Slide 1: CDW Corporation Webcast Conference Call
CDW Corporation Webcast Conference Call October 30, 2024
Slide 2: Today's Agenda
Third Quarter 2024 Results Performance Drivers Today's Agenda Outlook Q&A 2
Slide 3: Forward-Looking Statements
Forward-Looking Statements Statements in this presentation that are not statements of historical fact are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements regarding the futur
Slide 4: Non-GAAP Financial Measures
Non-GAAP Financial Measures Generally, a non-GAAP financial measure is a numerical measure of a company’s performance or financial condition that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accorda
Slide 5: Financial Performance
Financial Performance • Net sales of $5.5 billion • Down 2.0% on a reported basis • Down 3.5% on an average daily sales ("ADS") basis • Down 3.6% on an ADS constant currency* basis • Gross profit of $1.2 billion, down 2.2% • Gross profit margin of 21.8%, consistent with prior year • Operating income
Slide 6: Net Sales By Channel
Net Sales By Channel (Unaudited) ($ in millions) Three Months Ended September 30, Average Daily % 2024 2023 % Change(1) Change(1) Corporate $ 2,161.2 $ 2,226.5 (2.9)% (4.4)% Small Business 379.7 378.4 0.3 (1.2) Public Government 691.0 775.7 (10.9) (12.3) Education 995.7 1,026.7 (3.0) (4.5) Healthcar
Slide 7: Financial Results
Financial Results (Unaudited) ($ in millions, except percentages) Three Months Ended September 30, 2024 2023 % Change Net sales $ 5,516.6 $ 5,628.3 (2.0)% Average daily net sales(1) $ 86.2 $ 89.3 (3.5) Gross profit $ 1,200.7 $ 1,227.7 (2.2) Gross profit margin 21.8 % 21.8 % Selling and administrativ
Slide 8: Earnings Per Diluted Share
Earnings Per Diluted Share (Unaudited) ($ in millions, except per share amounts) Three Months Ended September 30, 2024 2023 % Change US GAAP Net income $ 316.4 $ 315.5 0.3 % Weighted-average common shares outstanding - Diluted 134.9 135.9 Net income per diluted share $ 2.34 $ 2.32 1.0 Non-GAAP net i
Slide 9: Debt and Revolver Availability
Debt and Revolver Availability (Unaudited) ($ in millions) September 30, 2024 December 31, 2023 September 30, 2023 Cash and cash equivalents $ 946.7 $ 588.7 $ 440.7 Short-term investments 211.7 — — Total debt 6,030.7 5,644.9 5,701.5 Net debt* 4,872.3 5,056.2 5,260.8 Revolver availability 1,254.4 1,2
Slide 10: Cash Conversion Cycle
Cash Conversion Cycle (Unaudited) (Based on a rolling three-month average) September 30, 2024 December 31, 2023 September 30, 2023 Days of sales outstanding 79 77 73 Days of supply in inventory 14 13 14 Days purchases outstanding (76) (73) (72) Cash conversion cycle 17 17 15 10
Slide 11: Free Cash Flow and Adjusted Free Cash Flow
Free Cash Flow and Adjusted Free Cash Flow (Unaudited) ($ in millions) Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Net cash provided by operating activities $ 342.1 $ 468.7 $ 932.0 $ 1,062.2 Capital expenditures (33.6) (43.5) (94.0) (114.7) Free Cash Flow* 30
Slide 12: 2024 Capital Allocation Priorities
2024 Capital Allocation Priorities PRIORITIES OBJECTIVES ACTIONS Target ~25% payout of Non-GAAP net ~1% increase in November 2024 Increase Dividend Annually income; grow in-line with earnings to $2.50/share annually Target ~2.0 to 3.0 times Net Leverage Ratio; (1) Maintain Net Leverage Ratio consist
Slide 13: Outlook
CUSTOMER SPEND U.S. IT growth plus a premium target of ~200 to 300 bps 2024 (1),(2) GROSS PROFIT Low-single digit decline Outlook NON-GAAP EARNINGS PER DILUTED SHARE Mid-single digit decline 1. Certain annual outlooks are provided on a non-GAAP basis because certain reconciling items are dependent o
Slide 14: Modeling Thoughts
Modeling Thoughts Metric Expectations • Sequential declines in Q4 lead to low-to-mid single digit year-over-year declines Gross profit • 2H slightly above 1H total with Q4 meaningfully lower than Q3 • Currency expected to be neutral to slightly favorable in Q4, driven by UK • Approximately $275 mill
Slide 15: Questions and Answers
Questions and Answers ———————