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INACOM REPORTS 58 PERCENT INCREASE IN SECOND QUARTER PROFIT

 OMAHA, Neb., July 19 /PRNewswire/ -- Inacom Corp. (NASDAQ: INAC) today reported a 58 percent increase in profits for its 1993 second quarter over the prior-year quarter, with net earnings of $3.8 million on revenues of $379.3 million. This compares to earnings of $2.4 million on revenues of $253.2 million for the second quarter of 1992, according to Bill L. Fairfield, Inacom's president and chief executive officer.
 Earnings-per-share were 40 cents for the quarter on 9.5 million weighted average shares, up from 28 cents in the prior-year quarter on 8.5 million weighted average shares. Earnings-per-share reflect the sale of 1.4 million shares in May of 1993.
 According to Fairfield, Inacom's revenue growth was fueled by customer demand for IBM, Compaq and Hewlett-Packard products, as well as a full-quarter contribution from Sears Business Centers, acquired by Inacom in February. Despite record shipments from major vendors, back orders climbed from $30 million at the end of the first quarter of 1993 to $60 million at the end of June. The company anticipates that back orders may remain at relatively high levels through the remainder of the year.
 "Inacom is benefiting from its historical focus on selling and supporting major vendors' products," said Fairfield. "As the demand for these products grows, Inacom's efforts to complete the integration of Sears Business Centers and streamline operations will put us in an excellent position to leverage revenue gains to the bottom line."
 Gross margins for the quarter were 11.7 percent, compared with 11.6 percent in the 1992 second quarter. This year-to-year increase reflects the company's efforts to expand its service business and profitably manage margins on hardware sales.
 Selling, general and administrative costs as a percent of gross margin were 81.2 percent for the quarter, compared with 79.6 percent for the 1992 second quarter. This expected rise reflects the cost of using redundant accounting, credit and inventory systems during the integration of Sears Business Centers (SBC). Fairfield said this redundancy caused inventory and accounts receivable to be higher than required for the quarter. The conversion of SBC locations to the Inacom MIS system, completed in June, will address this issue.
 "Our continued revenue and earnings growth during the second quarter was particularly noteworthy given the integration of Sears Business Centers and the progress made to further improve our operational efficiency," said Fairfield.
 According to Fairfield, during the quarter Inacom:
 -- brought a new distribution and configuration center on line in Swedesboro, N.J., giving Inacom two major distribution centers and three configuration centers across the country
 -- completed a 30,000-square-foot expansion of the main distribution center in Omaha
 -- converted SBC locations to the Inacom MIS system
 -- opened a National Service Dispatch Center
 According to Inacom Chairman Rick Inatome, the evolution of corporate computing in America dovetails well with Inacom's strengths. "Corporate customers increasingly are choosing major vendors' products and integrating those systems into connected environments," he said. "They want to work with a national systems integrator with proven expertise in supporting products from IBM, Compaq, Apple, Hewlett- Packard and other key vendors."
 Inacom, headquartered in Omaha, Neb., with executive offices in Omaha and Troy, Mich., markets and distributes information technology products and services through a nationwide network of over 1,300 computer centers, systems integrators, value added resellers and other specialized providers of computer systems and support.
 For more information on Inacom, contact Geri Michelic, Inacom Corp., 10810 Farnam, Omaha, Neb. 68154.
 INACOM CORP. AND SUBSIDIARIES
 Condensed and Consolidated Statements of Earnings
 (Unaudited, Amounts in Thousands, Except Per Share Data)
 Periods Ended Thirteen Weeks Twenty-Six Weeks
 6/26/93 6/27/92 6/26/93 6/27/92
 Revenues:
 Independently owned
 business centers $163,139 $144,636 $330,166 $278,327
 Company-owned business
 centers 201,523 103,054 356,415 209,154
 Other 14,646 5,544 24,023 10,200
 379,308 253,234 710,604 497,681
 Direct costs:
 Independently owned
 business centers 151,319 133,027 308,420 256,123
 Company-owned business
 centers 171,968 86,996 303,904 177,302
 Other 11,497 3,923 18,367 6,991
 334,784 223,946 630,691 440,416
 Gross margin 44,524 29,288 79,913 57,265
 Selling, general and
 administrative expenses 36,146 23,316 65,164 45,760
 Operating income 8,378 5,972 14,749 11,505
 Interest expense 2,121 2,028 3,753 4,604
 Earnings before income taxes 6,257 3,944 10,996 6,901
 Income tax expense 2,502 1,574 4,447 2,794
 Earnings before cumulative
 effect of change in
 accounting for income taxes 3,755 2,370 6,549 4,107
 Cumulative effect of change in
 accounting for income taxes -- -- 229 --
 Net earnings $3,755 $2,370 $6,778 $4,107
 Earnings per share $.40 $.28 $.75 $.48
 Weighted average shares
 outstanding 9,500 8,500 9,000 8,500
 INACOM CORP. AND SUBSIDIARIES
 Condensed and Consolidated Balance Sheets
 (Unaudited, Amounts in Thousands, Except Share Data)
 Periods Ended June 26, December 26,
 Assets 1993 1992
 Current assets:
 Cash and cash equivalents $2,923 $11,835
 Accounts receivable, net 183,403 98,575
 Current and deferred income taxes 3,260 670
 Inventories 195,140 111,806
 Other current assets 13,971 4,713
 Total current assets 398,697 227,599
 Other assets, net 26,149 21,836
 Cost in excess of net assets of business
 acquired, net of accumulated amortization 27,887 20,756
 Property and equipment, net 23,525 18,174
 $476,258 $288,365
 Liabilities and Stockholders' Equity
 Current liabilities:
 Accounts payable $166,246 $88,016
 Notes payable and current portion of
 long-term debt 111,960 46,016
 Other current liabilities 27,241 13,481
 Total current liabilities 305,447 147,513
 Long-term debt 35,500 36,800
 Other long-term liabilities 3,111 2,777
 Deferred income taxes 1,501 --
 Stockholders' equity:
 Capital stock:
 Class A preferred stock of $1 par value.
 Authorized 1,000,000 shares; none issued -- --
 Common stock of $.10 par value. Authorized
 30,000,000 shares; issued 10,040,000 shares
 in 1993 and 8,640,000 shares in 1992 1,004 864
 Additional paid-in capital 88,584 67,086
 Retained earnings 44,226 37,448
 133,814 105,398
 Less:
 Cost of common shares in treasury of
 276,972 in 1993 and 364,469 in 1992 2,432 3,202
 Unearned restricted stock 683 921
 Total stockholders' equity 130,699 101,275
 $476,258 $288,365
 -0- 7/19/93
 /CONTACT: Dave Guenthner, executive vice president and CFO of Inacom Corp., 402-392-3940/
 (INAC)


CO: Inacom Corp. ST: Nebraska IN: CPR SU: ERN

LD -- NY003 -- 2875 07/19/93 08:31 EDT
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