Ingram Micro Inc. is placing big bets on emerging markets and technologies to grow the Santa Ana-based company over the next four years, according to Chief Executive Gregory Spierkel.
That means picking up market share amid the explosive growth of mobile devices and growing operations in Brazil, Russia, India and China.
“Asia and Latin America provide broad opportunities for growth,” Spierkel told shareholders and analysts earlier this month in New York.
Ingram Micro is the biggest distributor of computers, software and other technology products in the world, and the largest company in Orange County in terms of revenue, with about $35 billion in annual sales.
The company traditionally keeps its outlook on operations and financial performance close to the vest.
Spierkel and other high-ranking executives departed from their norm during a recent invitation-only event with the company’s shareholders and analysts. It marked the first time the company provided sales totals and growth targets for several “specialty areas,” including:
Outlooks
• Advanced (enterprise) computing—sales expected to top $10 billion in 2011, and reach more than $14 billion in 2015. The segment includes products in the traditional distribution business, such as storage for large companies, software, servers and networking.
• Data capture/point of sale—2011 revenues expected to surpass $600 million, grow to $900 million by the end of 2015.
• Mobility products and services—revenue projected to eclipse $600 million in 2011, and grow to $1.7 billion by 2015, a 183% jump.
• Logistics—fee volume, or gross profit, projected to hit more than $120 million this year and surpass $190 million by 2015.
• Cloud computing—a new service launched earlier this year, projected to top $200 million by 2015.
Overall, Ingram Micro projects annual revenue growth between 4.5% and 6.5% through 2015. That would put annual sales at more than $42 billion in four years, up about 20% from current revenue.
The projection would put revenue growth in line with overall technology spending, which tends to eclipse gross domestic product by 1.5% to 2% annually, executives said.
Analysts on average expect earnings of $1.59 per share this year and $1.99 per share in 2012.
Spierkel said Ingram Micro aims to generate earnings per share of $2.60 to $3.10 by 2015.
A key to better margins will be an ongoing distribution systems overhaul that’s expected to be complete by 2014.
Ingram Micro has installed its new distribution program in seven countries and has 19 more on tap. It is designed to improve automation, operations and services for customers and vendors around the world.
The changeover went smoothly in Singapore, New Zealand, Chile, the Netherlands, Belgium and Indonesia but problems in Australia have dogged the company and hampered earnings throughout the year.
“We’ve run into a few bumps that have been very significant,” Spierkel said. “We’re not happy (with) what’s happened in Australia.”
Acquisitions could also play a bigger role for Ingram in the coming years, he noted.
“We’ve got some flexibility to go after some things,” Spierkel said. “We think we’re going to do more than what we have done in the last two years.”
