Arrow flies higher than expected in Q3 financials

Despite heavy restructuring charges, global distributor's results are ahead of expectations

Distribution giant Arrow has reported a better than expected third-quarter performance.

Third-quarter profit stood at $12.6m (£7.6m) on turnover of $3.67bn compared to net profit of $76.1m on turnover of $4.3bn in Q3 last year.

Taking into account a restructuring and integration charge in Q3, Arrow said its profit would have been $44.9m for the quarter.

Michael Long, chief executive of Arrow, said: “Our execution this quarter was excellent, exceeding our expectations for revenue, earnings per share and cashflow. We continue to control well those things that we can, no matter the economic environment.

“We continued to deliver on our commitment to simplify the business while remaining focused on our long-term goals to maximise sales and profitable market share growth.”

Components sales dropped 15 per cent year on year, the distributor said.

Long added: “Global components revenue exceeded our expectations, with double-digit increases sequentially across all geographies. Year-over-year sales declines have begun to moderate in both North America and Europe, and Asia continues to post sales gains.

“We are well positioned to take advantage of opportunities in the market and will continue to grow profit and gain market share across this business.”

Global enterprise computing solutions (ECS) sales of $1.13bn decreased 14 per cent year on year.

“ECS sales were ahead of the midpoint of our expectations and above normal seasonality, fuelled by a strong federal government year-end, as well as sequential increases in storage and services. In our worldwide server business the year-over-year declines have moderated,” he said.

For the first nine months of 2009, net profit was $60.4m on turnover of $10.5bn, compared with profit of $258.2m on turnover of $12.7bn in 2008.

Net profit for the first nine months of 2009 includes restructuring and integration charges of $80.9m.