Ingram Micro Reports $10.3M Loss

Sales for the quarter totaled $5.9 billion, down 4.1 percent from the year earlier period. Year-end sales for 2002, meanwhile, fell 10.8 percent to $22.5 billion from $25.2 billion achieved in 2001.

For the quarter, Ingram Micro posted a net loss of $10.3 million. In the year earlier period, the company earned $5.7 million. Losses for the year totaled $275.2 million. In 2001, the company generated net earnings of $6.7 million.

Despite the sales shortfall and losses, Ingram Micro officials said the company performed admirably during the quarter. In particular, they pointed to the company's improved gross margins and asset sheet management as indications that the company is poised for a financial rebound when the economy improves.

In an interview with VARBusiness after the company's fourth quarter earnings call, Ingram Micro president and COO Michael Grainger said his company is well positioned to handle the current downturn and is well poised to help partners grow their own businesses once the overall economy improves. In particular, Grainger said his company's debt reduction plan and its cost-savings plan have helped Ingram Micro maintain its leadership position. Excluding reorganization costs and other items, net income for the fourth quarter was $29.2 million.

In addition, Grainger was pleased about his company's recent gains with IBM, which helped to offset a sales shortfall of products from HP. The latter Ingram Micro attributes to HP's merger with Compaq, and the decision by HP to more aggressively sell products direct to customers. Grainger said the company was able to keep is systems sales relatively on par due to the extensive work it did with IBM to help drive sales of its products. That work lead IBM to honor Ingram Micro earlier this week at its annual PartnerWorld conference with several awards, including Distributor of the Year awards in six of seven regions where Ingram Micro competes. In addition, the company achieved the No. 1 distribution channels market share position for IBM's Personal Computing Division (PCD) and eServer xSeries systems in the Americas region.