Fiscal 2009 Fourth-Quarter Investor Relations Presentation Quarter ended January 31, 2009
Forward-Looking/Non Looking/Non-GAAP Information Forward-Looking Statements - Some of the statements made during today s presentation or in the following Question & Answer period are Forward-Looking Statements as described in the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in these forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements can be found in the company s periodic filings with the Securities and Exchange Commission, copies of which can be obtained at the company s Investor Relations website at www.techdata.com. The company undertakes no duty to update any forward-looking statements herein to actual results or changes in the company s expectations. Non-GAAP Financial Information - The non-gaap data contained in this presentation is included with the intention of providing investors a more complete understanding of our operational results and trends, but should only be used in conjunction with results reported in accordance with Generally Accepted Accounting Principles ("GAAP"). Non-GAAP measures presented in this presentation or other presentations, press releases and similar documents issued by the company, exclude restructuring charges, certain consulting costs, impairment charges, changes in valuation allowances for certain deferred tax assets, extraordinary gains or losses and other infrequent or unusual items. This information is also available for review on the Investor Relations section of Tech Data s website at www.techdata.com. 2
Strength in Numbers Strength in Numbers * Net Sales Fortune Ranking >$24B 105 Years in the industry Customers served 35 100,000+ IT products sold 100,000+ Countries served 100+ * Fiscal year 2009 3
Well-Positioned In A Large, Dynamic Market Strong Market Position 78% of Worldwide IT Spending in the Americas & European Markets $1,000 Billion+ Industry Asia/ROW Americas Europe 78% Source: Gartner Dataquest Market Databook, December 2007/2008 update. 4
A Strategic Link in the IT Ecosystem $1,000+ B Industry VARs DMs & Retailers Corporate Resellers Enterprise SMB Consumer Technical Proficiency Efficient Logistics Capabilities Credit Capacity 5
SMB = Sweet Spot Fortune 1000 Large companies Over 2/3 of Tech Data s customer portfolio Medium sized businesses (100-999 employees) Small businesses (<100 employees) Americas Opportunity = Over 8.4 Million U.S. Companies Source: IDC SMB = Small and medium businesses Home office Consumer 6
Balanced Product & Customer Portfolio Mix PRODUCTS CUSTOMERS Peripherals: 40% Systems: 30% Networking: 15% Software: 15% Value-added resellers: 50% Direct marketers & retailers: 30% Corporate resellers: 20% PC SPECIALISTS 7
8 Financial Review
Net Sales Annual Net Sales (in billions) Fourth Quarter FY09 Net Sales (in billions) $20.5 $21.4 $23.4 $24.1 $6.5 $5.7 $9.5 $9.9 $11.0 $10.6 $2.7 $2.3 Americas Europe $11.0 $11.5 $12.4 $13.5 $3.8 $3.4 FY06 FY07 FY08 FY09 FY08 Q4 FY09 Q4 9
Fiscal 2009 Results Net Sales Worldwide net sales of $24.1 B increased 3% y-o-y Americas net sales of $10.6 B declined 3.6% Europe net sales of $13.5 B increased 8.5% (4% in Euros) Gained share in select markets Gross Margin Gross margin of 5.04% vs. 4.84% last year Improved pricing, inventory and freight management Competitive market conditions Operating Income Worldwide op income of $242.2 M; 11% increase y-o-y 1.01% op margin vs..93%* last year Americas op income of $157.2 M or 1.48% of net sales Europe op income of $97.0 M or.72% of net sales EPS EPS of $2.40 vs. $2.51* last year 10 *The year ended January 31, 2008 excludes loss on disposal of subsidiaries of $14.5 million related to the exit of the company s operations in the UAE and Israel and net restructuring charges of $16.1 million primarily related to the closure of a European logistics center.
Fiscal 2009 Fourth-Quarter Results Net Sales Worldwide net sales of $5.7 B declined 12%; stronger U.S. dollar impact 7% Gross Margin Gross margin of 5.62% vs. 4.95% last year Improved pricing, inventory, and freight management Foreign currency exchange loss recovery Operating Income Worldwide op income of $98.5 M; 33% increase y-o-y 1.73% op margin vs. 1.14%* last year EPS Record EPS of $1.17 vs. $.96* last year; 22% increase y-o-y 11 * FY08 Q4 operating margin is non-gaap and exclude loss on disposal of subsidiaries of $1.4 million related to the exit of the company s operations in the UAE and Israel.
Americas: FY09 Fourth-Quarter Review Q4 Results Focus Net sales of $2.3 B Year-over-year decline of 14.1% Economy decline/softer IT spending Operating income of $38.1 M, or 1.63% of net sales Pricing, inventory, and freight management Competitive market conditions Recovery of foreign currency exchange losses Sales execution Disciplined pricing and inventory management Cost management Customer and vendor partner profitability Cost management 12
Europe: FY09 Fourth-Quarter Review Q4 Results Net sales of $3.4 B Year-over-year decline of 10.3%; flat on a Euro basis Record quarterly operating income of $63.6 M, or 1.89% of net sales Gross margin stability through improved pricing and inventory management Recovery of foreign currency exchange losses Brightstar Europe traction; net income of $1 M Focus Execution on all fronts Leverage infrastructure Measured improvement in profitability Cost management 13
Solid Capital Structure Total Capitalization Cash position of $528.0 M Net cash position of $108.3 M YTD cash flow of $280 M Excellent liquidity and financial flexibility Focused on improving ROCE January 31, 2009 $2.1 B Debt 20% Equity 80% 14
Positioning Tech Data for the Future 15
Americas: Driving Execution Optimization of sales force coverage and effectiveness Leverage IT/SAP systems SAP WMS Teams of Two FICO AP/GL Costa Rica operations center 16
Europe: Stronger Foothold Pan-European IT infrastructure Fully harmonized business processes Single e-commerce platform drives over 60% of orders Efficient, state-ofthe-art logistics operation 10 logistic centers 6 Million shipments a year Changing the Nordic distribution landscape 17
Catalysts for Long-term Success Today Tomorrow Future Broadline Industry standardization Value-added services Security MOBILITY Disruptive solutions Greening of technology HD video conferencing MOBILITY Valueline Pro-sumer Channel consolidation Social networks / Web MOBILITY Tech Data s Pillars of Strength Excellence in Execution People Financial Health Market Coverage 18
Tech Data in Summary A strategic link in the IT ecosystem Long-term record of growth and profitability Americas track record demonstrates execution; European profitability improving Strong capital structure Strong management team with deep industry domain Well-positioned in a large, dynamic marketplace A Clear Strategy: Execute, Diversify & Innovate 19
The Difference In Distribution