Ingram Micro 2013 Annual Report Download - page 3

Table of Contents
PART I
ITEM 1. BUSINESS
The following discussion includes forward-looking statements, including but not limited to, management’s expectations of competition; market share;
revenues, margin, expenses and other operating results or ratios; economic conditions; vendor terms and conditions; deployment of enterprise systems; pricing
strategies and customer terms and conditions; organizational effectiveness program and related restructuring, integration and other reorganization costs;
process and efficiency enhancements; cost savings; cash flows; working capital levels and days; capital expenditures; liquidity; capital requirements;
acquisitions and integration costs; operating models; exchange rate fluctuations and related currency gains and losses; resolution of contingencies; seasonality;
interest rates and expenses; and rates of return. In evaluating our business, readers should carefully consider those factors discussed under “Risk Factors.”
We disclaim any duty to update any forward-looking statements. Unless otherwise stated, all currency amounts, other than per share information, contained
in Parts I and II are stated in thousands.
Our Background
Ingram Micro Inc., a Fortune 100 company, is the largest wholesale technology distributor, by net sales, and a global leader in supply-chain
management and mobile device lifecycle services. We distribute and market a large variety of technology and mobility products from leading companies, such
as Acer, Apple, Cisco, Citrix, Hewlett-Packard (“HP”), IBM, Lenovo, Microsoft, Samsung, Symantec, VMware and many others. As a vital link in the
technology value chain, we create sales and profitability opportunities for vendors, resellers and other customers through unique marketing programs;
outsourced logistics and mobile device lifecycle solutions; technical support; financial services; product aggregation and distribution; solutions creation and
cloud service models.
We began business in 1979, operating as Micro D Inc., a California corporation. Through a series of acquisitions, mergers and organic growth, we
have expanded and strengthened our global footprint, product breadth and service capabilities. In recent years, our acquisitions have been primarily focused
on global expansion of our higher-value product and service offerings. In 2012, we made major strides in expanding our presence in areas of strategic focus
through the following acquisitions: Brightpoint, Inc. (“BrightPoint”), the global leader in mobile device lifecycle services; certain information technology ("IT")
distribution businesses of Aptec Holdings Ltd. (“Aptec”), a Dubai-based value-added distributor in the Middle East and Africa ("MEA") region; and Promark
Technology Inc. (“Promark”), a U.S.-based, value-added distributor focused on sales to government customers. During 2013, we completed acquisitions that
strengthen our capabilities in supply-chain services and cloud-based solutions, including: Shipwire, Inc. (“Shipwire”), a leading provider of e-commerce
fulfillment services for small-to-medium-sized businesses (“SMB”), CloudBlue Technologies, Inc. (“CloudBlue”), a global leader in enterprise information
technology asset disposition (“ITAD”), onsite data destruction and e-waste recycling services and SoftCom, Inc. (“SoftCom”), a leading cloud marketplace
and global service provider offering domain name management, web hosting and cloud infrastructure. Our focus is on profitably growing and optimizing our
core IT distribution business, expanding the reach of our acquired operations, building upon our established services business and continuing to make
strategic investments in higher-margin services and solutions.
Where We Are
We have operations in 39 countries, spanning all global regions: North America (United States and Canada), Europe (Austria, Belgium, Denmark,
France, Finland, Germany, Hungary, Italy, the Netherlands, Norway, Poland, Portugal, Slovakia, Spain, Sweden, Switzerland and the United Kingdom),
Asia-Pacific (which includes MEA) (Australia, the People’s Republic of China (including Hong Kong), Egypt, India, Indonesia, Israel, Lebanon, Malaysia,
New Zealand, Singapore, South Africa, Thailand, Turkey and United Arab Emirates) and Latin America (Brazil, Chile, Colombia, Mexico and Peru). We
also operate support centers in Argentina, Bulgaria, Costa Rica, India, Philippines and Puerto Rico. Additionally, we serve many other markets where we do
not have an in-country presence through our various export sales offices, including our general telesales operations in numerous markets. We sell our products
and services to a global customer base of more than 200,000 customers in more than 170 countries. Based on currently available data, we believe that we are
the market share leader in technology distribution, by net sales, in North America and Latin America, and number two in Europe and Asia-Pacific.
Our Strengths
We believe that the current technology industry generally favors large, financially-sound distributors that have broad product portfolios, economies of
scale, strong business partner relationships and wide geographic reach. Our conservative approach to working capital management, as well as our diversified
portfolio of capital resources, serves us well in the current credit markets. Our financial strength enables us to provide valuable credit to our customers, while
employing a disciplined approach to managing accounts and determining creditworthiness. Our financial position provides us with a competitive advantage as
a reliable, long-term business partner for our suppliers, resellers and other customers. Our value is in enabling these partners to become more efficient,
knowledgeable and profitable. We believe there is a growing demand for additional services and solutions from companies
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