SYNNEX Corporation(NYSE: SNX) reported its 1st quarter 2017 result wherein its President and Chief Executive Officer Mr. Kevin Murai said that the solid execution in its technology solutions focused growth areas and strong overall performance in its Concentrix business led to record Q1 results. The diversification business strategy positioned the company to pursue new opportunities and to proactively respond to the dynamic markets it competes in.
For the quarter, the company reported 12.6% YoY increase in revenues to $3.521 billion while net income was at $61.8 million, up by 32.7%. The non-GAAP net income attributable to Synnex Corporation was at $73.1 million as compared with $54.6 million in the corresponding quarter. Diluted EPS was at $1.54 and that of non-GAAP was at $1.82.
Segmentwise, technology solutions revenue was $3 billion, up 9.4% from prior fiscal year quarter. Adjusted for currency effect, the growth was at 8.6%. The segment generated operating income of $80.4 million Vs $67.7 million in corresponding quarter. Concentrix segment had revenues of $478.2 million, up by 38.7% from $344.7 million in corresponding quarter. Operating income was at $21.3 million Vs $7.9 million in prior fiscal year quarter.
Company’s debt capitalization ratio was 33.1% and had depreciation and amortization expenses at $19.5 million and $16.5 million respectively. Company declared cash dividend of $0.25 per share.
In March 2017, the company has bagged 2016 Google Cloud Partner Award for Devices Ecosystem Customer Success. The company has also been honored as the Distributor of the year at the 2017 Aruba Americas Partner Summit held in February-March 2017.
Going forward, the company has guided that the revenues for Q2FY17 would be in the range of $3.57 – $3.77 billion. The net income for the period would be in the range of $57.7 – $60.9 million and on a Non-GAPP basis, net income is expected to be in the range of $68.3 -$71.5 million. Diluted EPS is expected to be in the range of $1.44-$1.52 and on non-GAAP basis, in the range of $1.7- $1.78. The company said after-tax amortization of intangibles is expected to be $10.6 million or $0.26 per share. The company expects revenue growth over Q1FY17 while expects lower profit over the previous quarter.
The stock has a consensus HOLD rating with target price of $120.