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Ingram Micro's earnings rise 21% on higher sales

October 25, 2006|From Bloomberg News

Ingram Micro Inc., a Santa-Ana-based distributor of computers, software and electronics, said Tuesday that third-quarter profit rose 21%, beating analysts' estimates.

Net income rose to $58.5 million, or 34 cents a share, from $48.4 million, or 29 cents, a year earlier, the company said. Sales increased 7.9% to $7.51 billion.

Chief Executive Gregory Spierkel has curbed costs by shifting technical support and application development to less-expensive regions while entering new markets.

Demand for computers and related gear is increasing in regions such as Asia, helped by economic growth and lower prices.

Ingram Micro's North American sales rose 9% to $3.37 billion in the third quarter, while European sales increased 4% to $2.43 billion, Asia Pacific region sales climbed 13% to $1.36 billion and Latin American sales grew 8% to $349 million.

"This was a solid performance," said Andy Hargreaves, a Pacific Crest Securities analyst. "The market is very competitive" and the company has "good cost control," he added.

Profit was expected to be $54 million, or 32 cents a share, on sales of $7.42 billion, the average estimate of analysts surveyed by Thomson Financial.

The company is forecasting fourth-quarter profit of $85 million to $92 million, or 50 cents to 54 cents a share, on sales of $8.4 billion to $8.65 billion. Analysts estimate profit of 52 cents a share on sales of $8.39 billion in the fourth quarter, according to Thomson.

In June, Ingram Micro bought SymTech Nordic to enter Europe's radio-frequency identification tag and point-of-sale data-capture market.

Ingram Micro reported earnings after the close of markets. Earlier, the shares closed down 27 cents at $19.82.

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