation 2017 2016 Federal Statutory Rate 35.0% 35.0% State Taxes 1.8% 2.4% Foreign Taxes -2.3% -2.1% Excess benefits from RSUs -1.5% 0.0% Other items 1.6% 2.1% Change in U.S. Tax Law 8.4% 1.8% Effective Tax Rate 43.0% 39.3% 2018 Est
Slide 14: Adoption of ASC 606
Adoption of ASC 606 Impacts to Insight • Lower revenue for certain security software licenses • 2017 sales approximately $240 million • Earlier revenue recognition for certain bill and hold arrangements • Bill and hold arrangements exist when customers purchase product from Insight, but store the pr
Slide 15: Closing Comments – 2018 Outlook
Closing Comments – 2018 Outlook • 2018 sales expected to grow in the low single digit range • After giving effect to the new revenue recognition for security software products which was approximately $240 million in 2017 • Adjusted diluted earnings per share are expected to be between $3.90 and $4.0
Slide 16: Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures
Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures Insight Presentation Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2017 Insight Direct USA, Inc. All Rights Reserved. 16
Slide 17: Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures (continued)
Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures (continued) Insight Presentation Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2017 Insight Direct USA, Inc. All Rights Reserved. 17