We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits. Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels. SCSC cu ...

ScanSource, Inc. (NASDAQ:SCSC) Q3 2024 Earnings Conference Call May 7, 2024 10:30 AM ET Company Participants Mary Gentry - Senior Vice President, Treasurer and Investor Relations Mike Baur - Chair and Chief Executive Officer Steve Jones - Senior Executive Vice President, Chief Financial Officer Tony Sorrentino - President for Specialty Technology Conference Call Participants Greg Burns - Sidoti Keith Housum - Northcoast Research Michael Latimore - Northland Capital Markets Operator Welcome to the ScanSource ...

Financial Performance - For the quarter ended March 31, 2024, net sales were $752.6 million, a decrease of 15% compared to $885.5 million for the same quarter in 2023[17] - Gross profit for the quarter was $94.5 million, down 15% from $111.8 million in the prior year, resulting in a gross margin of 12.5%[17] - Net income for the quarter was $12.8 million, a decline of 40% from $21.2 million in the same quarter last year, leading to a net income per share of $0.51[17] - Total revenue for the nine months ended March 31, 2024, was $2,513,696 thousand, compared to $2,840,573 thousand for the same period in 2023, reflecting a decrease of 11.4%[47] - Net income for the nine months ended March 31, 2024, was $60,964,000, a decrease of 14.3% compared to $70,997,000 for the same period in 2023[24] - For the quarter ended March 31, 2024, net income was $12,806 thousand, a decrease of 39.8% compared to $21,221 thousand for the same quarter in 2023[49] - Basic earnings per share for the quarter ended March 31, 2024, was $0.51, down from $0.84 in the same quarter of 2023, a decrease of 39.3%[49] Assets and Liabilities - Total current assets decreased to $1.42 billion as of March 31, 2024, from $1.66 billion as of June 30, 2023, primarily due to a reduction in accounts receivable and inventories[14] - Total liabilities decreased to $838.9 million as of March 31, 2024, from $1.16 billion as of June 30, 2023, reflecting a reduction in accounts payable and long-term debt[14] - Cash and cash equivalents increased significantly to $159.1 million as of March 31, 2024, compared to $36.2 million as of June 30, 2023[14] - The company’s total assets decreased to $1.78 billion as of March 31, 2024, from $2.07 billion as of June 30, 2023[83] - The total debt as of March 31, 2024, was $145,881 thousand, significantly reduced from $329,901 thousand on June 30, 2023[56] Operational Changes and Restructuring - The company reported a restructuring expense of $3.9 million for the quarter, indicating ongoing efforts to optimize operations[17] - A restructuring program initiated in January 2024 is expected to yield approximately $10.0 million in annualized savings in selling, general and administrative expenses[100] - The balance of accrued restructuring costs as of March 31, 2024, was $2.8 million, expected to be paid through the third quarter of fiscal year 2025[103] - Employee separation and benefit costs amounted to $3.923 million for the quarter ended March 31, 2024[101] - The total restructuring costs recognized for the nine months ended March 31, 2024, are also $3.923 million, all allocated to the Corporate reporting unit[101] Market Conditions and Future Outlook - The company anticipates continued challenges from macroeconomic conditions, including inflation and supply chain issues, which may impact future performance[11] - The company is focused on enhancing its organic growth strategy and managing credit risks associated with larger customers and suppliers[11] Cash Flow and Investments - Cash flows from operating activities provided $316,908,000 in the nine months ended March 31, 2024, compared to a cash outflow of $20,508,000 in the same period of 2023[24] - The company reported a capital expenditure of $7,285,000 for the nine months ended March 31, 2024, compared to $6,549,000 in the same period of 2023[24] - Common stock repurchased amounted to $21,168,000 in the nine months ended March 31, 2024, compared to $10,718,000 in the same period of 2023[24] Segment Performance - Specialty Technology Solutions sales decreased to $483.7 million in Q1 2024 from $565.7 million in Q1 2023, a decline of 14.5%[83] - Modern Communications & Cloud segment sales fell to $268.9 million in Q1 2024 from $319.9 million in Q1 2023, representing a decrease of 15.9%[83] - Operating income for the Modern Communications & Cloud segment was $12.99 million in Q1 2024, compared to $14.47 million in Q1 2023, a decrease of 10.3%[83] Tax and Compliance - The company reported a discrete net tax benefit of $1.5 million during Q1 2024, related to an income tax recovery in Brazil[93] - The company's effective tax rate for Q1 2024 was 28.7%, compared to 29.1% in Q1 2023[94] - The Company was in compliance with all covenants under the Amended Credit Agreement, including a Leverage Ratio of less than or equal to 3.50 to 1.00[60]

Exhibit 99.1 FOR IMMEDIATE RELEASE Contact: Steve Jones Mary M. Gentry ScanSource, Inc. ScanSource, Inc. (864) 286-4302 (864) 286-4892 Senior EVP, Chief Financial Officer SVP, Treasurer and Investor Relations "While hardware sales were lower than we expected, our resilient business model delivered strong margins and robust free cash flow," said Mike Baur, Chair and CEO, ScanSource, Inc. "Our strong balance sheet gives us the capacity and flexibility to execute our disciplined capital allocation plans." Quar ...

Financial Data and Key Metrics Changes - For Q2 2024, the company reported net sales of $885 million, a decline of 12.5% year-over-year, with adjusted EBITDA expected to be at least $155 million, reflecting an EBITDA margin of 4.4% [4][5][32] - Free cash flow for the quarter was $61 million, with a full-year outlook of at least $200 million [2][5][6] - Gross profit margins were reported at 11.4%, consistent with the prior year [4] Business Line Data and Key Metrics Changes - The Intelisys Technology Services business saw a growth of 7.5%, with end user billings increasing 10% year-over-year, exceeding $2.6 billion annualized [2][30] - The Specialty Technology & Solutions segment experienced a revenue decline of 17% year-over-year, with a corresponding decline in gross profit [4] - The Modern Communication and Cloud segment's revenues declined 5% year-over-year, with gross profits down 9% due to an unfavorable product mix [32] Market Data and Key Metrics Changes - Demand for hardware technologies, particularly in barcode, mobility, point-of-sale, security, and communications, declined more than expected [12] - The company noted a slowdown in physical security and mobility point-of-sale technologies, which were previously experiencing strong growth [4][35] Company Strategy and Development Direction - The company is focusing on building a cash culture and sustainable free cash flow, with plans to redirect resources towards the Intelisys recurring revenue business [5][6] - The updated guidance reflects expectations of continued revenue headwinds, with net sales projected to be at least $3.5 billion for FY 2024 [5] - The company is actively managing SG&A spending to align with revenue growth expectations [5] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment over lower-than-expected net sales in the hardware business, attributing it to changing demand dynamics [2][4] - The company anticipates ongoing challenges in forecasting demand due to the lack of backlogs and bookings, emphasizing the need for cautious guidance [3][41] - Management remains confident in the resilience of the business and its positioning for a return to growth [5] Other Important Information - The company has an active pipeline of M&A opportunities and plans to maintain a balance between share repurchases and strategic investments [52] - The effective tax rate for FY 2024 is expected to range from 27% to 28% [5] Q&A Session Summary Question: Observations on technology cycles and demand - Management acknowledged a slowdown in networking business growth but noted it still experienced some growth year-over-year [35] Question: Impact of self-checkout kiosks on demand - Management confirmed a slowdown in self-checkout business but remains optimistic about future opportunities in point-of-sale technologies [18] Question: Capital allocation priorities - Management stated that capital allocation focuses on share repurchases and M&A to drive recurring revenue, with $65 million remaining on the current authorization [50][52]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ☒ Quarterly period ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to ____ Commission File Number: 000-26926 ScanSource, Inc. South Carolina (State of Incorporation) 57-0965380 (I.R.S. Employer Identification No.) 6 Logue Court Greenvil ...

Scansource, Inc. (NASDAQ:SCSC) Q1 2024 Earnings Conference Call November 9, 2023 10:30 AM ET Company Participants Mary Gentry - VP, IR & Treasurer Michael Baur - Founder, Chairman & CEO Stephen Jones - Senior EVP & CFO Conference Call Participants Gregory Burns - Sidoti & Company Adam Tindle - Raymond James & Associates Michael Latimore - Northland Capital Markets Operator Welcome to the ScanSource quarterly earnings conference call. [Operator Instructions]. I would now like to turn the call over to Mary Ge ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to ____ Commission File Number: 000-26926 ScanSource, Inc. South Carolina (State of Incorporation) 57-0965380 (I.R.S. Employer Identification No.) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ☒ Quarterly period ended September 30, 2023 | Large accelerated f ...

ScanSource, Inc. (NASDAQ:SCSC) Q4 2023 Earnings Conference Call August 22, 2023 10:30 AM ET Company Participants Mary Gentry - SVP, IR, & Treasurer Mike Baur - Chairman & CEO John Eldh - President Steve Jones - CFO Conference Call Participants Greg Burns - Sidoti & Company Keith Housum - Northcoast Research Partners Jake Norrison - Raymond James Operator Welcome to the ScanSource Quarterly Earnings Conference Call. All lines have been placed in a listen-only mode, until the question-and-answer session. Toda ...

Financial Performance - Net sales for the fiscal year ended June 30, 2023, totaled $3.79 billion[18] - For the fiscal year ended June 30, 2023, total net sales increased by $257.8 million, or 7.3%, reaching $3,787.7 million compared to $3,529.9 million in fiscal year 2022[165] - The Specialty Technology Solutions segment saw net sales increase by $248.7 million, or 11.9%, primarily due to strong growth in key technologies in North America[167] - The Modern Communications & Cloud segment experienced a net sales increase of $9.1 million, or 0.6%, with adjusted net sales growth of 0.4% after accounting for foreign exchange impacts[168] - The company's operating income for fiscal year 2023 was 3.6%, compared to 3.5% in fiscal year 2022, indicating slight improvement in profitability[162] - Total operating income for fiscal year 2023 was $135.9 million, an increase of $13.7 million or 11.2% compared to the previous year[177] - The company reported a diluted EPS of $3.47 for the year ended June 30, 2023, compared to $3.44 in the previous year, reflecting a growth of 0.03[200] - Gross profit for fiscal year 2023 was $449.2 million, reflecting a $22.7 million increase or 5.3% compared to the prior year[171] - Specialty Technology Solutions segment gross profit increased by $18.5 million, while the gross profit margin decreased to 9.6%[172] - Modern Communications & Cloud segment gross profit increased by $4.2 million, with the gross profit margin rising to 15.4%[173] Customer and Market Dynamics - The company serves approximately 30,000 customers across various industries, with no single customer accounting for more than 4% of total net sales[27] - The company has contracts with over 200 leading telecom carriers and cloud service providers, focusing on empowering sales partners to advise customers on technology and cost savings[54] - Customer relations are critical, and any deterioration in these relationships could negatively impact operating results[111] - The company’s sales organization focuses on developing customer relationships and providing tailored solutions, supported by comprehensive training for sales representatives[68] Operational Strategy - The Specialty Technology Solutions Segment includes recurring revenue from hardware rentals and other SaaS offerings, contributing to the overall revenue[25] - The Modern Communications & Cloud Segment includes recurring revenue from Intelisys and intY businesses, enhancing the company's service offerings[26] - The company aims to drive sustainable, profitable growth through a hybrid distribution strategy leveraging partnerships and technology solutions[20] - The company operates a 741,000 square foot distribution center in Southaven, Mississippi, aiming to ship all orders on the same day to minimize shipping errors[74] - The company operates distribution facilities in the United States and Brazil, supporting its business segments across North America and internationally[152] Employee and Workplace Culture - ScanSource has approximately 2,300 employees, with 1,500 located in the United States and 800 internationally[52] - The company was named one of the Best Places to Work in South Carolina for the eighth consecutive year, reflecting its commitment to employee satisfaction[51] - The company has implemented a work-from-home policy for all employees, maintaining high productivity levels with a largely remote workforce[58] - The company has launched a global digital workplace, The Bridge, to enhance communication and employee engagement[61] - The company emphasizes a comprehensive benefits package, including a 401(k) program with a market-competitive employer match and performance-based bonuses[57] - The company is committed to a diverse and inclusive workplace, led by a Chief Diversity Officer and an internal D&I Advisory Council[59] Risks and Challenges - The company is highly dependent on information and communication systems, and any failure could disrupt business operations and adversely affect financial results[85] - Supply chain issues, including product shortages, may increase costs or delay customer order fulfillment, impacting financial results[88] - Manufacturing interruptions due to factors like labor disputes or natural disasters could further disrupt the supply chain and affect product availability[89] - The company faces credit exposure to customers, and any adverse trends could lead to credit losses, negatively impacting performance[94] - Supplier relationships are critical, and changes in supply agreement terms could adversely affect operating margins and revenue[101] - The company relies on third-party logistics for product delivery, and any failure in these services could disrupt operations and harm customer relationships[97] - Economic factors such as inflation and rising interest rates could restrict the company's ability to raise capital, affecting operations[109] - Economic weakness and geopolitical uncertainty may adversely affect the company's results, leading to reduced demand for products and potential impairments of assets[135] - Intense competition in the market could lead to reduced margins and loss of market share, with competitors having greater resources potentially responding more quickly to market changes[120] - The company may face challenges in adapting to rapid technological changes, which could affect its competitiveness and market share[122] Financial Position and Capital Management - The company has a multi-currency senior secured credit facility with a leverage ratio requirement of less than or equal to 3.50:1.00, which must be maintained[107] - The company has a $350 million revolving credit facility to support its liquidity needs[214] - Cash and cash equivalents totaled $36.2 million as of June 30, 2023, compared to $38.0 million in 2022, with $31.0 million held outside the United States[216] - The company utilizes a weighted average cost of capital (WACC) relative to each reporting unit's geography and industry as the discount rate for estimated future cash flows[214] - The company has never declared or paid a cash dividend, with restrictions on cash dividends under the terms of its credit facility[149] Cybersecurity and Compliance - The company experienced a ransomware attack in May 2023, which interrupted order processing for approximately nine business days and resulted in the disclosure of information on the dark web[129] - A cybersecurity incident on May 14, 2023, impacted sales, with business interruption insurance expected to cover some lost profits[166] - Cybersecurity-related costs amounted to approximately $1.5 million, with insurance expected to cover a portion of these expenses[175] - The company is subject to additional costs and potential fines due to compliance with laws and regulations when selling products to government entities[130] Goodwill and Impairment Testing - As of June 30, 2023, the goodwill balances for the Specialty Technology Solutions and Modern Communications & Cloud reporting units are $16.4 million and $200.3 million, respectively, with fair values exceeding carrying values by 2% and 13%[114] - The company assesses goodwill for impairment annually, with the most recent test indicating no impairment for fiscal years 2023 and 2022[211] - The fair value of the Specialty Technology reporting unit exceeded its carrying value by 2%, while the Modern Communications & Cloud reporting unit exceeded its carrying value by 13% as of the annual goodwill impairment testing date[210]