SYNNEX Corporation Reports Fiscal 2012 Fourth Quarter and Year-End Results

  SYNNEX Corporation Reports Fiscal 2012 Fourth Quarter and Year-End Results

Strong Earnings, Exceptional Distribution Execution and 21% GBS Organic Growth

Business Wire

FREMONT, Calif. -- January 10, 2013

SYNNEX Corporation (NYSE: SNX), a leading business process services company,
today announced financial results for the fiscal fourth quarter and year ended
November 30, 2012.

                                    Q4 FY12    Q4 FY11    Net Change
Revenue ($M)                         $2,765     $2,841     -2.7%
Operating income ($M)                $74.7      $84.7      -11.9%
Operating margin                     2.70%      2.98%      -28bp
Net income attributable to SYNNEX    $43.6      $50.2      -13.0%
Corporation ($M)
Diluted EPS                          $1.16      $1.37      -15.3%

“I am pleased to report solid quarterly earnings even as compared to the prior
year’s exceptional profits from the hard disk drive shortage. Strong
operational execution within the core Distribution Segment aligned well with
rapid expansion into adjacent, higher margin service and solution businesses,"
stated Kevin Murai, President and Chief Executive Officer, “Also our GBS
Segment’s organic revenue growth continues to accelerate driven by continued
investment and increasing momentum in our rapidly growing Concentrix
business.”

Fiscal 2012 Fourth Quarter Highlights:

  *Distribution: Revenue was $2.72 billion, down 3% from the prior fiscal
    year quarter, due in part to a previously reported customer business
    transition starting within Q4 2011 from gross revenue to net fee for
    services, resulting in lower reported revenue in Q4 2012. Distribution
    income before non-operating items, income taxes and noncontrolling
    interest was $70.4 million, or 2.59% of distribution revenue compared with
    $81.1 million, or 2.89% in the prior fiscal year quarter. As previously
    reported, the fiscal 2011 fourth quarter included a very significant gross
    margin benefit resulting from shortages of hard disk drives.
  *Global Business Services (GBS): Revenue grew to $54.9 million, an increase
    of 22.2% over the prior fiscal year quarter. GBS income before
    non-operating items, income taxes and noncontrolling interest was $4.3
    million, or 7.89% of GBS revenue compared with $3.6 million, or 8.11% in
    the prior fiscal year quarter.
  *The trailing four quarters ROIC was 10.5% for the fiscal fourth quarter of
    2012, compared to 11.1% in the prior year fiscal fourth quarter.
  *The cash conversion cycle was 40 days compared to 39 days in the prior
    fiscal year quarter.
  *The debt to capitalization ratio was 17%.
  *Depreciation and amortization were $3.9 and $2.1 million, respectively.

Fiscal Year 2012 Highlights:

                                  FY12^(1)    FY11^(2)    Net Change
Revenue ($M)                       $10,286     $10,410     -1.2%
Operating income ($M)              $255.0      $256.2      -0.5%
Operating margin                   2.48%       2.46%       2 bp
Net income attributable to         $151.4      $150.3      0.7%
SYNNEX Corporation ($M)
Diluted EPS                        $3.99       $4.08       -2.2%
(1) FY 2012 includes a $0.7 million credit adjustment to SG&A for contingent
M&A consideration.

(2) FY 2011 includes a $5.4 million credit adjustment to SG&A for contingent
M&A consideration.

  *Distribution: Revenue from continuing operations was $10.12 billion, a
    decrease of 1.5% over the prior fiscal year. Distribution income from
    continuing operations before non-operating items, income taxes and
    noncontrolling interest was $241.8 million, or 2.39% of distribution
    revenue compared with $237.3 million, or 2.31% in the prior fiscal year.
    Fiscal year 2012 results include certain customer business which
    transitioned year-over-year from a gross revenue business to a net fee for
    service logistics relationship starting within the fiscal fourth quarter
    of 2011.
  *Global Business Services (GBS): Revenue from continuing operations was
    $197.4 million, an increase of 20.8% over the prior fiscal year. GBS
    income from continuing operations before non-operating items, income taxes
    and noncontrolling interest was $13.5 million, or 6.83% of GBS revenue
    compared with $18.9 million, or 11.57% in the prior fiscal year. FY 2012
    includes a $0.7 million credit adjustment to SG&A for contingent M&A
    consideration compared to a $5.4 million credit adjustment in FY 2011.
  *SYNNEX consolidated depreciation and amortization were $16.3 million and
    $8.3 million, respectively.

Fiscal 2013 First Quarter Outlook:

The following statements are based on the Company’s current expectations for
the fiscal 2013 first quarter. These statements are forward-looking and actual
results may differ materially.

  *Revenue is expected to be in the range of $2.38 billion to $2.48 billion.
  *Net income is expected to be in the range of $32.2 million to $33.4
    million.
  *Diluted earnings per share are expected to be in the range of $0.85 to
    $0.89.

Conference Call and Webcast

SYNNEX will be discussing its financial results and outlook on a conference
call today at 2:00 p.m. (PT). A webcast of the call will be available at
http://ir.synnex.com. The conference call will also be available via telephone
by dialing (888) 469-3219 in North America or (630) 395-0205 outside North
America. The passcode code for the call is “SNX.” A replay of the webcast will
be available at http://ir.synnex.com approximately two hours after the
conference call has concluded.

About SYNNEX

SYNNEX Corporation (NYSE: SNX), a Fortune 500 corporation, is a leading
business process services company, servicing resellers, retailers and original
equipment manufacturers in multiple regions around the world. The Company
provides services in IT distribution, supply chain management, contract
assembly and business process outsourcing. Founded in 1980, SYNNEX employs
approximately 11,000 full-time and part-time associates worldwide. Additional
information about SYNNEX may be found online at www.synnex.com.

Safe Harbor Statement

Statements in this press release regarding SYNNEX Corporation, which are not
historical facts, are "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These forward-looking statements may be identified by
terms such as believe, expect, may, will, provide, could and should and the
negative of these terms or other similar expressions. These statements,
including statements regarding the demand environment, growth in
profitability, expansion into higher margin service and solution businesses,
extent of investment in our GBS segment, transition of customers from gross
revenue to net fee for service, and our revenue, operating margins, net income
and earnings per share, are subject to risks and uncertainties that could
cause actual results to differ materially from those discussed in the
forward-looking statements. These risks and uncertainties include, but are not
limited to: our ability to successfully integrate our recent acquisitions;
diversion of management as a result of our recent acquisitions; loss of
vendors and suppliers as a result of our recent acquisitions; market
acceptance and product life of the platforms sold by companies recently
acquired; general economic conditions and any weakness in IT and consumer
electronics spending; the loss or consolidation of one or more of our
significant OEM suppliers or customers; market acceptance and product life of
the products we assemble and distribute; competitive conditions in our
industry and their impact on our margins; pricing, margin and other terms with
our OEM suppliers; our ability to gain market share; variations in
supplier-sponsored programs; changes in our costs and operating expenses;
changes in foreign currency exchange rates; changes in the tax laws; risks
associated with our international operations; uncertainties and variability in
demand by our reseller and contract assembly customers; supply shortages or
delays; any termination or reduction in our floor plan financing arrangements;
credit exposure to our reseller customers, and negative trends in their
businesses; any future incidents of theft; risks associated with our business
process outsourcing and contract assembly business; risks associated with our
anti-dilution share repurchase program; and other risks and uncertainties
detailed in our Form 10-Q for the fiscal quarter ended August 31, 2012 and
from time to time in our SEC filings. Statements included in this press
release are based upon information known to SYNNEX Corporation as of the date
of this release, and SYNNEX Corporation assumes no obligation to update
information contained in this press release.

Copyright 2013 SYNNEX Corporation. All rights reserved. SYNNEX, the SYNNEX
Logo, CONCENTRIX and all other SYNNEX company, product and services names and
slogans are trademarks or registered trademarks of SYNNEX Corporation. SYNNEX,
the SYNNEX Logo and CONCENTRIX Reg. U.S. Pat. & Tm. Off. Other names and marks
are the property of their respective owners.

SNX-F


SYNNEX Corporation
Consolidated Balance Sheets
(currency in thousands)
(unaudited)
                                                            
                                                 November 30,    November 30,
                                                  2012          2011      
ASSETS
Current assets:
     Cash and cash equivalents                   $ 163,699       $ 67,571
     Short-term investments                        15,933          16,017
     Accounts receivable, net                      1,401,087       1,293,027
     Receivable from affiliates                    285             1,344
     Inventories                                   923,340         975,047
     Current deferred tax assets                   23,390          28,241
     Other current assets                         52,727        57,168    
                     Total current assets          2,580,461       2,438,415
                                                                 
Property and equipment, net                        122,923         125,157
Goodwill                                           189,088         185,312
Intangible assets, net                             29,049          37,539
Deferred tax assets                                619             590
Other assets                                      41,122        46,282    
                     Total assets                $ 2,963,262    $ 2,833,295 
                                                                 
LIABILITIES AND EQUITY
Current liabilities:
     Borrowings under securitization, term       $ 52,698        $ 159,200
     loans and lines of credit
     Convertible debt                              141,436         -
     Accounts payable                              1,111,833       1,035,691
     Accrued liabilities                           181,270         172,226
     Income taxes payable                         7,470         5,136     
                     Total current                 1,494,707       1,372,253
                     liabilities
                                                                 
Long-term borrowings                               81,152          87,659
Convertible debt                                   -               136,163
Long-term                                          58,783          60,676
liabilities
Deferred tax liabilities                          9,265         8,086     
                     Total liabilities            1,643,907     1,664,837 
                                                                 
SYNNEX Corporation stockholders' equity:
     Preferred stock                               -               -
     Common stock                                  37              37
     Additional paid-in capital                    324,292         310,316
     Treasury stock                                (21,611   )     (11,524   )
     Accumulated other comprehensive income        35,405          30,026
     Retained earnings                            980,900       829,524   
                     Total SYNNEX
                     Corporation                   1,319,023       1,158,379
                     stockholders' equity
Noncontrolling interest                           332           10,079    
                     Total equity                 1,319,355     1,168,458 
                     Total liabilities and       $ 2,963,262    $ 2,833,295 
                     equity

SYNNEX Corporation
Consolidated Statements of Operations
(currency and share amounts in thousands, except for per share amounts)
(unaudited)
                                                                   
                                                                          
                     Three Months Ended                  Fiscal Year Ended
                     November 30,       November 30,     November 30,     November 30,
                     2012               2011             2012             2011
                                                                          
Revenue              $ 2,765,066        $ 2,840,971      $ 10,285,507     $ 10,409,840
                                                                          
Cost of revenue       (2,585,966 )      (2,653,130 )    (9,628,770 )    (9,779,342 )
                                                                          
Gross profit           179,100            187,841          656,737          630,498
                                                                          
Selling, general
and                   (104,448   )      (103,144   )    (401,725   )    (374,270   )
administrative
expenses
                                                                          
Income before
non-operating
items, income          74,652             84,697           255,012          256,228
taxes and
noncontrolling
interest
                                                                          
Interest expense
and finance            (5,567     )       (6,595     )     (22,930    )     (25,505    )
charges, net
Other income          1,864            (936       )    4,471          (1,005     )
(expense), net
                                                                          
Income before
income taxes and       70,949             77,166           236,553         229,718
noncontrolling
interest
                                                                          
Provision for         (27,256    )      (26,964    )    (84,050    )    (79,165    )
income taxes
                                                                          
Net income             43,693             50,202           152,503          150,553
                                                                          
Net income
attributable to       (53        )      (29        )    (1,127     )    (222       )
noncontrolling
interest
                                                                          
Net income
attributable to      $ 43,640          $ 50,173        $ 151,376       $ 150,331    
SYNNEX
Corporation
                                                                          
Net income per
share
attributable to
SYNNEX
Corporation:
                                                                          
Basic                $ 1.19            $ 1.39          $ 4.14          $ 4.20       
                                                                          
Diluted              $ 1.16            $ 1.37          $ 3.99          $ 4.08       
                                                                          
Weighted-average
common shares
outstanding:
                                                                          
Basic                 36,726           36,142         36,584         35,830     
                                                                          
Diluted               37,733           36,675         37,908         36,833     

Contact:

SYNNEX Corporation
Deirdre Skolfield, CFA, 510-668-3715
Investor Relations
deirdres@synnex.com
 
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