Business Wire

ScanSource Reports Fourth Quarter and Fiscal Year 2022 Results

Strong Demand and Outstanding Execution by our Team

GREENVILLE, S.C.–(BUSINESS WIRE)–ScanSource, Inc. (NASDAQ: SCSC), a leading hybrid distributor connecting devices to the cloud, today announced financial results for the fourth quarter and fiscal year ended June 30, 2022. All results in this release reflect continuing operations only unless otherwise noted.

 

Fourth Quarter Summary

 

Fiscal Year Summary

 

Q4 FY22

 

Q4 FY21

 

Change

 

FY22

 

FY21

 

Change

 

(in thousands, except per share data)

Select reported measures:

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

962,283

 

 

$

852,694

 

 

12.9

%

 

$

3,529,935

 

 

$

3,150,806

 

 

12.0

%

Gross profit

$

110,792

 

 

$

95,778

 

 

15.7

%

 

$

426,524

 

 

$

350,716

 

 

21.6

%

Gross profit margin %

 

11.51

%

 

 

11.23

%

 

28bp

 

 

12.08

%

 

 

11.13

%

 

95bp

Operating income

$

27,424

 

 

$

23,283

 

 

17.8

%

 

$

122,167

 

 

$

61,483

 

 

98.7

%

GAAP net income

$

19,947

 

 

$

20,657

 

 

-3.4

%

 

$

88,698

 

 

$

45,389

 

 

95.4

%

GAAP diluted EPS

$

0.78

 

 

$

0.80

 

 

-2.5

%

 

$

3.44

 

 

$

1.78

 

 

93.3

%

Select Non-GAAP measures:

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

38,672

 

 

$

35,299

 

 

9.6

%

 

$

166,723

 

 

$

117,949

 

 

41.4

%

Adjusted EBITDA margin %

 

4.02

%

 

 

4.14

%

 

-12bp

 

 

4.72

%

 

 

3.74

%

 

98bp

Non-GAAP net income

$

23,266

 

 

$

24,522

 

 

-5.1

%

 

$

102,140

 

 

$

69,868

 

 

46.2

%

Non-GAAP diluted EPS

$

0.91

 

 

$

0.96

 

 

-5.2

%

 

$

3.97

 

 

$

2.74

 

 

44.9

%

“Our exceptional fiscal year 2022 results demonstrate the success of the new ScanSource and faster growth of our recurring revenue,” said Mike Baur, Chairman and CEO, ScanSource, Inc. “Our hybrid distribution strategy of devices and digital is winning, as evidenced by our 12% net sales growth. We exceeded our full-year 2022 outlook for net sales growth and achieved record adjusted EBITDA.”

Quarterly Results

Net sales for the fourth quarter of fiscal year 2022 totaled $962.3 million, up 12.9% year-over-year, or 12.2% year-over-year for organic growth, with strong demand in both segments. Fourth quarter fiscal year 2022 net sales in the Specialty Technology Solutions segment increased 12.6% year-over-year, or 12.4% year-over-year for organic growth, to $580.6 million, driven by broad-based demand across technologies and execution by our people. Fourth quarter fiscal year 2022 net sales in Modern Communications & Cloud increased 13.2% year-over-year, or 11.9% year-over-year for organic growth, to $381.7 million, primarily due to increased demand across our communications solutions.

Gross profit for the fourth quarter of fiscal year 2022 totaled $110.8 million, up 15.7% year-over-year. The increase is primarily due to higher sales volume and higher vendor program recognition compared to the prior-year quarter. Gross profit margin increased to 11.51% for the fourth quarter of fiscal year 2022, up from 11.23% in the prior-year quarter.

For the fourth quarter of fiscal year 2022, operating income increased to $27.4 million from $23.3 million in the prior-year quarter. Fourth quarter fiscal year 2022 non-GAAP operating income increased to $31.9 million for a 3.31% non-GAAP operating income margin, compared to $28.4 million and a 3.33% non-GAAP operating margin for the prior-year quarter.

On a GAAP basis, net income for the fourth quarter of fiscal year 2022 totaled $19.9 million, or $0.78 per diluted share, compared to net income of $20.7 million, or $0.80 per diluted share, for the prior-year quarter. Fourth quarter fiscal year 2022 non-GAAP net income totaled $23.3 million, or $0.91 per diluted share. These results compare to fourth quarter fiscal year 2021 non-GAAP net income of $24.5 million, or $0.96 per diluted share, which includes a $0.19 benefit from discrete tax items.

Adjusted EBITDA for the fourth quarter of fiscal year 2022 increased 9.6% to $38.7 million, or 4.02% of net sales, compared to $35.3 million, or 4.14%, of net sales in the prior-year quarter. Adjusted return on invested capital totaled 14.9% for fourth quarter fiscal year 2022, compared to 16.0% in the prior-year quarter, primarily from increased average invested capital for the current year quarter.

Full-Year Results

For fiscal year 2022, net sales increased 12.0% to $3.5 billion, or a 11.8% year-over-year increase on an organic basis. Fiscal year 2022 net sales in the Specialty Technology Solutions segment increased 14.7% year-over-year, or 14.6% year-over-year for organic growth, to $2.1 billion, driven by broad-based demand across technologies and execution by our people. Fiscal year 2022 net sales in the Modern Communications & Cloud segment increased 8.4% year-over-year, or 7.9% year-over-year for organic growth, to $1.4 billion, primarily due to increased demand across our communications solutions.

Gross profit for the fiscal year 2022 totaled $426.5 million, up 21.6% year-over-year. The increase is primarily due to higher sales volume and higher vendor program recognition compared to the prior year. Gross profit margin increased to 12.1%, up from 11.1% in the prior-year.

For the fiscal year ended June 30, 2022, operating income increased to $122.2 million from $61.5 million in the prior-year. Fiscal year 2022 non-GAAP operating income increased to $140.1 million for a 4.0% non-GAAP operating margin, up from $93.1 million and a 3.0% non-GAAP operating margin for the prior-year.

On a GAAP basis, net income for the fiscal year ended June 30, 2022 totaled $88.7 million, or $3.44 per diluted share, compared to net income of $45.4 million, or $1.78 per diluted share for the prior-year. Fiscal year 2022 non-GAAP net income totaled $102.1 million, or $3.97 per diluted share, compared to $69.9 million, or $2.74 per diluted share for the prior-year.

Adjusted EBITDA for the fiscal year ended June 30, 2022 increased to $166.7 million, or 4.7% of net sales, compared to $117.9 million, or 3.7% of net sales for the prior-year, primarily due to higher gross profits. Adjusted return on invested capital increased to 17.0% for the fiscal year, compared to 12.6% the prior year, driven by higher profitability.

Annual Financial Outlook for Fiscal Year 2023

The following guidance is based on ScanSource’s current expectations for the full fiscal year ended June 30, 2023.

 

 

FY23 Annual Outlook

Net sales growth, year-over-year

 

At least 5.5%

Adjusted EBITDA (non-GAAP)

 

At least $174 million

Adjusted EBITDA is a non-GAAP measure, which excludes estimates for amortization of intangible assets, depreciation expense, and non-cash share-based compensation expense. ScanSource’s outlook does not include the potential impact of any business combinations, asset acquisitions, divestitures, strategic investments, or other significant transactions that may be completed after the date hereof. These statements are forward-looking, and actual results may differ materially.

Webcast Details and Earnings Infographic

At approximately 4:15 p.m. ET today, an Earnings Infographic, as a supplement to this press release and the Company’s conference call, will be available on ScanSource’s website, www.scansource.com (Investor Relations section). ScanSource will present additional information about its financial results and business in a conference call today, August 23, 2022, at 5:00 p.m. ET. A webcast of the call will be available for all interested parties and can be accessed at www.scansource.com (Investor Relations section). The webcast will be available for replay for 60 days.

Safe Harbor Statement

This press release contains “forward-looking” statements, including the Company’s FY23 outlook, which involve risks and uncertainties. Any number of factors could cause actual results to differ materially from anticipated results, including, but not limited to, failure to hire and retain quality employees, risk to the Company’s business from a cyber-security attack, supply chain challenges, the failure to manage and implement the Company’s organic growth strategy, economic weakness and inflation, a failure of the Company’s IT systems, a failure to acquire new businesses, changes in interest and exchange rates and regulatory regimes impacting the Company’s international operations, credit risks involving the Company’s larger customers and suppliers, loss of the Company’s major customers, termination of the Company’s relationship with key suppliers or a significant modification of the terms under which it operates with a key supplier, changes in the Company’s operating strategy, and other factors set forth in the “Risk Factors” contained in the Company’s annual report on Form 10-K for the year ended June 30, 2022, filed with the Securities and Exchange Commission. Except as may be required by law, the Company expressly disclaims any obligation to update these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.

Non-GAAP Financial Information

In addition to disclosing results that are determined in accordance with United States Generally Accepted Accounting Principles (“GAAP”), the Company also discloses certain non-GAAP financial measures, which are summarized below. Non-GAAP financial measures are used to understand and evaluate performance, including comparisons from period to period. Non-GAAP results exclude amortization of intangible assets related to acquisitions, change in fair value of contingent consideration, acquisition costs, restructuring costs and other non-GAAP adjustments.

Net sales on a constant currency basis, excluding acquisitions (organic growth): The Company discloses the percentage change in net sales excluding the translation impact from changes in foreign currency exchange rates between reporting periods and excluding the net sales from acquisitions prior to the first full year from the acquisition date. This measure enhances the comparability between periods to help analyze underlying trends on an organic basis.

Additional Non-GAAP Metrics: To evaluate current period performance on a more consistent basis with prior periods, the Company discloses non-GAAP SG&A expenses, non-GAAP operating income, non-GAAP net income and non-GAAP diluted earnings per share (non-GAAP diluted “EPS”). Non-GAAP results exclude amortization of intangible assets related to acquisitions, changes in fair value of contingent consideration, acquisition and divestiture costs, impairment charges, restructuring costs, and other non-GAAP adjustments. These year-over-year metrics include the translation impact of changes in foreign currency exchange rates. Non-GAAP metrics are useful in assessing and understanding the Company’s operating performance, especially when comparing results with previous periods or forecasting performance for future periods.

Adjusted earnings before interest expense, income taxes, depreciation, and amortization (“Adjusted EBITDA”): Adjusted EBITDA starts with net income and adds back interest expense, income tax expense, depreciation expense, amortization of intangible assets, changes in fair value of contingent considerations, and other non-GAAP adjustments, including acquisition and divestiture costs, impairment charges, and restructuring costs. Effective with the first quarter of fiscal year 2022, non-cash share-based compensation expense is also added back in calculating Adjusted EBITDA. Since Adjusted EBITDA excludes some non-cash costs of investing in our business and people, management believes that Adjusted EBITDA shows the profitability from our business operations more clearly. The presentation for Adjusted EBITDA for all periods presented has been recast to reflect this change to enhance comparability between periods.

Adjusted return on invested capital (“Adjusted ROIC”): Adjusted ROIC assists management in comparing the Company’s performance over various reporting periods on a consistent basis because it removes from our operating results the impact of items that do not reflect our core operating performance. We believe the calculation of Adjusted ROIC provides useful information to investors and is an additional relevant comparison of our performance. Adjusted ROIC is calculated as Adjusted EBITDA over invested capital. Invested capital is defined as average equity plus average daily funded interest-bearing debt for the period. Management believes the calculation of Adjusted ROIC provides useful information to investors and is an additional relevant comparison of the Company’s performance during the year.

These non-GAAP financial measures have limitations as analytical tools, and the non-GAAP financial measures that the Company reports may not be comparable to similarly titled amounts reported by other companies. Analysis of results and outlook on a non-GAAP basis should be considered in addition to, and not in substitution for or as superior to, measurements of financial performance prepared in accordance with GAAP. A reconciliation of the Company’s non-GAAP financial information to GAAP is set forth in the Supplementary Information (Unaudited) below.

About ScanSource, Inc.

ScanSource, Inc. (NASDAQ: SCSC) is a leading hybrid distributor connecting devices to the cloud and accelerating growth for partners across hardware, SaaS, connectivity and cloud. ScanSource enables partners to deliver solutions for their customers to address changing end-user buying and consumption patterns. ScanSource sells through multiple, specialized routes-to-market with hardware, SaaS, connectivity and cloud services offerings from the world’s leading suppliers of point-of-sale (POS), payments, barcode, physical security, unified communications and collaboration, telecom and cloud services. Founded in 1992 and headquartered in Greenville, South Carolina, ScanSource was named one of the 2022 Best Places to Work in South Carolina and on FORTUNE magazine’s 2022 List of World’s Most Admired Companies. ScanSource ranks #773 on the Fortune 1000. For more information, visit www.scansource.com.

ScanSource, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

(in thousands)

 

June 30, 2022

 

June 30, 2021*

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

37,987

 

 

$

62,718

 

Accounts receivable, less allowance of $16,806 at June 30, 2022

and $19,341 at June 30, 2021

 

729,442

 

 

 

568,984

 

Inventories

 

614,814

 

 

 

470,081

 

Prepaid expenses and other current assets

 

141,562

 

 

 

117,860

 

Total current assets

 

1,523,805

 

 

 

1,219,643

 

Property and equipment, net

 

37,477

 

 

 

42,836

 

Goodwill

 

214,435

 

 

 

218,877

 

Identifiable intangible assets, net

 

84,427

 

 

 

104,860

 

Deferred income taxes

 

15,668

 

 

 

21,853

 

Other non-current assets

 

61,616

 

 

 

63,615

 

Total assets

$

1,937,428

 

 

$

1,671,684

 

Liabilities and Shareholders’ Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

714,177

 

 

$

634,805

 

Accrued expenses and other current liabilities

 

88,455

 

 

 

87,790

 

Income taxes payable

 

34

 

 

 

2,501

 

Current portion of long-term debt

 

11,598

 

 

 

7,843

 

Total current liabilities

 

814,264

 

 

 

732,939

 

Deferred income taxes

 

3,144

 

 

 

3,954

 

Long-term debt, net of current portion

 

123,733

 

 

 

135,331

 

Borrowings under revolving credit facility

 

135,839

 

 

 

 

Other long-term liabilities

 

53,920

 

 

 

68,269

 

Total liabilities

 

1,130,900

 

 

 

940,493

 

Commitments and contingencies

 

 

 

Shareholders’ equity:

 

 

 

Preferred stock, no par value; 3,000,000 shares authorized, none issued

 

 

 

 

 

Common stock, no par value; 45,000,000 shares authorized, 25,187,351 and 25,499,465 shares issued and outstanding at June 30, 2022 and June 30, 2021, respectively

 

64,297

 

 

 

71,253

 

Retained earnings

 

846,869

 

 

 

758,071

 

Accumulated other comprehensive loss

 

(104,638

)

 

 

(98,133

)

Total shareholders’ equity

 

806,528

 

 

 

731,191

 

Total liabilities and shareholders’ equity

$

1,937,428

 

 

$

1,671,684

 

*Derived from audited financial statements.

ScanSource, Inc. and Subsidiaries

Condensed Consolidated Income Statements (Unaudited)

(in thousands, except per share data)

 

 

 

 

 

 

 

 

 

Quarter ended

June 30,

 

Fiscal year ended

June 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Net sales

$

962,283

 

 

$

852,694

 

 

$

3,529,935

 

 

$

3,150,806

 

Cost of goods sold

 

851,491

 

 

 

756,916

 

 

 

3,103,411

 

 

 

2,800,090

 

Gross profit

 

110,792

 

 

 

95,778

 

 

 

426,524

 

 

 

350,716

 

Selling, general and administrative expenses

 

75,905

 

 

 

64,758

 

 

 

275,442

 

 

 

247,438

 

Depreciation expense

 

3,023

 

 

 

2,898

 

 

 

11,062

 

 

 

12,533

 

Intangible amortization expense

 

4,440

 

 

 

4,893

 

 

 

17,853

 

 

 

19,488

 

Restructuring and other charges

 

 

 

 

(54

)

 

 

 

 

 

9,258

 

Change in fair value of contingent consideration

 

 

 

 

 

 

 

 

 

 

516

 

Operating income

 

27,424

 

 

 

23,283

 

 

 

122,167

 

 

 

61,483

 

Interest expense

 

1,886

 

 

 

1,643

 

 

 

6,523

 

 

 

6,929

 

Interest income

 

(1,360

)

 

 

(1,341

)

 

 

(4,333

)

 

 

(3,097

)

Other (income) expense, net

 

684

 

 

 

(65

)

 

 

1,354

 

 

 

116

 

Income before income taxes

 

26,214

 

 

 

23,046

 

 

 

118,623

 

 

 

57,535

 

Provision for income taxes

 

6,267

 

 

 

2,389

 

 

 

29,925

 

 

 

12,146

 

Net income from continuing operations

 

19,947

 

 

 

20,657

 

 

 

88,698

 

 

 

45,389

 

Net income (loss) from discontinued operations

 

 

 

 

3,053

 

 

 

100

 

 

 

(34,594

)

Net income

$

19,947

 

 

$

23,710

 

 

$

88,798

 

 

$

10,795

 

 

 

 

 

 

 

 

 

Per share data:

 

 

 

 

 

 

 

Net income from continuing operations per common share, basic

$

0.79

 

 

$

0.81

 

 

$

3.48

 

 

$

1.79

 

Net income (loss) from discontinued operations per common share, basic

 

 

 

 

0.12

 

 

 

 

 

 

(1.36

)

Net income per common share, basic

$

0.79

 

 

$

0.93

 

 

$

3.48

 

 

$

0.42

 

Weighted-average shares outstanding, basic

 

25,286

 

 

 

25,482

 

 

 

25,504

 

 

 

25,423

 

 

 

 

 

 

 

 

 

Net income from continuing operations per common share, diluted

$

0.78

 

 

$

0.80

 

 

$

3.44

 

 

$

1.78

 

Net income (loss) from discontinued operations per common share, diluted

 

 

 

 

0.12

 

 

 

 

 

 

(1.36

)

Net income per common share, diluted

$

0.78

 

 

$

0.92

 

 

$

3.45

 

 

$

0.42

 

Weighted-average shares outstanding, diluted

 

25,584

 

 

 

25,664

 

 

 

25,758

 

 

 

25,518

 

ScanSource, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)

 

Quarter ended

June 30,

 

Fiscal year ended

June 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net income

$

19,947

 

 

$

23,710

 

 

$

88,798

 

 

$

10,795

 

Net income (loss) from discontinued operations

 

 

 

 

3,053

 

 

 

100

 

 

 

(34,594

)

Net income from continuing operations

 

19,947

 

 

 

20,657

 

 

 

88,698

 

 

 

45,389

 

Adjustments to reconcile net income to net cash provided by operating activities of continuing operations:

 

 

 

 

 

 

 

Depreciation and amortization

 

7,701

 

 

 

8,090

 

 

 

29,884

 

 

 

33,507

 

Amortization of debt issue costs

 

104

 

 

 

104

 

 

 

417

 

 

 

417

 

Provision for doubtful accounts

 

1,357

 

 

 

112

 

 

 

1,514

 

 

 

338

 

Share-based compensation

 

2,872

 

 

 

2,328

 

 

 

11,663

 

 

 

8,039

 

Deferred income taxes

 

3,742

 

 

 

2,941

 

 

 

5,737

 

 

 

2,916

 

Change in fair value of contingent consideration

 

 

 

 

 

 

 

 

 

 

516

 

Contingent consideration payments excess

 

 

 

 

 

 

 

 

 

 

(5,457

)

Finance lease interest

 

1

 

 

 

23

 

 

 

34

 

 

 

119

 

Changes in operating assets and liabilities, net of acquisitions:

 

 

 

 

 

 

 

Accounts receivable

 

(98,535

)

 

 

(50,204

)

 

 

(165,939

)

 

 

(118,859

)

Inventories

 

(27,613

)

 

 

(6,394

)

 

 

(145,962

)

 

 

(12,301

)

Prepaid expenses and other assets

 

(12,369

)

 

 

(17,111

)

 

 

(27,371

)

 

 

(18,753

)

Other non-current assets

 

3,914

 

 

 

7,102

 

 

 

1,123

 

 

 

9,948

 

Accounts payable

 

15,434

 

 

 

105,511

 

 

 

82,969

 

 

 

175,120

 

Accrued expenses and other liabilities

 

7,876

 

 

 

(8,928

)

 

 

(4,869

)

 

 

(493

)

Income taxes payable

 

(3,115

)

 

 

(2,886

)

 

 

(2,252

)

 

 

(3,679

)

Net cash (used in) provided by operating activities of continuing operations

 

(78,684

)

 

 

61,345

 

 

 

(124,354

)

 

 

116,767

 

Cash flows from investing activities of continuing operations:

 

 

 

 

 

 

 

Capital expenditures

 

(3,523

)

 

 

(80

)

 

 

(6,849

)

 

 

(2,363

)

Cash received for business disposal

 

 

 

 

 

 

 

3,125

 

 

 

34,356

 

Net cash (used in) provided by investing activities of continuing operations

 

(3,523

)

 

 

(80

)

 

 

(3,724

)

 

 

31,993

 

Cash flows from financing activities of continuing operations:

 

 

 

 

 

 

 

Borrowings on revolving credit, net of expenses

 

572,139

 

 

 

395,215

 

 

 

2,166,409

 

 

 

1,881,679

 

Repayments on revolving credit, net of expenses

 

(480,593

)

 

 

(449,017

)

 

 

(2,030,569

)

 

 

(1,949,392

)

Repayments on long-term debt, net

 

(1,875

)

 

 

(1,875

)

 

 

(7,843

)

 

 

(7,839

)

Repayments of finance lease obligations

 

(306

)

 

 

(320

)

 

 

(1,238

)

 

 

(1,294

)

Contingent consideration payments

 

 

 

 

 

 

 

 

 

 

(41,393

)

Exercise of stock options

 

712

 

 

 

12

 

 

 

2,304

 

 

 

451

 

Taxes paid on settlement of equity awards

 

(26

)

 

 

 

 

 

(2,754

)

 

 

(1,036

)

Common stock repurchased

 

(9,676

)

 

 

 

 

 

(18,203

)

 

 

 

Net cash provided by (used in) financing activities of continuing operations

 

80,375

 

 

 

(55,985

)

 

 

108,106

 

 

 

(118,824

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ScanSource, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited), continued

(in thousands)

 

 

 

 

 

 

 

 

Cash flows from discontinued operations:

 

 

 

 

 

 

 

Net cash flows provided by operating activities of discontinued operations

 

 

 

 

2,469

 

 

 

 

 

 

24,173

 

Net cash flows used in investing activities of discontinued operations

 

 

 

 

 

 

 

 

 

 

(58

)

Net cash flows used in financing activities of discontinued operations

 

 

 

 

 

 

 

 

 

 

(29,494

)

Net cash flows used in discontinued operations

 

 

 

 

2,469

 

 

 

 

 

 

(5,379

)

Effect of exchange rate changes on cash and cash equivalents

 

(3,720

)

 

 

5,648

 

 

 

(4,759

)

 

 

3,706

 

(Decrease) Increase in cash and cash equivalents

 

(5,552

)

 

 

13,397

 

 

 

(24,731

)

 

 

28,263

 

Consolidated cash and cash equivalents at beginning of period

 

43,539

 

 

 

49,321

 

 

 

62,718

 

 

 

34,455

 

Consolidated cash and cash equivalents at end of period

 

37,987

 

 

 

62,718

 

 

 

37,987

 

 

 

62,718

 

Cash and cash equivalents of discontinued operations

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents of continuing operations

$

37,987

 

 

$

62,718

 

 

$

37,987

 

 

$

62,718

 

ScanSource, Inc. and Subsidiaries

Supplementary Information (Unaudited)

(in thousands, except percentages)

 

 

 

 

 

 

 

 

Non-GAAP Financial Information:

 

 

 

 

Quarter ended

June 30,

 

Fiscal year ended

June 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Adjusted return on invested capital ratio (Adjusted ROIC), annualized(a)

 

14.9

%

 

 

16.0

%

 

 

17.0

%

 

 

12.6

%

 

 

 

 

 

 

 

 

Reconciliation of Net Income to Adjusted EBITDA:

 

 

 

 

 

 

 

Net income from continuing operations (GAAP)

$

19,947

 

 

$

20,657

 

 

$

88,698

 

 

$

45,389

 

Plus: Interest expense

 

1,886

 

 

 

1,643

 

 

 

6,523

 

 

 

6,929

 

Plus: Income taxes

 

6,267

 

 

 

2,389

 

 

 

29,925

 

 

 

12,146

 

Plus: Depreciation and amortization

 

7,700

 

 

 

8,090

 

 

 

29,884

 

 

 

33,507

 

EBITDA (non-GAAP)

 

35,800

 

 

 

32,779

 

 

 

155,030

 

 

 

97,971

 

Plus: Share-based compensation

 

2,872

 

 

 

2,328

 

 

 

11,663

 

 

 

8,039

 

Plus: Acquisition and divestiture costs(b)

 

 

 

 

246

 

 

 

30

 

 

 

2,376

 

Plus: Restructuring costs

 

 

 

 

(54

)

 

 

 

 

 

9,047

 

Adjusted EBITDA (numerator for Adjusted ROIC) (non-GAAP)

$

38,672

 

 

$

35,299

 

 

$

166,723

 

 

$

117,949

 

 

 

 

 

 

 

 

 

Invested Capital Calculations:

 

 

 

 

 

 

 

Equity – beginning of the quarter

$

806,654

 

 

$

690,575

 

 

$

731,191

 

 

$

678,246

 

Equity – end of the quarter

 

806,528

 

 

 

731,191

 

 

 

806,528

 

 

 

731,191

 

Plus: Share-based compensation, net

 

2,134

 

 

 

1,912

 

 

 

 

 

Plus: Acquisition and divestiture costs(b)

 

 

 

 

207

 

 

 

30

 

 

 

2,337

 

Plus: Restructuring, net

 

 

 

 

(40

)

 

 

 

 

 

6,840

 

Plus: Discontinued operations net (income) loss

 

 

 

 

(3,053

)

 

 

(100

)

 

 

34,594

 

Average equity

 

807,658

 

 

 

710,396

 

 

 

773,179

 

 

 

729,825

 

Average funded debt (c)

 

233,445

 

 

 

177,074

 

 

 

209,114

 

 

 

202,869

 

Invested capital (denominator for Adjusted ROIC) (non-GAAP)

$

1,041,103

 

 

$

887,470

 

 

$

982,293

 

 

$

932,694

 

Contacts

Steve Jones

Senior EVP, Chief Financial Officer

ScanSource, Inc.

(864) 286-4302

Mary M. Gentry

SVP, Treasurer and Investor Relations

ScanSource, Inc.

(864) 286-4892

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