ScanSource Q4 Profit Tops Estimate

(RTTNews) - ScanSource, Inc. (SCSC) reported net income for the fourth quarter of $27.1 million or $0.94 per share, compared to a net loss of $13.3 million or $0.48 per share for the prior year quarter.

Excluding items, adjusted net income for the fourth quarter was $17.3 million or $0.60 per share, compared to $19.9 million or $0.71 per share in the year-ago quarter.

Net sales for the fourth quarter increased 6.4% to $758.1 million, compared with $712.7 million for the prior year quarter.

Analysts polled by Thomson Reuters expected the company to earn $0.59 per share on revenue of $740.03 million for the fourth quarter.

The company also announced a $120 million authorization by its Board of Directors to repurchase shares of common stock over three years.

Excluding acquisitions and acquisition costs, ScanSource expects net sales for the first quarter to range from $750 million to $770 million and earnings per share to range from $0.59 to $0.61 per share. Analysts currently expect the company to earn $0.66 per share on revenue of $756.99 million for the first quarter.

Separately, ScanSource said it has executed a non-binding letter of intent to acquire Imago Group plc, Europe's leading value-added distributor of video and voice communications equipment and services. Pursuant to the letter of intent, ScanSource will be acquiring Imago's operations in the United Kingdom France, and their recently acquired business in Germany.

The all-cash deal as currently negotiated includes an initial purchase price of about GBP 24.5 million (about US$41 million), plus earnout payments over the next two years. The acquisition as contemplated in the letter of intent is expected to be accretive to earnings per share and ROIC in the first year after closing, excluding one-time acquisition costs.

The proposed acquisition is expected to close in the quarter ending September 30.