Excellent report!!!
Systemax Reports First Quarter 2006 Results Net Income Increases to $17.6 Million from $2.6 Million
Systemax Inc. (NYSE:SYX), a leading distributor and manufacturer of PC hardware, related computer products and industrial products in North America and Europe, today announced results for the quarter ended March 31, 2006.
Net sales for the quarter increased 6.9% to $574.9 million compared to $537.9 million in the year-ago quarter. Income from operations increased more than four-fold to $20.9 million from $5.2 million in the first quarter of 2005. Richard Leeds, Chairman and Chief Executive Officer said, "I am pleased to report this excellent increase in operating income, which resulted from a combination of increased sales and improved gross margins. We are also benefiting from the cost cutting, streamlining and restructuring actions that we have taken during the last two years. We have successfully reduced and managed our selling, general and administrative expenses from 16.5% of net sales in 2002 to our current rate of 12.2% for the first quarter of 2006." Net income was $17.6 million or $.48 per diluted share compared to $2.6 million or $.07 per diluted share in the year ago period. Net income in 2006 would have been $.36 per diluted share excluding a gain of $4.3 million, or $.12 per diluted share after tax, from the sale of a warehouse facility.
Gilbert Fiorentino, CEO of Tiger Direct, commented that Systemax remains focused on controlling its costs and growing the business. He added, "North American sales grew 10.7% during the first quarter of 2006 with Tiger's increased e-commerce sales and expanded product offerings leading the way. European sales decreased marginally in U.S. dollars but increased 11.1% in constant dollars compared to the year-ago quarter. Our gross profit margin increased to 15.8% from 14.8% last year as a result of a favorable product mix, reduced warehouse costs and increased vendor rebates."
Steven Goldschein, Chief Financial Officer, noted that the Company's reporting of its 2006 quarterly results has been delayed due to the longer-than-expected 2005 year-end closing process. The Company filed its 2005 quarterly reports on Form 10-Q and annual report on Form 10-K earlier today. The Company currently anticipates reporting its second quarter results in approximately six weeks.
Systemax Inc. (www.systemax.com) employs a system of branded e-commerce web sites, direct mail catalogs and relationship marketers to sell PC hardware, related computer products, consumer electronics products and industrial products in North America and Europe. Systemax is a Fortune 1000 company.
