EPlus (PLUS) came out with quarterly earnings of $0.93 per share, missing the Zacks Consensus Estimate of $1.17 per share. This compares to earnings of $1.36 per share a year ago. These figures are adjusted for non- recurring items. This quarterly report represents an earnings surprise of -20.51%. A quarter ago, it was expected that this computer products reseller would post earnings of $1.38 per share when it actually produced earnings of $1.18, delivering a surprise of -14.49%. Over the last four quarters ...

[Part I](index=6&type=section&id=Part%20I) [Business Overview](index=6&type=section&id=Item%201.%20Business) ePlus inc. operates through two main businesses: a technology business providing IT solutions (products, professional, and managed services) and a financing business for IT assets, with the technology segment accounting for 98% of net sales and 84% of operating income in fiscal 2024 - ePlus operates through Technology and Financing segments, with the Technology business driving **98% of net sales** and **84% of operating income** in FY2024[16](index=16&type=chunk)[24](index=24&type=chunk) Technology Business Revenue by Customer End Market (FY 2024) | End Market | Percentage of Revenue | | :--- | :--- | | Telecom, Media & Entertainment | 25% | | Technology | 17% | | SLED (State, Local Gov & Education) | 15% | | Healthcare | 13% | | Financial Services | 11% | - Sales to Verizon Communications Inc. accounted for **19% of net sales** in FY2024, **22% in FY2023**, and **24% in FY2022**[22](index=22&type=chunk) - Strategic partnerships are maintained with leading technology vendors such as AWS, Cisco, Dell EMC, Microsoft, NVIDIA, and Palo Alto Networks[18](index=18&type=chunk) [Offerings and Solutions](index=9&type=section&id=Our%20Offerings) ePlus provides a comprehensive suite of IT solutions, including hardware and software products, managed services like proactive monitoring and SOC, professional services such as consulting and project management, and financing options for IT equipment - The Technology business provides products including hardware and software, managed services such as proactive monitoring and SOC, and professional services like consulting and project management[37](index=37&type=chunk)[39](index=39&type=chunk)[43](index=43&type=chunk) - The Financing business specializes in sales-type and operating leases, loans, consumption-based financing, and IT equipment asset management[40](index=40&type=chunk)[41](index=41&type=chunk) [Competitive Strengths and Growth Strategy](index=11&type=section&id=Our%20Competitive%20Strengths%20and%20Growth%20Strategy) ePlus's competitive strengths include a diverse customer base, deep technical expertise, and a proven acquisition track record, with its growth strategy focusing on comprehensive IT partnerships, geographic expansion, talent management, and operational efficiency - The company serves a diverse base of **4,600 customers** and boasts deep technical expertise with over **850 employees** holding **7,000+ certifications**[45](index=45&type=chunk)[47](index=47&type=chunk) - ePlus has a strong history of growth through acquisitions, successfully integrating nearly **30 companies since 1997**[51](index=51&type=chunk)[52](index=52&type=chunk) - Consistent financial growth is evidenced by an **8.8% CAGR in net sales** and **8.9% CAGR in consolidated gross profit** from FY2020 to FY2024[54](index=54&type=chunk) - Key growth strategies involve deepening customer relationships, expanding geographic presence, strategic hiring and acquisitions, and enhancing operational efficiency via technology investments[56](index=56&type=chunk)[60](index=60&type=chunk)[61](index=61&type=chunk)[62](index=62&type=chunk) [Human Capital](index=15&type=section&id=Our%20Human%20Capital) As of March 31, 2024, ePlus employed 1,900 people, primarily in sales/marketing and professional services, emphasizing diversity, corporate social responsibility through programs like GRIT, and employee development via training and an Employee Stock Purchase Plan Employee Headcount by Function | Functional Area | As of March 31, 2024 | As of March 31, 2023 | | :--- | :--- | :--- | | Sales and marketing | 719 | 644 | | Professional services | 816 | 750 | | Administration | 359 | 354 | | Executive management | 6 | 6 | | **Total** | **1,900** | **1,754** | - The company fosters corporate social responsibility through its GRIT program, which has introduced over **300 middle school girls** to technology careers[78](index=78&type=chunk) - ePlus invests in workforce development through professional development, education support, and an Employee Stock Purchase Plan (ESPP) to attract and retain talent[61](index=61&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk) [Risk Factors](index=16&type=section&id=Item%201A.%20Risk%20Factors) The company faces risks including significant dependence on key customers and vendors (e.g., Cisco, Verizon), intense competition, cybersecurity threats, potential reductions in vendor incentives, supply chain disruptions, and challenges in talent acquisition and retention, alongside broader economic and technological shifts - The technology business is highly dependent on key vendors, with Cisco Systems products accounting for approximately **44% of net sales** in FY2024, and **17% of accounts receivable** concentrated with Verizon Communications Inc.[85](index=85&type=chunk)[96](index=96&type=chunk) - The business faces cybersecurity threats, including ransomware and data breaches, with potential for liability, reputational harm, and business disruption if confidential information is not protected or data privacy laws are not met[99](index=99&type=chunk)[100](index=100&type=chunk)[103](index=103&type=chunk) - The highly competitive IT solutions market poses risks from larger competitors, direct vendor sales, and the shift to cloud and 'as-a-service' models impacting traditional business[90](index=90&type=chunk)[92](index=92&type=chunk)[155](index=155&type=chunk) - Operational and economic risks include supply chain disruptions, inflation, rising interest rates, challenges in talent acquisition and retention, and potential adverse effects from failed acquisitions or reduced vendor incentives[110](index=110&type=chunk)[117](index=117&type=chunk)[131](index=131&type=chunk)[135](index=135&type=chunk) [Cybersecurity](index=29&type=section&id=Item%201C.%20Cybersecurity) ePlus maintains a comprehensive cybersecurity program led by a dedicated information security team under the CIO, integrated with Enterprise Risk Management, and overseen by the Board of Directors, with no material incidents reported as of the report date - An enterprise-wide cybersecurity strategy is managed by a dedicated information security team, led by the Senior Director of Information Security who reports to the CIO[179](index=179&type=chunk) - Cybersecurity processes are integrated with the Enterprise Risk Management (ERM) program, incorporating routine testing, third-party penetration testing, and industry framework alignment[180](index=180&type=chunk)[181](index=181&type=chunk) - The Board of Directors provides ultimate oversight of cybersecurity risk, receiving regular reports on strategy, threats, and program assessments[182](index=182&type=chunk) - As of the report date, no cybersecurity threats or incidents have materially affected the company's business, operations, or financial condition[183](index=183&type=chunk) [Part II](index=31&type=section&id=Part%20II) [Market for Common Equity and Related Matters](index=31&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) ePlus common stock trades on NASDAQ under "PLUS", and the company has not paid cash dividends in fiscal 2024 or 2023, instead retaining earnings for operations and a share repurchase program authorized for up to 1,000,000 shares - The company did not pay cash dividends in FY2024 and FY2023, retaining earnings for operations and share repurchases[191](index=191&type=chunk) - A share repurchase program authorized on March 22, 2023, allows for the buyback of up to **1,000,000 shares**, with **956,028 shares** remaining available as of March 31, 2024[193](index=193&type=chunk)[194](index=194&type=chunk) [Management's Discussion and Analysis (MD&A)](index=32&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) ePlus reported a **7.6% increase in FY2024 net sales to $2.23 billion**, driven by technology business growth, despite a **4.8% decline in operating income to $158.3 million** due to rising expenses, and a **3.0% decrease in net earnings to $115.8 million**, while generating **$248.4 million in operating cash flow** Consolidated Financial Highlights (FY 2024 vs. FY 2023) | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $2,225.3 M | $2,067.7 M | +7.6% | | Gross Profit | $550.8 M | $517.5 M | +6.4% | | Operating Income | $158.3 M | $166.2 M | -4.8% | | Net Earnings | $115.8 M | $119.4 M | -3.0% | | Diluted EPS | $4.33 | $4.48 | -3.3% | | Adjusted EBITDA | $190.4 M | $190.6 M | -0.1% | - Net sales growth was primarily driven by an **8.0% increase in the technology business**, despite a **5.8% decline in the financing business**[212](index=212&type=chunk)[226](index=226&type=chunk)[241](index=241&type=chunk) - Operating expenses increased **11.7% to $392.5 million**, mainly due to higher salaries and benefits from an **8.3% increase in headcount to 1,900 employees**[214](index=214&type=chunk) [Segment Results of Operations](index=38&type=section&id=Segment%20Results%20of%20Operations) The Technology business's net sales grew **8.0% to $2.18 billion** in FY24, driven by strong managed services and product sales, though operating income declined **5.4% to $132.6 million**; the Financing business experienced a **5.8% drop in net sales to $49.4 million**, leading to a **1.4% decline in operating income to $25.7 million** Technology Business Segments Performance (FY 2024 vs. FY 2023) | Metric | FY 2024 | FY 2023 | % Change | | :--- | :--- | :--- | :--- | | **Net Sales** | | | | | Product | $1,883.8 M | $1,750.8 M | +7.6% | | Professional Services | $154.5 M | $151.8 M | +1.8% | | Managed Services | $137.5 M | $112.7 M | +22.1% | | **Total Net Sales** | **$2,175.9 M** | **$2,015.2 M** | **+8.0%** | | **Total Gross Profit** | **$508.5 M** | **$474.5 M** | **+7.2%** | | **Operating Income** | **$132.6 M** | **$140.1 M** | **-5.4%** | - Technology business growth was driven by **financial services (+55.9%)** and **SLED (+13.4%)** end markets, with networking sales increasing **25.1%**[226](index=226&type=chunk) Financing Business Segment Performance (FY 2024 vs. FY 2023) | Metric | FY 2024 | FY 2023 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $49.4 M | $52.5 M | -5.8% | | Gross Profit | $42.3 M | $43.0 M | -1.7% | | Operating Income | $25.7 M | $26.1 M | -1.4% | - The financing segment's sales decline was primarily due to a **39.4% decrease in post-contract earnings**, including proceeds from off-lease equipment sales and month-to-month rents[241](index=241&type=chunk) [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity significantly improved in FY2024, with net cash provided by operating activities reaching **$248.4 million**, driven by better working capital management and a reduced cash conversion cycle, while investing activities included **$62.0 million** for acquisitions and financing activities used **$36.6 million** Cash Flow Summary (in millions) | Cash Flow Activity | FY 2024 | FY 2023 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $248.4 | $(15.4) | | Net cash used in investing activities | $(62.0) | $(18.9) | | Net cash used in financing activities | $(36.6) | $(21.0) | - The technology business's cash conversion cycle improved from **59 to 46 days**, driven by decreases in Days Sales Outstanding (DSO) and Days Inventory Outstanding (DIO)[260](index=260&type=chunk)[264](index=264&type=chunk) - The company uses a **$500 million credit facility** with Wells Fargo for technology business operations, with an outstanding floor plan balance of **$105.1 million** as of March 31, 2024[273](index=273&type=chunk)[278](index=278&type=chunk) - Investing activities included **$54.2 million** for business acquisitions, specifically NSG and Peak[266](index=266&type=chunk) [Critical Accounting Estimates](index=46&type=section&id=Critical%20Accounting%20Estimates) Management identifies critical accounting estimates requiring significant judgment, including revenue recognition (gross vs. net), residual values for leased assets, goodwill impairment testing, vendor consideration, allowance for credit losses, and accounting for income taxes and business combinations - Revenue recognition requires significant judgment in identifying performance obligations and determining gross versus net recognition, particularly for third-party software and services sales[289](index=289&type=chunk)[292](index=292&type=chunk) - Goodwill is tested for impairment annually or upon triggering events, involving fair value estimation of reporting units using discounted cash flow and market approaches with significant assumptions[299](index=299&type=chunk)[301](index=301&type=chunk)[302](index=302&type=chunk) - The allowance for credit losses is estimated based on internal credit ratings, historical data, and current economic conditions for accounts and financing receivables[306](index=306&type=chunk) - Business combinations require significant estimation of fair values for acquired assets and liabilities, such as customer relationships, often with valuation specialist assistance[311](index=311&type=chunk) [Financial Statements and Supplementary Data](index=49&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) Deloitte & Touche LLP issued an unqualified opinion on the consolidated financial statements for FY2024, highlighting two critical audit matters: revenue recognition (gross vs. net) and transfers of financial assets (sale vs. secured borrowing assessment) - Deloitte & Touche LLP, the independent auditor, issued an unqualified opinion on both the consolidated financial statements and the effectiveness of internal control over financial reporting[351](index=351&type=chunk)[352](index=352&type=chunk) - Two Critical Audit Matters (CAMs) were identified: Revenue Recognition (Gross vs. Net) due to subjectivity in determining combined performance obligations for third-party software and support, and Transfers of Financial Assets due to subjectivity in assessing legal isolation for sale versus secured borrowing accounting[356](index=356&type=chunk)[359](index=359&type=chunk) [Controls and Procedures](index=49&type=section&id=Item%209A.%20Controls%20and%20Procedures) As of March 31, 2024, the CEO and CFO concluded that the company's disclosure controls and procedures were effective, and management's assessment, affirmed by the independent auditor, found internal control over financial reporting to be effective, with no material changes reported during the fourth quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2024[319](index=319&type=chunk) - Management assessed and confirmed the effectiveness of internal control over financial reporting as of March 31, 2024, based on the COSO framework, a conclusion affirmed by an unqualified auditor opinion[324](index=324&type=chunk)[325](index=325&type=chunk) - No material changes to internal control over financial reporting occurred during the quarter ended March 31, 2024[325](index=325&type=chunk) [Part IV](index=51&type=section&id=Part%20IV) [Exhibits and Financial Statement Schedules](index=51&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section provides a comprehensive list of all exhibits filed with the Form 10-K, including corporate governance documents, material contracts, employment agreements, incentive plans, credit agreements, and certifications by key officers - This section provides a comprehensive list of all exhibits filed as part of the annual report, as required by the SEC[339](index=339&type=chunk) - Key exhibits include executive officer employment agreements, long-term incentive and stock purchase plan details, and the First Amended and Restated Credit Agreement with Wells Fargo[341](index=341&type=chunk)[342](index=342&type=chunk)

EXHIBIT 99.1 ePlus Reports Fourth Quarter and Fiscal Year 2024 Financial Results and Announces New Share Repurchase Program - Return to Double Digit Net Sales Growth in 4Q Marked a Strong Close to The Year - Fourth Quarter Fiscal Year 2024 Fiscal Year 2024 HERNDON, VA – May 22, 2024 – ePlus inc. (NASDAQ: PLUS), a leading provider of technology and financing solutions, today announced financial results for the three months and fiscal year ended March 31, 2024. Management Comment "ePlus returned to double dig ...

- Return to Double Digit Net Sales Growth in 4Q Marked a Strong Close to The Year - HERNDON, Va., May 22, 2024 /PRNewswire/ -- Fourth Quarter Fiscal Year 2024 Fiscal Year 2024 ePlus inc. (NASDAQ: PLUS), a leading provider of technology and financing solutions, today announced financial results for the three months and fiscal year ended March 31, 2024. Management Comment "ePlus returned to double digit revenue growth in the quarter to finish out a strong year. For the quarter, technology business revenue gre ...

| Date: | May 22, 2024 | | --- | --- | | Time: | 4:30 p.m. ET | | Audio Webcast (Live & Replay): | https://events.q4inc.com/attendee/690482659 | | Live Call: | (888) 596-4144 (toll-free/domestic) | | | (646) 968-2525 (international) | | Archived Call: | (800) 770-2030 (toll-free/domestic) | | | (609) 800-9909 (international) | | Conference ID: | 6354397# (live call and replay) | A replay of the call will be available approximately two hours after the call through May 29, 2024. HERNDON, Va., May 15, 2024 /PR ...

HERNDON, Va., May 10, 2024 /PRNewswire/ -- ePlus inc. (NASDAQ NGS: PLUS – news) today announced that it has been named Growth Partner of the Year by Varonis. ePlus was selected because of its demonstrated ability to leverage its deep knowledge of Varonis technology while helping organizations maximize the value from their investments. Working closely with Varonis, ePlus helps customers improve their data security posture and stay ahead of cyber threats by better securing their critical data. Earlier this ye ...

HERNDON, Va., May 9, 2024 /PRNewswire/ -- ePlus inc. (NASDAQ NGS: PLUS – news) today announced Binary Defense as a new Tier 2 Managed Detection and Response (MDR) partner for ePlus. Binary Defense collaborates closely with organizations by customizing its MDR solution to meet their specific needs, including security posture, individual risks, and business priorities. Through the combination of its unique Open XDR strategy and attacker mindset, Binary Defense delivers accelerated detection, investigation, an ...

HERNDON, Va., April 16, 2024 /PRNewswire/ -- ePlus inc. (NASDAQ NGS: PLUS) (news) announced today that it has attained Amazon Web Services (AWS) Migration Competency status. This designation recognizes that ePlus has demonstrated expertise in helping customers accelerate their cloud migration and modernization journey to AWS with an outcome-driven methodology. Achieving AWS Migration Competency status differentiates ePlus as an AWS Partner Network (APN) member that provides specialized consulting services d ...

HERNDON, Va., March 18, 2024 /PRNewswire/ -- ePlus inc. (NASDAQ NGS: PLUS – news) today announced that it has earned places on both the CRN MSP 500 List, in the Elite 150 category, and the CRN Tech Elite 250 List. The MSP 500 is an annual list that recognizes North American Managed Service Providers and managed security service providers that have proven track records of innovation and growth. MSP 500 Elite 150 companies have an extensive managed services portfolio, including on-premises and off-premises ca ...

HERNDON, Va., March 5, 2024 /PRNewswire/ -- ePlus inc. (NASDAQ NGS: PLUS – news) today announced that it has been named F5's North America 2023 Strategic Solutions Partner of the Year. ePlus was selected because of its work to modernize legacy apps and update customer infrastructure, thereby driving numerous accomplishments with organizations across the SLED, enterprise, telecom, financial services, and healthcare industries. The F5 and ePlus partnership delivers application security, performance, and autom ...