GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Insight Enterprises Inc. Reports Operating Results (10-Q)

August 05, 2010 | About:
10qk

10qk

18 followers
Insight Enterprises Inc. (NSIT) filed Quarterly Report for the period ended 2010-06-30.

Insight Enterprises Inc. has a market cap of $668 million; its shares were traded at around $14.45 with a P/E ratio of 12.2 and P/S ratio of 0.2. NSIT is in the portfolios of Arnold Schneider of Schneider Capital Management, Richard Pzena of Pzena Investment Management LLC, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Net sales in North America increased 21%, or $152.0 million, for the three months ended June 30, 2010 compared to the three months ended June 30, 2009. Net sales of hardware and software increased 27% and 21%, respectively, year over year, while net sales in the services category declined 15% year to year. The increase in hardware net sales is primarily due to higher demand in all client groups, but particularly in the very large account space. The increase in software sales year over year relates to higher volume with multiple publishers and higher true-ups from key public sector clients. The decrease in sales of services year to year resulted primarily from a large services engagement during the prior year quarter that did not recur in the current year.

Net sales in North America increased 13%, or $180.2 million for the six months ended June 30, 2010 compared to the six months ended June 30, 2009, primarily as a result of the strong hardware performance during both the first and second quarter of 2010. On a year to date basis, net sales of hardware increased 25% year over year, while net sales of software and services declined 1% and 10%, respectively.

Net sales in EMEA increased 28%, or $78.0 million, in U.S. dollars, for the three months ended June 30, 2010 compared to the three months ended June 30, 2009. Excluding the effects of foreign currency movements, net sales were up 36% compared to the second quarter of last year. Net sales of hardware grew 13% year over year in U.S. dollars, 18% excluding the effects of foreign currency movements, due to higher demand across all client groups and new client engagements. Software net sales increased 34% year over year in U.S. dollars, 44% excluding the effects of foreign currency movements, due primarily to higher volume, new client engagements and new product offerings from our publishers, offset in part by the effects of publisher program changes that were effective beginning in May of last year. Net sales from services increased 31% year over year in U.S. dollars, 39% excluding the effects of foreign currency movements, due primarily to higher volume.

Net sales in EMEA increased 23%, or $124.5 million, in U.S. dollars, for the six months ended June 30, 2010 compared to the six months ended June 30, 2009. Excluding the effects of foreign currency movements, net sales were also up 23% compared to the first six months of last year. Hardware and software sales increased 22% and 23%, respectively, while sales of services improved 27% year over year. The year to date increases primarily resulted from higher volume, new client engagements and new product offerings from our publishers.

EMEAs gross profit increased 11% in U.S. dollars for the three months ended June 30, 2010 compared to the three months ended June 30, 2009. Excluding the effects of foreign currency movements, gross profit was up 19% compared to the second quarter of last year. As a percentage of net sales, gross margin declined 200 basis points due primarily to a decrease in product margin, which includes vendor funding, of 121 basis points, resulting from price competition in the region, increased sales to enterprise and public sector clients, which are typically at lower margins, as well as a decrease in the margin contribution from agency fees for enterprise software agreement renewals of 67 basis points resulting partially from the effects of publisher program changes. For the six months ended June 30, 2010, gross profit increased 13% compared to the six months ended June 30, 2009. Excluding the effects of foreign currency movements, gross profit increased 14% compared to the six months ended June 30, 2009. As a percentage of net sales, gross margin for the six month periods declined 110 basis points, primarily due to decreases in product margin, including vendor funding, and decreases in agency fees for enterprise software agreement renewals.

APACs gross profit increased 22% for the three months ended June 30, 2010 compared to the three months ended June 30, 2009. Excluding the effects of foreign currency movements, gross profit increased 10% compared to the second quarter of last year. As a percentage of net sales, gross margin declined by 30 basis points, due primarily to a decrease in product margin, offset in part by an increase in the margin contribution from agency fees for enterprise software agreement renewals. For the six months ended June 30, 2010, gross profit increased 37% compared to the six months ended June 30, 2009. Excluding the effects of foreign currency movements, gross profit increased 19% compared to the six months ended June 30, 2009. As a percentage of net sales, gross margin declined 160 basis points, primarily due to decreases in software product margin, including vendor funding, partially offset by increases in agency fees from enterprise software agreement renewals.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 4.8/5 (4 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide