Year in review: Ingram Micro, the largest distributor of technology products, had one of its best years yet, generating $31 billion in sales.
Chief Executive Greg Spierkel jokes Ingram Micro is “the largest organization in the U.S. that no one has ever heard of.”
Spierkel said at the start of 2006 he was shifting the company’s focus from cost cutting after the tech bust to more sales growth.
But the cutting wasn’t entirely over: In May Ingram Micro outsourced 80 jobs in its technology department, including around 45 workers locally.
The company started the year with speculation about a possible acquisition of Digital China Holdings Ltd. of Hong Kong, China’s largest tech distributor. That didn’t pan out.
In search of profits, Ingram Micro pushed further into services last year, offering tech resellers it serves help finding workers, marketing and getting more money out of product warranties.
In June, the company picked up Norway’s SymTech Nordic AS for undisclosed terms.
What’s ahead: A move to a new warehouse management system in Germany dampened fourth-quarter profit growth. The system’s now in place and should boost efficiency there.
Ingram Micro hopes to regain lost market share in Germany this year.
The company is in a review by Microsoft Corp. of its three largest distributors with the one finishing last set to be culled by the software maker. A decision is set for the end of June.
Falling prices and the need to maintain profits or find new sources of them again will be a factor for Ingram Micro this year.
The company is waiting and seeing on Microsoft’s Vista software, which so far hasn’t been a big driver but could pick up later this year.
Asia should be a key source of growth. In 2004, Ingram Micro bought Australia’s Tech Pacific Ltd. for $530 million to gain operations in Asia.
BusinessWeek recently speculated Ingram Micro could be a target for private equity investors, though there’s been no indication of interest.
Wall Street’s take: Ingram Micro’s shares are down about 9% this year and off about 5% in the past 12 months.
Even so, most analysts are upbeat about the stock and urge their clients to buy shares. For the year, they expect sales of $33.4 billion, up 7% from 2006, and profits of $288 million, up 8%.
,Dan Anderson
WHO’S IN CHARGE
GREGORY SPIERKEL
Chief executive, Ingram Micro
Joined company: 1997
Education: bachelor’s from Carleton University, Ottawa; master’s in business from Georgetown University
Career: Prior to Ingram, spent 11 years at Canada’s Mitel Networks Corp., a maker of phone systems, software and electronics. Got his start in 1979 at Bell Canada, working on one of the first e-mail systems.
Notable: Played hockey and curling until age 17. Says he wasn’t “NHL material.” He worked for a time in iron ore mines, doing a number of duties including driving giant mining trucks. His uncle is the founder of Cirque du Soleil.
Headquarters: 1600 E. St. Andrew Place, Santa Ana
Employees: 13,800; 890 in OC
Business: technology products distributor
Market value, as of April 2: $3.3 billion
2006 revenue: $31.4 billion, up 9%
2006 net income: $266 million, up 23%
