Electronic components distributor Avnet Inc. (AVT: Quote), Wednesday reported a lower profit for the fourth quarter, as sales dropped reflecting cautious customers amidst "slowing global economic growth."
Avnet's earnings and revenues for the quarter came in below analysts' estimates. The company also guided its first quarter earnings below Street expectations.
Avnet's sales for the quarter dropped 8.8 percent to $6.31 billion from $6.91 billion last year. Analysts expected revenues of $6.55 billion for the quarter.
Chief Executive Rick Hamada said, "Our Q4 revenues came in below our original expectations at both operating groups as customers grew more cautious towards the end of the quarter."
The company also pointed out that one-third of the year-over-year decline was due mainly to the translation impact of currency.
Avnet Electronic Marketing unit's sales declined 5 percent, with EMEA down 21.4 percent and Asia down 2.3 percent. Avnet Technology Solutions revenues dropped 13.8 percent, with sales decreasing in all three geographic regions, Americas, EMEA and Asia.
Hamada said, "Technology Solutions experienced a weaker than expected June as a number of customers in both the Americas and EMEA regions chose to defer their final purchasing decisions during the last two weeks of the month."
Phoenix, Arizona-based Avnet's fourth-quarter profit dropped to of $133.4 million or $0.91 per share from $238.83 million or $1.54 per share last year.
Adjusted earnings slipped to $0.99 per share from $1.22 per share last year. On average, 11 analysts polled by Thomson Reuters expected earnings of $1.08 per share. Analysts' estimates typically exclude special items.
Looking forward to the first quarter, Avnet expects adjusted earnings of $0.78 to $0.88 per share, and sales of $5.80 billion to $6.40 billion. Analysts currently expect earnings of $0.97 per share on revenues of $6.33 billion.
AVT is currently trading at $30.44, down $2.29 or 7%, on a volume of 1.4 million shares on the NYSE.
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by RTT Staff Writer
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