Avnet 2011 Sales Hit $26.5 Billion, Share Buyback Announced
The VAR Guy has to give credit where credit is due: Avnet is a bright star in a very dark economic sky. The distribution company posted figures for the end of fiscal year 2011, announcing record sales of $26.5 billion amid numerous other increases. So The VAR Guy wants to know: What’s next for the distribution giant, and what exactly is fueling its success? Facts, figures and the channel follow …
For fiscal year 2011, Avnet’s sales increased 38.5 percent year over year to a record-breaking $26.5 billion, with Q4 sales increasing 32.6 percent year over year to $6.91 billion. Adjusted operating income for Avnet in fiscal year 2011 increased 52.4 percent, hitting more than $1 billion, and up nearly 25 percent year over year for Q4 to $270.9 million. Even amid Wall Street turmoil, the outlook for Avnet is excellent, with stock prices hovering around $26 a share and Raymond James bumping Avnet’s stock from ‘Outperform’ to ‘Strong Buy.’
Avnet’s rosy Q4 growth is especially encouraging in light of its CEO transition from Roy Vallee to Rick Hamada earlier in 2011. Hamada commented on Avnet’s results, noting an increase in global footprint and customer base have propelled much of its success. Because of the bullish outlook, Avnet is launching a $500 million share buyback program and promises “adequate liquidity” for more organic growth in the near future. Despite economic uncertainty, technology markets are a main source of recovery and Avnet will be “building on the momentum from fiscal year 2011” for 2012, Hamada said.
What’s on the horizon for Avnet? The VAR Guy has asked that question in the past, and believed it to be a heavier focus on cloud solutions along with Avnet’s trademark SolutionPaths. As it turns out, The VAR Guy was right about the cloud — witness the launch of Avnet’s cloud workshop. Meanwhile, Avnet’s executive team plans to continue to keep their collective eye on the cloud. Easy-to-grasp distribution programs and pre-packaged solutions could be the secret to Avnet’s growing global user footprint. And as always, The VAR Guy will keep a close watch on Avnet to see how it does against rivals Tech Data and Ingram Micro.