Tech Data Corp. (NASDAQ:TECD) Q3 2017 Earnings Conference Call Transcript

Nov 27, 2017 • 05:00 pm ET

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Tech Data Corp. (NASDAQ:TECD) Q3 2017 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good afternoon. Welcome to Tech Data Corporation's Fiscal Year 2018 Third Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the presentation, we'll conduct a question-and-answer session. (Operator Instructions) Today's conference is being recorded. If you have any objections, you may disconnect at this time.

Now, I will turn the meeting over to Arleen Quinones, VP of IR. Ma'am, you may begin.

Executive
Arleen Quinones

Thank you, Matt. Good afternoon and welcome to Tech Data's earnings conference call and webcast to review our financial results for the third quarter of fiscal year 2018. I am joined this afternoon by Bob Dutkowsky, Chairman and CEO; and Chuck Dannewitz, EVP and CFO.

For a detailed look at our third quarter results, please review our financial highlights summary slide presentation posted this afternoon on the IR portion of our website located at www.techdata.com/investor. Unless otherwise specified, all gross comparisons we make on this call today relate to the corresponding period of the previous fiscal year. (Forward-Looking Cautionary Statements) Also, throughout this conference call, we will reference both GAAP and non-GAAP financial measures, which exclude certain items contained in our GAAP financial results. A detailed reconciliation between results reported in accordance with GAAP and non-GAAP financial measures can be found in the press release and on the IR portion of our Company's website.

Please note that during today's call, we will refer to Technology Solutions business acquired from Avnet on February 27, 2017, as Technology Solutions or as TS. We have provided certain estimates of pro forma sales growth rate and product performance based on combining the stand-alone operating results of Tech Data and Technology Solutions for the periods prior to the acquisition date. This pro forma information is provided for informational purposes only and does not represent what actual results would have been had the acquisition been completed at the beginning of the prior fiscal year. And it is not necessarily indicative of the results of operations that may result in the future. In addition, this call is the property of Tech Data and may not be recorded or rebroadcast without specific written permission from the Company.

I will now turn the call over to Tech Data's Chairman and CEO, Bob Dutkowsky.

Executive
Robert Dutkowsky

Thank you, Arleen and good afternoon, everyone, thank you for joining us today. We're pleased to report Q3 results that were in line with our expectations and that continue to highlight the enhanced earnings power and cash flow profile of the new Tech Data. For the first time in Tech Data's history, quarterly sales surpassed $9 billion, and through pricing discipline and strong cost controls, we delivered solid non-GAAP earnings per share. In addition, we generated $70 million of cash from operations, paid down $350 million of our debt, reflecting our strong commitment to deleverage the Company, and we earned an adjusted return on invested capital for the trailing 12-month period well in excess of our weighted average cost of capital. You will recall that our Q2 earnings missed