Tech Data Corporation Reports Second Quarter Fiscal Year 2019 Results
CLEARWATER, Fla., Aug. 30, 2018 /PRNewswire/ -- Tech Data (Nasdaq: TECD) (the "Company") today announced its financial results for the second quarter ended July 31, 2018.
Second quarter ended July 31, Six months ended July 31,
----------------------------- -------------------------
($ in millions, 2018 2017 Y/Y 2018 2017 Y/Y
except per share amounts) Change Change
------------------------ ------ ------
Net Sales $8,886.1 $8,092.4 10% $17,434.4 $15,116.0 15%
Operating income (GAAP) $110.4 $103.5 7% $180.9 $178.6 1%
Operating margin (GAAP) 1.24% 1.28% -4 bps 1.04% 1.18% -14 bps
Operating income (Non-GAAP) $135.0 $127.8 6% $259.0 $251.1 3%
Operating margin (Non-GAAP) 1.52% 1.58% -6 bps 1.49% 1.66% -17 bps
Net income (GAAP) $75.9 $47.5 60% $109.6 $78.1 40%
Net income (Non-GAAP) $77.7 $66.7 16% $148.5 $136.8 9%
EPS - diluted (GAAP) $1.97 $1.24 59% $2.84 $2.06 38%
EPS - diluted (Non-GAAP) $2.01 $1.74 16% $3.85 $3.61 7%
----------------------- ----- ----- --- ----- ----- ---
A reconciliation of GAAP to non-GAAP financial measures is presented in the financial tables of this press release.
This information is also available on the Investor Relations section of Tech Data's website at www.techdata.com/investor.
Financial Highlights for the Second Quarter Ended July 31, 2018:
-- Net sales were $8.9 billion, an increase of 10 percent compared to the
prior-year quarter. On a constant currency basis, net sales increased 8
percent.
-- Americas: Net sales were $4.0 billion (46 percent of worldwide net
sales), an increase of 7 percent compared to the prior-year quarter.
-- Europe: Net sales were $4.5 billion (51 percent of worldwide net
sales), an increase of 13 percent compared to the prior-year
quarter. On a constant currency basis, net sales increased 9
percent.
-- Asia Pacific: Net sales were $0.3 billion (3 percent of worldwide
net sales), an increase of 5 percent compared to the prior-year
quarter. On a constant currency basis, net sales increased 7
percent.
-- Gross profit was $527.0 million, an increase of $11.4 million, or 2
percent compared to the prior-year quarter. As a percentage of net
sales, gross profit was 5.93 percent compared to 6.37 percent in the
prior-year quarter.
-- Selling, general and administrative expenses ("SG&A") were $415.3
million, or 4.67 percent of net sales, compared to $410.6 million, or
5.07 percent of net sales in the prior-year quarter. Non-GAAP SG&A was
$392.1 million, an increase of $4.4 million, or 1 percent, compared to
the prior-year quarter. As a percentage of net sales, non-GAAP SG&A was
4.41 percent, compared to 4.79 percent in the prior-year quarter.
-- Worldwide operating income was $110.4 million, or 1.24 percent of net
sales compared to $103.5 million or 1.28 percent of net sales in the
prior-year quarter. Non-GAAP operating income was $135.0 million, an
increase of $7.1 million, or 6 percent, compared to the prior-year
quarter. As a percentage of net sales, non-GAAP operating income was
1.52 percent, compared to 1.58 percent in the prior year quarter.
-- Americas: Operating income was $87.9 million, or 2.17 percent of net
sales, compared to $88.0 million, or 2.33 percent of net sales in
the prior-year quarter. Non-GAAP operating income was $95.4 million,
an increase of $10.7 million, or 13 percent, compared to the
prior-year quarter. As a percentage of net sales, non-GAAP operating
income was 2.36 percent, an improvement of 11 basis points from the
prior-year quarter.
-- Europe: Operating income was $29.1 million, or 0.64 percent of net
sales, compared to $18.5 million, or 0.46 percent of net sales in
the prior-year quarter. Non-GAAP operating income was $44.3 million,
an increase of $0.9 million, or 2 percent, compared to the
prior-year quarter. As a percentage of net sales, non-GAAP operating
income was 0.97 percent compared to 1.07 percent in the prior-year
quarter.
-- Asia Pacific: Operating income was $1.3 million, or 0.45 percent of
net sales, compared to $5.1 million, or 1.81 percent of net sales in
the prior-year quarter. Non-GAAP operating income was $2.5 million,
a decrease of $4.2 million, or 63 percent, compared to the
prior-year quarter. As a percentage of net sales, non-GAAP operating
income was 0.86 percent compared to 2.39 percent in the prior-year
quarter.
-- Stock-based compensation expense was $8.0 million, essentially flat
from the prior-year quarter. This includes $0.7 million of
acquisition and integration-related stock compensation expense.
These expenses are excluded from the regional operating results and
presented as a separate line item in the company's segment reporting
(see the GAAP to non-GAAP reconciliation in the financial tables of
this press release).
-- Net income was $75.9 million, compared to $47.5 million in the
prior-year quarter. Non-GAAP net income was $77.7 million, an increase
of $11.0 million, or 16 percent, compared to the prior-year quarter.
-- Earnings per share on a diluted basis ("EPS") were $1.97, compared to
$1.24 in the prior year quarter. Non-GAAP EPS was $2.01, an increase of
$0.27, or 16 percent compared to the prior-year quarter.
-- Net cash generated by operations during the quarter was $561 million.
-- Return on invested capital for the trailing twelve months was 5 percent,
compared to 10 percent in the prior-year period. The adjusted return on
invested capital for the trailing twelve months was 11 percent, compared
to 12 percent in the prior-year period.
Global Business Optimization Program
Tech Data also announced a Global Business Optimization Program ("GBO Program") designed to create a more agile and cost-efficient organization that is structured for sustainable, long-term profitable growth. Components of the GBO Program include:
-- Enhancing the Company's regional go-to-market models to deliver even
greater value to channel partners;
-- Digitizing processes to drive a more responsive, empowered and nimble
work environment; and
-- Driving productivity improvements through increased centralization and
standardization throughout the global organization
The GBO Program is expected to result in annual cost savings of $70 million to $80 million, of which approximately half will be reinvested to accelerate the Company's strategic priorities. To achieve these cost savings, the Company expects to incur one-time costs of $70 million to $80 million over the next 18 to 24 months. Through July 31, 2018, the Company incurred GBO Program-related costs of approximately $18 million, which are included in acquisition, integration and restructuring expenses.
"Fueled by strong demand for Endpoint Solutions, Q2 worldwide sales grew 10 percent to $8.9 billion -- the high end of our guidance range,' said Rich Hume, chief executive officer. "Non-GAAP earnings per share improved 16 percent from the year-ago quarter to $2.01, however, came in at the lower end of our expected range largely due to product mix. The strength in high-velocity sales generated exceptionally strong cash from operations of $561 million and produced a return on invested capital of 11 percent. Looking ahead, we will continue to build on our strengths - the powerful combination of our global scope with local expertise; strong operations; valued channel partner relationships; and dedicated colleagues, as we invest in both our people and our business. The Global Business Optimization Program we announced today will enable us to accelerate our strategic priorities and set a new standard in our industry by creating a more efficient and agile organization, and to secure our next wave of sustainable, profitable growth."
Business Outlook
-- For the quarter ending October 31, 2018, the Company anticipates
worldwide net sales to be in the range of $8.7 billion to $9.0 billion.
-- For the quarter ending October 31, 2018, the Company anticipates EPS to
be in the range of $1.19 to $1.49 and non-GAAP EPS to be in the range of
$2.00 to $2.30.
-- This guidance assumes an average U.S. dollar to euro exchange rate of
$1.14 to EUR1.00.
-- This guidance assumes weighted average diluted shares outstanding of
38.6 million.
-- For the quarter ending October 31, 2018, the Company anticipates its
effective tax rate will be in the range of 24 percent to 26 percent.
Webcast Details
Tech Data will hold a conference call today at 9:00 a.m. (ET) to discuss its financial results for the second quarter ended July 31, 2018. A webcast of the call, including supplemental schedules, will be available to all interested parties and can be obtained at www.techdata.com/investor. The webcast will be available for replay for three months.
Non-GAAP Financial Information
The non-GAAP financial information contained in this release is included with the intention of providing investors a more complete understanding of the Company's operational results and trends, but should only be used in conjunction with results reported in accordance with Generally Accepted Accounting Principles ("GAAP"). Certain non-GAAP measures presented in this release or other releases, presentations and similar documents issued by the Company include sales, income or expense items as adjusted for the impact of changes in foreign currencies (referred to as "constant currency"), non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP earnings per diluted share and Adjusted Return on Invested Capital. Certain non-GAAP measures also exclude acquisition-related intangible assets amortization expense, benefits associated with legal settlements, acquisition, integration and restructuring expenses, value-added tax assessments and related interest expense, gain on disposal of subsidiary, tax indemnifications, acquisition-related financing expenses, changes in deferred tax valuation allowances and the impact of U.S. tax reform. A detailed reconciliation of the adjustments between results calculated using GAAP and non-GAAP in this release is contained in the attached financial schedules. This information can also be obtained from the Company's Investor Relations website at www.techdata.com/investor.
Forward-Looking Statements
Certain statements in this communication may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements, including statements regarding Tech Data's plans, objectives, expectations and intentions, Tech Data's financial results and estimates and/or business prospects, involve a number of risks and uncertainties, and actual results could differ materially from those projected. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which Tech Data operates, and the beliefs and assumptions of our management. Words such as "expects," "anticipates," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," variations of such words, and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to projections of Tech Data's future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or circumstances, are forward-looking statements. These forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements.
For additional information with respect to risks and other factors which could occur, see Tech Data's Annual Report on Form 10-K for the year ended January 31, 2018, including Part I, Item 1A, "Risk Factors" therein, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other securities filings with the Securities and Exchange Commission (the "SEC") that are available at the SEC's website at www.sec.gov and other securities regulators. Readers are cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Many of these factors are beyond Tech Data's control. Unless otherwise required by applicable securities laws, Tech Data disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Tech Data undertakes no duty to update any forward-looking statements contained herein to reflect actual results or changes in Tech Data's expectations.
About Tech Data
Tech Data connects the world with the power of technology. Our end-to-end portfolio of products, services and solutions, highly specialized skills, and expertise in next-generation technologies enable channel partners to bring to market the products and solutions the world needs to connect, grow and advance. Tech Data is ranked No. 83 on the Fortune 500(®) and has been named one of Fortune's "World's Most Admired Companies" for nine straight years. To find out more, visit www.techdata.com or follow us on Twitter, LinkedIn and Facebook.
Contacts:
Charles V. Dannewitz, Executive Vice President, Chief Financial Officer
727-532-8028 (chuck.dannewitz@techdata.com)
Arleen Quiñones, Corporate Vice President, Investor Relations and Corporate Communications
727-532-8866 (arleen.quinones@techdata.com)
TECH DATA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three months ended Six months ended
July 31, July 31,
-------- --------
2018 2017 2018 2017
(As Adjusted1 ) (As Adjusted1 )
-------------- --------------
Net sales $8,886,101 $8,092,353 $17,434,420 $15,115,973
Cost of products sold 8,359,071 7,576,762 16,384,273 14,143,294
--------- --------- ---------- ----------
Gross profit 527,030 515,591 1,050,147 972,679
Operating expenses:
Selling, general and administrative expenses 415,319 410,598 837,680 763,230
Acquisition, integration, and restructuring expenses 13,297 30,117 46,522 72,183
Legal settlements and other, net (5,234) (28,655) (8,199) (41,343)
Gain on disposal of subsidiary (6,717) - (6,717) -
------ --- ------ ---
416,665 412,060 869,286 794,070
------- ------- ------- -------
Operating income 110,365 103,531 180,861 178,609
Interest expense 28,053 28,272 53,975 59,280
Other expense (income), net 901 284 2,818 (131)
--- --- ----- ----
Income before income taxes 81,411 74,975 124,068 119,460
Provision for income taxes 5,545 27,516 14,503 41,347
----- ------ ------ ------
Net income $75,866 $47,459 $109,565 $78,113
======= ======= ======== =======
Earnings per share:
Basic $1.97 $1.24 $2.86 $2.07
===== ===== ===== =====
Diluted $1.97 $1.24 $2.84 $2.06
===== ===== ===== =====
Weighted average common shares outstanding:
Basic 38,428 38,174 38,356 37,720
====== ====== ====== ======
Diluted 38,566 38,388 38,565 37,935
====== ====== ====== ======
(1)Amounts have been adjusted to reflect the adoption of Accounting Standard Update 2014-09, Revenue from Contracts with
Customers (ASC 606) on a full retrospective basis.
TECH DATA CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(In thousands, except par value and share amounts)
(Unaudited)
July 31, January 31,
2018 2018
ASSETS (As Adjusted1 )
--------------
Current assets:
Cash and cash equivalents $792,859 $955,628
Accounts receivable, net 5,200,039 6,035,716
Inventories 3,022,673 2,965,521
Prepaid expenses and other assets 383,191 403,548
------- -------
Total current assets 9,398,762 10,360,413
Property and equipment, net 268,137 279,091
Goodwill 944,959 969,168
Intangible assets, net 1,009,177 1,086,772
Other assets, net 212,281 224,915
------- -------
Total assets $11,833,316 $12,920,359
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $6,233,180 $6,962,193
Accrued expenses and other liabilities 1,016,496 1,169,986
Revolving credit loans and current maturities of long-term debt, net 116,881 132,661
------- -------
Total current liabilities 7,366,557 8,264,840
Long-term debt, less current maturities 1,402,301 1,505,248
Other long-term liabilities 213,747 228,779
------- -------
Total liabilities $8,982,605 $9,998,867
---------- ----------
Shareholders' equity:
Common stock, par value $0.0015; 200,000,000 shares authorized; 59,245,585 $89 $89
shares issued at July 31, 2018 and January 31, 2018
Additional paid-in capital 829,002 827,301
Treasury stock, at cost (20,898,729 and 21,083,972 shares at July 31, 2018
and January 31, 2018) (931,864) (940,124)
Retained earnings 2,855,499 2,745,934
Accumulated other comprehensive income 97,985 288,292
------ -------
Total shareholders' equity 2,850,711 2,921,492
--------- ---------
Total liabilities and shareholders' equity $11,833,316 $12,920,359
=========== ===========
(1)Amounts have been adjusted to reflect the adoption of Accounting Standard Update 2014-09, Revenue from
Contracts with Customers (ASC 606) on a full retrospective basis.
TECH DATA CORPORATION AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(In thousands)
Three months ended July 31, 2018
---------------------------------
Americas (1) Europe (1) Asia Pacific
(1) Stock Consolidated
Compensation
Expense
---
Net Sales $4,043,331 $4,549,127 $293,643 $8,886,101
========== ========== ======== ==========
Operating income (GAAP) (1) $87,930 $29,085 $1,318 $(7,968) $110,365
Acquisition, integration and restructuring (844) 13,342 131 668 13,297
expenses
Acquisition-related intangible assets 13,570 7,727 1,418 22,715
amortization expense
Tax indemnifications - 910 (356) 554
Gain on disposal of subsidiary - (6,717) - (6,717)
Legal settlements and other, net (5,234) - - (5,234)
------ --- --- ------
Total non-GAAP operating income adjustments $7,492 $15,262 $1,193 $668 $24,615
------ ------- ------ ---- -------
Operating income (non-GAAP) $95,422 $44,347 $2,511 $(7,300) $134,980
======= ======= ====== ======= ========
Operating margin (GAAP) 2.17% 0.64% 0.45% 1.24%
Operating margin (non-GAAP) 2.36% 0.97% 0.86% 1.52%
(1) GAAP operating income does not include stock compensation expense at the regional level.
Three months ended July 31, 2017
---------------------------------
Americas (1) Europe (1) Asia Pacific
(1) Stock Consolidated
Compensation
Expense
---
Net Sales $3,769,696 $4,043,110 $279,547 $8,092,353
========== ========== ======== ==========
Operating income (GAAP) (1) $87,975 $18,464 $5,066 $(7,974) $103,531
Acquisition, integration and restructuring 14,242 14,685 145 1,045 30,117
expenses
Acquisition-related intangible assets 12,413 8,965 1,477 22,855
amortization expense
Legal settlements and other, net (29,971) 1,316 - (28,655)
------- ----- --- -------
Total non-GAAP operating income adjustments $(3,316) $24,966 $1,622 $1,045 $24,317
------- ------- ------ ------ -------
Operating income (non-GAAP) $84,659 $43,430 $6,688 $(6,929) $127,848
======= ======= ====== ======= ========
Operating margin (GAAP) 2.33% 0.46% 1.81% 1.28%
Operating margin (non-GAAP) 2.25% 1.07% 2.39% 1.58%
(1) GAAP operating income does not include stock compensation expense at the regional level.
TECH DATA CORPORATION AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(In thousands)
Six months ended July 31, 2018
-------------------------------
Americas (1) Europe (1) Asia Pacific
(1) Stock Consolidated
Compensation
Expense
---
Net Sales $7,661,537 $9,210,829 $562,054 $17,434,420
========== ========== ======== ===========
Operating income (GAAP) (1) $149,272 $46,403 $741 $(15,555) $180,861
Acquisition, integration and restructuring 13,072 31,330 452 1,668 46,522
expenses
Acquisition-related intangible assets 27,213 16,056 2,750 46,019
amortization expense
Tax indemnifications - 910 (356) 554
Gain on disposal of subsidiary - (6,717) - (6,717)
Legal settlements and other, net (8,199) - - (8,199)
------ --- --- ------
Total non-GAAP operating income adjustments $32,086 $41,579 $2,846 $1,668 $78,179
------- ------- ------ ------ -------
Operating income (non-GAAP) $181,358 $87,982 $3,587 $(13,887) $259,040
======== ======= ====== ======== ========
Operating margin (GAAP) 1.95% 0.50% 0.13% 1.04%
Operating margin (non-GAAP) 2.37% 0.96% 0.64% 1.49%
(1) GAAP operating income does not include stock compensation expense at the regional level.
Six months ended July 31, 2017
-------------------------------
Americas (1) Europe (1) Asia Pacific
(1) Stock Consolidated
Compensation
Expense
---
Net Sales $6,905,018 $7,750,375 $460,580 $15,115,973
========== ========== ======== ===========
Operating income (GAAP) (1) $138,875 $43,263 $9,363 $(12,892) $178,609
Acquisition, integration and restructuring 44,424 26,257 145 1,357 72,183
expenses
Acquisition-related intangible assets 22,514 16,713 2,377 41,604
amortization expense
Legal settlements and other, net (42,659) 1,316 - (41,343)
------- ----- --- -------
Total non-GAAP operating income adjustments $24,279 $44,286 $2,522 $1,357 $72,444
------- ------- ------ ------ -------
Operating income (non-GAAP) $163,154 $87,549 $11,885 $(11,535) $251,053
======== ======= ======= ======== ========
Operating margin (GAAP) 2.01% 0.56% 2.03% 1.18%
Operating margin (non-GAAP) 2.36% 1.13% 2.58% 1.66%
(1) GAAP operating income does not include stock compensation expense at the regional level.
TECH DATA CORPORATION AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(In thousands)
Selling, general and administrative expenses ("SG&A") Three months ended July 31,
---------------------------
2018 2017
---- ----
Net Sales $8,886,101 $8,092,353
========== ==========
SG&A Expenses (GAAP) $415,319 $410,598
Tax indemnifications (554) -
Acquisition-related intangible assets amortization expense (22,715) (22,855)
SG&A Expenses (non-GAAP) $392,050 $387,743
======== ========
SG&A Expenses (GAAP) % 4.67% 5.07%
SG&A Expenses (non-GAAP) % 4.41% 4.79%
Six months ended July 31,
-------------------------
2018 2017
---- ----
Net Sales $17,434,420 $15,115,973
=========== ===========
SG&A Expenses (GAAP) $837,680 $763,230
Tax indemnifications (554) -
Acquisition-related intangible assets amortization expense (46,019) (41,604)
SG&A Expenses (non-GAAP) $791,107 $721,626
======== ========
SG&A Expenses (GAAP) % 4.80% 5.05%
SG&A Expenses (non-GAAP) % 4.54% 4.77%
Three months ended July 31,
---------------------------
2018 2017
---- ----
Net Income Diluted EPS Net Income Diluted EPS
GAAP Results $75,866 $1.97 $47,459 $1.24
Legal settlements and other, net (5,234) (0.13) (28,332) (0.74)
Acquisition, integration and restructuring expenses 13,297 0.34 30,117 0.78
Acquisition-related intangible assets amortization expense 22,715 0.59 22,855 0.60
Gain on disposal of subsidiary (6,717) (0.17) - -
Tax indemnifications 554 0.01 - -
Income tax effect of tax indemnifications (554) (0.01) - -
Income tax effect of other adjustments above (9,404) (0.25) (5,367) (0.14)
Income tax benefit from acquisition settlement (12,839) (0.34) - -
Non-GAAP Results $77,684 $2.01 $66,732 $1.74
======= ===== ======= =====
Six months ended July 31,
-------------------------
2018 2017
---- ----
Net Income Diluted EPS Net Income Diluted EPS
GAAP Results $109,565 $2.84 $78,113 $2.06
Legal settlements and other, net (8,199) (0.21) (41,020) (1.08)
Value added tax assessments and related interest expense (928) (0.02) - -
Acquisition, integration and restructuring expenses 46,522 1.21 72,183 1.90
Acquisition-related intangible assets amortization expense 46,019 1.19 41,604 1.10
Acquisition-related financing expenses - - 8,807 0.23
Gain on disposal of subsidiary (6,717) (0.17) - -
Tax indemnifications 554 0.01 - -
Income tax effect of tax indemnifications (554) (0.01) - -
Income tax effect of other adjustments above (22,312) (0.58) (22,896) (0.60)
Income tax benefit from acquisition settlement (12,839) (0.34) - -
Change in deferred tax valuation allowances (2,600) (0.07) - -
Non-GAAP Results $148,511 $3.85 $136,791 $3.61
======== ===== ======== =====
TECH DATA CORPORATION AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(In thousands)
Return on Invested Capital (ROIC)
Twelve months ended July 31,
TTM Net Operating
Profit After Tax
(NOPAT)*: 2018 2017
---- ----
Operating income $412,331 $344,598
Income taxes on
operating income
(1) (211,261) (88,150)
NOPAT $201,070 $256,448
======== ========
Average Invested Capital:
Short-term debt (5-
qtr end average) $188,558 $340,608
Long-term debt (5-
qtr end average) 1,604,359 988,243
Shareholders' Equity
(5-qtr end average) 2,819,394 2,316,790
--------- ---------
Total average
capital 4,612,311 3,645,641
Less: Cash (5-qtr
end average) (737,995) (1,081,802)
Average invested
capital less
average cash $3,874,316 $2,563,839
========== ==========
ROIC 5% 10%
* Trailing Twelve Months is abbreviated as TTM.
(1) Income taxes on operating income was calculated using the trailing twelve months
effective tax rate.
Adjusted Return on Invested Capital (ROIC)
Twelve months ended July 31,
TTM Net Operating
Profit After Tax
(NOPAT), as
adjusted*: 2018 2017
---- ----
Non-GAAP operating
income (1) $610,691 $454,332
Income taxes on non-
GAAP operating
income (2) (172,797) (134,878)
NOPAT, as adjusted $437,894 $319,454
======== ========
Average Invested Capital, as adjusted:
Short-term debt (5-
qtr end average) $188,558 $340,608
Long-term debt (5-
qtr end average) 1,604,359 988,243
Shareholders' Equity
(5-qtr end average) 2,819,394 2,316,790
Tax effected impact
of non-GAAP
adjustments (3) 95,231 31,842
------ ------
Total average
capital, as
adjusted 4,707,542 3,677,483
Less: Cash (5-qtr
end average) (737,995) (1,081,802)
Average invested
capital less
average cash $3,969,547 $2,595,681
========== ==========
Adjusted ROIC 11% 12%
* Trailing Twelve Months is abbreviated as TTM.
(1) Represents operating income as adjusted to exclude acquisition, integration and
restructuring expenses,
legal settlements and other, net, gain on disposal of subsidiary, value added tax assessments
and
acquisition-related intangible assets amortization expense.
(2)Income taxes on non-GAAP operating income was calculated using the trailing twelve months
effective
tax rate adjusted for the impact of non-GAAP adjustments during the respective periods.
(3)Represents the 5 quarter average of the year-to-date impact of non-GAAP adjustments.
TECH DATA CORPORATION AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
Guidance Reconciliation
Three months ending October 31, 2018
------------------------------------
Low end of High end of
guidance range guidance range
-------------- --------------
Earnings per share - diluted $1.19 $1.49
Acquisition, integration and restructuring expenses 0.49 0.49
Acquisition-related intangible assets amortization expense 0.59 0.59
Income tax effect of the above adjustments (0.27) (0.27)
Non-GAAP earnings per share - diluted $2.00 $2.30
----- -----
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SOURCE Tech Data Corporation
