SYNNEX Corporation
Mar 20, 2008

SYNNEX Corporation Reports Fiscal 2008 First Quarter

Year-Over-Year Gross Margin Expands 79 Basis Points to Record 5.48% EPS Exceed Analyst Estimates

FREMONT, Calif.--(BUSINESS WIRE)--March 20, 2008--SYNNEX Corporation (NYSE:SNX), a leading business process services company, today announced financial results for the fiscal first quarter ended February 29, 2008.

For the first quarter of fiscal 2008, revenues were $1.75 billion, compared to $1.59 billion for the quarter ended February 28, 2007, representing a 10% increase over the prior year quarter. These results were in line with analysts' consensus and within the Company's guidance of $1.73 billion to $1.78 billion.

Net income for the first quarter of fiscal 2008 was $16.8 million, or $0.51 per diluted share, compared with $13.9 million, or $0.43 per diluted share in the prior year quarter, representing a 21% increase in net income over the prior year quarter. These results were above analysts' consensus and at the high end of the Company's guidance of $0.49 to $0.51. The first quarter for fiscal 2008 marks the 83rd consecutive profitable quarter for SYNNEX.

"Our first quarter results demonstrate our focused commitment and attention on increasing the profitability of our business," stated Robert T. Huang, President and Chief Executive Officer. "I am very pleased with our ability to grow profitably as we continue to invest in meaningful opportunities to expand our business offerings and leverage our efficient infrastructure."

First Quarter Fiscal 2008 Financial Highlights:

Second Quarter Fiscal 2008 Outlook:

The following statements are based on the Company's current expectations for the second quarter of fiscal 2008 and are independent of the Company's pending acquisition of New Age Electronics, Inc. These statements are forward-looking and actual results may differ materially.

The calculation of diluted earnings per share for the second quarter of fiscal 2008 is based on an approximate diluted weighted-average share count of approximately 33.2 million.

"Our outlook for the second quarter reflects our current visibility into the marketplace, our continued focus on growing operating income and the overall diversification of our business model," Huang continued. "We reiterate our commitment to our stated goal of growing our annual earnings per share in excess of 15% year-over-year. We believe that we can achieve these goals in the current economic environment, through a combination of continued execution, realization of the full impact of our recent acquisitions and continued improvements in efficiency and productivity."

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 The conference call can be accessed by dialing 866-835-8893 in North America or 703-639-1409 outside North America. The confirmation code for the call is 1211676. A replay of the conference call will be available at approximately two hours after the conference call has concluded and will be archived until April 3, 2008.


SYNNEX Corporation, a Fortune 500 corporation, is a leading business process services company, servicing resellers 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 over 6,000 employees worldwide and operates in the United States, Canada, China, Mexico, the Philippines and the United Kingdom. Additional information about SYNNEX may be found online at

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, plan, anticipate, could and should and the negative of these terms or other similar expressions. These statements, including statements regarding our focus on growing operating income and diversification of our business model, expectations of growth in earning per share, expectations of continued execution, realization of the full impact of our 2007 acquisitions and continued improvements in efficiency and productivity, and expectations of our revenues, 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: general economic conditions and any weakness in IT 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; variations in supplier-sponsored programs; changes in our costs and operating expenses; changes in foreign currency exchange rates; 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 contract assembly business; risks associated with the consolidation, integration and performance of our recent acquisitions; our ability to complete and integrate the acquisition of New Age Electronics, Inc.; and other risks and uncertainties detailed in our Annual Report on Form 10-K for the year ended November 30, 2007 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 2008 SYNNEX Corporation. All rights reserved. SYNNEX, the SYNNEX Logo, and all other SYNNEX company, product and services names and slogans are trademarks or registered trademarks of SYNNEX Corporation. SYNNEX and the SYNNEX Logo Reg. U.S. Pat. & Tm. Off. Other names and marks are the property of their respective owners.

                          SYNNEX Corporation
                     Consolidated Balance Sheets
                            (in thousands)

                                             February 29, November 30,
                                                 2008         2007
                                             ------------ ------------
Current assets:
      Cash and cash equivalents                $   43,554   $   42,875
      Short-term investments                       14,583       17,257
      Accounts receivable, net                    678,757      729,797
      Receivable from vendors, net                109,746       96,035
      Receivable from affiliates                    7,511        9,790
      Inventories                                 625,069      642,524
      Deferred income taxes                        18,132       18,612
      Current deferred assets                      14,746       14,478
      Other current assets                         10,589       16,859
                                             ------------ ------------
            Total current assets                1,522,687    1,588,227

Property and equipment, net                        61,348       59,440
Goodwill and intangible assets, net               125,938      117,940
Deferred income taxes                               6,262        5,416
Long-term deferred assets                          88,064       97,171
Other assets                                       23,697       18,909
                                             ------------ ------------

            Total assets                       $1,827,996   $1,887,103
                                             ============ ============

Liabilities and Stockholders' Equity
Current liabilities:
      Borrowings under securitization, term
       loans and lines of credit               $  304,198   $  351,142
      Accounts payable                            563,675      588,801
      Payable to affiliates                        67,527       67,334
      Accrued liabilities                         113,891      120,617
      Current deferred liabilities                 33,970       35,522
      Income taxes payable                          5,300        5,103
                                             ------------ ------------
            Total current liabilities           1,088,561    1,168,519

Long-term borrowings                               32,507       37,537
Long-term liabilities                              23,480       14,533
Long-term deferred liabilities                     56,367       60,565
Deferred income taxes                                 452          437
                                             ------------ ------------
            Total liabilities                   1,201,367    1,281,591
                                             ------------ ------------

Minority interest in subsidiary                     1,146          958
                                             ------------ ------------

Stockholders' equity:
      Preferred stock                                   -            -
      Common stock                                     31           31
      Additional paid-in-capital                  197,660      196,128
      Accumulated other comprehensive income       31,877       28,939
      Retained earnings                           395,915      379,456
                                             ------------ ------------
            Total stockholders' equity            625,483      604,554
                                             ------------ ------------

            Total liabilities and
             stockholders' equity              $1,827,996   $1,887,103
                                             ============ ============

                          SYNNEX Corporation
                Consolidated Statements of Operations
             (in thousands, except for per share amounts)

                                Three Months Ended  Three Months Ended
                                   February 29,        February 28,
                                       2008                2007
                                ------------------  ------------------

Revenue                          $       1,748,574   $      1,588,276

Cost of revenue                          1,652,724          1,513,852
                                ------------------  ------------------

Gross profit                                95,850             74,424

Selling, general and
 administrative expenses                    63,070             49,481
                                ------------------  ------------------

Income from operations before
 non-operating items, income
 taxes and minority interest                32,780             24,943

Interest expense and finance
 charges, net                                4,167              3,058
Other (income) expense, net                  2,046               (158)
                                ------------------  ------------------

Income from operations before
 income taxes and minority
 interest                                   26,567             22,043

Provision for income taxes                   9,551              8,168
Minority interest in subsidiary                188                  -
                                ------------------  ------------------

Net income                       $          16,828   $         13,875
                                ------------------  ------------------

Diluted earnings per share       $            0.51   $           0.43
                                ------------------  ------------------
Diluted weighted-average common
 shares outstanding                         33,043             32,372
                                ------------------  ------------------

Laura Crowley, 510-668-3715
Director of Investor Relations and Public Relations

SOURCE: SYNNEX Corporation