Bell Micro Meets 2Q Estimates, Revenue Up 25 Percent

The San Jose-based distributor earned $1.1 million or 4 cents per share, compared to a $2.4 million loss, or a loss of 12 cents per share, in the year-ago quarter. Bell Microproducts' revenue was $630 million, compared to $503 million last year.

"We generated strong revenue improvement in all geographies and all product categories, except disk drives, compared to last year's second quarter," said Don Bell, president and CEO, in a statement. "The second quarter is typically a seasonally softer demand quarter for Bell Micro, and we are pleased with the relative strength experienced in our solutions category of products in the second quarter as well as in recent quarters."

Bell Microproducts also completed its June acquisition of OpenPSL, a U.K.-based distributor of enterprise, storage and security products and related professional services, according to Bell.

"[Open PSL's] revenues over the last 12 months were approximately $200 million with gross and operating margins higher than our corporate averages. This acquisition complements our three primary strategies for growth: focus on enterprise solutions, expand supplier partnerships, and increase our geographic footprint. Furthermore, we expect the acquisition to be accretive to our EPS," Bell said in a statement.

North American revenue increased 14 percent compared with the second quarter of 2003, according to the company.

In the third quarter ending Sept. 30, Bell Microproducts expects earnings between 8 cents and 10 cents per share and revenue between $690 million and $710 million, both in line with estimates.

"While there have recently been mixed signals in the technology marketplace, we believe that our business model is working. We expect that there will be continued spending and investment in the product categories we distribute. We are forecasting growth in the second half of the year and, as a result, expect to set another revenue record in 2004, accompanied by a significant improvement in profitability," Bell said in a statement.

Shares of Bell Microproducts closed at $6.14, down 7 cents per share, or 1 percent.