Avnet Sees 3Q Sales Uptick

The Phoenix-based distributor reported sales of $2.76 billion for the quarter, up from $2.64 billion a year earlier, and a profit of $41.1 million, or 34 cents per share. Analysts' consensus earnings estimate was nearly 35 cents per share, according to Thomson Financial. Avnet totaled net income of $26.7 million, or 22 cents per share, including charges, for its fiscal 2004 third quarter. Excluding those charges, earnings were $40.9 million, or 34 cents per share.

"We are pleased with our overall performance in the March [2005] quarter. Technology Solutions exceeded expectations with year-over-year revenue growth of 11 percent," said Avnet Chairman and CEO Roy Vallee in a statement.

The Avnet Technology Solutions group, which includes distributor Avnet Partner Solutions and solution provider Avnet Enterprise Solutions, reported sales of $1.16 billion. "IT spending for small and medium-size businesses continues to grow over last year, and Technology Solutions is executing well and profitably, growing faster than the markets it serves," according to Vallee.

In the current quarter, Avnet forecasts sales of $2.8 billion to $2.9 billion and earnings of 35 cents to 39 cents per share. The guidance doesn't take into account any impact from the company's proposed acquisition of semiconductor distributor Memec, announced earlier this week. Financial analysts project Avnet to earn 37 cents per share on $2.75 billion in sales.

Avnet shares closed Wednesday at $17.72, up 47 cents per share.