24
Introduction to Arrow Electronics, Inc.

Introduction to Arrow Electronics, Inc

  • Upload
    others

  • View
    3

  • Download
    0

Embed Size (px)

Citation preview

Introduction to Arrow Electronics, Inc.

Founded: 1935 Ticker Symbol: ARW (New York Stock Exchange) Web Site: www.arrow.com 2012 Sales: $20.4 billion Global Components: $13.4 billion

ECS: $7.0 billion

2012 Net Income*: $488.4 million 2012 EPS*: $4.40 Employees: 16,500 Locations: Global network of more than 470 locations in 55

countries and territories Corporate Headquarters: Englewood, Colorado Customers: 100,000 Fortune 500 Rank: 133

Arrow at a glance

2

*Represents GAAP measure adjusted to exclude the impact of restructuring and other items affecting comparability.

A global provider of products, services and solutions to industrial and commercial

users of electronic components and enterprise computing solutions

Arrow is…

Wireline and Wireless Networking Infrastructure

Medical Imaging, Instrumentation and Scientific Testing Military and Aerospace

Electronic Manufacturing Services

Machine Tools and Industrial Controls Enterprise Computing

Medical Services

GIDDINGS & LEWIS

Global customer base of more than100,000

No single customer represents more than 3% of revenue

To be the premier electronics company in

the world

Our vision is…

Core Businesses

Services

Global strategy – drive growth in the core, services, and high-growth product sets

Michael J. Long Chairman, President and Chief Executive Officer

Paul J. Reilly Executive Vice President, Finance and Operations, and Chief Financial Officer

Peter S. Brown Senior Vice President and General Counsel

Andrew S. Bryant President, Arrow Enterprise Computing Solutions

Peter T. Kong President, Arrow Global Components

Vin Melvin Vice President and Chief Information Officer

M. Catherine Morris Senior Vice President and Chief Strategy Officer

Gretchen Zech Senior Vice President, Global Human Resources

Arrow’s leadership

Business Segment Overview

Arrow Global Components – Arrow Americas – 44% of components sales – Arrow EMEA (Europe, Middle East, Africa) – 27% of components sales – Arrow Asia-Pacific – 29% of components sales

Core Drivers • Broad line card • Broad customer base – 100,000+ • Engineering focus • Demand creation • Value-added programs

Differentiators • Global strength and depth • Design win performance • Highest ranked level of customer

service • Industry leading operating margins • Financial resources

Breakdown of 2012 Component Sales • 66% Semiconductor • 20% PEMCO (passive, electro-mechanical and connector) • 9% Computing and memory • 5% Other products and services

Global components

Design System hardware, OS Configuration & development, product specification, RoHS compliance, complete solutions

Production Prototype, manufacturing, integration, breaking tape and reel, programming

Distribution On-time delivery, direct fulfillment, supply chain solutions, post sales/end of life, quality and process control

Service Local support, new online search/user interface, materials management and logistics

Powering the supply chain: global components

COUNTRIES Argentina Brazil Canada Mexico United States

COUNTRIES Austria Belgium Bulgaria Czech Republic Denmark Egypt Estonia Finland France Germany Greece Hungary Israel Italy

Netherlands Norway Poland Portugal Romania Russian Federation Slovakia Slovenia South Africa Spain Sweden Switzerland Turkey Ukraine United Kingdom

COUNTRIES Australia China Hong Kong India Indonesia Japan Korea Malaysia New Zealand Philippines Singapore Taiwan Thailand Vietnam

Americas Europe, Middle East, Africa Asia-Pacific

www.arrownac.com

www.arrowasia.com www.arroweurope.com

2012 Sales: $5.9 billion 2012 Sales: $3.7 billion 2011 Sales: $3.8 billion

Global components by region

Industrial

Lighting

Transportation/ Automotive

Aerospace and Defense

Power Supplies

Alternative Energy

Custom Logic

Embedded Computing Machine-to-Machine

Medical

Market expertise

Arrow Enterprise Computing Solutions (ECS) – Arrow ECS is the global business group that provides enterprise and midrange

computing products, services and solutions to value-added resellers and system integrators

– ECS Americas – 68% of ECS sales – ECS Europe – 32% of ECS sales

Core Drivers • Small and medium sized customers – 13,000

VAR partners • Business continuity • Server consolidation • Compliance/regulatory environment • Engineering and technical expertise • Education and training services • Enterprise Solutions Centers (Atlanta &

Minneapolis) • Financing programs • Business development & marketing

expertise • Innovation and investments

Differentiators • Customer service • Customer and OEM relations • Solutions focused • Non-compete relationship with reseller

customers • Unparalleled line card

Enterprise computing solutions accounted for 35% of Arrow’s 2012 sales

Enterprise computing solutions

Powering the supply chain: ECS

COUNTRIES Canada United States

COUNTRIES Austria Belgium Croatia Czech Republic Denmark Estonia Finland France Germany Hungary Iceland Israel Latvia

Lithuania Luxembourg Morocco Netherlands Norway Poland Portugal Serbia Slovenia Spain Sweden Switzerland United Kingdom

Americas Europe, Middle East, Africa

www.ecs.arrow.com

www.arrowecs.eu

2012 Sales: $4.8 billion 2012 Sales: $2.3 billion

ECS by region

Financial Overview

Outstanding organic sales growth

Significant margin expansion

Committed to strong cash flow generation

Strategic expansion of the portfolio

17

Investment considerations

($ in billions)

18

$13.6

$16.0 $16.8

$14.7

$18.7

$21.4 $20.4

2006 2007 2008 2009 2010 2011 2012

82%

18%

2006 sales of $13.6 billion

2012 sales of $20.4 billion

65% 35%

Global components Global ECS

Revenue growth – a balanced approach

Industry-leading operating margin

* Peer group includes AVT, IM, SNX, TECD, and WPG

19

4.6% 4.4%

3.6%

2.6%

4.2% 4.5%

3.8%

2.5% 2.7%

2.4%

2.1%

2.6% 2.5% 2.2%

1.0%

2.0%

3.0%

4.0%

5.0%

2006 2007 2008 2009 2010 2011 2012 Operating margin* Peer margin

Excellent record of cash flow generation

($ in millions)

20

$121

$972

$1,591

$2,441

$2,662 $2,783

$3,458

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

2006 2007 2008 2009 2010 2011 2012

Superior returns on capital: 40% above WACC

WACC

21

ROIC as % of WACC

80%

100%

120%

140%

160%

180%

200%

2006 2007 2008 2009 2010 2011 2012

Invest in the business

Acquisitions that meet our value criteria to strategically accelerate growth

Evaluate options to return value to shareholders

Maintain investment grade rating over the long-term

Capital allocation strategy

22

23

Outperforming the industry and our targets

Deliver to Commitments

Revenue Growth

5-Year Performance

Operating Margin Expansion

EPS Growth

Return on Working Capital

Operating Cash Flow

We have and will continue to invest in businesses that lessen the exposure to economic and technology cycles.

24

2010 2011