Avnet 2003 Annual Report Download - page 4

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Avnet closed FY ’03 with $9.05 billion in revenue, maintaining the number one position in our industry.
While the markets we serve and our Company’s revenue have remained relatively flat for the past
eight quarters, earnings per share improved $0.32 over FY ’02 (before the cumulative effect of change
in the accounting principle). Operating income margin was up over last year. Aided by record-setting asset
velocity, return on capital employed more than doubled, although it remains well below an acceptable
level. And, due primarily to debt reduction, interest expense fell nearly $20 million during FY ’03.
re:INVENT
Our Goal: Consistently Increase Shareholder Value
The financial principles that govern our strategy and execution have evolved as our Company has
matured. During our building phase, we shifted from a traditional distribution company focused
primarily on growing revenue and capturing market share to a value-added distributor focused
on growing earnings organically and through industry-consolidating mergers. Today, Avnet is a
premier technology marketing, distribution and services provider serving customers in 68 countries.
We are leveraging our global scope and scale to achieve a new financial goal: to consistently increase
shareholder value.
In FY ’03, revenue stability coupled with significant cost reduction led to greater earnings, and greater
earnings coupled with improved asset velocity drove higher return on capital. Avnet has improved its
working capital velocity (the total amount of inventory and receivables net of accounts payable, relative to
sales) consistently since the industry downturn began, setting a company record in the March 2003 quarter.
annual report2003
2
With a large base of leading technology
suppliers, design chain and supply chain
services, consultative engineering, product
specialization and a broad array of inventory,
Avnet Electronics Marketing is dedicated
to giving its customers around the world
“Support Across the Board.™” Avnet, Inc. FY ’03
Sales by Operating Group
Electronics Marketing (EM) Avnet Electronics Marketing
markets, inventories and adds value, via services such
as engineering design and supply chain management, to
semiconductors; interconnect, passive and electromechanical
devices; radio frequency and microwave devices; and
specialty products from leading component manufacturers.
Computer Marketing (CM) Avnet Computer Marketing
builds channels to market that provide focused sales,
marketing and value-added distribution of enterprise
computing systems, software and services to value-added
resellers, and enterprise solutions to end users.
Applied Computing (AC) Avnet Applied Computing
focuses on the unique requirements of original equipment
manufacturers, independent software vendors and
system builders. Through engineering assistance,
financing, distribution, supply chain management and
end product integration and support, Avnet Applied
Computing markets and adds value to embedded
technology subsystems, including computer platforms
and servers, boards and memory modules, mass storage,
peripherals, microprocessors, flat panel displays and
operating systems.
$ Billions % of Avnet Sales
AC $1.63 18.0%
CM $2.43 26.9%
EM $4.99 55.1%