Avnet 2006 Annual Report Download - page 91

Download and view the complete annual report

Please find page 91 of the 2006 Avnet annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 98

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98

AVNET, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
In all periods, to the extent owned facilities, equipment or IT-related assets were written down as part of
these charges, the write-downs were to estimated fair value based upon management's estimates of asset value
from historical experience and/or analyses of comparable facilities or assets. Particularly in the case of IT-
related initiatives, many of the assets were written off entirely as there is no potential to sell the related assets
or otherwise realize value of the assets in the business. In such cases, the assets have generally been disposed
of by the Company.
As of July 1, 2006, the Company's remaining reserves for fiscal 2004 restructuring and other related
activities totaled $6,698,000. Of this balance, $468,000, relates to remaining severance reserves the majority of
which the Company expects to utilize by the end of fiscal 2008. The remaining reserve balance also includes
$5,942,000 related to reserves for contractual lease commitments (shown as Facility Exit Costs in the table at
the beginning of this Note), substantially all of which the Company expects to utilize by the end of fiscal
2010, although a small portion of the remaining reserves relate to lease payouts that extend as late as fiscal
2012. The other reserves, which total $288,000, relate primarily to remaining contractual commitments, the
majority of which the Company expects to utilize during fiscal 2007.
18. Summary of quarterly results (unaudited):
First Second Third Fourth
Quarter Quarter Quarter Quarter Year
(Millions, except per share amounts)
2006(a)
Sales ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $3,268.3 $3,759.1 $3,614.6 $3,611.6 $14,253.6
Gross profitÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 423.2 461.8 472.1 481.9 1,839.0
Net incomeÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 24.9 49.6 71.2 58.8 204.5
Diluted earnings per share ÏÏÏÏÏÏÏÏÏÏ 0.17 0.34 0.48 0.40 1.39
2005
Sales ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $2,600.0 $2,883.2 $2,758.2 $2,825.4 $11,066.8
Gross profitÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 349.6 373.9 364.6 370.9 1,459.0
Net incomeÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 36.3 43.5 41.1 47.3 168.2
Diluted earnings per share ÏÏÏÏÏÏÏÏÏÏ 0.30 0.36 0.34 0.39 1.39
(a) Quarterly results for fiscal 2006 include certain impacts to gross profit, net income and diluted earnings
per share due to (i) restructuring, integration and other charges; (ii) incremental stock-based compensa-
tion costs; (iii) debt extinguishments costs (impacts first and fourth quarter); (iv) incremental intangible
assets amortization in connection with the acquisition of Memec (impacts third and fourth quarter); and
(v) net loss on sale of business lines divested (impacts third and fourth quarter). The impact of the
charges described in (i) through (v) by quarter in Fiscal 2006 was $29.2 million pre-tax, $19.3 million
after tax and $0.14 per share on a diluted basis in the first quarter; $36.4 million pre-tax, $24.0 million
after tax and $0.16 per share on a diluted basis in the second quarter; $12.6 million pre-tax, $8.3 million
after tax and $0.05 per share on a diluted basis in the third quarter; and $37.7 million pre-tax,
$32.2 million after tax and $0.22 per share on a diluted basis in the fourth quarter. The impact of these
charges on the twelve months ended July 1, 2006 were $115.9 million pre-tax, $83.9 million after tax and
$0.57 per share on a diluted basis. For further details of the total impact of these charges on the fiscal
year see footnote (a) to Item 6 of this Form 10-K.
85