Insight Enterprises, Inc. Reports Fourth Quarter and Record Full Year 2017 Results

TEMPE, Ariz., 15 februari 2018 - Insight Enterprises, Inc. (Nasdaq:NSIT) (the "Company") today reported results of operations for the quarter and full year ended December 31, 2017.

  • Net sales up 22% year over year to $1.8 billion for the fourth quarter and also up 22% for the full year
    • Net sales up 30% year over year in North America for the fourth quarter and full year
  • Gross profit up 22% year over year to $232.9 million for the fourth quarter and up 24% for the full year
  • Earnings from operations up 12% year over year to $45.5 million for the fourth quarter and up 20% for the full year
    • Adjusted earnings from operations up 5% year over year for the fourth quarter and up 24% for the full year

"Our fourth quarter results reflect a strong close to a very good year," stated Ken Lamneck, President and Chief Executive Officer. "We reported strong organic growth in our core business in 2017 and gained market share from competitors in North America, according to third party data, reflecting growth in data center solutions as well as devices. Our acquisition of Datalink in January 2017 complemented the growth in our core business. We realized expense synergies ahead of our expectations and are pleased with the overall financial results of the Datalink business in its first year as part of Insight. I am pleased to report that gross profit growing faster than sales and tight cost management across the business in 2017 produced an impressive increase in earnings from operations year over year," stated Lamneck.

"Our plans for 2018 are focused on driving growth in excess of the market across our operating segments," stated Lamneck. "The IT industry is healthy and growing. More than ever, clients are challenged to efficiently manage their day-to-day IT operations while they leverage technology to transform their business to bring value to their own customers. We have a full suite of solutions that we developed over time and have acquired through recent acquisitions, which position us to provide value to our clients throughout their technology journey and provide a strong foundation for us to compete in the marketplace in 2018," stated Lamneck.

Results for the Quarter:

  • Consolidated net sales of $1.8 billion for the fourth quarter of 2017 increased 22% compared to the fourth quarter of 2016.
    • Net sales in North America of $1.4 billion were up 30% year over year;
    • Net sales in EMEA of $366.8 million increased 1% year over year; and
    • Net sales in APAC of $38.9 million were down 20% year to year.
  • Excluding the effects of fluctuating foreign currency exchange rates, consolidated net sales increased 19% year over year, with net sales growth in North America of 30% year over year and a decline in net sales in EMEA and APAC of 6% and 22%, respectively, year to year.
  • Consolidated gross profit of $232.9 million increased 22% compared to the fourth quarter of 2016, with consolidated gross margin increasing 10 basis points to 13.1% of net sales
    • Gross profit in North America of $174.6 million (12.7% gross margin) increased 31% year over year;
    • Gross profit in EMEA of $50.4 million (13.7% gross margin) increased 3% year over year; and
    • Gross profit in APAC of $7.9 million (20.3% gross margin) decreased 7% year to year, with margin expansion of 270 basis points.
  • Excluding the effects of fluctuating foreign currency exchange rates, consolidated gross profit increased 19% year over year, and gross profit in North America increased 30% year over year, while gross profit in EMEA and APAC decreased 5% and 10%, respectively, year to year.
  • Consolidated gross profit of $232.9 million increased 22% compared to the fourth quarter of 2016, with consolidated gross margin increasing 10 basis points to 13.1% of net sales.
    • Earnings from operations in North America increased 28% year over year to $37.2 million, or 2.7% of net sales;
    • Earnings from operations in EMEA decreased 23% year to year to $7.1 million, or 1.9% of net sales; and
    • Earnings from operations in APAC decreased 48% year to year to $1.2 million, or 3.0% of net sales.
  • Excluding the effects of fluctuating foreign currency exchange rates, consolidated earnings from operations increased 9% year over year, and earnings from operations in North America increased 27% year over year while earnings from operations decreased in EMEA and APAC by 30% and 50%, respectively, year to year.
  • Adjusted consolidated earnings from operations increased 5% year over year to $48.3 million, or 2.7% of net sales for the fourth quarter of 2017.
  • Consolidated net earnings and diluted earnings per share for the fourth quarter of 2017 were $14.2 million and $0.39, respectively, at an effective tax rate of 64.8%, which includes income tax expense of $13.4 million recognized during the quarter as a result of U.S. federal tax reform enacted in December 2017.
  • Adjusted consolidated net earnings and Adjusted diluted earnings per share for the fourth quarter of 2017 were $29.5 million and $0.81, respectively.

Results for the Year:

  • Consolidated net sales of $6.7 billion for 2017 increased 22% compared to 2016.
    • Net sales in North America of $5.2 billion were up 30% year over year;
    • Net sales in EMEA of $1.4 billion increased 1% year over year; and
    • Net sales in APAC of $166.5 million decreased 5% year to year.
  • Excluding the effects of fluctuating foreign currency exchange rates, consolidated net sales increased 22% year over year, with net sales growth in North America and EMEA of 30% and 2%, respectively, year over year, while net sales in APAC decreased 7% year to year.
  • Consolidated gross profit of $918.6 million increased 24% compared to 2016, with consolidated gross margin increasing approximately 20 basis points to 13.7% of net sales.
    • Gross profit in North America of $691.7 million (13.3% gross margin) increased 32% year over year;
    • Gross profit in EMEA of $190.3 million (14.0% gross margin) increased 2% year over year; and
    • Gross profit in APAC of $36.6 million (22.0% gross margin) increased 15% year over year.
  • Excluding the effects of fluctuating foreign currency exchange rates, consolidated gross profit increased 24% year over year, and gross profit in North America, EMEA and APAC increased 31%, 4% and 13%, respectively, year over year.
  • Consolidated earnings from operations increased 20% compared to 2016 to $179.3 million, or 2.7% of net sales.
    • Earnings from operations in North America increased 31% year over year to $153.7 million, or 3.0% of net sales;
    • Earnings from operations in EMEA decreased 27% year to year to $17.4 million, or 1.3% of net sales; and
    • Earnings from operations in APAC increased 3% year over year to $8.2 million, or 5.0% of net sales.
  • Excluding the effects of fluctuating foreign currency exchange rates, consolidated earnings from operations increased 20% year over year, and earnings from operations in North America and APAC increased 31% and 2%, respectively, year over year, while earnings from operations in EMEA declined 27% year to year.
  • Adjusted consolidated earnings from operations increased 24% year over year to $195.2 million, or 2.9% of net sales, for 2017.
  • Consolidated net earnings and diluted earnings per share for 2017 were $90.7 million and $2.50, respectively, at an effective tax rate of 43.0%, which reflects the income tax expense recorded in the fourth quarter of 2017 as a result of U.S. federal tax reform, noted previously, and non-deductible acquisition-related expenses incurred during the year
  • Adjusted consolidated net earnings and Adjusted diluted earnings per share for 2017 were $117.5 million and $3.24, respectively.

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