Avnet 2015 Annual Report Download - page 23

TableofContents
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
ForanunderstandingofAvnetandthesignificantfactorsthatinfluencedtheCompany’sperformanceduringthepastthree
fiscalyears,thefollowingdiscussionshouldbereadinconjunctionwiththedescriptionofthebusinessappearinginItem1ofthis
Report and the consolidated financial statements, including the related notesand schedule, and other information appearing in
Item15ofthisReport.TheCompanyoperatesona“52/53week”fiscalyear.Fiscal2016contained53weeks,fiscal2015and
2014 both contained 52 weeks. The extra week, which occurred in the first quarter of fiscal 2016, impacts the year-over-year
analysisoffiscal2016inthisMD&A.
TherearereferencestotheimpactofforeigncurrencytranslationinthediscussionoftheCompany’sresultsofoperations.
WhentheU.S.Dollarstrengthensandthestrongerexchangeratesofthecurrentyearareusedtotranslatetheresultsofoperations
ofAvnet’ssubsidiariesdenominatedinforeigncurrencies,theresultingimpactisadecreaseinU.S.Dollarsofreportedresults.
Conversely,whentheU.S.Dollarweakensandtheweakerexchangeratesofthecurrentyearareusedtotranslatetheresultsof
operations of Avnet’s subsidiaries denominated in foreign currencies, the resulting impact is an increase in U.S. Dollars of
reported results. In the discussion that follows, results excluding this impact, primarily for subsidiaries in EMEA, and
Asia/Pacific, are referred to as “excluding the translation impact of changes in foreign currency exchange rates” or “constant
currency.”
Inadditiontodisclosingfinancialresultsthataredeterminedinaccordancewithgenerallyacceptedaccountingprinciplesin
theU.S.(“GAAP”),theCompanyalsodisclosescertainnon-GAAPfinancialinformation,including:
·Sales, income or expense items excluding the translation impact of changes in foreign currency exchange rates for
subsidiariesreportingincurrenciesotherthantheU.S.Dollarbyadjustingtheaverageexchangeratesusedincurrent
periodtobeconsistentwiththeaverageexchangeratesineffectduringthecomparativeperiod,asdiscussedabove.
·Sales adjusted for certain items that impact the year-over-year analysis, which includes the impact of certain
acquisitionsordivestituresbyadjustingAvnet’spriorperiodstoincludethesalesofacquiredbusinessesorexcludethe
salesof divested businesses asiftheacquisitionsordivestitureshadoccurred at the beginning oftheearliestperiod
presented. In addition, fiscal 2016 sales are adjusted for the estimated impact of the extra week of sales in the first
quarter of fiscal 2016 due to it being a 14-week quarter, as discussed above. Sales taking into account these
adjustmentsarereferredtoas“organicsales.”
·Operatingincomeexcluding(i)restructuring,integrationandotherexpenses(seeRestructuring,IntegrationandOther
Expensesin this MD&A) and (ii) amortization of acquired intangible assets and other. Operating income excluding
suchamountsisreferredtoas“adjustedoperatingincome.”
Thereconciliationofoperatingincometoadjustedoperatingincomeispresentedinthefollowingtable:


   Years Ended
 July 2, June 27, June 28,
   2016 2015 2014
   (Thousands)
Operatingincome   $ 787,669  $ 827,673  $ 789,940
Restructuring,integrationandotherexpenses    79,318   90,805   94,623
Amortizationofacquiredintangibleassetsandother    28,614  54,049  46,783
Adjustedoperatingincome   $ 895,601 $ 972,527 $ 931,346
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