Insight Enterprises, Inc. · NASDAQ:NSIT
Insight Enterprises — Q1 2022 Earnings Presentation
23 slides from Insight Enterprises's earnings presentation, May 5, 2022
Slide 1: Insight Enterprises, Inc. First Quarter 2022 Earnings Conference Call and Webcast
Insight Enterprises, Inc. First Quarter 2022 Earnings Conference Call and Webcast Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2022 Insight Direct USA, Inc. All Rights Reserved. 1
Slide 2: Disclosures
Disclosures • Safe harbor statement This presentation includes “forward-looking statements” w ithin 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 those related to coronavirus strain
Slide 3: Agenda
Agenda • Disclosures • CEO Commentary ◦ Areas of Expertise ◦ Solutions at Work • CFO Commentary ◦ First Quarter 2022 Financial Highlights ◦ Cashflow and Debt Covenants ◦ 2022 Outlook • Closing Comments InsightInc. Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2022 Insight Direct U
Slide 4: Well Positioned to Help Organizations
Well Positioned to Help Organizations Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2022 Insight Direct USA, Inc. All Rights Reserved. 4
Slide 5: Retailer Improves Security with Improved Cloud Ops & Modern IT
Retailer Improves Security with Improved Cloud Ops & Modern IT Solution Client Client and Outcomes Objectives Services Long-standing fashion retailer • Streamline and secure back- • Modern Infrastructure • Client passed 44 controls for operating in over 30 countries end operations regulatory complia
Slide 6: Travel Leader Meets Market Challenges with Managed Services
Travel Leader Meets Market Challenges with Managed Services Solution Client Client and Outcomes Objectives Services Travel leader w ith over 18,000 • Fluctuating customer demands • Modern Infrastructure • 250TB of data under Managed teammates and operations introduced need for flexibility Services •
Slide 7: CFO Commentary
CFO Commentary • First Quarter 2022 Financial Highlights • Cashflow and Debt Covenants • 2022 Outlook Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2022 Insight Direct USA, InsightInc. All Rights &Reserved. Proprietary Confidential. Do Not Copy or Distribute. © 2022 Insight Direct
Slide 8: First Quarter 2022 Highlights
First Quarter 2022 Highlights • Record first quarter for revenue, gross profit and adjusted diluted earnings per share • Net sales of $2.7 billion • Gross profit of $379 million • 18.1% - Cloud as a percent of total gross profit compared to 17.9% prior year* • Gross margin 14.3% • SG&A up 10% in US
Slide 9: Q1 2022 Year over Year Results
Q1 2022 Year over Year Results 21% YoY 22% YoY (in constant $**) 14% YoY -80 bps YoY -110 bps YoY -110 bps YoY 31% YoY 39% YoY GAAP Earnings f rom operations $80M GAAP Diluted EPS $1.53 * See Appendix for reconciliation of non-GAAP measures ** Reference “Constant currency” section on slide 2 of this
Slide 10: Q1 2022 North America | Financial Results
Q1 2022 North America | Financial Results 25% YoY 18% YoY -80 bps YoY -110 bps YoY -100 bps YoY 34% YoY GAAP Earnings from operations $65M * See Appendix for reconciliation of non-GAAP measures Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2022 Insight Direct USA, Inc. All Rights
Slide 11: Q1 2022 EMEA | Financial Results
Q1 2022 EMEA | Financial Results 17% YoY (in constant $**) 3% YoY (in constant $**) -160 bps YoY -170 bps YoY -170 bps YoY 21% YoY (in constant $**) GAAP Earnings from operations $11M * See Appendix for reconciliation of non-GAAP measures ** Reference “Constant currency” section on slide 2 of this p
Slide 12: Q1 2022 APAC | Financial Results
Q1 2022 APAC | Financial Results -3% YoY (in constant $**) 23% YoY (in constant $**) 540 bps YoY 330 bps YoY 330 bps YoY 33% YoY (in constant $**) GAAP Earnings from operations $4M * See Appendix for reconciliation of non-GAAP measures ** Reference “Constant currency” section on slide 2 of this pres
Slide 13: Q1 2022 | Cash Flows and Cash Cycle
Q1 2022 | Cash Flows and Cash Cycle 8 days YoY -3 days YoY 2 days YoY -9 days YoY Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2022 Insight Direct USA, Inc. All Rights Reserved. 13
Slide 14: Liquidity and Debt Covenants
Liquidity and Debt Covenants Twelve Months Ended March 31, US Dollar in $000s 2022 2021 Adjusted Consolidated EBITDA Net income $ 232,808 $ 181,847 Interest expense 39,460 40,081 Taxes 77,706 60,672 3.93x Depreciation and amortization of property and equipment 22,584 26,917 Amortization of intangibl
Slide 15: Full Year 2022 Outlook
Full Year 2022 Outlook Assumptions: As of May 5, 2022 As of February 10, 2022 Full year net sales growth % over prior year Low double digit Mid-single digit Interest expense $30 - $35 million $30 - $35 million Effective tax rate 24% - 25% 25% - 26% Adjusted diluted EPS $7.95 - $8.15 $7.65 - $7.85 Av
Slide 16: Appendix
Appendix Insight Proprietary & Confidential. Do Not Copy or Distribute. © 2022 Insight Direct USA, Inc. All Rights Reserved. 16
Slide 17: Appendix – Reconciliation of GAAP to Non-GAAP
Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures* Three Months Ended March 31, US Dollars in $000s, except per share data 2022 2021 Adjusted Consolidated Earnings from Operations: GAAP consolidated EFO $ 79,849 $ 67,024 Amortization of intangible assets 7,925 8,041 Other 1,783 (6,740
Slide 18: Appendix – Reconciliation of GAAP to Non-GAAP (continued)
Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures* (continued) Three Months Ended March 31, US Dollar in $000s 2022 2021 Adjusted North America Earnings from Operations: GAAP EFO from North America segment $ 64,560 $ 53,921 Amortization of intangible assets 7,348 7,417 Other 715 (7,23
Slide 19: Appendix – Reconciliation of GAAP to Non-GAAP (continued)
Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures* (continued) Twelve Months Ended March 31, US Dollar in $000s 2022 2021 Return on invested capital: GAAP consolidated EFO $ 344,886 $ 285,736 Other 6,889 2,928 Adjusted non-GAAP consolidated EFO * 351,775 288,664 Income tax expense** 9
Slide 20: Appendix – Reconciliation of GAAP to Non-GAAP (continued)
Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures (continued) Three Months Ended March 31, US Dollar in $000s 2022 2021 Adjusted Consolidated Selling and Administrative Expenses: GAAP selling and administrative expenses $ 297,640 $ 271,190 Less: Other* 8,336 8,041 Adjusted non-GAAP se
Slide 21: Appendix – Reconciliation of GAAP to Non-GAAP (continued)
Appendix – Reconciliation of GAAP to Non-GAAP Financial Measures (continued) Three Months Ended March 31, US Dollar in $000s 2022 2021 Adjusted EMEA Selling and Administrative Expenses: GAAP selling and administrative expenses $ 52,326 $ 55,447 Less: Other* 457 496 Adjusted non-GAAP selling and admi
Slide 22: Appendix - Convertible Senior Notes
Appendix - Convertible Senior Notes I ns ight is required to s ettle the c onvertible notes principal/par value in c ash with the exc ess being s ettled in s hares resulting in dilution in G AAP reported D iluted E arnings P er Share (“D E PS”). T he D EPS incremental s hares for G AAP reporting pur
Slide 23: Appendix - Convertible Senior Notes
Appendix - Convertible Senior Notes Insight Convertible Senior Notes - $350 Million Relevant NSIT stock prices: • Price at issuance - $51.56 Triggered potential additional • Conversion ratio price equivalent - $68.32 shares in GAAP DEPS* • Sales price conversion trigger - $88.82 • Bond hedge strike