Arrow Meets 3Q Expectations

Revenue in the quarter was $2.10 billion, compared with $1.81 billion in the year-ago quarter.

The financial results for 2003 and 2002 include special charges that affected earnings. Excluding those items, net income would have been $15.1 million, or 15 cents per share, this year and $500,000, or 1 cent per share, in 2002. Thomson Financial/First Call had projected earnings of 15 cents per share before special items.

The Melville, N.Y.-based distributor previously stated that third-quarter earnings were reduced by $2.9 million, or 3 cents per share, as a result of the issuance in June 2003 of $350 million in 10-year senior notes, the proceeds of which were used to repay $192.0 million of higher-interest senior notes that matured Oct. 1, and to pay $154.4 million for the zero-coupon bonds before they matured.

"We are encouraged by our solid operating performance in what is traditionally a seasonally weak quarter," said William Mitchell, president and CEO of Arrow. "We generated over $105 million in free cash flow and took further steps to strengthen our balance sheet by once again purchasing debt prior to maturity."

Sales in the Computer Products group, which includes the MOCA, SBM, Support Net and Enterprise Storage Solutions divisions, were $516.3 million in the third quarter, a 4 percent increase from $496 million in the same period last year.

North American Computer Products sales have grown year-over-year for three consecutive quarters, Mitchell said.

Through the first three fiscal quarters, Arrow has lost $312,000 on sales of $6.2 billion, compared with a loss of $618.1 million on sales of $5.50 billion through the year-ago period.

Arrow shares were trading at $19.62 Thursday morning.